Klass (@oroumann) is an experienced investor who has worked in various fields and owned businesses in several countries. After spending some time on eToro, he discovered CopyPortfolios and started investing through them, as a long-term, complementary investment option to his day-to-day trading portfolio. Check out our interview with him below:
This is not investment advice. Past performance is not an indication of future results. Your capital is at risk.
- Tell us a little bit about yourself?
My bio is everything but linear. After finishing school in Germany I moved to Mexico, where I did an apprenticeship with the customs broker TRANSUNISA SA. At the tender age of 21 I became the manager of one of their subsidiaries and only later decided to study economics. At 30 I became the director of the Danish subsidiary of a German graphic peripherals distributor and later set up their Swedish and UK operations. My family members have multiple nationalities – so I guess we “think we are from everywhere” and that’s how I invest.
- How did you end up leading FotoInsight?
While studying an MBA in 2003 and with two children in independent schools in Cambridge, I was heading for financial meltdown. A large photo lab that I knew well was going digital. We set-up “FotoInside” to sell their photobooks, prints and calendars. But most internet connections were not providing sufficient bandwidth, so it wasn’t going anywhere. Even worse: Intel was threatening us with their claim over the word “Inside,” which frightened the partners away. I ended up with the whole business and rebranded it as “FotoInsight.” Actually, the Intel threat provided benign press coverage – you could say Intel powered FotoInsight’s European expansion.
- As well as being an entrepreneur you have been investing in the financial markets. How did you get into the field?
In my twenties, I used to invest clients’ deposits for duty payments in the stock market, basically investing other people’s money for a few weeks at a time. Mexico had a 150% annual inflation, which meant that you could cream off phenomenal profits, though risk prevention and diversification were still paramount for me.
Today, apart from dealing in shares, often of smaller companies below the market-cap required for eToro, I also look after my family’s estate and shares, though neither of the banks’ online trading systems are as engaging as eToro’s. I also occasionally blog about my trades.
- Why did you then decide to invest on eToro?
After a ten-year growth streak and with a frenetic twitterer in the White House occasionally shocking investors, stock markets have become jittery. To counter this, I like to trade some Contract for Difference (CFDs) sell positions. Several platforms offer CFD trades and thereby the option to sell (or short) a stock. I came to eToro because trading on its platform is particularly fast and easy and the international range of stocks and marketplaces is larger than most. eToro covers the main cryptocurrencies too, as well as offering managed investment strategies, CopyPortfolios. I have stayed with eToro, because trading on a social platform is more engaging and you learn a lot.
- You mention CopyPortfolios, which ones are you investing in?
I tend to hold a diverse range of mainly European stocks, often in companies I know from the inside. I currently complement my portfolio with two US focused Copyportfolios designed by eToro: ‘BigTech’ and the very interesting ‘OutSmartNSDQ’ Portfolio. Both require an investment in excess of $5,000 each.
- How long do you plan to invest in these Portfolios?
I am into ‘OutSmartNSDQ’ and ‘BigTech Companies’ for the long term. Even though these CopyPortfolios have so far outperformed the market, they tend to go up or down when the stock market does. I will close these investment positions if I foresee a sharp decline on Wall Street. I would also consider redistributing my investment if I came to the conclusion that eToro has designed a new, more attractive investment strategy.
- In regards to new CopyPortfolios, are there any specific ones that you would like to see on the platform?
While most pharmaceuticals are suffering from rapidly increasing development costs and a shrinking pipeline of new medicines, there are areas like CRISPR and Medical Marijuana I would like to invest more in, possibly through a CopyPortfolio.
I feel that we have come through a correction in the valuation of Renewable Energy and Artificial Intelligence (AI) and would welcome international funds covering these. Fashion stocks like Luxottica, Kering, Inditex, Hermès and Adidas have been growing and would present an interesting international portfolio option in the consumer goods sector.
Female traders are in the minority. That several female popular investors have a lower risk score suggests that they invest differently. So I would like to add an ‘eToro female popular investors CopyPortfolio’ to my wishlist.
As the US stock market’s valuation is second to none, most funds include mainly Wall Street stocks. But I would love to see a EuroStocks fund and, while probably difficult, a German “Maschinenbauer” Portfolio.
On the other extreme of my wish list would be a kind of penny stocks fund, covering devalued companies where there is still substance left, e.g. Spanish engineering group Abengoa, the Italian ‘Banca Monte dei Paschi di Siena’ or international furniture group Steinhoff International Holdings NV.
- What do you think differentiates CopyPortfolios from investing elsewhere?
