The finale in the Sunday newspaper’s stock market game: The winner made a fabulous return and earned a trip to Schloss Elmau. The editor Georg Meck can’t keep up with that.
ENothing helps: We give up. In the stock market game, the Sunday newspaper called on readers to compete against me, the editor. Who will make more out of 25,000 euros? That was the bet made by “Schlag den Meck”, the third season of which began in autumn 2018. Our money was real, that of the other participants was fictitious, only to be seen virtually on the online account. And yes, we gave everything, read the relevant stock market letters even more extensively than usual, listened to gurus and real experts. It didn’t bring anything: We ended up being beaten in 238th place, more was not possible. That means: 237 readers were better. Hats off!
So much respect is required, we grant success to everyone. What hurts is what comes out behind: the return generated. The best 25 FAS readers have all made more than 20 percent profit, the best eight have more than doubled their stakes – and that under difficult circumstances in these stressful times. Autumn was scary on the stock market. As soon as the stock market game started in October, the Dax rushed down by 1000 points.
The sad truth is: We, that is, our depot, have not withstood the pressure of the financial markets. The fortune has shrunk. 744 euros – mind you, real euros – we have less there today than at the start of the game last October; exactly 24,256 instead of 25,000 euros. Now that’s just a number on paper, assets only decrease when we realize the losses and sell off the loser stocks.
So what went wrong with our three underperformers?
But we still hold the position, hope that the situation will improve again, even in these heated days with trade warrior Donald Trump and the Chinese resistance, when the stock exchange people used all the crash metaphors at the beginning of the week. Now, a few days later, when the Dax takes the curve and marches back towards 12,000 points, the world is already looking friendlier again. “Shares remain an important, diversifying component in an investor’s portfolio,” says a fund company. Didn’t we always say that?
We comfort ourselves that the success or failure of our share purchases can only be assessed in the long term. We invest for eternity or at least until the point in time when the teenage children need the money. There is no question that we are among the good guys, we are not speculators, but long-term investors like Warren Buffett (only with smaller amounts). Such guys keep their nerve when it storms and crashes outside. So: keep calm when it glows red in the depot. Everything just a snapshot. It’s still annoying, damn it. It puts you in a bad mood to study the courses. So what went wrong with our three underperformers?
Failure number one: Continental, one of our favorite companies in the Dax. A solid automotive supplier, technologically top-notch, always up to date, we thought. At the top, Elmar Degenhart, is a CEO, and on top of that a manager as we would like him to be: with serious passion and unadorned elegance. None of those bullshit CEOs with a personality cult. Nevertheless, the market is relentless: Since the Conti boss has been spreading bad mood time and again with his figures since last autumn, the stock market reacts badly.
We made a lot of mistakes
At the beginning we thought the price reductions were excessive, which is why we bought Conti shares for almost 4,000 euros at the start of the stock market game. That was dear to us; Now that the announcements from Hanover are still getting darker, it is obvious: Conti has a real problem. And we lost 15 percent, it will take patience for papers to make up for this minus, if at all. And what do we learn from this?