Some days ago Tobias Carlisle posted on twitter a slide from a micro cap event which showed how well some of the companies presented did. A couple of replies played devil’s advocate and wondered about the ones that didn’t do so well. I couldn’t help myself and pointed out that good events have good ideas. What I didn’t mention is that participants don’t even need to figure out the best ones to make money. Let’s look at some examples from personal experience.
In 3 days, is the fully-booked 3rd annual Cyprus Value Investor Conference. A by-invitation gathering of investors to share ideas and network. In the previous 2 years, 33 ideas were presented with an average return of 27% while the corresponding indices only did 14%. In 2016, Simon Caufield presented Fiat Chrysler which went on to rise 150%+, while in 2017 Firebird’s Harvey Sawikin presented Lukoil which rose over 50%+ regardless of whether you bought the local or international issue. My own recommendation came in 4th at 32%. One high net worth private investor called the event, “the highest return on investment decision of the year”.
As an investor, I did buy Simon’s Fiat recommendation but do you have to pick the best idea in advance to make money from such events? ABSOLUTELY NOT! Last year, I made over 30% on an idea presented. This idea only made 6% year-on-year but I didn’t enter on the day of the presentation or exit a year later. I waited and got a better extry and exited the stock as it rallied intra-year. Perhaps you’re thinking I got lucky or that the occurrence was just the exception to the rule. A fellow investor who is head of asset management at a bank bought Dixons Carphone intra-year and also made 30%. The total return for Dixon’s is -6% year-on-year. So as you understand, the average return of good events is highly understated! And I haven’t even spoken about the educational value or about all the great side discussions which take place. I recall last year a nice one between an Amazon bull and Amazon bear. I learned a lot listening to those two battle it out! A good event not only has great ideas but also has quality discussions that take place throughout the time you are there. If not then move on.
If you are interested in finding out how the Cyprus event was born then go here and scroll down to the article “How The Event Was Born And The Resulting Chain Reaction“.
