Automate Your Investment Life

13.6.2013 | Kohti taloudellista riippumattomuutta

My friend Tim du Toit just released a new eBook Automate Your Investment Life. I've been exchanging ideas with Tim for a several years now and I still keep learning from him. Tim is pure value investor and publishes a monthly EuroshareLab newsletter. He is ex-banker and located in Hamburg, Germany.

In this interview Tim tells us more about his new eBook and what's been happening since I first introduced him to my blog readers.

I first introduced you to my blog readers in November 2011. You had left your banking career and went working full time for your investing newsletter. The investors that decided to grab the offer - how have they done? 

I mean how have your newsletter recommendations, that you also invest your own money into, done since then?

In 2012 the portfolio returned 12.7% and 7.2% in 2013 (up to 12 June 2013). 

That compares quite nicely to the 14% in 2012 and 4.3% increase of the European STOXX 600 index over the same period.

To make sure that you compare apples with apples the portfolio returns do not include dividends (the European STOXX 600 index also doesn’t) which over both years amounted to an average of about 3,2% per year.

So overall as you can see the returns have been highly satisfactory, outperforming the index.

Now you have written a 53 page eBook called Automate Your Investment Life. Can you tell us what lead you to write this book?

Inherently I am a very lazy person; I hate wasting time doing things that can be done more efficiently through proper planning or building a reliable system. That is what the book is all about, tools I have come up with that will enable you to build a system to make your investment life as easy as possible. 

(As a side note there is a very good book on how to do this Work the System).

The idea of putting all the tools together in the book came a lot later. 

It started out with a view e-mails I sent to friends and other investors of the tools I discovered to make managing my investments easier.

Over time it dawned on me that a lot more people may be interested in on using these tools to make their lives easier as well.

As with a lot of things, the book took a lot longer to finish than what I thought. Especially the layout (because there are so many screenshots) took a long time because I didn't want the pages to look too busy.

I think your readers will agree that in the end the person that did the layout of the book did a really outstanding job of making it easy to read as well as follow the detailed instructions.

The book isn't actually for investment newbies. What kind of investors will benefit most from reading the book?

You're right it's not for somebody that just starting to invest but even if you only have a few investments I'm sure you'll find the book really helpful.

It will help you to set up systems to manage your investments in the most effective way. 

The tools will make sure you have all the information you need to make decisions through an automated process. For example by having up-to-date company information sent to you so that you do not have to look for it.

So even if you only have a few investments you will most definitely find the book helpful.

I love that all the tools you promote in your book are free. My favourite one is the Excel add-in that enables you to import 5 years of fundamental data from Reuters right into a spread sheet! How did you come up with all these tools?

In my previous position I had access to a Bloomberg which I couldn’t afford (about 1500€ per month) when I went on my own. After spending a lot of time on Internet searching for solutions I eventually stumbled onto the Excel add-in.

It took a long time to get everything to work as I describe in the book. Now because it works really well (and fast) it is the first things I do to see if a company is worth researching. 

As you have seen the tool allows you to import five years of data (income statement, balance sheet and cash flow statement) so you can quickly see (through all the valuation ratios it calculates) if the company is worth researching further.

Just as a note to your readers the Excel add-in only works on a Microsoft Windows based computer.

The other tools were developed through a process of evolution as I became frustrated with what I have been using or if takes up too much of my time.

As you know technology develops all the time, always making new tools available that work a lot better than the ones you have been using. I read a lot which leads me to stumble onto really useful tools all the time.

Can you tell us more what's included in the book?

My main aim with the book is to save you time so in the book you will find detailed instructions on how you can with the least effort:
  • Find investment ideas
  • Analyse them (Microsoft Windows computers only)
  • Sort and organise your research so you can easily and quickly find everything
  • Get email updates on all the companies you choose to follow
  • Automate the updating of your portfolio (Microsoft Windows computers only)
Here is the index of the book (click to enlarge screenshots):

Besides the book what else have kept you busy since our last interview?

