Summary of November 2014

Usually I collect all the data concerning my companies after the trading has stopped. Today I am not able to do that and I am forced to make it during the day since it will be a busy schedule this evening with Boogie Woogie lessons, Berlin Philharmonie and mingling in the French Embassy (at least the wine should be good!).

My weight have indeed stabilised itself when I run two days of fasten per week and a secondary improvement is that I do not get crazy hungry when I only make it during two days. When I was doing three fasten days then, yes, I did lose weight but I was also craving food. So I am very happy with how things are working out now.

I managed to make all the Christmas shopping as well as sending out all the packages for my family and as always it is an expensive story. This year in the family we made the rule of one package/item to the price of max 50 € per person. Christmas and New Year celebrations will always drain the account and this year will not be any different...  It is a pity that I can not go home to see my nephews this year especially since there has been a new addition that I have not yet seen but it simply did not work out this time. I did unfortunately already buy a ticket for flying home that I will now no longer be able to use so that additionally became 100 € burnt for nothing with no chance of refund. Still... one can not plan everything in life and sometimes unexpected things just happen and the financial price is then often also the small price to pay.

German inside trading: November 2014

Ouch, by the first look of it then they have been busy again here in Germany so lets see if that is really the case or just the same activity having in a few companies. Managers are like any other herd... if one start buying then others often also do.

For the previous report please click on German inside trading: October 2014.

The dealings were:

Analysis of Magnit

Company: Magnit

ISIN US55953Q2021 | WKN A0MVY2

Business: A Russian retail chain that are being called the Wal-Mart (see analysis of Wal-Mart) of Russia and is currently the largest retail chain since it went passed the X5. The have four store formats convenience store (8143 of them), hypermarket (181 of them), "Magnit Family" stores (76 of them) and cosmetics stores (1000 of them). From what I have understood then each new built store is paid back in full after 3 years and to protect themselves against corruption they perform lie-detector tests on employees.

Active: Russia, mainly in the western parts but growing quickly towards the east.

P/E: 31.6 (crazy high for a Russian company today!)

Comment: The analysis is based on the equivalent of GDR stocks. One of the biggest investors, besides from the founder Sergey Nikolaevich Galitskiy with 40%, is OppenheimerFunds, Inc.

Disappointment as a customer and shareholder

Since I made my round of analysis of Russian companies I have been very interested in making an investment there. It did however encounter a couple of problems...

It did not appear to be easy to buy directly from the Russian market.
Some Russian companies have ADRs (so buying in the US) but that causes double taxation of dividends.
Other companies had GDRs (often traded from London or Frankfurt) which will make dividend taxation easier but...
there were so many of them that were interesting and I simply ended up feeling too scared about stepping into a Russian company with a GDR.

I started thinking more and more about ETFs and after reading up on it, and especially on the two options that were being offered to me from Deutsche Bank since I am both a customer as well as a shareholder there, I found that I was still not satisfied concerning the costs and I therefore called them up.

Ovomaltine crunchy cream: it rings a bell...

Yesterday I received, due to an advertisement campaign, a 400 g jar of Ovomaltine crunchy cream. Directly when I got the jar I started digging in my brain. Where have I heard this before? Hmmm... it must be a large company... could it be Unilever? I then looked at the jar and it said Wander AG. Hmmm... I have never heard about that before so as soon as I had the chance to access internet (yes, I am actually so retarded that I do not even have internet on my "smartphone") I started digging.

To my great happiness it turns out that Ovomaltine belongs to Associated British Foods! I knew I had seen the brand before but it had just slipped out of my mind where that was.

As soon as I came home I spread it out on a piece of bread and it was fully ok. Similar to Nutella but still different. The normal, well known way, to consume Ovomaltine is as a chocolate drink. I do however see a couple of issues with this new product....

From what I could find the price was around 4€ per 400 g. That is twice the price you pay for a jar of Nutella so they have no chance to compete with the price.

Secondly the design of the jar and looks as if it was made by a five year old. Yes, I know Ovomaltine is an old brand but if you want to arrive with a new product, and new way of using the product then maybe it will be better to make a new design and it could be that one should even use a new brand name for the product.

Since they can not beat price against Nutella they should have gone after health or other aspects such as Bio or Energy or something due to the malt extract that they use as the base of the product.

As a good shareholder one should however always try to consume products made by the companies that you own. For this reason I will enjoy my jar of Ovomaltine crunchy spread and if I see it in the store at a discounted price then I will try to buy one.