Personal do's and don'ts when dealing with the investment industry based on more than 25 years of experience

1. Individual Investors
(e.g. yourself)
Institutional Investors
(e.g. Pension funds, Banks, Investment companies, Registered Day-Traders, … )
Professional investors
(95% of investment market)
Asset management
industry
Brokers
(e.g. ABNAMRO, ING, Binck, …)
Stock Exchanges
(e.g. AEX, CAC40, DAX, NYSE, NASDAQ, …)
Economic
owners
Investment
helpers
Investment
companies
Day-Traders
(e.g. your retired or jobless neighbor)
Public Traded Companies
(e.g. Philips, Unilever, Shell, Apple, Microsoft, ….)
Private investors
(5% of investment market)
Advisory companies
• Stock market analysts
• Credit assessors
• Financial media
• Investment advisors
• ….Mutual Funds
(e.g. BlackRock, Vanguard, Pictet, Robeco,
ETF index trackers, …)
Personal illustration of the Investment Industry
Prepared by: E.L. van ‘t Hoff
Amsterdam, July 2017
Asset Managers
(e.g. Van Lanschot, ING Private Banking, …)
Derivative Instruments
• Options (Call/Put)
• Futures (Short/Long)
• Sprinters, Turbos
• Warrants, …
Shares & Bonds

2. Individual Investors
(e.g. yourself)
Institutional Investors
(e.g. Pension funds, Banks, Investment companies, Registered Day-Traders, … )
Professional investors
(95% of investment market)
Asset management
industry
Brokers
(e.g. ABNAMRO, ING, Binck, …)
Stock Exchanges
(e.g. AEX, CAC40, DAX, NYSE, NASDAQ, …)
Economic
owners
Investment
helpers
Investment
companies
Day-Traders
(e.g. your retired or jobless neighbor)
Public Traded Companies
(e.g. Philips, Unilever, Shell, Apple, Microsoft, ….)
Private investors
(5% of investment market)
Advisory companies
• Stock market analysts
• Credit assessors
• Financial media
• Investment advisors
• ….Mutual Funds
(e.g. BlackRock, Vanguard, Pictet, Robeco,
ETF index trackers, …)
Personal do’s & don’ts when dealing with the Investment Industry
Asset Managers
(e.g. Van Lanschot, ING Private Banking, …)
Derivative Instruments
• Options (Call/Put)
• Futures (Short/Long)
• Sprinters, Turbos
• Warrants, …
Shares & Bonds
There are nowadays more mutual funds
than public traded companies. Many
have a life-span shorter than 3 years
and only 15% are truly beneficial!
Always realize that you are
competing against highly
professional investors and
experienced day-traders
who are waiting for you to
buy and make mistakes!
Derivatives derive value from shares and
should be avoided in case you lack the
time and experience for doing deep
technical analysis of the underlying shares
(e.g. study candlestick charts). Otherwise
you are just speculating on the future price
of an asset, meaning taking huge risks!
Diversification is the only free lunch!
Spread your investments across
multiple industries, countries, and
growth & value companies!
Remember that the
investment industry is
best in influencing you to
buy stocks for their own
personal gain!
Use mutual funds and asset
managers only if you don’t
have any time! Buying stocks
directly is less expensive but
more risky. Do it with a short
& long-term strategy, know
what you buy and review
your positions regularly!
Passive investors are on the
long term more successful than
Active ones who often sell too
early and buy too late!
Open a separate “casino” account
if you want to cask quickly. Follow
the online financial media to spot
growth/decline opportunities and
trade weekly. Set your Stop-Loss
& Take-Profit levels. Buy when
Oversold (RSI <30) & Sell when
Overbought (RSI > 70)
Asset managers costs a fortune and often
just focus on stocks they are getting paid
for. To avoid in case you don’t own +€500k!
Target shares with a low price/earnings ratio
(< 15) and/or a high dividend yield (>3%),
and favor the most healthy profit makers per
industry (return on equity > 15% & solid
solvency for on-going ability to pay debts)
A put option should only be used
as an insurance policy when
buying stocks with big money
that you can’t afford to loose!
Never forget that risks comes
from not knowing what you are
doing! Don’t buy more than 12
stocks and follow them actively!
Prepared by: E.L. van ‘t Hoff
Amsterdam, July 2017