Minding your own percents

“
Page 1 of 6 May 2013 © Copyright StockTakers Limited, All Rights Reserved. Copying Prohibited.
The author does not provide investment advice. In order to use reproduce or convey the material herein,
in any way, written agreement must be obtained from the author or its agent Architypes Inc.
StockTakers Limited is an Alberta corporation providing information on “likeables” equities.
StockTakers Limited encourages your seeking tax law advisor for capital gains tax dispositions.
Alice, meet Dr. Dodgson! Minding Your Own Percents.
Alice, the old adage remains, “You have to make your own bacon.”As a
small investor if you expect financial industry profits for their using your
savings, your wealth will not be flying but wormed. In reality ‘financial
products’ they sell do not work for you. Fees plus inflation they never
overcome. Your wealth will be eroded. They take those fees but down their
rabbit hole your cash goes. They have delusions not maps or compass.
You must obtain a real return higher than inflation which in our present 42
year productive adult lifetimes has averaged 4.42%, plus their average fee
of 2% plus MERs (Management Expense Ratios) of 2% charged on top of
that 4.42% inflation rate. They need to obtain 8.62% every year to maintain
the value of your money entrusted them. That they have never done.
Minding your own percents? Yeah, that we have proven works. From 2000 through 2012 average
26.53% obtained on the DOWs by our logically correct and mathematically proven theory and
methods have scientifically proven consequences of knowing equities Risk Price in any market.
Our ABCs, Tax Charities, and BookBuilderTM
portfolios all help the small investor up. These with
the Newbies of Q4 and Q1 seven portfolios are testable consequents of Risk Price partitioned
"Likeables' exposed in realtime. Each of these portfolios is an arbitrary 'filtered' portion of the
NYSE and TSX, a random sampling. The ABCs are in particular relevant as it extends right
through a sagging and rebounding TSX and NYSE, on these 18 months, for 37.02%.
ABC-NYSE 31dec2011-22may2013 – 47.25% IRR avg
ABC-TSX 31dec2011-22may2013 – 26.78% IRR avg
What small investors expect of bankers and financial industry investment products is a way to
secure savings value by growing their wealth. You have made it theirs, now just you try getting it
back. The circularity of ‘investment talk’ from fund managers and advisors who have sold you
their “goods” and taken your money to ‘safely invest’ is like what Alice gets in Wonderland.
“Somebody said,” Alice whispered, “that it’s done by everybody minding their own business!”
“Ah well! It means much the same thing,” said the Duchess, “and the moral of that is ‘Take care of
the percents and the pounds will take care of themselves.’” “Thinking again? The Duchess asked.
“I’ve a right to think,” said Alice. “Just as much right,” said the Duchess, “as pigs have to fly.”
Pretty much, they have taken it all before your need arises. “Alice, meet the Duchess.”

“
NYSE Solo-50K – 59.33% IRR
NYSE Value 17K – 45.37% IRR
TSX Value22.5K – 22.29% IRR
From fresh balance sheet data there are always newly emerging firms, also projections of those
firms tending to declining market preference we might best be prepared to shun. Our “Newbies” we
draw from to replace laggards and build portfolio performance, always going forward.
NYSE Q1-2013 Newbies – 33.94% IRR
TSX Q1-2013 Newbies – 36.87% IRR

“
Mind, all those percents tend to an average 38.83% IRR obtained while markets have been gaining.
Those are very useful results you have seen unfold in “likeables” public run portfolios. Risk Averse
AlphaSmart gains, Capital Safety, and ready Liquidity works, that is minding percents.
Cash value erodes when idle. Cash is not capital until it is engaged in the business of firms creating
and adding value creating cash flow through ideas and productivity. The markets are always a
movable feast the investor must move with. Our “likeables” give direction, like map and compass.
Minding your own percents? Yes, we have proven that works. What proof does convention show?
The financial industry does not even come close to
the average of benchmark indices. Has your
statement value grown 27.06% in the last three
years? What about returns of the brashest self
promoting hedge funds performance for deep pocket sophisticated investors? HFRI reports an
average 3.01% for 3 years or a total of 9.59% gain for their clients, flush with recent low inflation.
Well, how about the best, brightest and most learned institution endowments run by and overseen
by economists with PhDs and Nobel Prizes sitting on their boards. Perhaps those1
have managed
better in securing generous return with those philanthropic gifts in exchange for charitable tax
write-downs. Sad fact is those numbers include all new philanthropic donations made to those
funds in that fiscal year, like our pension fund contributions skew results. Resulting in fewer and
larger classes, less research, smaller and fewer scholarships, and greater student debt the grinding
reality of fiscal and investment management is agent, as scienters’ wrongful acts?
Despite better intentions and hefty tax write-downs on wealth drawn from our living national
economy investing to build institutions express our society’s aspirations for future innovation and
productivity arising from better institutions obtaining universal education. Fund managers’
practices belie these promises. They do not deliver more than fine words of self praise. Well, maybe
they are just doing their best with bad tools. They should know. Poor results are theirs.
The investment models of the industry do not work to obtain the minimum 8.42% return required.
Many sitting at board endowments invented the methods being used that even for their own

