Events And Meetups | Annual Financial Report - The Real Alternative To Attending Seminars

24th Mar '17 by GrindertraderUK

17 comments 9201 reads

Introduction

In this post I wanted to open a discussion on the advantages and disadvantages of attending company seminars. I want to add at this stage that I am not a professional writer so forgive me

if my English writing/typing skills are far less than average. I do hope what I am trying to say is clear enough. This is my own opinion and of course I certainly expect disagreement.

You may have seen company presentations hosted by the likes of Mello, Sharesoc, Shareprophets, and other organisations. This month Master Investor Show and UK Investor Show are competing to become the top investor show of the year.

Reasons for attending seminars

But when considering going to these events have you planned out what you want to gain from attending them? Have you often thought about attending, or have you attended them in the past? At the end did you benefit from listening to the speakers and did it alter your opinion of the company being hosted?

My reasons for attending seminars had very little to do with the actual companies/exhibitors being hosted. You may find this surprising but I have virtually no interest in speaking to any of the exhibitors. I certainly didn’t push my way to the front of the queue so that I could speak to the board of directors during seminars. With regards to Investor Shows most exhibitors are pretty bad. Just look at their Stockopedia reports for a start!

However the main benefit received from the Investor Shows and Seminars was to meet investors that I would chat to on twitter. Exchanging our ideas over a glass of wine, finding out about each other personal lives and just as important having a laugh was more valuable to me than interacting with the exhibitors to whom I already decided that I wouldn’t be buying shares in their company anyway.

The risks of meeting management on stocks already owned.

If you own stocks in a particular company I bet your feeling pretty good and confident about your decision. What if you made a bad investment decision and don’t realise it yet, or worse you don’t want to admit it. Maybe you are looking for confirmation from others that your investment case is sound. What a better way to receive that confirmation than attend a seminar of the company your invested in!

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Edward Croft

24th Mar '17

I couldn't agree more ! I'm sure many have seen my bubble charts of UK Exhibitor stocks. I've often got in trouble from exhibition organisers for showing the Q, V and M ranks of all the exhibiting companies from the stage - they tend to be sucker stocks on low rankings.

The performance history of exhibitors also tells a sorry tale. I'm not speaking at any shows this year (due to date clashes)... so I need to update my chart... but here's what I displayed last year at the UKIS show during my Manage the Monkey speech.

58d5286a2214cUKIS_2016_-_Managing_the_Mo

There can be some great tips from the main stage of these shows, but also some dire ones.... and you have to be wary sometimes as fund managers often tip the odd stock they are trying to sell or reduce their positions in.

But the one thing you should never do is buy the shares of a stock just because the CEO gave a good pitch. You are susceptible to the Halo Effect... and as the above chart shows... your odds are pretty poor !

Investor & Trader

Interesting graph...

If you add in the 90+ stock ranks to this chart the variance between exhibitors and ranks would be alarming and confirms your thoughts even more...

pobby

Agreed Ian. It's all a beauty pagent. We are all part of the snake oil industry. Take it all home with you and re-assess with Stockopedia, Annual Reports and RNSs in the cold light of a new day! Saying that I will be at both events, with a pint and packet of crisps (if you dare!) at the ready if the circumstances allow. Whilst the internet and all its tools are a force for good, it can easily become an "echo chamber" with "like minded" people. It should always be DYOR!

Brackendale

The irritating thing is that I imagine a lot of beginners start off at events like these, which are dangerous environments. The companies are usually from the (very) speculative end of the market, and as for the money managers.... put it this way, at a well respected London event last year, I sat through a presentation by a man who claimed he is in demand by governments worldwide because he can forecast market crashes.

Add to these perils the fact that you have a lot of behavioural biases happening (group think, social proof, apparent authority) and I'm sure a lot of people end up poorer as a result.

GrahamF

I've been to UKIS the last couple of years and will be there this year. But I don't go to meet the companies seeking investment as I can't help thinking that something is not quite good enough about them if they need to be there to raise investment and interest. So I go to meet companies like Stockopedia and hear what market commentators and investors are saying. It means I get to hear some views that are contrary to my own which helps me challenge my own preconceptions.

As to the Annual Report, in general I think the blurb from the chairman and CEO are less and less useful the bigger the company in general. That's because when they are so remote from the front line I doubt they have a particularly good handle on what is really happening in the company.

For small caps, particularly ones with disruptive tech or business models, it's necessary to gain an understanding of the business from somewhere but it's not too important where (website, AR or seminar).

