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JSE Direct with Simon Brown

Weekly podcast hosted by Simon Brown covering the JSE and listed companies.
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Now displaying: July, 2018
Jul 25, 2018
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Simon Shares

  • Steinhoff (JSE code: SNH) almost 400c then under 200c. If you're in SNH understand you are trading it, this is not a recovery story. Nothing wrong with trading but rule 1 is stop loss and rule 2 is profit. Don't forget either.
  • Blue Label (JSE code: BLU) back below 900c. I have no idea what the story is here regarding the collapsed share price and neither does anybody I speak to. Results due late August and a trading update in the next week or two. Best is to wait for clarity from the results.
  • Kumba (JSE code: KIO) results show what happens when everything comes together for a single commodity stock - cash flow galore and dividends. They're paying 1451c for the first six months.
  • Sabvest N (JSE code: SVN) is doing a book build for two of their larger investors who want to exit. They are a holding company and the price is a discount to net asset value (NAV) of about 36% when a typical discount would be 15%-20%. This book build should improve liquidity and ideally help close the discount gap, but first have a look at their underlying companies they hold because while a steep discount is nice, they holdings are ultimately what you are buying.
  • OUTStanding Money: Why do I want money?
  • Investing in BBBEE schemes.
  • Upcoming events

Safcoin - stay away

I first saw them on my Google news feed, a promoted story on IOL.

Safcoin, not illegal but going to end in tears. That I guarantee. They're pre-selling 500,000 in an ICO at R70, then there are another 5million. In short the market will be flooded with these coins that have no use and sellers will drive the price to zero. Stay away.

Read their white paper and then compare it to the white paper for Ripple or Ethereum. This white paper is just marketing material.
Where does the money from the ICO go? A white paper should detail expenses etc. With Safcoin we can only assume that the R35million (500k coins at R70) goes to the founder (Neil Ferreira).

What of the other 5million coins? Who holds them? Again I assume Neil Ferreira. What I also don't know is are the initial 500k ICO coins included in the 5million or added on top?

How do I mine them?

Who is the team behind Safcoin? On Twitter Neil Ferreira said they had a team of 12, but no mention of who this team is and typically one trumpets your team for their expertise.

Who are the auditors? On Twitter Neil Ferreira said they were SmartDec Moscow Russia but we have no confirmation of this, have asked them on Twitter, as yet no reply.

Coin limit is apparently 5.5million, but when you check the website he used to create them (yip not their own code even though they claim 12 people involved) it says 222billion coins. That's about US$1trillion! Heck out government should start a coin and clear our national debt.

Ask you self what problem does this new coin solve? If it is not solving a problem then why will anybody want to buy it? No buyers equals over supply and price crash.

Consider the fact that over half of new ICOs fail, and this is a conservative estimate. I have seen stats that suggest less than 10% of ICOs ever get to market.

Scams, Scoundrels And Multimillion-Dollar Frauds: How To Check An ICO Isn't A Con

They mention they will list on local exchanges. Which?

Smarter people then me asked on twitter (with no answers);

  • What mining algorithm does your blockchain use?
  • What is the consensus algorithm used by the project and how was it picked?
  • Where do the tokens fall on the Howey Test?

You get paid a 5% referral fee if you send people. Referrals always bother me, they smack of pyramid schemes.

As I said up front, not illegal. But before you rush off with your hard earned money, do some homework and 5 minutes on this coins offering and it is not going to make anybody a single cent - except for Neil Ferreira. On listing Neil Ferreira could use his income from ICO sales to be an active buyer pushing the price higher, but this never works for long as eventually one runs out of money and real demand reverts to what it really is - and here it likely is zero.

I could go on and on with the issues about this new coin. Short version remains - stay away.

 


JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.

