Stock Market Consulting – February 2019 (Value Investing FM)

Here you have the stock exchange office for February 2019 in which Adrián Godás and Paco Lodeiro answer questions from listeners.

On this occasion, we deal with topics such as investing in Canada from DeGiro, the COT, investing in salmon, petition 232 on uranium, investing in funds, ethical criteria when investing in the stock market, the D-6 model, investing in Japanese small caps, Ken Fisher's book Superstocks, the taxation of small investors, in what to invest 500 euros or financial derivatives such as CFDs or ETFs.

We also talk about companies such as Severstal, Harley Davidson, Orezone, RA International, Kraft Heinz, Bakkafrost, California Resources Corp, Ipco, Teekay, Telefónica or Paradox Interactive.

Tabla de contenido

Stock Market Consulting - February 2019

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Questions from the February 2019 Stock Exchange Consultation

On trading with Canadian companies at DeGiro

I have a question about DEGIRO. I tried to buy Constellation Software and it wouldn't let me buy from the source market. Only a quote in euros appears, but I see the very high commission that is listed in France if I remember correctly. Is there any other alternative to buying Constellation Software?

(Ignacio Almendro)

About the TOC

Congratulations on the practice. For the next one: how we can take advantage of the COT (us commodity futures trading commission) I have read Larry Williams (insiders) that you can take advantage of it and see the strong movements of the market there.

(Zeed)

About the book Warren Buffett and the interpretation of financial statements

Congratulations on the program. I have listened to you from the beginning and have learned a lot from you. Thank you! To the following CONSULTANT: Have you read the book "Warren Buffett and the Interpretation of Financial Statements" (by Mary Buffett and David Clark) "? It doesn't sound like they mentioned it. What do you think of as a complement to Pat Dorsey? Greetings from Tenerife.

(Efraín-84 from Tenerife)

About Severstal

Very good pair of stars !! I have been keeping an eye on the TUI AG company since I work in the sector and through reading their reports I discovered that there is a super Russian who owns 24% called Alexey Mordashov. This led me to investigate a little more about this man and I know that he owns 70% of Severestal Russian company of Siderurgia-Minera ... what do you think of the latter? Greetings from Valencia and thanks in advance;)

(Jorge Ibáñez)

About Harley Davidson

Hi. I'm looking at Harley Davidson, I see that it is at a not very cheap but reasonable price, that its debts are paid easily with the FCF that is healthy and with a net cash, which has a lot of “Skin in the game”. I'm just worried about not hearing her name a value investor. Can you tell me if you see something wrong? I understand that the only risk is Trump and that the market does not understand well some of his investments outside the USA. But it is a benchmark brand in its world, the "moat" is there.

(Cide Hamete)

About time spent reading

How many pages does Paco read a day in his books? Greetings from Chile.

(Tomás Barra)

About interning in investment managers

Question for both of you: Do you think it makes sense and is it feasible to try to do an internship for a university degree (ADE) in a financial asset manager? Personally, I would like value managers such as Cobas or Magallanes, but I understand that it is complicated and I would not rule out a bank or insurance company for trying the experience. Greetings from Madrid.

(Sergio Belinchón)

About Orezone

Simple question and at the bottom, what do you think is the target price of Orezone?

(Anonymous)

About RA International

Thanks to Lucas López I discovered the company RA international, I was wondering what opinion Adrián has of said company and the country where it operates. Regards.

(Anonymous)

Sobre Kraft Heinz

Hello good, congratulations on the program, I have followed you for a year and I think you are the best. What is your opinion of KHC?

(Robertojusticia)

About investing in salmon

Good morning everyone!! congratulations on the program !! a couple of questions for the office 🙂 for the raw materials part, how do you see the sector of farmed salmon? For example, the Bakkafrost company, it seems that the supply is limited and the demand is growing and it is a sector very little followed. What about California Resources Corp?

(Anonymous)

About Oriol Amat

Hello! I am making my first foray into the world of accounting. In a first search of bibliography in Spanish I have come across a certain Oriol Amat everywhere. It makes me distrust that he must be quite sectarian on the Catalan subject and also seems like the typical university professor who has made his personal mark and goes around appearing everywhere and always repeating the same thing. I would like to ask you if you recommend it and if you do not or do not know what alternatives there are.

