I was quite busy in recent weeks. Between regulatory reviews FSA British cramming and my new job I started, and an absence of two weeks in late September, not easy to release me.
I'll still be short, since I will truly more time until the end of next week, when I finish moving those pesky exams FSA.
A month of madness that just ended on the markets. Unheard of. Fellow speaking, a September 11 every two or three days for two months, in the words of the head of equity derivatives at Société Générale. Beyond all the polemics and dreams of some "end system", several findings, strike me:
1) Basically there is one of the most serious financial crisis in living memory, a mixture of 1929 and the Savings & Loans crisis. Also a crisis that few people saw coming.
2) Governments around the world have taken almost all measures they could. One wonders if instead of saving the banks massively, it would have been preferable to an ad hoc basis to participate in capital increases for troubled banks and guarantee interbank market for sound institutions. But one thing seems fairly certain: the states are willing to do anything to avoid depression. I think the worst is behind us. Especially do not forget the basic rule: when states want something and there is political will, the tide is inflected.
3) Some crazy valuations: the crisis in which we are surprised most people, after the violence. It is above all a question of trust has evaporated, a phenomenon that has been addresses illicit by bad loans made in recent years, accounting rules "IFRS" that force financial institutions to enhance their balance sheets at market value ( this leads to aberrant values and sometimes completely disconnected what a statistical approach would be to value loans, and forced sales). However, during recent months, we went to sellout sellout. Each fall, the prices seemed to have reached the purchase price ... but buyers were frustrated to find even lower prices the next day. Today the situation is simply absurd!
Consider a company like Renault. While the automobile, when the crisis will spread to the real economy will be affected. But at a price of 30 Euros, not distibution than 1 / 3 of its profits, entrprise gives a yield of about 16%! The course is back to pretty much the price the company before the'alliance with Nissan, and developments in emerging markets! It is 3 to 4 times the net result of a good year.
Rally, the holding company of Casino: no risk, 14% yield, 3.5 times the profits! How much will erode the margin if the consumer suffers from recession?
And so on. It is a course of sellout.
The best opportunities are certainly having said on the side of small values, the volatility was literally blown away. As the funds have come out en masse, prices have collapsed, even for securities with strong growth. Sword Group, a magnificent mechanical believed to 20-30% per year for 7 years, and sells software (and computer) is treated 6 times its profits. It is as if the growth the past 4 years had not existed.
Easydentic, a biometric specialist equipment, a real bomb, keeps publishing publishing exceed its targets, and display growth rates of 40-50% yet and it is only worth 13 times 2008 and 8 times 2009!
I pass, without forgetting, however, another company that seems to have proven, Yin partners, multichannel communication agency, innovative, open crosisance, whose founder is respected around the middle, which again raised in breakneck speed. It is worth 10 million euros of, virtually no debt, and EUR 1.6 million profit in 2007.
This market is crazy, and daring, ready to buy, (especially small caps) by accepting that they will not have the lowest price will enjoy it. There are probably even more money to be made in autumn 2002, because overall, companies are much healthier, while valuations are still lower than at the time.
Good luck!
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