March 2016
Latest fund price: $1.7559 (+0.0196, 1.13%)
Total Market Value: $ 1,503,908.07
Total units: 856,505.1069 units
April 2016
Latest fund price: $1.7842 (+0.0283, 1.61%)
Total Market Value: $ 1,528,161.07
Total units: 856,505.1069 units
May 2016
Latest fund price: $1.7810 (-0.0032, 0.18%)
Total Market Value: $ 1,525,441.14
Total units: 856,505.1069 units
Dear Investors,
This fund is 7 years old on the 4th of June, remember the first I invite you to invest? Or you contact me for no particular reason then suddenly decided to invest a lump sum of money into my fund, and then ask me how much your $2 worth now every time we meet? Haha! All of that seems like yesterday to me, never the less 7 years is not that long, but it’s not that short neither.
Winning the loser’s game is a book written by Charles Ellis, he is served as a successor trustee of Yale University from 1997 to 2008, due to his extraordinary return made for the university, and he received the Yale Medal in 2009 for his service. He is famously authored the article “The Loser’s Game” claiming: “The investment management business (it should be a profession but is not) is built upon a simple and basic belief: Professional money managers can beat the market. That premise appears to be false”, later become the book that will sum up his career, which pretty sum up my investment career so far as well, I recommend you read it if you are interested in investment. In his book he argued the idea so called professional investor can do better than market simply is false, not because these highly educated elites involve in a scam or try to cheat the public, in fact they are all highly motivated with good intention, and confidently they are in the winning game, however in reality investment is a loser’s game, meaning they aren’t beating the market, the market is beating them. The secret of winning in a loser’s game is to minimizing mistakes and for investors this means minimizing trading.
The funny thing is Warren Buffett have said similar thing: “if you are not going to hold a stock for 10 years you better not invest in it in the first place”, I have definitely broken this rule… lots of time, mainly due to lack of confident, or due to numerous bad decisions, even though most of my trades have made profit, yet if I could do it again, today’s outcome would definitely be much better, but well, I guess that’s part of life.
The 2016 annual shareholders meeting of Warren Buffett’s company Berkshire Hathaway was casted online live for the first time, in the past only the class A shareholders can gain access to the so call “Woodstock for Capitalists”. I forgot whether I have said it before, my fund hold some of his class B shares, luckily this year I can sit at my house and watch the Q&A section (at mid-night though), however the quality of the questions is inversely proportional to the increase number of attendants, esp. the amount of Chinese shareholders increase every year, the parvenu from China have little understanding of the investment philosophy, but highly invested in people with fame, the way they see to become as a shareholder of a highly successful company is because they feel honored, it’s like getting a Ferrari, it represent a status symbol, the price doesn’t come cheap though, class A now worth 212k USD per share, roughly 1.6M in HKD. However I am not speaking from jealousy, rather in concern, China work very differently, socialists try to run capitalism result in many ridiculous things, it has made a lot of people become very wealthy (Some from doing nothing or by delivering things has no value), yet they are very proud of the “success” of their own country, and think they are in par with the real successful stories in other free worlds which is very dangerous, when the reality strike one day things can turn really ugly.
Anyway, back to my fund, I didn’t touch anything since the last 2 months reports, that’s the Dec, 2015, nothing too special in the last few months except my prediction about gold surprised me, I expected a slow rise, but in fact the gold price has raised for over 35% in half a year, unfortunately my holding in gold is very limited. I advised my insurance clients start investing in gold since July last year, one of the women end up putting 60% of her daughter education fund into gold related fund, she felt like she has hit the jack pot, when she told me my reaction wasn’t that positive, it was scary to me because I didn’t expect she put that much of % into gold, traditionally gold should only consist 5% max of your investment portfolio, 10% max in some extreme condition (3% in my fund), 60% is just ridiculous, I guess it is pure luck it turned out that “great”. After helping her to lock the profit, I felt a sense of irony some billionaires lost 20 million because of a bad investment decision, yet it is only a little loss of his overall wealth, while at the same time 35% growth for a mother is only enough to pay the tuition fee for her daughter for 2 months.
The longer I run a fund, the more I understand the wisdom behind investment: If you want to get reasonable return, you need to rely on your own intelligent and hard work, but if you want to get high return, you must rely on the stupidity of the market.
To sum it up, so far so good, I really want to make this fund become a thing, I enjoyed managing it, and I am looking forward to see how things will turn out for the next 7 years ahead. Bear in mind though, the market is quite bullish in the last 7 years, so prepare for some volatility in the coming year, although no one can predict the future, market crash is part of the game, and it happens in cycle for every 7-10 years, remember what John Templeton said: “Bull-markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”
Regards,
Calvin
p.s. I have uploaded my trading records online; you can see it through this link: https://docs.google.com/spreadsheets/d/1cvZm0BsyKDhoRhR5Yv46n3Uc8kA3W6FR8Myv_ysUpC8/edit?usp=sharing
p.p.s. I have finished creating a 10 hours youtube investment tutorial this year, I started it 2 years ago, it is consisted of 7lessons, it carefully explained my investment philosophy and how I pick stocks in practice, it drawn some attention in HK, if you are interested, you can find the link here: https://www.youtube.com/playlist?list=PLpXD88Tmz_4e7PrqLo48DyclQogG-_qEB
親愛的投資者,
這個基金在6月4日已經七歲了, 是否記田第一次我邀請你投資? 或你突然無啦啦決定投資一筆錢入這這個基金, 接著每次見到都問我你投資的兩蚊現在價值多少? 哈哈! 對我而言感覺就像昨天, 雖然七年不算長, 但也不短.
