Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Five Factors of Return - Stop Wasting Time, Start Adding Value, Part IV

In six parts Andrew Stotz will teach you how to Stop Wasting Time and Start Adding Value on the two topics: Stock picking and Managing a portfolio.

The fourth part will break down return into five factors: inflation, dividend yield, real book value growth, share dilution and the "Dream Factor". Look inside to see how dreams and nightmares can affect your return.

  • Login to see the comments

Five Factors of Return - Stop Wasting Time, Start Adding Value, Part IV

  1. 1. STOP Wasting Time START Adding Value2014-05-20 Do YOU Know How to Make Money from Dreams & Nightmares? Part IV: Five Factors of Return
  2. 2. Pick stocks Managing a portfolio Forecasting Value drivers Five factors of return Risk matters more Stop targets Reduce action Every day is new 20 May 2014 2 In six parts Andrew Stotz will teach how to Stop Wasting Time and Start Adding Value in stock picking and portfolio management. In Part IV the focus will be on five factors of return. Source: A. Stotz Investment Research
  3. 3. FIVE RETURN FACTORS Inflation Dividend yield Real book value growth Share dilution* “Dream factor” 20 May 2014 3 *Share dilution is captured in the Real book value growth factor which is shown in the charts on the following pages Source: A. Stotz Investment Research
  4. 4. 5 FACTORS IN ASIA, DREAMS AND NIGHTMARES EVEN OUT 20 May 2014 4 *Inflation is a simple average of the inflation in the Asian countries that constitutes Asia ex-Japan Sources: A. Stotz Investment Research, Thomson Reuters (Years) (10) (8) 50 19 21 36 45 (52) 71 21 (18) 24 1 (80) (60) (40) (20) - 20 40 60 80 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation* (Total return Asiaex-Japan,%)
  5. 5. 5 FACTORS IN INDONESIA, BIG DREAMS, STEADY INFLATION 20 May 2014 5Sources: A. Stotz Investment Research, Thomson Reuters (Years) (14) 13 55 51 18 56 52 (51) 93 47 4 15 0 (80) (60) (40) (20) - 20 40 60 80 100 120 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation (Total return Indonesia,%)
  6. 6. 5 FACTORS IN SINGAPORE, EVEN CONTRIBUTION, NIGHTMARES 20 May 2014 6 (Years) (12) (17) 39 17 19 33 22 (49) 75 15 (14) 26 1 (80) (60) (40) (20) - 20 40 60 80 100 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation (Total return Singapore,%) Sources: A. Stotz Investment Research, Thomson Reuters
  7. 7. 5 FACTORS IN MALAYSIA, ALL FACTORS EVEN 20 May 2014 7 (Years) 6 (2) 26 16 3 27 34 (36) 48 24 4 12 14 (50) (40) (30) (20) (10) - 10 20 30 40 50 60 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation (Total return Malaysia,%) Sources: A. Stotz Investment Research, Thomson Reuters
  8. 8. 5 FACTORS IN PHILIPPINES, EVERY YEAR A DREAM 20 May 2014 8 (Years) (19) (10) 37 26 18 48 18 (44) 61 66 1 23 1 (60) (40) (20) - 20 40 60 80 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation (Total return Philippines,%) Sources: A. Stotz Investment Research, Thomson Reuters
  9. 9. 5 FACTORS IN CHINA, DREAMS TURN TO NIGHTMARES 20 May 2014 9 (Years) (26) (13) 28 (16) (11) 103 117 (65) 82 (13) (21) 6 (6) (100) (50) - 50 100 150 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation (Total return ChinaA-shares,%) Sources: A. Stotz Investment Research, Thomson Reuters
  10. 10. CUMULATIVE RETURNS ASIA, DREAMS TO NIGHTMARES 20 May 2014 10 *Inflation is a simple average of the inflation in the Asian countries that constitute Asia ex-Japan (Years) 113 97 75 (27) 258 (100) (50) - 50 100 150 200 250 300 (100) (50) - 50 100 150 200 250 300 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation* Terminal wealth (Cumulative return in US$,Asiaex-Japan) Sources: A. Stotz Investment Research, Thomson Reuters
  11. 11. INDONESIA TWO THIRDS DREAM FACTOR AND INFLATION 20 May 2014 11 (Years) 313 218 136 296 964 (200) - 200 400 600 800 1,000 1,200 (200) - 200 400 600 800 1,000 1,200 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation Terminal wealth (Cumulative return in US$,Indonesia) Sources: A. Stotz Investment Research, Thomson Reuters
  12. 12. NIGHTMARES IN SINGAPORE 20 May 2014 12 68 70 67 (44) 160 (100) (50) - 50 100 150 200 250 (100) (50) - 50 100 150 200 250 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation Terminal wealth (Cumulative return in US$,Singapore) (Years) Sources: A. Stotz Investment Research, Thomson Reuters
  13. 13. SOLID ALL AROUND PERFORMANCE IN MALAYSIA 20 May 2014 13 (Years) 69 73 91 88 321 - 50 100 150 200 250 300 350 (100) (50) - 50 100 150 200 250 300 350 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation Terminal wealth (Cumulative return in US$,Malaysia) Sources: A. Stotz Investment Research, Thomson Reuters
  14. 14. NEARLY ALL DREAMS IN PHILIPPINES, NO BOOK VALUE GROWTH 20 May 2014 14 104 9 56 219 388 (50) - 50 100 150 200 250 300 350 400 450 (100) (50) - 50 100 150 200 250 300 350 400 450 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation Terminal wealth (Cumulative return in US$,Philippines) (Years) Sources: A. Stotz Investment Research, Thomson Reuters
  15. 15. 48 97 30 (157) 18 (200) (150) (100) (50) - 50 100 150 200 (200) (150) (100) (50) - 50 100 150 200 00 01 02 03 04 05 06 07 08 09 10 11 12 13 "Dream factor" Dividend yield Real book value growth Inflation Terminal wealth (Cumulative return in US$,ChinaA-shares) CHINA, 13 YEARS OF NIGHTMARES, BUT HAS BOOK VALUE GROWTH 20 May 2014 15 (Years) Sources: A. Stotz Investment Research, Thomson Reuters
  16. 16.  Real book value growth and dividend yield are the main drivers of terminal wealth  The “Dream factor” contributes little in Asia ex-Japan, but swings widely  Know when gains come from the “Dream factor” 20 May 2014 16 WHAT WE HAVE LEARNED Source: A. Stotz Investment Research
  17. 17. Share this with your friends www.andrewstotz.com Follow me on:

×