Previously I said investing in Russian Bonds was a good idea.  It turned out to be right as Russian bond yields have come down considerably as you can see here http://www.tradingeconomics.com/russia/government-bond-yield

Russian businesses are highly undervalued at 1 – 3 times earnings (PE, Price/Earnings Ratio).  Meaning your buying businesses at 80 – 90% off based on that metric.  There is reasons for this such as the fact that Russia is a highly corrupt place but still India is corrupt and businesses are fairly valued.  Its moreso the reason because of the fact that Russians in some sense are Eur-Asians.   Russia is both in Europe and Asia at the same time, but who knows what im talking about on this front im just a financial analyst.

Right now Market Vectors Russia ETF (RSX) has a 3.59% trailing yield which is pretty good, it will probably be more than that this year but who knows.

Im still in RSX and may get out at any time but ill probably be in this for another 3 – 24 months at the least.

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

Im sorry if this idea is not sexy enough for some but making a solid 9 – 10% yearly (a 5% to 6% dividend plus appreciation) is good in my books.  Your money is doubling in 7 years which is not bad http://en.wikipedia.org/wiki/Rule_of_72).

These 2 mutual funds are balanced funds and with no further ado here they are:

1) http://funds.ci.com/GeneratePDF.aspx?FSID=6803&Language=en which over the last 10 years has returned 9.85% annually as of March 4 2015 as found here http://funds.ci.com/Default.aspx?tab=LongTerm
2) http://funds.ci.com/GeneratePDF.aspx?FSID=686&Language=en this fund has returned 10.82% annually over 15 years as found http://funds.ci.com/Default.aspx?tab=LongTerm

As a note these funds may say “High Income” but do not confuse this with “High Yield Bonds” they do not have large exposure to that asset class.

These 2 funds pay a monthly dividend in the 5% to 6% range as they have exposure to high yielding value stocks, basically huge companies that pay generous dividends.

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

This trade is not in the opinion of the management/owner of this Blog TheValueSwan.com .

Prior to the early 1990s the investing business and investing in companies took a lot of work and mostly depended on connections.  Now that there is the Internet we can invest in the stock market easily, and knowledgeably, or we can invest in private companies or people from the developed world to the developing world with ease.

Restaurant Brands International (QSR) Owner of Tim Hortons and Burger King just released its full year and 4th quater report here http://www.newswire.ca/en/story/1488097/restaurant-brands-international-reports-full-year-and-fourth-quarter-2014-results and the stock has since rocked up 7% as of 11AM EST February 17 2015.  The stock has since rocketed up because of Burger King same store sales up 3% yoy, Tim Hortons up 4% yoy which is phenomenal.

Some analysts have been saying that QSR is going to be the best performing stock in the TSE this year and I agree with that assessment.

Here are the highlights to the full year and 4th quarter report

Full Year 2014 Highlights:

• Tim Hortons (TH) comparable sales increased 3.1% and Burger King (BK) comparable sales increased 2.1%
• Delivered 186 net restaurant growth (NRG) at TH and 705 NRG at BK
• System-wide sales grew 6.6% at TH and 6.8% at BK in constant currency
• TH Adjusted EBITDA grew 10.5% on an organic basis to $816 million
• BK Adjusted EBITDA grew 11.5% on an organic basis to $726 million
• Paid Burger King Worldwide Inc. dividends of $0.30 per share or approximately $106 million

Fourth Quarter 2014 Highlights:

• TH comparable sales increased 4.1% and BK comparable sales increased 3.0%
• Delivered 81 NRG at TH and 412 NRG at BK
• System-wide sales grew 7.4% at TH and 7.7% at BK in constant currency
• TH Adjusted EBITDA grew 10.2% on an organic basis to $209 million
• BK Adjusted EBITDA grew 8.8% on an organic basis to $189 million

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

The guy that runs this is named Prem Watsa and is nicknamed the “Warren Buffett of Canada” as he has made consistantely great investments since near the beginning of his career at in 1985. Even in the 1 year chart for Fairfax Financial Holdings, the company is up 50%+ year over year.

He has recently introduced (about a week or 2 old) a fund which is essentially a stock/etf/mutual fund of India named Fairfax India Holdings () . Basically this fund solely invests in India a market where the average salary is $4000 US a year (Rougly $330 a month ). The East Indian market has a lot of room to grow and could potential go nuclear (go huge fast) because of President Modi.