「勝出輸家的遊戲」是一本查爾斯。艾利斯寫的書，他在１９９７年至２００８年間為耶魯大學管理大學的信託基金，因為出色的表現，他在２００９年獲得耶魯勳章。他撰寫一篇著名的文章「輸家的遊戲」，聲稱：「投資管理的業務（它應該是一個專業，但現實卻不是）是建立於一個簡單而基本的信念：專業資金管理人可以打敗市場。這個前提似乎是假的」，這篇文章之後成為這本書總括了他的投資生涯，也總括了我暫時的投資生涯，如你對投資有興趣我建議你可以一看。在這本書他表明所謂的「專業投資者」可以表現得比市場更好的想法是錯誤的，不是因為這些受過高等教育的精英參與詐騙或試圖欺騙公眾，相反他們都是積極性很高而且有良好動機，自信自己在「贏家的遊戲」，可惜現實投資是一個「輸家的遊戲」，也是說他們無法擊敗市場，市場擊敗了他們。要勝出輸家的遊戲就是要減少錯誤，對投資來說就是要減少交易。
搞笑的是巴菲特也說過相似的話:「如果你不打算持有一隻股票十年，你一開始就不應該碰它」，我一定已經犯過很多次規，主要是沒有信心，或是因為很多錯誤的決定，雖然我大部份的交易都賺錢，但如果我可以再做一次，今天的結果一定很不一樣，但我想，這就是生活的一部份。
巴菲特的公司巴郡２０１６年年度股東大會第一次全球線上直播，過去只有A股股東能夠獲得參加被稱為「資本家的胡士托」的資格。我忘了是否說過，這個的基金持有一些他的B股，幸運地今年我可以在我家坐看問答部分（雖然在午夜），雖然提問的質素跟參加人數的數量成反比，特別中國股東的數量逐年增加，來自中國的暴發戶對價值投資理念的了解甚少，但高度投資於出名的人，在他們的角度成為一間非常成功的公司的股東，是因為他們感到榮幸，這就像買法拉利，是一種身份的象徵，但代價不菲，A股每股目前的價錢廿一萬美元，港幣約一百六十萬。不過我這樣說不是因為妒忌，而是關注，中國的運作非常不同，社會主義者嘗試執行資本主義導致很多非常荒謬的結果，它使很多人變得非常富有（有些來自無所作為或通過提供沒有價值的東西），但他們卻很自豪自己國家的「成功」，而且認為他們可以跟其他在自由社會真正成功的故事相提並論，這是非常危險的，當有日現實打擊事情可以相當難看。
說回我的基金，自上兩個基金報告我甚麼也沒碰過，是２０１５年１２月之後，這半年沒有甚麼特別的事情，除了我對黃金的預測讓我吃驚，我預期慢升，但過去半年黃金已經升了３５％，可惜我的黃金持貨十分有限。我上年７月開始建議我的保險客戶投資黃金，有位女仕最後將她女兒的教育基金轉入黃金相關的基金，她感覺好像中了頭獎，當她告訴我時我的反應不是太正面，對我來說這是可怕的事因為我沒有預期她將這麼高百分比放入黃金，傳統上黃金應該最多只佔你投資組合的５％，在極端的情況下１０％（在我的基金只佔３％），６０％實在是太荒謬，我想結果這樣好是純粹幸運。幫她鎖住利潤之後，我覺得一種諷刺的感覺，有些億萬富翁因為一個糟糕的投資決策損失了二千萬，對他而言只是一點損失，而同一時期一位母親的基金增長了３５％只足夠她的女兒交兩個月的學費。
當我運作這個基金的時間愈長，我愈理解投資背後的智慧：如果你想獲得合理的回報，你需要依賴自己的智慧跟努力，但如果你想獲得超高回報，你必須依靠市場的愚蠢。
總括來說，到目前還不錯，我真的想令這個基金變得更好，我很喜歡管理它，我很期待看未來七年事情會變成如何。但請記住，市場在過去七年相當牛，所以對於來年一定的波動做好準備，雖然沒有人能預測未來，但市場大跌是遊戲的一部分，它在週期每七至十年發生，記住約翰。鄧普頓說：「牛市在悲觀中誕生，在懷疑中成長，在樂觀中成熟，在興奮中死亡」
問候
卡爾文
p.s. 我已上載我過去的交易記錄上網，你可以通過此鏈接看到：https://docs.google.com/spreadsheets/d/1cvZm0BsyKDhoRhR5Yv46n3Uc8kA3W6FR8Myv_ysUpC8/edit?usp=sharing
p.p.s. 我剛剛完成製作一個10小時的YouTube投資教學，兩年前開始的，它是由七課組成的，它小心解釋了我完整的投資理念以及如何實踐挑選股票，在香港得出了一些關注，如果你有興趣，你可以在這裡找到的鏈接：https://www.youtube.com/playlist?list=PLpXD88Tmz_4e7PrqLo48DyclQogG-_qEB