“
investment businesses proved failure in practice. The Yale investment board in particular is hailed
as the model many social service endowments use. That board endorses fund managers take nearer
6% in fees, costs and salaries even in bad times, and then, even congratulates them, for loses.
Yale posted a return of 4.7 percent on its investments during the latest fiscal year,...“Thanks to the outstanding
work of the Investments Office, ..."
Yet when fees are fully accounted theirs was -0.1% result. Outstanding work, or nice if you can get
it from donors? The Yale model espouses fine sounding "Alternative Investments" entailing higher
cost for them to oversee and with the very risk of illiquidity and losses if they do not succeed as
they hope for. Rudely not shy about Schadenfreude they draw derisive attention to others losses.
Yale’s endowment performance ... exceeds the returns registered at ... Harvard University announced
yesterday that its investments had experienced a 0.05 percent loss during fiscal year 2012.
Is Yale just paying 33% more in management fees than Harvard, as this infers? More is told in the
base reference of fiscal year ends; June 2011 to June 2012 the markets gain averaged 9.62% as
these multi-billion dollar university endowments returns were negative. In real value terms not half
of the 2009 losses have been recovered four years later as inflation is relentless and very real.
None of the Yale model proposed private equity, hedge fund, fund of funds and fixed asset
elements under “Alternative Investments” umbrella are cited for scrutiny given ongoing failure of
consistent results the model supposes its advantage. Their core strategy is ‘more baskets’ in
opposition to traditional bonds and stock market equities. These elements are all failing in their
hands, by compounding fee charges claimed for their managing, but more and poor overview
ability on all these asset classes. They wear cap and robes, but have no real clothes.
All the proof is in the pudding. These kingly men handling those social nest eggs are not making
‘just desserts’ for social good as likely as they are their own benefit among industry confreres with
‘pay as you play’ schemes made notorious in financial industry investigations. Hiring hedge funds
and alternative asset advisors is claiming panoply of fees for guidance services being subcontracted
to fellows of the class. Such serial subcontracting just inflates the cost for poor performance.
Many more baskets can seem prudent practice for carrying the nest eggs. One needs to check for
holes and safe handles. Evaluating equity quality seemed lost art given recent bubbles they had
bought and lost. The Yale model was a new direction from pedigree source as manna to fund
managers. But buying heavily into private equity positions, funds and real estate creates illiquidity
and buys inherent risks. Better you choose sturdy baskets with sound handles on the business you
are minding, or holding. Good fortune with darts matters more than rote they suppose are financial
algorithms that actually arose from poor interpretations and pretenses in science.
These social endowment fund managers draw whatever they can in salaries, fees, sales (more
donations are always needed) and overhead costs by use of what are known inadequate investment
methods. These methods are those same used by banks and insurers creating mutual funds as