(Juan)

About John Malone and Charter

Hello, I had read that Malone (Charter) was leaving his position, you could deny me this.

(Kike Mullor)

On petition 232 on uranium

Congratulations on the program! And for the full podcast! I've been listening to you from the first! One question, do you recommend finishing looking at UUUU and the sector before the 232 procedures begin to move? I am starting to study it and to see if I should hurry on the valuation. Do you think that the approval of this law is very discounted in the price? Would production companies like Cameco that have mines in the US also benefit or would it only affect US producers? thank you! Keep going!!

(Anonymous)

About IPCO

good program although short: P question for the office: D can you do a small update of Ipco after its results and its new guidance that I find very good, and of Cameco that also seems to have presented more or less decent results? by the way do you know anything about Canadian production cuts? Companies such as Ipco, for the Canadian part, continue to extract but are storing it to sell when the cuts are lifted or do they have to stop extracting? 🙂 thanks cracks !!

(Anonymous)

Specific question, from what price of a barrel of oil does the Ipco company make money?

(Anonymous)

About Teekay

Even though you made the purchase of Teekay Corp before coming to the conclusion that ships are just that, ships. What was your medium-term assessment of the Teekay company?

(Anonymous)

About Ken Fisher's book Superstocks

Excellent interview as always. I wanted to ask you if you have read the book "Superstocks" by Kenneth L. Fisher son of legend Philip Arthur Fisher. It literally says that a Superstock is one that: "Can generate internally funded future long-term average growth of approximately 15 to 20 percent. Will generate future long-term average after-tax profit margins above 5 percent. Is bought at a Price Sales Ratio of 0.75 or less."I still haven't finished reading the book but I found it very interesting. Greetings from Mexico. By the way, a Value investor in Mexico?

(Ángel González from Mexico)

About investing in funds

Hello, I have two questions for the office. First, thank you for your work for making me open my eyes and begin to be interested in value. The first question is, would you recommend investing the savings in an investment fund such as Bestinver, Cobas, azValor, etc ... or wait to learn more and buy shares directly for a 30-year-old newbie like me who is just starting out and has no idea? I say this because understanding the markets I suppose it will take a long time and in this way I would not have the money in the account. The second question is that it is better to buy a fund like the ones I have mentioned directly from the fund's website or from the brokers that you always recommend (Interactive and deGiro). Thank you very much and keep it up. Your work can help a lot of people.

(Josep Alba Zapater)

On the ethical criteria when investing and the D-6 model

  1. Do you have any ethical criteria when investing? That is, you do not invest in something for moral, ethical, religious reasons or whatever you want to call it. To give an example, companies that pollute, arms companies, companies with child labor, companies with a pink logo ... (I think it is understood)
  2. You can talk about the D-6 model (annual declaration of the Investment Registry of Spanish investments abroad), what is this, when to present it and all that?

(Jesús)

About investing in Japanese small caps

Hello! Have you valued any Japanese company? Do you see good opportunities in small caps from Japan?

(Rafael Ros)

About respect and feeling offended

My opinion: Presumption of respect. This respect must be maintained.

I do not respect: scammers. Political thieves. Empowered idiots.

(A couple of listeners)

About shorting DeGiro

What is not clear to me is where to make short sales, in DeGiro you comment that it is not a good idea, where do you recommend? Thanks and best regards Paco.

(Peepepep from Twitter)

On diversifying or concentrating the portfolio

Diversification defines the profile of an investor. Personally, I think there is little use in obtaining double digits in companies where you have 5% of your portfolio. Having 20 companies in the portfolio and all of them achieve this benefit is very complicated. I think 3-4 companies with competitive advantages, anti-fragile, with little debt ... etc., Is the best, what do you say?

Stock funds based on value investing, do you think it is a good option to make a pension piggy bank? would you diversify into various funds? What funds do you think are the best at the moment?

About Berkeley Energía

And for Adrián, ask him what he thinks of Berkeley Energía and its mine in Salamanca. They talk of starting to extract at the end of 2019. In January it has tripled its value. Do you think it is already overrated? Do we invest there right now?

