Obermatt stock portfolio
We buy the stocks we discuss
Obermatt CEO Dr. Hermann J. Stern is saving for his retirement by investing in stocks, which he found in the Obermatt Top 10 stock lists. You can track his stock purchases on our investing insights blog every week. These stock purchases are not recommendations. They are provided for instruction purposes so that you can make your own stock investment decisions. The latest performance of Stern's portfolio of all his stock investment decisions can be found here:
Last updated on July 11, 2022. The status of the Obermatt portfolios is updated once a year in January. We recommend that you do this rarely for your own portfolio, too. Frequently looking at portfolio values may mislead you.
Every currency shows a different performance picture
The Obermatt portfolio performance was calculated in Swiss Francs. If you use a different currency for exactly the same payment flows (deposits and withdrawals) and the reporting of the portfolio value with profits and losses, the picture is usually different. In Euros, British Pounds and US Dollars, 2018 was still slightly negative, while it was already positive in Swiss francs (above, showing a small profit):
The fact that every portfolio can look slightly different in a different currency, or quite different in the case of major changes in exchange rates, is a good illustration of the limited informative value of historical returns. Depending on the currency chosen, the exact same stocks and cash holdings suddenly look different. This is one of the reasons why historical returns are of little use as investment performance information.
Obermatt's investment principles for successful stock investment are simple
For his investments, Stern uses Obermatt's principles as described in the Obermatt Investing Handbook:
- Buy shares on a regular basis, invest only 5% of the total value per purchase. For a total portfolio value of 100,000 invest 5,000 per stock (company). If you are beginning investing, you will invest a higher proportion of your total amount which isn't a problem as long as you continue saving and investing. You will eventually arrive at a diversified portfolio of at least 20 stocks (better 30 to 50).
- Distribute the investment across different regions and sectors to minimize the risk.
- Primarily buy shares of large companies, because many of these companies’ executives make sure that the company is successful.
You can do it yourself
To help you learn how to build your own portfolio, we show all the decisions on our blog and send you regular Top 10 Stock lists in the markets that interest you in the free Stock Update. You can also use the following Google Sheet as a simple portfolio management tool with the Obermatt method:
What you need to do to build your own stock portfolio
- Open an account at a discount brokerage and transfer your money. Brokerage comparison: Switzerland, Germany.
- Subscribe to our free Obermatt Stock Update and read the Obermatt Investing Handbook for more guidance information on successful stock investing
- You will receive weekly Top 10 Stocks with your Obermatt Stock Update when they are published for a market you selected. You can study the stock more closely at Obermatt, and you may google for further information and visit the company’s website before you buy through your discount broker.
- To search for stocks or to sort stocks according to different criteria, use the Obermatt database that premium customers receive weekly with the Obermatt Stock Update email as CSV file. You can open the file with Google Sheets, Numbers, LibreOffice or Excel.* The Obermatt database file contains all information that Obermatt calculates.
- Maintain and track your stock portfolio. The easiest way is to enter all of your stocks into a Google Sheet and input the Obermatt database. Now you will have and know the most recent rankings of your stocks. In order to decide whether to buy or sell a stock, you can easily set up investment parameters or price thresholds.
*: For Excel, use "file", "import", "CSV file", "Unicode (UTF-8)".
How good were the Obermatt Top 10 Lists in the past?
In the beginning, we compared the returns of the Obermatt Top 10 stocks with the returns of popular stock indexes. We discontinued this practice because past returns are a bad indicator of future returns. Even worse, good past returns may motivate investments in those asset classes just when they are at the end of their upcycles. This may lead to disappointments. We display here our return comparisons from the founding period of Obermatt Investing: The Obermatt Top 10 lists outperformed the respective stock indexes the majority of the time for all years when we conducted this analysis:
We have stopped tracking returns because it is a theoretical exercise and gives a false sense of security and, perhaps worse, sends false signals because past returns are not a good indicator for future returns. We have many educational videos on stock investing and, perhaps more importantly, videos on the typical mistakes in stock investing that are far more valuable than checking past returns.
How good are Obermatt Top 30 stocks?
Ten stocks are too few for a broad-based portfolio (diversification). For this reason, we have examined how the best thirty stocks have performed for eighteen of the most relevant markets since the publication of the Obermatt ranks in 2014.
When measured over four years and eighteen markets, the best 30 stocks identified by the Obermatt method have a 4.4% to 6.0% higher return per year compared to the corresponding benchmark indices. More importantly, the Obermatt Top 30 were better than the index in 72% to 79% of all cases. In other words: In four out of five years, the Obermatt ranks performed better than using an index fund. The whole report is available online as a PDF, all data can be obtained as a spreadsheet from Obermatt upon request.