President Modi has offered a huge amount of reform and will most likely get his reforms done as he has a huge majority. He has awarded people roles in his government based on merit and not political connections.

The savings rate in India is only 33% which is not that high for a developing 2nd world economy as found here but it is still pretty high and a lot higher than 1st world countries at around 1 – 15%.

Now back to Fairfax India Holdings. Presently they released at $1 billion market cap and will be investing in private as well as public companies, so they will buy parts or all of a company or they will buy securities like stocks or bonds.

It is very hard to lose money in India at the moment other than if its Fraud on the part of a partner. If you take a look at Mutual Funds such as Birla Sun Life ’95 Fund and Birla Sun Life Tax Relief ’96 both have 25%+ yearly returns since there inception in 1995 and 1996. Which means you could have made 80 to 180 times your money since inception.

Right now there is not much information on Fairfax India Holdings as it is extremely new and sometimes companies dont release good documentation till the 1st quarter of operations is done but granted that its run by Prem Watsa the man who runs Fairfax Financial Holdings and was Chairman and CEO since its inception.

Prem Watsa does have a CFA (Chartered Financial Analyst designation) which is the hardest designation to get in the financial field as hard as getting a Ph.D in Finance and he is only 64 years old. Furthermore he is worth $1.3 billion as he owns 10% of Fairfax Financial Holdings a $13 billion dollar corporation.

You will note that Fairfax Financial Holdings bought Blackberry in 2013 for $4.7 billion dollars. We will have to see if they made good money on this deal in the coming years but a stock appreciation of 52% year over year is pretty good.

We will have to wait and see if Fairfax India Holdings can make substantial returns much like how Fairfax Financial Holdings has, I believe it will and am invested.

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

The bitshares ecosystem is on fire with the announcement that the development of a new DAC (Decentralized Autonomous Corporation) + Bitassets (Assets under the Bitshares SuperDAC/Brand), ie Cryptohedge.io and CFSassets is coming online.

Lets cut to the skinny, what is going on?  Basically Cryptohedge.io is releasing market making bots and is going to back it up with the asset of bitshares/bitgold and Gold Futures (the last one having counterparty risk)  Now dont get worried just yet about Gold futures having counterparty risk, it is a highly liquid and a multi-multi billion dollar market as you can see here http://www.cmegroup.com/trading/metals/precious/gold.html which shows a market of over 100,000 traded in the day (each contract found here http://futures.tradingcharts.com/specs/ is 100 ounces or roughly $120,000 US Dollars per contract which comes to over $12 billion dollars traded in the day (roughly $20 billion and just in the CME Group but whose counting really).

Now the negatives out of the way, is this actually a good investment?  Most likely yes because they are performing arbitrage in a market that has no real competition as of yet.  Furthermore, as long as there is a market they will be able to skim off a little bit to constantly increase there NAV (Net Asset Value).

How good can these bot/arbitrage mechanisms be in terms of profitability?  Well basically the best market making or arbitrage firm in the world which uses the power of mathematics and physics is https://www.rentec.com/Home.action?index=true .  The guy that started it James Simon is worth $14 billion dollars and is known as the “Quant King,” he really is.  With returns after commissions over 35% – 40% a year meaning hes making 45% – 55% a year.  It is true he is not just an arbitrager and that he uses the power of his mathematics University Ph.D teaching degree as well as trend following, special situations, and most likely high frequency trading (he is most likely doing this  in his alphabet soup of technique.)

Anyways sorry for getting off topic but if they dont get hit by a black swan and if the market for bitgold/bitcoingold/goldfuturesgold is big enough and more competitors dont come in (there is probably room for 2 – 4 big firms in the future).  We could see some serious gains, upwards of 20% a year.  Truth be told they may have a few 100 – 200% years and I may be wrong and every year for 10 years they could make 75%+ bringing there asset into the multi billions, much like Renaissance Technologies LLC $25 billion under management.   These guys could do it too, it will come down to there ability.  We will have to wait and see.

I will keep you updated with developments and you can follow me below on twitter or like my page on facebook to keep updated

You can read the Prospectus for CFSgold here http://cryptohedge.io/wp-content/uploads/2015/02/Prospectus.pdf

 This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

Would you invest along side the 3rd Richest man in the world, Warren Buffett, if you could?

