At the start of the year, RBS analyst Andrew Roberts grabbed headlines with a “sell everything” note to clients. So gloomy was Mr Roberts that he could not think of an asset class that was worth investing in, other than high quality sovereign bonds. Everything else, Roberts reckoned, was going to hell in a handbasket.
He certainly gained a lot of publicity for himself and his firm, so well done. But so outlandish was the claim that I offered to bet him $10,000 that on 11 variables he indicated the price would fall, with the winner only needing to get six of the 11 in the right direction to win. Here is that offer; https://thekouk.com/blog/sell-everything-my-challenge-to-andrew-roberts-of-rbs.html
Alas, Mr Roberts refused to put his own money where his mouth was and the bet did not eventuate.
While it is still early days for 2016, I thought it prudent to see how my offer to Mr Roberts is going.
The early signs are that 10 of the 11 variables that Mr Roberts said should be sold have risen and only one, Chinese stocks, have fallen.
So at the end of the first month, it is The Kouk 10, RBS Roberts 1.
And had one placed an evenly weighted investment holding those items Mr Roberts suggested were to be sold, the gain (excluding dividends, rent and the like which favours the long position) is a handsome 1.63 per cent.
The table is below.
SELL EVERYTHING BET
Level at time Latest Difference
of bet %
US stocks S&P500 1925.0 1940.2 0.792
Brazil stocks Ibovespa 39500.0 40406.0 2.294
China stocks Shenzhen 1850.0 1766.2 -4.528
Japan stocks Nikkei 17200.0 17821.6 3.614
US house prices Case-Shiller 182.83 182.86 0.016
UK 20 city house prices Hometrack 228800 232500 1.617
Sydney house prices Corelogic 915.00 919.83 0.528
Iron ore US$ tonne 40.50 41.50 2.469
Oil WTI US$ barrel 31.50 32.92 4.508
Copper US$ tonne 4325.00 4570.00 5.665
AUD/USD 0.7000 0.7065 0.929
Simple average gain +1.628
I aim to update this score sheet approximately every month. I still reckon I will be more right than wrong.