Gerardo Capitán Narbona from Alameda (Málaga)

On the taxation of small investors

Very good, let's see if you can clarify this question for me: doesn't the taxation applied to small investors imply a handicap that is difficult to assume compared to investing in funds?

I will try to explain myself better. For this I will put some numbers based on the 17% average annual profitability that you have commented on in a program that you had obtained in the last 10 years. To continue it would be necessary to know the amount received in dividends and the rotation of the portfolio. I do not know these data, so I am going to be moderately optimistic and consider that the turnover could be around 50%. In the range of AzValor, Valentum and Cobas. With these numbers, the time would come to settle accounts with the treasury. As small investors, we will pay approximately 20% of dividends and capital increases, so that we will lose between 1.5% and 3% of our profitability at the hands of the treasury. The end result will be an “effective” annual return (the one that will exercise the magic of compound interest) that will be between 14% and 15.5%. In other words, we will be paying a “commission” higher than the maximum commission that investment funds can charge us.

(Manu)

On the possibility of using CFDs in Value Investing

Greetings from Ecuador!

I am Rommel Argüello, I tell you that I am starting in investing and I have been following you through your free course and your podcast.

I would like to know if in Value Investing it works to invest in CFD's or what tool do you recommend for beginners with low initial capital.

Greetings and thank you very much.

(Rommel Argüello from Ecuador)

On investing in big tech

As a novice investor, it would be a good idea to start investing in the most famous technology companies (the most popular winners), such as Google, Facebook, Amazon, Apple (and some more like Microsoft, for example). Do you think it would be a good idea?

(Go)

About investing in Markel or Berkshire Hathaway for the long term

I have opened a broker account for my 10-year-old son to inject money every month for his future training.

I have seen the ING Direct proposal where making 1 purchase or sale every 6 months, my intention is to buy Markel or BRK-B every 6 months with what I inject monthly into 1 account.

As you see?

I'm just looking for a quiet investment for 10 years without worrying too much (I think the managers of both companies, I know they are stocks and not funds, are very good)

(Juan Ramón Millán desde Málaga)

On the compatibility of technical analysis and value investing

A question from a beginner in value investing; Although you are reluctant to technical analysis, do you not have it when buying a certain security previously valued with fundamental analysis?

(Fake G)

On where to invest 500 euros

By the way, I know that there are different forms of investment, your philosophy is directed to the actions of companies from what I see, and I would like to ask you a question. If you only had 500 euros in your account, where and how would you invest it?

It looks like when the owner of CocaCola was asked what he would do if he only had $ 5.

(José Machado from Cádiz)

About scrip dividends

I can't understand how the scrip dividend works. If you could explain it to me I would really appreciate it.

(Tomás D'Aureli from Argentina)

On what not to do to be a good investor

What do you recommend NOT to do to be a good investor, that is, NOT to waste time. I think there are too many blogs, podcasts, YouTube channels, people to follow on Twitter, etc ... and it is very easy to get lost in all that and not focus on what is important. Maybe talk about percentages of time to dedicate to each thing as you say (reports, presentations, books, podcasts, social networks, ...)

(Jordi Agusti from Madrid)

About Telefonica

Hi, I'm anonymous from Valencia again: P rookie question for the monthly questionnaire: if Telefónica = Timofónica, why is it on the Ibex 35? thanks and regards!

(Anonymous)

About RockRose Energy

Question that Lord Digger will love to spread and listeners will like to hear the thesis. Could you comment in detail on Rockrose Energy's thesis?

(Anonymous)

About Twitteros

Are there some blogs or twitter that you recommend to follow?

(Anonymous)

About investing in ETFs

A question for both of you: What do you think of the use of ETFs as an investment tool? Do you think it can be a good long-term tool? Compatible with a value investment? If yes, are there any ETFs that you think might be interesting to have on the radar? Greetings and thank you.

(Anonymous)

About Alberto Espelosín

Hi, I'm Toni and I would like to ask Adrián what he thought about Alberto Espelosín's presentation that he made at the Az school this summer and I think Paco was already there, to tell us about his impressions of Farnam Street. Thanks to both of you.

(Anonymous)

About Paradox Interactive

Question for Adrian, what do you think of the incredible results of paradox? Did you expect them even better?

(Anonymous)