Do you feel bad missing the 1000% run-up of Tesla Motors (https://www.google.com/finance?q=NASDAQ%3ATSLA&ei=b8_NVPm3CqK1iAKimoD4Cg )?

Well there is a company in China, on the Hong Kong Stock Exchange, that you could invest in that Warren Buffett owns 10%.  The company is BYD Company symbol 1211 .

This company is an electric car maker that has seen its shares go in 2005 at $12 hong kong dollars to 2007 $70 hong kong dollars then it collapsed because of the 2008 crisis to $8 hong kong dollars then to $85 in 2009 and now is back to $28.

The wild ride took place because of a subsidy that the Chinese government removed for electric cars.

This BYD Company is the worlds biggest electic bus maker and one of the worlds biggest battery makers so it is diversified.It is also producing many different electric cars while Tesla is just producing 1 electric car type.  BYD is definitely ahead of the game.  Furthermore, it is getting into the energy storage business.  Notwithstanding, the company is vertically integrated and controls even the Lithium mines for its batteries.

One company named Longboard with CEO Cole Wilcox predicted that Tesla would hit $200 a share and it did.  They are now predicting BYD to go to $100 a share in 18 months from the $28 it is right now.  It is possible but even if it goes to $50 a person would be very happy.

Lastly BYD’s CEO Wang Chuanfu is to China as Elon Musk is to the US.  Wang Chaunfu is absolutely incredible and has built an incredibly strong company.

As of the writing of this article the company has a small 0.22% dividend.

As the Chinese are transitioning over to a consumer based economy that is trying to be more and more “Green” this electric car company will gain steam.

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.

Is there really a worry the government of Russia is going to go bankrupt when as of 2013 Government debt took up 7.9% of GDP as found at CIA Factbook: Russia .  Most statistics are taken from CIA Factbook unless are opinions.

My central view is that Russian government debt is a steal (good buy) if you can get it.

This was mostly a political move to crush Russia, Moodys is a government licensed rating agency, essentially a monopoly with just 2 other agencies.

Unemployment in the country as of 2013 was 5.8% and incomes were $18,000 US a year when just in 2000 incomes were as low as $4,000 US a year, a huge improvement.

The government has a small government deficit as of 2013 and this year may have a significantly higher one at $30 billion to $100 billion.  But they have reserves of $400 billion and gross national savings of 28% which is good.

Russia also has 80 billion barrels of oil which is an estimate and is probably in the range of 500 billion to 2 trillion barrels because they most likely have oil sands or shale oil like the US and Canada, Russia is a country that is mostly unexplored and very sparse with only a population of 142 million with a land area of 17 million sq kilometers.   The amount of land is mind blasting and should be taken as a significant advantage.   Putin really did not need the warm water port and should just focus on the Arctic and making money not cold war mentalities of defeating the evil America, its just not that important.  Russia is a corporation now, it is not a dictatorship.

If they have 80 billion barrels of oil it means they have $3 trillion dollars of wealth, if they have 2 trillion which I believe they do, they have roughly $90 trillion in value there, thats trillion with a T.  All in US dollars.

Also as a note because of the corruption in Russian companies trade at PEs (Price to Earnings Ratios) at less than 5, Gazprom is trading at a PE of 3 which is 3 years earnings.   When the war in Ukraine is over and everything goes back to normal for a reasonable period and corruption is wiped clean, you could see Gazprom trading at a PE of 10 or higher meaning Gazprom is undervalued by 300% right now.

Also as a note Gazprom is probably a great investment with a 6.67% dividend which I will look at (Gazprom the stock) in a later article.  Remember it is 50.01% owned and controlled by the government, meaning it wont be going bankrupt anytime soon.

This material has been prepared by Thevalueswan.com . This document is for information and illustrative purposes only and does not purport to show actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No representation is being made that any account, product, or strategy will or is likely to achieve profits, losses, or results similar to those discussed, if any. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Thevalueswan.com , other than to your employees. This information is provided with the understanding that with respect to the material provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Thevalueswan.com does not purport to and does not, in any fashion, provide broker/dealer, consulting or any related services. You may not rely on the statements contained herein. Thevalueswan.com shall not have any liability for any damages of any kind whatsoever relating to this material. You should consult your advisors with respect to these areas. By accepting this material, you acknowledge, understand and accept the foregoing.