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  1. #31
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    Quote Originally Posted by justakiwi View Post
    To be honest, I hadn’t even heard of them until recently when there was discussion about them on the Sharesies Share Club and the NZX stock Market Investors, Facebook groups. I then saw the discussion here. I had no clue what they were about so spent some time looking over their website, read all the info I could find there, and pretty much typed BLT into Google and read everything that came up. I also emailed them to ask if I there was somewhere I could access/read their published research. They sent me back a long bibliography list of everything that has been published. From there I had to manually search online to locate the full articles - bloody huge job I can tell you! So far I have only had time to find and read about three of them. I would have thought they might be much more easily accessed via the investor centre section of their website, but they told me they can’t provide them there for general (or even investor) access due to rules about promoting their products as “medicines” etc. Still not entirely sure I believe their explanation but have given them the benefit of the doubt.

    Having done that research I feel they may be “onto something” with their products. I’m not necessarily someone who would be their customer, but I do know people are becoming much more interested in seeking out alternative products/probiotics, so I think there will definitely be a market for them, if they can be competitive price-wise. Funnily enough, I went to give one of our rest home residents a cuppa just the other day, and as I sat it on the tray of his walking frame for him, I noticed a sheet of tablets on the tray. I had a look to see what they were (we need to be aware if residents are taking any medications that we don’t know about) - and the first thing I saw was the word “BLIS” - such a coincidence but I thought it was really interesting as it shows that the general public is aware of the products. This fellow is 92, and his family obviously brought them for him. So the market is there and may well be wider than we might think, in terms of the age spread of users.

    Anyway, I tried to talk myself out of it because speculative stock is not really a wise investment for someone like me, but hey .... you only live once and I think it’s worth a punt. Only 5000 shares so never going to make me a fortune, but if it makes me something long term I’ll be happy enough
    One other thing to add. Its nice to see you do good homework and research. But market theory (taught at universities) states that there are millions of other investors doing exactly what you are doing (including some smarter ones than you) and that consensus of views is what forms the market price at any one time. So the best thing you can do is buy an index and save yourself all the hassle and time. The academic view is that you the individual investor cannot outperform the market index over a long period of time. Whether you subscribe to that theory or not is up to you, but if you look at fund managers world wide who are active investors you will find that half outperform the market, half underperform and once fees are taken out, most underperform.

  2. #32
    percy
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    I made reference to "The Annual report".
    Most probably the easiest simple one to start with is PAZ Pharmazen on NZ Unlisted market.
    Go to www.usx.co.nz
    enter PAZ.
    announcements.
    4th April Annual report.
    Note the chairman's report,in particular the outlook statement.
    Also note directors' shareholdings,balance sheet and cashflow statements,and equity ratio.
    I think once you have sorted this annual report out, you can venture onto more complex reports.
    Perhaps it is best to print it off.
    Last edited by percy; 14-01-2020 at 07:25 AM.

  3. #33
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    I absolutely know this, and agree with you. My first purchase was KFL back in 2016. I knew nothing back then and bought for the wrong reason - a friend had them. But, I have been very happy with their performance since then, and as I have said before, their quarterly dividends, DRP with discounted SP, has been a huge plus for me. I pretty much just sit back and watch my holding grow, without having to spend any additional capital on them. I recently added BRM and MLN to complete the trio. At this moment in time, they are providing me with decent diversification and good returns. As long as they continue to do that I’m not concerned that can’t beat the index. I’m not investing to build wealth. I have started way too late and have insufficient capital to realistically achieve that. My focus (hope) is simply to build my overall portfolio value, over the next 6 years and into retirement, to give me a little more financial security down the track. It will sit alongside my KS (which will also never be huge as again, I was a late starter to KS). My reality is I will be dependent on government super when I retire, but I live a minimalistic and reasonably frugal life. When I retire my KS and my portfolio investment will just sit there doing their thing. I have no intention of cashing either of them up when I retire. I will access them if and as needed, to supplement my super.

    Having said all that, who knows if I’m doing this the right way? Everything is a gamble but at least now, I feel I’m being proactive and even if it all turns to custard, I am really enjoying this. I have always been a “learner” and have always liked to challenge myself. In the past, it was mostly related to computers - I had to always be learning new things and figuring out how things worked “under the hood.” I was never a geek but used to do dumb things like install Linux from command line, just for fun. Learning just for the sake of it I guess. So now I’m learning about investing, and trying to prove to myself that I can do it - even if only on a very minuscule scale!