The newsletter keeps me quite busy but last year a friend and I finished quite an ambitious project. 

We wanted to find the investment strategy that would have given you the best returns over the past 12 years in the European markets, from June 1999 to June 2011.

As you know 2000 to 2012 was probably the most difficult time for any investor not just in Europe as this period included both the bursting of the Internet bubble the financial crisis (2007 and 2009) as well as the European sovereign debt crisis (2010 and continuing).

It can be found by either clicking on the image or the name of the study (subscribers to my newsletters receive the study for free).

I'm sure what we found will astound you as much as it did us. 

The best performing strategy returned 1100% over the 12 year period. 

In fact the top 10 strategies we tested all returned more than 730% (average 881%), a return I'm sure you will also be proud of even if you subtract dealing costs and capital gains taxes which are not included in the above numbers.

The results of the study has obviously found its way back to how I select all the companies I recommend in my newsletter.

In my opinion the euro crises have started to eased up. How you see current market environment? Where you now find the most undervalued stocks?

I am very positive about Europe and think that economic growth will return to Europe a lot faster than everyone thinks. A lot still has to be done but the crisis has led to a lot changes to rules and regulations that have been in place for far too long. With this out of the way it will be a lot easier for the struggling countries to start growing again. 

As with most value investment ideas you have to look where other investors are not. In Europe this means the countries hardest hit by the sovereign debt crisis, Spain, Portugal and Italy for example. 

What I have been doing is finding companies that are undervalued because they are located and listed in struggling countries but do not do a lot of business there. I have now widened my search to look for companies that will profit substantially once these countries recover.

For example in March this year I recommended a smallish German company that unfortunately, after being extremely successful in Germany, expanded to Spain, Portugal and Italy. As you can imagine sales collapsed and with it the company’s profits.

But as the company’s business is not threatened by online retailers as soon as these countries recover the company’s profits will explode. And while you wait for this to happen, because the business in Germany is doing very well, you get paid a nice dividend of over 5%

So as you can see there are still a lot of really interesting investment opportunities available if you are willing to do a bit of work.

Last time you had a nice discount for my readers that subscribed your newsletter. Would you be able to provide a special price for your Finnish readers that are interested of the book?

Of course Pasi, below is a 25% off offer for your readers.

As it is only for your readers I will only make the link available on my website for 7 days, as I don’t want anyone else to use it.

Any final words?

Your readers don’t know me so I want to their purchase to be as risk free as possible. 

So if at any time (no time limit) anyone is unhappy with their purchase they can simply send me an email and I will give them their full purchase price back.

No questions asked (they don’t even have to give me a reason). 

The only thing I do ask is that they can receive the money through a PayPal.

Thanks for the interview Tim!

My pleasure, as always Pasi.

Here is the link to buy the book at 25% off again: Special 25% off offer

2 vastausta artikkeliin "Automate Your Investment Life"

Anonyymi kirjoittaa:

"In 2012 the portfolio returned 12.7% and 7.2% in 2013 (up to 12 June 2013).

That compares quite nicely to the 14% in 2012 and 4.3% increase of the European STOXX 600 index over the same period."

Eli strategia on tuottanut 20.81% ja indeksi 18.9% puolessatoista vuodessa. Onko kyseisissä laskelmissa otettu huomioon kaupankäyntikustannukset, spreadit sekä veroseuraamukset? Entä mikä on ollut salkun volatiliteetti suhteessa indeksiin?

14.6.2013 klo 16.49.00

Tim du Toit kirjoittaa:

The return calculation includes a 1% trading cost for buying and selling (2% in total) which is very high, I only pay 0.25% for when buying or selling (0.5% total).

No spread cost is calculated as the companies are all relatively large where spreads do not have a large impact.

I do not calculate volatility compared to the index because volatility, as you know, is not a measurement of risk.

16.6.2013 klo 11.44.00

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