Jul 18, 2018
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Simon Shares

  • I was at the Mandela Lecture on Tuesday at which Barack Obama spoke. A special day. A truly talented orator and a speech well worth watching.
  • Famous Brands* (JSE code: FBR) CFO quits. Now directors are always quitting, but the CFO when you have indigestion from a over priced UK burger?
  • JSE (JSE code: JSE) trading update is strong. HEPS to be 30%-40% higher. In part thanks to a tax credit, retrenchments from last year kicking in the savings but also they say increased revenue.
  • Rand slowly moving stronger. According to the big mac index, it should be R5.63/US$
  • A listener asked abut Group 5 (JSE code: GRF). A nasty chart and this after a R1.6bn offer by Greenbay (JSE code: GRP) for their European Toll assets they now have a market cap of some R120million. This suggests the rest of the group is totally bankrupt, which it may be and while it appears to offer great value, this is a globally tough sector I continue to stay well away from.
  • Platinum around $820, lowest price since the post bubble crash in 2008 and before that 2004. Wayne McCurrie says on Twitter there is also the biggest net short position since 1999. This is a horror for the miners and another sector to stay well away from until we see some decent upside price action. Not just a few $ higher, a real sustained looking rally.
  • Cash Club: Forget about the Joneses

Make habits not goals

We tend to focus on goals. I want to be a millionaire, a billionaire. I want to be a successful trader. I want to invest like Buffett and so on.

But we do it wrong forgetting the steps to reaching the goal. These steps are the habits that ensure success.

If your goal is to run a marathon, you don't start off one cold morning at the start line for a 42.2km run. You start with getting off your couch and trying a small walk to the other couch. Then maybe a short jog to the bottle store for supplies and so on until one day you do complete a full marathon.

The large scary goals are seldom achieved because they are mono focused and overly large. So large in fact that we forget that a goal is actually a series of small steps that taken together get us through the journey.

So instead of large scary goals, focus on forming habits. Winning habits that will help us reach the end. Habits that in time will become second nature to us.

Focus on the small steps. Improve them. Review your trading and investing, where are you make mistakes? How do you improve and stop the mistakes? Focus on single issues that are holding you back and find ways for you to do them better. Focus on one or two small things until you're a master, then move onto the next one or two areas. You'll never run out of things to improve and you'll always be getting better.

Do perfect trades. Become ruthless with stop losses. Only buy quality. And so on.

Identify your problems and work to fix them.


JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited

Jul 11, 2018

Simon Shares

  • JSE Direct is ten years old. Started 8 July 2008 on Classic FM.
  • Aton out smartens Aveng (JSE code: AEG) and Murray and Roberts (JSE code: MUR) with a 25.4% in Aveng that can effectively block any special resolutions such as a take over. Alternative if the deal between MUR and AEG goes ahead, Aton will get MUR shares as a AEG shareholder which should ensure they end up with 50% +1 and in complete control at MUR.
  • Torre (JSE code: TOR) is maybe delisting. There will be a shareholder vote and if it passes you'll either get the money or remain a shareholder but in an unlisted company. The later is a horrid idea as liquidity and price discovery is typically zero. I Also think we'll likely see more small cap stocks delisting.
  • What can you do?
    • Vote. There will be a vote by shareholders and you have every right to vote against it and as a delisting requires a special resolution 75% +1 is the required minimum to pass.
      • Organise. Find other small shareholders (easier said than done) and get them to vote against.
      • Talk to management and large shareholders. You may be a small shareholder but you have your rights and potential influence.
      • Fight against interested parties voting.
      • Using above also try and get the price raised.
      • At the end of the day, if you're in the minority you lose. That's how voting works.
  • OUTstanding money: Saving tax-free
  • Upcoming events;

Inside Easy Equity users

Easy Equity recently did a user survey with over 6,000 responses and I sat down with Charles Savage (CEO of Purple Group & Easy Equities) to chat around he main findings.


JSE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited

Jul 4, 2018
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Simon Shares

Inside the robo advisor

Robo advisors are all the rage these days but I wanted to know what's inside the robo so I sat down with Grant Locke, head of OutVest for a geeky understanding about how it all works.


SE – The JSE is a registered trademark of the JSE Limited.

JSEDirect is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited

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