    Quote Originally Posted by blackcap View Post
    One other thing to add. Its nice to see you do good homework and research. But market theory (taught at universities) states that there are millions of other investors doing exactly what you are doing (including some smarter ones than you) and that consensus of views is what forms the market price at any one time. So the best thing you can do is buy an index and save yourself all the hassle and time. The academic view is that you the individual investor cannot outperform the market index over a long period of time. Whether you subscribe to that theory or not is up to you, but if you look at fund managers world wide who are active investors you will find that half outperform the market, half underperform and once fees are taken out, most underperform.

  4. #34
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    Quote Originally Posted by justakiwi View Post
    I absolutely know this, and agree with you. My first purchase was KFL back in 2016. I knew nothing back then and bought for the wrong reason - a friend had them. But, I have been very happy with their performance since then, and as I have said before, their quarterly dividends, DRP with discounted SP, has been a huge plus for me. I pretty much just sit back and watch my holding grow, without having to spend any additional capital on them. I recently added BRM and MLN to complete the trio. At this moment in time, they are providing me with decent diversification and good returns. As long as they continue to do that I’m not concerned that can’t beat the index. I’m not investing to build wealth. I have started way too late and have insufficient capital to realistically achieve that. My focus (hope) is simply to build my overall portfolio value, over the next 6 years and into retirement, to give me a little more financial security down the track. It will sit alongside my KS (which will also never be huge as again, I was a late starter to KS). My reality is I will be dependent on government super when I retire, but I live a minimalistic and reasonably frugal life. When I retire my KS and my portfolio investment will just sit there doing their thing. I have no intention of cashing either of them up when I retire. I will access them if and as needed, to supplement my super.

    Having said all that, who knows if I’m doing this the right way? Everything is a gamble but at least now, I feel I’m being proactive and even if it all turns to custard, I am really enjoying this. I have always been a “learner” and have always liked to challenge myself. In the past, it was mostly related to computers - I had to always be learning new things and figuring out how things worked “under the hood.” I was never a geek but used to do dumb things like install Linux from command line, just for fun. Learning just for the sake of it I guess. So now I’m learning about investing, and trying to prove to myself that I can do it - even if only on a very minuscule scale!
    To be fair, I did not add in my post that I took have an "active" part of my portfolio which I manage myself. Like you say its all about learning and becoming a more informed investor. Whether I outperform, I do not know, but if I do it is not by much. One small addition, they do say that NZ fund managers in NZ can outperform the NZ 50 index because they have better information than the overseas funds that play in our market and are more able to exit and enter when required. Not 100% sure on the data on this but I did hear it from a reputable source. That would also apply then to us retail investors as we know the market here in NZ better than our overseas counterparts.

    Percy speaks a lot of sense with his suggestions and ratio's. But for me to fully get through an annual report, some form of accountancy training will be your best help.

  5. #35
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    justkiwi, nice to know about your struggle learning and hope that this struggle of yours is the only "tuition fee" you'll be paying to the Sharemarket Goddess on your lifetime endeavour to know her. But worry not, you're on the right track

  6. #36
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    Quote Originally Posted by blackcap View Post
    One other thing to add. Its nice to see you do good homework and research. But market theory (taught at universities) states that there are millions of other investors doing exactly what you are doing (including some smarter ones than you) and that consensus of views is what forms the market price at any one time. So the best thing you can do is buy an index and save yourself all the hassle and time. The academic view is that you the individual investor cannot outperform the market index over a long period of time. Whether you subscribe to that theory or not is up to you, but if you look at fund managers world wide who are active investors you will find that half outperform the market, half underperform and once fees are taken out, most underperform.
    Perhaps the best advice a new investor should accept because at the end of the day, the so called experts may claim they beat the market returns but the poor investor pays a cost for that service... a BIG cost in the form of management fees. Furthermore the taxation in NZ is not at level playing under FIF. That is the individual that invests directly abroad can choose the 'Comparative Method' on years that their portfolio gets a negative return and pay no tax for the year. However for managed funds in NZ, they can't use this method and have to pay FDR.

    On a side note @ Snoopy's reply: Does it make a difference if a person earning over $70K annual income from wages / salary pay any different level in tax when he/she invests in a fund under FIF? Even more discriminant, PIE funds give the top income earners a tax advantage than the low income earners in the lower tax brackets.