I am keeping an eye on the strategies of eToro’s most popular investors and CopyPortfolios and regularly update my blog post about their performance. Once I have analysed interesting options, keeping a part of my investment in a successful, managed portfolio saves time, allowing me to focus on my other trading positions.
Because the Portfolios follow criteria different from my own, they include stocks that help to diversify. Some Market Portfolio’s allow investors to diversify into specific industries, where they might not otherwise feel comfortable: CRISPR, CryptoPortfolio or PanicMode (when its time comes) spring to mind.
- What are your hobbies/interests?
I am interested in politics and blog and tweet about it. I also campaign for sustainable transport and cycling and love cycle touring. I used to clock up a few thousand miles per year riding my touring bike, though since I have a larger garden now, I have had less time for cycling. Lacking time, I try to build exercise into my schedule, and sometimes, I even hop on my bike after trade fairs or meetings to cycle back home over hundreds of miles.
- Please share links to some of your online activity:
My investment blog: http://exactresults.com/wp/profit/
My political blog: http://counter-offensive.blogspot.com/
FotoInsight UK: http://fotoinsight.co.uk/
Twitter profile: https://twitter.com/iitm
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
This is not investment advice. Past performance is not an indication of future results.
Cybersecurity took center stage in 2018 and could present an exciting investment opportunity
Cybersecurity has always been a topic of importance for both enterprises and individuals. However, 2018 was riddled with events that highlighted just how crucial an issue it is, following privacy breaches such as the Cambridge Analytica Facebook scandal. With renewed interest in online safety and privacy, cybersecurity stocks are attracting increasing attention in the investment world.
2018 – the year of the hack
The attention to online privacy reached new heights in 2018, following the Cambridge Analytica scandal, which jeopardised the data of some 87 million Facebook users¹. The scandal put in question many of Facebook’s user privacy practices, resulting in Founder and CEO Mark Zuckerberg testifying before Congress. A month later, the General Data Protection Regulation (GDPR) came into effect in the EU, applying new restrictions on any entity that collects personal data.
The dynamics of online security
One of the reasons cybersecurity is, and will remain, a hot topic is the ever-changing nature of the online world. With so much sensitive information being stored in the cloud and on computer networks, the risks are ever growing and the need for effective cyberdefenses is ever present. From “simple” risks, such as phishing scams, to complex ransomware programs and crypto mining bots, each person and enterprise with an online presence is in danger of falling victim to a cyber attack.
The cybersecurity industry is huge, estimated at more than…
Mobile payments is a big market – and it’s about to get much bigger
In recent years, mobile payment has become a key method of online shopping and other forms of eCommerce. With more members of Generation Z, who grew up in a world where smartphones were not an innovation, but a reality, this segment of the financial space is expected to grow tremendously in coming years. With more smartphones in people’s pockets and an increasing number of countries shifting towards cashless economies, it is no surprise that many of the leading payment technology companies in the world are constantly working to introduce new and improved payment solutions.
In 2016, the mobile payment market was valued at $601 billion¹. By 2017, it grew to nearly $720 billion², and it is expected to cross the $1 trillion milestone in 2019³. Forecasts suggest that it will continue to grow, reaching anywhere between $2.7 and $4.5 trillion by 2023. This growth will be prompted by many catalysts, which will both get more people to use mobile payments and make it easier for existing users to conduct more of their transactions with mobile devices.
The introduction of mobile internet and smartphones placed mobile payment at the fingertips of billions around the world. As the industry grew, more users started using mobile payments, due to its seamless, frictionless nature. Moreover, using an application for making payments gives the user more transparency and control over their finances,…
Big banks, big opportunity? Earnings season kicks off
Each quarter, publicly listed companies share their earnings reports with their investors and the general public. These reports provide insights into each company’s performance and more often than not, impact their stock prices. Over the next six weeks, companies will be sharing their reports for the fourth quarter of 2018 (Q4), with major banks kicking off the earnings season.
Reporting earnings in a challenging market
This earnings season has a very meaningful backdrop, as Wall Street has been heavily impacted by external forces recently. Firstly, the Fed’s drive to hike rates over the past year, with four rate hikes in 2018, has put pressure on the market.
Perhaps the most important factor causing Wall Street to struggle recently has been the rising yield of 10-year bonds. These bonds, issued by the US Treasury, present a relatively low-risk investment option and produce steady returns twice a year. When the interest produced by these bonds is high, it could push investors away from the stock market, as the safer option is now also high yielding. Recently, 10-year bond yields have been giving investors interest rates of 2.73%.
Entering this earnings season, many companies face the challenge of remaining a lucrative investment option for their shareholders. For some companies in the financial sector, this season might be especially crucial, as they have to recover from less-than-impressive results last quarter.
Banking on earnings…
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