GrindertraderUK

Thanks for the responses everyone. I went to both UKIS and MI last year and enjoyed my times. I especially found the speakers on stage interesting and there were a few educational speakers that I felt were worth while listening too. I am not attending this year due to my work patterns however if I was available I would certainly return to the UKIS 2018.

nigelo

I've been to a few seminars usually when one of the presenting companies is one I was interested in already. Most often the presentations are quite persuasive although I have seen a few which were laughable (not the particular company I was interested in). Once or twice I feel the good presentations have kept me in companies where I might have sold earlier and generally I agree with your points.

The investor shows have a lot of presentations and some of these are well worth attending but again most of the small company exhibitors are probably best ignored.

PhilHofGrowYourDough

25th Mar '17

My advice ... stay away from anyone and I mean anyone offering a view on a company. Let the numbers do the talking and make sure you're fishing in a pond which statistically wins. Run your winners and cut your losers. Sit back and resist the temptation to climb aboard the next big thing that everyone is talking about unless it fits in with your criteria. Raise a glass and smile at the good fortune of others when their hot stock succeeds and gain confidence in your approach when others tank and their supporters look to average down.

Re: The Halo effect

I used to work in a small and upcoming software company around the time of the turn of the century. The CEO was convinced we were on the verge of being bought out at one point stating "We're so close now I can smell it". Employees and their families were offered the chance to buy into the company pre-buyout. Needless to say it didn't play out as planned and it was several years later we were bought out at a knock down price as we were running out of cash after several VC funding rounds. The former CEO is currently a NID on one of the most recently discussed stocks on these boards. I admire him greatly but it indicates that execs can get overconfident and swept away with their narrative.

As it happens the chatter here about the company has been tempting me to buy but staying strong to my approach I have so far resisted as it hasn't cropped up on my screens and probably won't.

Please don't ask me for the name of the company as I won't be sharing it.

and my riposte to anyone who has an issue with my perspective is to just point them at the performance of The Naked Trader-esque Guru Screen which of course is completely unable to listen to anyone.

There won't be many here who can beat an annualised return of 24% over 5 years.

peterg

There won't be many here who can beat an annualised return of 24% over 5 years.

The trick is maintaining it. I beat that over 8 years or so quite comfortably - but the next 8 years have totally failed to live up to historical expectations! All of which, I'm afraid, has left me extremely cynical about assessing returns over short time periods - which I'd class 5 years as.

Which is not to say that screen is not worth a close look.

27th Mar '17

Frontera Resources - A Lesson From Masters In Spin
This is an excellent article from Waseem Shakoor on Shareprophets describing his personal experiences and reinforces my view in this article.

best wishes
Ian

Rusty2

Yes the Naked Trader-esque screen has done well but you don't seem to follow it?

The http://www.stockopedia.com/screens/william-oneil-can-slim-esque-screen-11/ has done even better and especially inc. European shares.

I don't follow it but I took a lot from it and applied my screens to other markets.
My 4 years annualised return is 26.8%

The o'Neil screen has poor diversification and greater drawdowns. Not good for longterm performed in my view.

Think it's important to create your own set of rules but based on criteria set down from successful investors strategies.

Hi Phil, Thanks, I see I had not looked at diversification. I did noticed it had 4 of your shares included. I think the screen has some merit but is too short term for me.

Fundamentally my point is this..

If you are investing to grow your capital (rather than secure asteam of income) and you can't beat or even match an annualised return of 25% over a 5 year period then surely you have you ask yourself "Why am I doing all this research when there is a mechanical system that can achieve it?"

Imagine you were my fund manager and you said to me "we've managed to achieve an 8% growth in your investment over the last year. We do have a mechanical system that is annualising 25% but we prefer to stay involved"

Doesn't it hint at the real importance for the fund manager is that they are seen as important rather then the returns.

The only argument I might consider would be that another strategy improves risk adjusted returns and I'd like to see the stats for the guru screens. My gut suggests that the NT screen has a good risk profile and that the o'Neil screen has greater risk.

fifthcolumn

1st May '17

I totally agree with you Grindertrader including your last point #14 about creating your own set of rules. It would be far more beneficial to all of us I think, to cut out the company men and just meet up to share tips and stories.... and have a few beers.

Annual Financial Report - The real alternative to attending seminars

Introduction

Reasons for attending seminars

The risks of meeting management on stocks already owned.

Meet the…

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GrindertraderUK

17 comments

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