    The view that NZ fund managers have an advantage to investing on the NZX is a fallacy. That would be to say the same view as US fund managers having the inside edge (hence, inside information) when they invest on the NYSE or Nasdaq. Stats show this is not the case. The more relevant problem with the NZX is the diminishing level of liquidity; a trend that more and more investors are not investing in the NZX. Since the FMA came into force, international funds have shunned this FMA regulation forcing overseas firms to comply with NZ regulation. I've read US brokers have simply blacklisted the NZX. The end result is over time, those who a large position of shares on the NZX will have a tough time selling without drastically affecting the share price.

    Again, Fundamental Analysis only goes so far and paints a rough picture. For eg. in NZ I have a tough time finding the EPS figure in NZ listed companies in their glossy annual reports. When they make bold claims of meeting some dividend target %, I wonder what impact does that have on the balance sheet. In many cases, some borrow funds to meet a dividend payment while in previous years, they had the profits that should of been held in retained earnings, but instead, were pushed to pay dividends. It only tells me that in NZ, investors expect some annual payment on their investment without considering the capital gains on the share price is tax free.

    Those using Technical Analysis, again I see no point of that on NZX listed companies. The liquidity is the problem.

  7. #37
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    Quote Originally Posted by SBQ View Post
    The more relevant problem with the NZX is the diminishing level of liquidity;

    The end result is over time, those who a large position of shares on the NZX will have a tough time selling without drastically affecting the share price.

    The liquidity is the problem.
    True for fund managers but actually a potential source of reward for smaller investors who may be able to accept less liquidity.
    For clarity, nothing I say is advice....

  8. #38
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    In the real world away from academic hypotheses and monotonous uniformed posts there are those who long term outperform the market and those who underperform it and all those in between.

    To discover if you can be a star then you have to give it go and put some effort in.
    To give up before you start is not how you succeed.

    As Peter Lynch once said. "You do not outperform the index by buying the index".

    And for the benefit of SBQ the EPS figure is always at the end of the statement of P&L/Comprehensive Income which is usually the first item in the Financial Statements which is often in refered to in an index near the front of the report.
    om mani peme hum

  9. #39
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    Quote Originally Posted by Snow Leopard View Post
    In the real world away from academic hypotheses and monotonous uniformed posts there are those who long term outperform the market and those who underperform it and all those in between.

    To discover if you can be a star then you have to give it go and put some effort in.
    To give up before you start is not how you succeed.

    As Peter Lynch once said. "You do not outperform the index by buying the index".

    And for the benefit of SBQ the EPS figure is always at the end of the statement of P&L/Comprehensive Income which is usually the first item in the Financial Statements which is often in refered to in an index near the front of the report.
    Wise words.The simpler the better for investors starting out otherwise they will be overwhelmed.There is no right or wrong way and no need to follow the herd.An investor can not out perform the market by doing what every other investor is doing.But that is not the human psyche.
    Others might reason I am doing something wrong but I rarely read or analyse the full financial report.Usually just the end numbers & CEO report.My view is for those starting out, KISS
    Last edited by kiora; 15-01-2020 at 12:26 PM.

  10. #40
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    I really read or analyse the full financial report
    I assume you meant "rarely read...…", kiora?

    Personally, I reckon percy's annual report checklist is about right. There's a few key numbers and ratios to be found in the balance sheet!

  11. #41
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    Quote Originally Posted by macduffy View Post
    I assume you meant "rarely read...…", kiora?

    Personally, I reckon percy's annual report checklist is about right. There's a few key numbers and ratios to be found in the balance sheet!
    Oops thanks McD Now corrected.Percy's checklist about right for experienced investors but majorly off putting to new investors.They would likely just end up procrastinating.
    The first check on the checklist should be checking on daily volume versus average volume.Shows up if an investment should be sold or bought(GTK ,I have never owned but stayed interested,daily volume signal yesterday)
    Last edited by kiora; 15-01-2020 at 12:54 PM.

  12. #42
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    Quote Originally Posted by kiora View Post
    The first check on the checklist should be checking on daily volume versus average volume.Shows up if an investment should be sold or bought(GTK ,I have never owned but stayed interested,daily volume signal yesterday)
    That is the biggest nonsense I have read so far on this thread. Especially considering the initiator of this thread is talking about long term investing and portfolio building.

