Sumoy

Investment ideas and financial education

Aim

This blog focuses at providing unbiased investment ideas within industrial sectors. Marginally, I do expect posting some snippets on other themes of my interest, like rowing or trekking.

Hopefully there will be enriching conversations among the followers of the blog: knowledge sharing among investors might well be the ultimate aim of this blog. Professional investors might well be among the followers of this blog, as most ideas will be in small, lightly traded equities that do not have decent sell-side coverage.

But there is also an important educational aspect I would like to embed in my writings: society trains us to be good at our jobs, from the process engineer to the silversmith we are all trained to do something in exchange for money. However, not many people know what to do with this hard-earned cash. In my home country, for instance, most of the wealth of families is invested in real estate, which has not proven to be an intelligent move for many. Demystifying the financial markets by providing some financial education to the layman is my second aim.

Most sell-side research is produced with constraints which tend to led to crowd herding in their recommendations. Here you should be able to find eclectic views on different stocks. My points of view on equity valuation models, for instance, might not fit the standard views: quarterly Earnings Per Share (EPS) surprises and macro sentiment are, to me, more important to predict share price movements than long term prospects. In a Discounted Cash Flow (DCF) model, for instance, most of the Net Present Value (NPV) stems from a Terminal Value (TV) stemming from educated guesses. In reality, nobody knows what is going to happen to any particular company four or five years down the line… Which makes most DCF models useless. Therefore, as a venture capitalist once told me, when buying something one should always think of the price someone will be willing to pay for it in the future – investing is more a matter of craft than anything else.

Have fun.

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