“
Page 5 of 6 May 2013 © Copyright StockTakers Limited
The author does not provide investment advice. In order to use reproduce or convey the
in any way, written agreement must b
StockTakers Limited is an Alberta corporation providi
StockTakers Limited encourages your seeking tax law advisor for capital gains tax
Alice, meet Dr. Dodgson
financial products to exploit small investor savings for their taking fees.
They are not changing their tools or sharpening those they have.
took the “regular courses” to be certified in
is of their own c
“I only took the regular courses,” sighed the Mock Turtle.
“What was that?” inquired Alice.
“Reeling and Writhing, of course, to begin with, and then the different
branches of Arithmetic
Derision.”
Noise and gossip drive price and earnings
social beast politics serves as well
Conventional investment "fundamentals" are based in price and projected earn
fleeting and unreliable measures,
the corporation (virtual, though not irrelevant)
wish-filled projections in Punch and Judy puppet
newsy reports of flimsy, often
entire investment industry is gossip
What convention offers as 'fundamentals' for investment guidance
but not flawless. Graham and Dodd made
the business enterprise. Price, earnings and intrinsic values
surficial attributes unlinked to the firms’
obtained through its social role limiting liability
creation of the ‘fictitious person’
Investors need to know more, have some real
patterns of convenient thought experiments
Alice whispered, “Somebo
business!”
“Ah well! It means much the same thing
and the pounds will take care of themselves,
To successfully invest you need
defends your capital, keeps it safe
Our "likeables" are based in our new fundamentals
known. That is from our new theory of the firm
corporations as social creations
new fundamentals.
Our "likeables" are determined by the internal
its debt is at the core of our new theory of the firm
StockTakers Limited, All Rights Reserved. Copying Prohibited.
written agreement must be obtained from the author or its agent Architypes Inc.
They are not changing their tools or sharpening those they have.
took the “regular courses” to be certified in a self regulated industry
of their own creation, more impressive fiction than it is
“What was that?” inquired Alice.
branches of Arithmetic – Ambition, Distraction, Uglification, and
Derision.”
Noise and gossip drive price and earnings in any direction that may be contrived.
as well.
"fundamentals" are based in price and projected earn
measures, just chatter and noise. Both are external
(virtual, though not irrelevant). Price has no mass, and earnings are misleading
Punch and Judy puppet-shows that can be and often are manipulated in
artfully biased when not intentionally tales wagging
gossip-based in such flotsam riding the waves of loose conjectures
offers as 'fundamentals' for investment guidance is largely unchanged since 1934
Graham and Dodd made a nice step, but half-measure as based in externalities of
Price, earnings and intrinsic values (as if there are self
surficial attributes unlinked to the firms’ very founding in its debt obligations. Those
limiting liability grounded in a conflicted legal history accepting the
’ without responsibility “to his buttons”3
as earlier business norms.
need to know more, have some real intelligence from critical thinking that convention
experiments do not offer.
Alice whispered, “Somebody said, that it’s done by everybody minding their own
“Ah well! It means much the same thing, and the moral of that is ‘Take care of the percents
ds will take care of themselves,’” said the Duchess.
you need to Know What You Have and only Have What You Know
, keeps it safe. That lets your capital grow in value outpacing inflation.
our new fundamentals, the Risk Price (SF) of the company is
is from our new theory of the firm4
arising in law, economics
as social creations we have proven logically and mathematically
Our "likeables" are determined by the internal realities of corporation's debt. How the firm manag
its debt is at the core of our new theory of the firm. Debt-financing and obligation
Minding Your Own Percents.
They are not changing their tools or sharpening those they have. They all
a self regulated industry that
more impressive fiction than it is science.
Distraction, Uglification, and
in any direction that may be contrived. Rhetoric is the
"fundamentals" are based in price and projected earnings. Both are
values to running
Price has no mass, and earnings are misleading
that can be and often are manipulated in
tales wagging dogs. The
of loose conjectures.
unchanged since 19342
based in externalities of
(as if there are self-evident truths) are
obligations. Those structures are
history accepting the
as earlier business norms.
intelligence from critical thinking that conventional
that it’s done by everybody minding their own
is ‘Take care of the percents
Have What You Know. That
outpacing inflation.
of the company is our
, economics and philosophy of
mathematically consequences, our
rporation's debt. How the firm manages
financing and obligation is the essential

“
issue of corporations’ framework from inception of their legal structure as 'fictitious persons' under
management in the 1800’s (under protests of manager agency potent moral hazard). How debt
structures feed a business idea and obligations are met is ageless to any firms’ success, solvency or
ruin. Risk Price is based on debt structures integral to the firm we discern from its balance sheet.
Equities trading above our benchmark Risk Price are those investors tend to like. Two of three
continue to price rise due investors’ preference. These equities are “likeables.” They are revealed
by their rise above Risk Price, the measure that investors must know to defend their capital. It is the
real intelligence investors need5
but never had. Risk Price is practical benchmark for capital safety.
The "likeables" are the ‘Grail’ portfolio builders investors need. These provide capital safety
obtained through AlphaSmart gains while protecting the downside and always remain liquid as
cash, only better than cash by growing value in the long term. That is very different metric. The rest
of the firms in the market have difficult or compromised debt structure under management. Those
we reasonably call the ‘Goats’ rogues that will likely eat your grass, graze your wallet, and leave,
wealth takers, under management. Those rogue ’Goats’ you do not want their risky business.
Clear, concise and consistent. The equities we hold are “likeables” tending to gain 67% of the time.
We do not make stock prices but can reasonably respond to stock price tendencies, by our knowing
the price of risk, the downside, and buying and holding accordingly. That is new fundamentals from
our new theory of the firm. Know What You Have. Have What You Know
Our view is risk averse. Of course we require 2&20 fees for doing that. Mail us for our help.
Hans Goetze,
Architypes Inc and StockTakers Limited
Head Office
76 Midridge Close SE
Calgary, AB
T2X 1G1
351 Chemin Boulanger
Sutton, PQ
J0E 2K0
450 538-1270
1
http://www.nacubo.org/Documents/research/2012NCSEPublicTablesEndowmentMarketValuesRevisedFebruary42013.pdf
2
B. Graham and D. Dodd, Security Analysis, 1934, and, The Intelligent Investor, 1949
3
The famous “Names” of Lloyd’s Market once bore unlimited liability for their contracts as debts to redeeming even silver buttons
on their shirts.
4
E. Goetze, The Modal Geometry of the Firm and the Balance Sheet Worth of the Trading Connections, 2009
5
http://riskwerk.com/2013/05/18/the-real-intelligent-investor/

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