Tag Archives: Spain

Spain: investors are waiting for a new government

Why is the Spanish stock exchange one of the weakest when the economy is showing one of the highest growths in the European Union? If we see the evolution of the benchmark Ibex 35, we will notice a clear change since the beginning of 2015.

Ibex 35 evolution in the last five years

There was a continuous growth since the turmoil in 2012, when many investors bet for a bankruptcy of the fourth largest EU economy. This situation would have been very risky for the whole EU and the solution came finally with a banking bailout of 40,000 million euros.

Spain was very dependent economically from tourism and building. The crash of the building sector and the global crisis that affected the tourist sector were painful for both growth and employment. The recession took the unemployment rate over 24%. What is the current situation? GDP growth around 3.2% in 2015 and unemployment around 20%, but while the tourist sector is again flourishing (partly, because of the political crisis in the south bank of the Mediterranean Sea), the building sector disappeared and the country didn’t move to any alternative economic sector.

The current decrease begun in January 2015, when the business and consumer confidences fell and the stock exchange went down. Behind these trends, there were two factors: the possible political instability due to the appearance of new parties (particularly, the populist left-wing Podemos, which became very strong in the surveys) and the economic unbalances in the country (debt near 100% of the GDP, high budget deficit, weakening of the Social Security, trade deficit).

The failure of the politicians to create a government after the election on last December didn’t help to take decisions to reverse a possible stop in the economic improvement. The repetition of the election in June resulted similar, because the scenario is not clearer. The weak victory of the right-wing Partido Popular seems to be the beginning of a period of long negotiations to pass bills and budgets.

Our global trend chart of Spain shows the evolution of the last 12 months. It is easy to perceive that the Spanish market had low opportunities to invest. The Brexit also operate negatively.

Global trend evolution of the stock market in Spain

What can investors expect for the next months? It depends on the speed to compose a new government and the decisions that it takes. If the decisions agree what the markets expect (budgetary control, spending cuts), the exchange will possibly experience a relief and more opportunities will surge to invest.

The results of the T-Advisor model portfolios in 2015

T-Advisor, as wealth management solution for individuals and professionals, has not only tools for own investments, but also proposals to follow or even copy. That’s why our system has its own model portfolios. They are nine: five related to risk profile (from aggressive to very conservative) and five related to countries (Germany, UK, Spain in Europe and Mexico and Nasdaq 100 in the Americas).

How do they work? We select between four and six ETFs for the risk-profiled portfolios and up to ten stocks for the country portfolios. The main point for us is capital preservation. That’s why our results, when they are negative, are better than the markets. To obtain them, we rebalance the portfolios every two months. These rebalances let us improve the results, as we exclude the positions more affected by market negative waves and substitute them for better stocks or ETFs. Diversification is also part of the strategy. We select the securities with the best score and relevant figures to obtain the best results.

These are the results for 2015 for our risk-profiled model portfolios:

1-year-return Volatility Sharpe ratio
Aggressive -2.53% 19.44% 0.57
Dynamic 1.47% 16.86% 0.51
Balanced 3.53% 10.03% 0.58
Conservative 1.52% 3.94% 0.90
Very conservative 0.80% 2.39% 0.18

The figures where collected on January, 13th, and they are influenced by the very bad trend in the last weeks. However, the only negative result is our Aggressive portfolio and the losses are lower if we compare them with the 1-year-returns of some of the main exchanges: S&P (-4.42%), London (-8.80%), Madrid (-9%), Hong Kong (-17.96%).

And now the results of our country portfolios:

1-year-return Volatility Sharpe ratio Index
Germany 44.70% 19.89% 6.23 2.08% (DAX)
Spain 5.74% 18.28% 1.59 -9.00% (Ibex)
Mexico 23.96% 15.03% 5.09 -1.81% (IPC)
Nasdaq 100 2.97% 18.52% 3.27 -2.44% (Nasdaq)
UK 18.32% 14.72% 2.98 -8.80% (FTSE)

Our strategies outperformed the reference indexes and even in a negative environment, all performed positively, against the negative results of the indexes.

Aren’t you tempted to clone them? We have a tool to let our users do it. Let’s try it and compare the results with your investments!

Profiling investors: findings from BlackRock surveys

Picture from Investor Pulse in US by Blackrock

BlackRock is the biggest fund manager in the world. In the last years, it has conducted surveys in different countries around the world to obtain the main features from investors. If we take some of the insights, we may find several interesting figures:

  1. Cash is king. It is surprising that cash is the main asset in such proportion. For instance, 59% in LatAm, 63% in US, 51% in Asia, 58% in Spain… and 76% in Germany. In LatAm, 70% plan to add more cash in the next year. That’s quite a lot everywhere. Why investors are still reluctant to invest in other assets? This is a question that the financial and advisory branch has to discuss.
  2. Generally speaking, all are more optimistic than pessimistic about their financial future. Let’s see: 52% in US, 74% in LatAm, 64% in Asia, 54% in Germany. But it is interesting to mention that the rate is only 23% in Japan and 47% in Europe (38% in Spain). In contrast, Indians are optimistic in 81%. These figures show also opportunities. The branch has to bet for more optimistic countries to sell their products and solutions and have to work harder in more pessimistic countries trying to remove former ideas.
  3. What about retirement? Only 59% Americans are saving for it. It is to underline that the proportion is 57% of Gen X (between 37 and 49 years old) and… 60% of millennials (between 25 and 36). Surprisingly, young Americans are saving. That means that they already are target for the branch. The proportion of savers is higher in Asia: 69% average, with peaks in China (74%) and lows in Japan (42%). In LatAm, the percentage is 67%, in Germany, 65%, in Spain, 47%. There is also here a chance for advisory in these countries.
  4. And finally, what is the perception about advisers? 35% of Asians are advised in their finances with a high satisfaction. The proportion falls till 17% in LatAm (likewise very satisfied), 25% in Spain, it is also low in Germany. There is no figure for US, although it is supposed to be higher than in other countries. The chances to grow are also very relevant.

This kind of surveys is interesting to detect the general investor sentiment and find business opportunities for the advisory branch. It is also useful to open a debate about how to reach the customers and discover them the advantages of investing and planning their finances.

Note: Picture from BlackRock Investor Pulse Survey 2014. Page 12.

Market opportunities by T-Advisor: Corporación Financiera Alba

T-Advisor, through its tool Market Opportunities, has detected the company Corporación Financiera Alba, listed in Madrid Stock Exchange as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Corporación Financiera Alba main figures in T-Advisor

The chart shows the evolution in the last year:

Corporación Financiera Alba chart in T-Advisor

The technical analysis reveals also more data:

Corporación Financiera Alba technical analysis in T-Advisor

Finally, the risk analysis is as follows:

Corporación Financiera Alba risk analysis in T-Advisor

Alba Financial Corporation is an investment holding company established in 1986 and listed in Spain. The company is part of the March Group, a leading business and financial Spanish family-owned group in which Banca March and the Fundación Juan March are also integrated. The Group’s strategic investments, excluding those within the financial and insurance sectors, are made via Alba. 83% of invested capital is in listed companies, as Acerinox, ACS, Clínica Baviera, Ebro Foods, Indra, Antevenio, BME y Viscofán.

The sum of the revenues from shares and another incomes in 2013 was €300 million, against € -261 million from last year. Net profit was €226.9 million, against €299.4 million losses in 2012.

T-Advisor model portfolios: these are our results

T-Advisor, as wealth management solution for individuals and professionals, has not only tools for own investments, but also proposals to follow or even copy. That’s why our system has its own model portfolios. They are nine: five related to risk profile (from aggressive to very conservative) and four related to countries (Germany, UK, Spain and Nasdaq 100 from US).

How do they work? We select between four and six ETFs for the risk-profiled portfolios and up to ten stocks for the country portfolios. They are not static, but we rebalance them every two months. These rebalances let us improve the results, as we exclude the positions more affected by market negative waves and substitute them for better stocks or ETFs. Diversification is also part of the strategy. We select the securities with the best score and relevant figures to obtain the best results.

These are the results for 2014 for our risk-profiled model portfolios:

1-year-return

Volatility

Sharpe ratio

Aggressive

17.77%

10.94%

1.84

Dynamic

20.03%

9.91%

1.99

Balanced

19.50%

5.57%

2.84

Conservative

17.84%

2.06%

4.89

Very conservative

14.02%

0.62%

5.81

Who said that very conservative strategies have very low returns? And now the results of our country portfolios:

1-year-return

Volatility

Sharpe ratio

Index

Germany

20.84%

10.94%

1.84

2.65% (DAX)

Spain

9.31%

9.91%

1.99

3.66% (Ibex)

Nasdaq 100

1.91%

5.57%

2.84

18.8% (Nasdaq)

UK

-0.59%

2.06%

1.89

-2.71% (FTSE)

Our strategies outperformed the reference indexes (with the exception of Nasdaq 100), but even in a negative environment, as in UK, our portfolio reduced the losses.

Aren’t you tempted to clone them? We have a tool to let our users do it. Let’s try it and compare the results with your investments!

Market opportunities by T-Advisor: Red Eléctrica Española

T-Advisor, through its tool Market Opportunities, has detected the company Red Eléctrica Española, listed in Madrid Exchange, as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Red Eléctrica Española main figures in T-Advisor

The technical analysis reveals also more data:

Red Eléctrica Española technical analysis in T-Advisor

The chart shows the evolution i the last year:

Red Eléctrica Española chart in T-Advisor

Finally, the risk analysis is as follows:

Red Eléctrica Española risk analysis in T-Advisor

Red Eléctrica Española is the transmission system operator for electricity in Spain. The company is a holding with international presence in Portugal and South America. Founded in 1985, the main shareholders are the main Spanish energy suppliers, but it is listed since the 90′s.

Company revenues in 2013 slighty increased a 0.2%, till € 1,75 bn. Net profit summed up € 529 million, a 7.5% more. The share has increased a 33% this year, but the market capitalisation more than doubled since 2012.