  13. #43
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    As a beginner, I 100% disagree. Percy's words of wisdom, including this checklist, have been absolutely invaluable to me. We might be beginners, but we aren't stupid. We are more than capable of developing our understanding of "all things investing" with the help of checklists like his. As for your comments on volume - that makes absolutely no sense to me whatsoever!

    Quote Originally Posted by kiora View Post
    Percy's checklist about right for experienced investors but majorly off putting to new investors.They would likely just end up procrastinating.
    The first check on the checklist should be checking on daily volume versus average volume.Shows up if an investment should be sold or bought(GTK ,I have never owned but stayed interested,daily volume signal yesterday)

  14. #44
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    I'd agree with checking variations in the daily volume traded, but not so sure that it indicates a buy or a sell without also noting the trend in the shareprice. Remember, every share sold is bought by some other party. Which side is the pressure coming from?

  15. #45
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    Quote Originally Posted by Snow Leopard View Post
    In the real world away from academic hypotheses and monotonous uniformed posts there are those who long term outperform the market and those who underperform it and all those in between.

    To discover if you can be a star then you have to give it go and put some effort in.
    To give up before you start is not how you succeed.

    As Peter Lynch once said. "You do not outperform the index by buying the index".

    And for the benefit of SBQ the EPS figure is always at the end of the statement of P&L/Comprehensive Income which is usually the first item in the Financial Statements which is often in refered to in an index near the front of the report.
    No it's not. My aunt receives annual reports from her NZ holdings and on odd occasion, the 1st thing I look at is EPS. I remember decades ago with The Warehouse Group pushing their dividend policy as front page achievement in their glossy annual reports. Only to be disgusted that EPS was not a figure to be found - my aunt said you have to calculate that. So no I strong disagree. What is a fact is NZ's obsession of dividend payment on shares and that's why we have brokers like MacQuires NZ pushing the same rubbish and NZ listed companies having the same expectation to paying dividends.

    As a rebuttal for Peter Lynch, a reference to Warren Buffet's spew again those (active fund managers, individuals investors actively trading, the whole shebang!): Who's the better investor Peter Lynch or Warren Buffet? you decide...

    https://realbusiness.co.uk/warren-bu...stment-skills/

    and for those that don't care to click on the link, i'll post most of it here:

    “It seems so elementary,” he said, “but people just can’t believe that because they have billions of dollars to invest that they can’t go out and hire somebody who will do better than average. I hear from them all the time. Supposedly sophisticated people, generally richer people, hire consultants, and no consultant in the world is going to tell you ‘just buy an S&P index fund and sit for the next 50 years.’ You don’t get to be a consultant that way. And you certainly don’t get an annual fee that way.

    “So the consultant has every motivation in the world to tell you, ‘this year I think we should concentrate more on international stocks,’ or ‘this manager is particularly good on the short side.’ So they come in and talk for hours, you pay them a large fee and they always suggest something other than just sitting on your rear end and participating in business without cost. Those consultants then in turn recommend other people who charge fees, which cumulatively eats up capital like crazy.

    “I’ve talked to huge pension funds, and I’ve taken them through the math, and when I leave, they go out and hire a bunch of consultants and pay them a lot of money,” he said. “It’s just unbelievable, and the consultants always change their recommendations a little bit from year to year. They can’t change them 100 per cent because then it would look like they didn’t know what they were doing the year before. So they tweak them from year to year and they come in and they have lots of charts and PowerPoint presentations and they recommend people who are in turn going to charge a lot of money and the flow of money from the ‘hyperactive’ to what I call the ‘helpers’ is dramatic.”


    Buffett also didn’t hide his resentment for their lack of abilities when it comes to investing.

    There’s been far, far, far more money made by people in Wall Street through salesmanship abilities than through investment abilities,” he said. “There are a few people out there that are going to have an outstanding investment record. But very few of them. And the people you pay to help identify them don’t know how to identify them. They do know how to sell you.”

    Now are you trying to tell me that there exists some NZ actively managed fund that will outperform what Buffet has claimed? Get real, 1st let's start with their true % returns on their prospectus working through the math and taxation directly to the individual. They don't. There's no need; he won the Protégé Partners bet.

    As for some checklist? What kind of check list do active fund managers use when they look to buy or sell stocks? Complete utter nonsense and to the novice investor, the best the NZ gov't does is tell them to go into Kiwi Saver, for which, who is really getting rich?

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