Beating Buffett

1Beating Buffett

2How You Can

Too

1

Beating Buffett

Examples – Straight Ups

Examples – Straight Ups

Examples

1 = It can take the market time to see value, but the stock rarely falls below our entry price because it was already undervalued

2 = Market sees what we saw and price rises

Examples

1 = It can take the market time to see value, but the stock rarely falls below our entry price because it was already undervalued

2 = Market sees what we saw and price rises

Examples

1 = It can take the market time to see value, but the stock rarely falls below our entry price because it was already undervalued

2 = Market sees what we saw and price rises

Examples

1 = It can take the market time to see value, but the stock rarely falls below our entry price because it was already undervalued

2 = Market sees what we saw and price rises

Dear Alpesh, this is absolutely awesome !! Well done. Great going. Ashok Vaswani, CEO Barclays Business and Retail Banking

Outstanding!!! CongratulationsRavi Bulchandani, Head, JP Morgan Private Bank

Source: Trustnet

2

How You Can Too

possibleMISSION: THE BEST INVESTOR SOFTWARE IN THE WORLD

ALPESH B PATEL: TRADING AND INVESTING THE WORLD

Award Winning Trader

FT Top Ranked Forecaster

Financial TimesForecasting Competition

Rank Number 1

‘Gets to the heart of the matter of trading by clearly elucidating the methodologies of successful trading strategies while capturing the ineffible ethos of singlular successful traders.’ Pat Arbor, Chairman, Chicago Board of Trade. (World’s Largest Exchange)

Respected Strategy Expert

Amazon Bestseller With Harry Potter

Published in 8 languages

Top 5 Bestseller

How Did I Develop And Perfect The System

Thousands of live trades

20+ years of working with world’s leading traders

16 books on trading strategies based on research and interviews with leading industry experts

Worked with other traders to optimise accuracy

Since 1995 to present continuously perfected THIS system

APSE

Background Of StudentsStudents Full Time Mothers Full Time Plumbers Professional Traders School TeachersRetirees

My Talk At Bloomberg

Highly Rated Stock Picker

23

Growth Stocks

Income Stocks

Value Stocks

•Disciplined security analysis: Valuation, Growth (eg. Earnings and revenue growth), Income (eg dividend yield). Thereby avoiding the pitfalls of each style and capturing the best of all three theories for selecting stocks.•Qualitative and Quantative: (i) determining the variables to use to identify stocks falling in each style (eg. PEG), and then (ii) determining the range of relevant values (eg. PEG 0.2-0.8) for each criteria (iii) weighting those criteria

Money Management

’000s StocksPortfolio

Circa 14 PositionsStocks

Screen Transaction

Risk Management

•Low Transaction Costs: Our strategy is inherently not a high turnover strategy thereby reduces portfolio churn and transaction costs.

•Money Management: 25% per position hard stop-loss means no position can impact portfolio more than 1.8%.

•Risk impact of our 14 positions have same impact on portfolio downside as a GBP 200m equity funds largest 10-14 positions.

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Value Growth Income: USPDownside of Traditional Styles & Other Funds

Our way for generating maximising risk-adjusted returns

Value Stocks: can remain undervalued for long periods. Can be excessively undervalued because business is not viable.

As our stocks are also growth stocks, they tend to be spotted earlier by big funds. We avoid extremely strongly valued, or strongly growing or strongly yielding stocks –as these too can be problematic.

Income Stocks: Yields alone do not ensure shareholder returns

Yields provide downside protection. If the stocks price should fall, yields increase, ensuring a floor to price falls. But growth and valuation criteria mean the company should get selected rapidly and rise again.

Growth Stocks: Can be over-valued and not exceed expectations causing price declines

Our stocks are already relatively undervalued so strong growth means expectations are usually exceeded resulting in strong price rises.

Exits based on entry criteria We do not want to exit when our stocks are, say, fully valued. We want them to be overvalued when we exit. So our exits are based not on our entry criteria, but time – the optimal time, without back-test over-fitting, we think it takes for shareholder returns to be maximised, which based on VGI criteria is 12 months.

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Value Growth Income: USPTransaction costs cause cost drag due to large number of portfolio holdings

Our portfolio stocks have the same downside impact as the largest 10-20 holdings of a GBP200m fund. We don’t need 100 holdings and the costs inherent in them to diversify away risk. But our concentration generates Alpha due to our stock selection skills.

Style Drift By having a combination of styles we should ‘smooth’ the effects and downsides of any one style.

Poor bear market performance

Our stocks represent target ‘flight to quality’ stocks in bear markets.

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DTZ31/12/04 30/12/05Apr Jul Oct

DTZ Holdings PLC

Feb Mar May Jun Aug Sep Nov

Pence 3 day bars (dyn.) Ord

450 450

400 400

350 350

300 300

250 250

200 200

2000 2000Volume (Daily) - th's

ScopeShareChart (c) www.sharescope.co.uk

Growth results beat expectations

bring undervalued company to market

attention (i) in months not years (ii) with room

for price rises due to low valuation

Price drops limited because yield and valuations rise providing a protective

floor to falls

27

Growth results beat expectations

bring undervalued company to market

attention (i) in months not years (ii) with room

for price rises due to low valuation

Price drops limited because yield and valuations rise providing a protective

floor to falls

Easy As 1 – 2 – 3

AlpeshPatel.com

MISSION: THE BEST PRIVATE INVESTOR SOFTWARE IN THE WORLDHOW TO GET INFRONT OF COMPETITORS – ALPESH PATEL SPECIAL EDITION SHARESCOPE

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STOCK IDEAS

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NICE DESIGN

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DAILY & MONTHLY NEWSLETTER

STOCK COMMENTARY

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BEGINNER/INTERMEDIATE

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TEST IT

SINCE 2004: 17% pa returns from Alpesh Patel Special Edition stock picks

INDUSTRY AWARDS

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APSE

Global Following From 73 Countries

Next Step

www.sharescope.co.uk/alpesh

But What About Funds Managers and Investment Trusts?

Why Not Just Buy One Good Stock?

Why Not Index Trackers?

Go To Websitewww.sharescope.co.uk/alpesh

Step 1: Download

Step 2: Pick

Step 3: Relax & Monitor

Go To Websitewww.sharescope.co.uk/alpesh