Value Investing Blog

Great things happened this month, but I also got some potentially sad news for you as a reader of this blog. Get all the details in this month's edition of my Monthly Money Report!

 

MAJOR HAPPENINGS THIS MONTH

iEDGAR launch - Last month I told you about my plan to make financial statement data easier to access using XBRL data from the SEC website. The first step was to make company filings easier to access through a ticker symbol, which is why I created the iEDGAR search engine. It also comes with a data API which you can connect to your own software applications for free.

Unfortunately though, XBRL in its current form lacks several critical features to allow automatic extraction of normalized financial data, and trust me that I have tried every possible avenue, so I had to abandon this project and hope the XBRL experts will resolve this in the future.

Investing 101 videos - For those of you who are completely new to investing in stocks, I added some to-the-point YouTube videos explaining fundamental concepts like compound interest and earnings per share to help kickstart your investment journey. You can find the entire playlist of investing for beginners videos here. The sound quality is not that great, apologies for that, but I nevertheless hope you enjoy the content.

1000 Twitter followers - This month the Value Spreadsheet Twitter account @ValueSheet crossed the 1000 followers mark! Great to see so many people enjoy the tips and resources I'm sharing there.

#3 best stock trading course - My Value Investing Bootcamp video course got listed as one of the best stock trading courses online here.

Summary of Buffettology - I have finally gotten around to writing a summary of one of my favorite investing books of all time: Buffettology by Mary Buffett. You can read my Buffettology summary here, including the 10 most important lessons I learned from the book.

LIVE webinar - We did another live webinar this month on The Power of Simplification and had around 200 people register. During the webinar I explained the only two questions that count for value investors:

1. How well is the business performing?

2. Is the price right?

You can watch a recorded replay here:

 

PORTFOLIO NEWS

Apple (AAPL) is nearing my intrinsic value estimate of $125, , which is one of my three reasons to sell a stock. Therefore I have decided to sell this holding entirely once it reaches that point. That's not to say that I think it's impossible for Apple to move beyond $125, it simply means that holding it any longer would be irrational speculation.

Ben, one of my readers, pointed me towards a very interesting stock called Copa Holdings (CPA), which has just seen its price decline with 40%. CPA is an airline, and Buffett dislikes airlines for a good reason. However, CPA seems to be uniquely positioned to profit from economic growth in South America, pays only a 10% tax rate, and is one of the only airlines in the world that has consistently earned good money over time.

Copa Holdings (CPA)

The decline in price is due to the fact that Venezuela cut all ties with Panama, the home base of CPA, while the company still had $400 million in cash stored there. This is a painful and costly situation, but this does not change the otherwise strong fundamentals of the company. Still, South America is not the most stable region in the world, that's why I took a small position in CPA to start with.

 

LESSONS LEARNED

Don't be the man with the boat - Watching Jerry Seinfeld's often hilarious online show Comedians in Cars Getting Coffee, one of his guests, Bill Burr, shared a nugget of financial wisdom which his money savvy brother once told him. His brother used boats as a metaphor. He said something along the lines of: "Don't be the guy with the boat. Be the friend of the guy with the boat. Let him worry about the docking fees and cleaning and all that. You just have to show up with a sixpack of beer once in a while."

Excitement is the cure-all - I already told you that, after spending weeks working on it from every possible angle, my XBRL project hit a dead end and I had to give up on it. I felt like I wasted a lot of time, which obviously is not true since I learned a lot from it. Still, there I was, my big project gone which all of a sudden left me with plenty of time on my hands and not a clear idea yet of how to spend this time wisely.

I guess this is the same thing that happens to retirees, who need to find something worthwhile to do with their newly acquired free time. I hit that point again which I have hit several times before: "let's just get a job and earn some serious money." However, then I realized how lucky I am for having this business I can run from home, which gives me enough money to live well and enough freedom to pursue these big side-projects.

I love this quote from my personal hero Tim Ferriss:

 

“Excitement is the more practical synonym for happiness, and it is precisely what you should strive to chase. It is the cure-all. What would excite me?”

Tim Ferriss

 

If you feel a bit down, unsure if your life is moving in the right direction, just do something interesting, try something new, find something which excites you! I picked up my drawing course again, got myself a museum pass, and started reading some books that have been staring at me for months.

This was great, I was enjoying myself, but then something really exciting crossed my path: a business proposal from a good friend of mine to shoot immersive Virtual Reality video content which puts the viewer in the middle of the action, much like Jaunt VR, which has received $36 million in funding so far. We have been working our asses off on this project ever since and have made good progress. The website is almost ready, the camera prototype is at the laser cutter, and we even got our own Oculus Rift DK2! Really cool stuff.

Excitement, or even just plain action, helps to cure nearly all existential crises.

 

FUTURE PLANS

December is a busy month filled with cosy family dinners and other festivities. Also, I'll be going snowboarding in December, so content creation for the blog will probably slow down a bit.

We are currently building our own stereoscopic 360 camera & spatial audio system to capture VR videos with, because such camera systems are not yet commercially available. Once this prototype is ready and tested, hopefully before the end of the year, we will start looking for funding to purchase all the necessary hardware and software so we can find our first clients. As you can probably guess, this means I will have less time to create content for this blog. If it really takes off, I might even have to quit the Money Tree Podcast and my weekly stock analysis videos

However, before we reach that point I still got something really cool coming up for you: an eBook with 6 amazing stocks for 2015! I will hand-pick 6 stocks which I believe are positioned to perform well in the upcoming calendar year. You will get a thorough fundamental analysis of each of these stocks, including their intrinsic value. I've never done anything like this before, and I will only make this eBook available for a limited time, so don't miss out! If you want to be the first to get notified when the eBook launches, leave your name and email in the form below:

Be the first to get notified when my eBook Stocks 2015 launches!