Philipp Haas, on building a fund with good performance & social media

Here you can enjoy our conversation with Philipp Haas of the Haas invest4 innovation S fund. Philipp is a GARP investor with a great performance. He has built his fund over the last few years by using the power of social media.

YouTube

By loading the video, you agree to YouTube’s privacy policy.
Learn more

Load video

PGlmcmFtZSB0aXRsZT0iUGhpbGlwcCBIYWFzLCBob3cgZGlkIHlvdSBidWlsZCBhIHN1Y2Nlc3NmdWwgZnVuZCB3aXRoIFlvdVR1YmUgJmFtcDsgYSBnb29kIHBlcmZvcm1hbmNlPyIgd2lkdGg9IjY0MCIgaGVpZ2h0PSIzNjAiIHNyYz0iaHR0cHM6Ly93d3cueW91dHViZS1ub2Nvb2tpZS5jb20vZW1iZWQvMjhBUFZobC1BNUU/ZmVhdHVyZT1vZW1iZWQiIGZyYW1lYm9yZGVyPSIwIiBhbGxvdz0iYWNjZWxlcm9tZXRlcjsgYXV0b3BsYXk7IGNsaXBib2FyZC13cml0ZTsgZW5jcnlwdGVkLW1lZGlhOyBneXJvc2NvcGU7IHBpY3R1cmUtaW4tcGljdHVyZSIgYWxsb3dmdWxsc2NyZWVuPjwvaWZyYW1lPg==

We have discussed the following topics:

Introduction

Check out Interactive Brokers

This episode of Good Investing Talks is supported by Interactive Brokers. Interactive Brokers is the place to go if you are ever looking for a broker. Personally, I use their service. They have a great selection of stocks and accessible markets. They have super fair prices and a great system to track your performance. If you want to try out the offer of Interactive Brokers and support my channel, please click here:

Introducing Philipp Haas

[00:00:38] Tilman Versch: Hello, Philip. Are you currently in Munich? Where are you?

[00:00:41] Philipp Haas: Yeah, around Munich. We had to move out a little bit because we got small kids. We have a little more space and more nature out there, but it’s not far, and we are close to the exits. High living quality, yeah.

[00:00:54] Tilman Versch: You have just defined yourself as a father, but what is your role in the financial industry, in the finance world? Are you a finance YouTuber? Are you a fund advisor? What is your role?

[00:01:06] Philipp Haas: I would say I’m a fund advisor. I’m really a fund advisor for five years. All the other things I did before, I think, were aimed to reach that target.

[00:01:19] Tilman Versch: Your story is quite interesting because you have built a fund business that is now already very successful with three ingredients. One is transparency, one is the power of social media, and the third is a good performance. Your fund is currently at a size of around 10 million or so?

[00:01:38] Philipp Haas: Today it’s 24 million.

The fair PE

[00:01:42] Tilman Versch: Okay. Then I really have to update my numbers. Congrats on the remarkable growth of the assets under management. Let’s take this as a chance to go back in time and understand how you’ve built your fund business.

With YouTube, it’s quite interesting that we can take a look at your channel back in 2016 or some time way back to the first video you published. I would translate this video title with, “The fair P/E stock-picking strategy based on fundamental data and trends.” What is fair P/E? Do you still use this fair P/E today in your investing approach?

[00:02:25] Philipp Haas: Yes. I think it’s impressive because the strategy hadn’t changed since 2016 when I developed this model. It’s pretty basic at the end, but I think it combines many concepts. Because when I start a new stock, I don’t know. As a value investor typically, yeah? And then, you try to find low P/E stocks. I don’t know if it’s ’18 ’19. And then you realize, okay, a lot of companies, there’s a reason why the P/E is so low.

And then, I tried to combine quality and fair price. In the end, it’s a GAP investment model. It grows at reasonable prices, and that’s my strategy because, on the other hand, what we see a lot today is people who just buy a story. I mean, there are a lot of good companies, but if I buy a company for 30-40 times revenue, I think a lot of things are baked in. I try to find those good companies who trade for reasonable multiples. In the end, I think this model has 16 criteria and is adjusted from one to 10 scores. And then, there’s an average score between one and 10. And for example, the 10 would be the perfect company. It does or doesn’t exist. And the nine would be a worthless company, I think. I did 500 – 2000. Analyze like that, and I believe they are just 5-6-7 or maybe 10 companies with 9+ scores.

And for them, it’s a really high P/E. I think it’s justified. And then, an above-average company would be eight, and then it’s a 20 times P/E. But I mean, the model was developed when there were still interest rates in the market. And now, in times of negative interest rates, maybe you can also increase the fair P/E ratios that are not included in the model. For sure, it’s basic, and you can say subjective.

I’m not a native. I’m reading every day. Maybe one-two hours in English, but I’m not talking so much in English anymore because we went in a different direction. My YouTube channel is entirely in German because I already had the target group of German investors for the fund in the market opportunity. I apologize for my English, but I think the people will understand.

The model I’m still using today—that was the question. I have another model that was based on a fair P/E. If you translate it like that, it’s called QFMA. It stands for Quality Fundamental Momentum and Alpha. It has four steps. The first step would be 0.5% or even less waiting in the portfolio. This has just to be a quality company. The valuation doesn’t have to be very attractive, but the next step would be 1%. Then, it should have an attractive valuation for the fair P/E or another model, SOTP, or the sum of the parts or fair revenue.

The search step would be the momentum position that the long-term momentum is positive. The most important is called a core position. I try to find an investment case with an alpha odd year where I think I see something in the market or this company that the market hasn’t found yet. And if I’m right, I will generate alpha. And if I’m not right, it’s often not so problematic because it’s not baked in the price. Yeah, that’s my investment strategy if you want to sum it up.

Trend/momentum investment

[00:06:18] Tilman Versch: Don’t worry about your English. I already had interviews with natural German-speaking conversation partners, and they survived that as well. And we did a good discussion, so don’t worry about it.

In your models of analyzing a stock, you have a particular trend factor embedded. So, what role does trend play for you?

[00:06:40] Philipp Haas: Yeah. I mean, if you’re a value investor, you’re always making a little fun out of trend investing. But if you’re for long times in the market, especially in the short term, it plays a role, and I use it for the waitings. I rarely buy a company just because the trend is nice. But suppose you have, for example, four interesting companies, they’re very similar. I think it makes sense to invest more in a company with some attractive trends at the moment because you have other people looking for it. And also, if more and more algorithms invest in trend following, and often, it’s also risk protection because if the trend is positive, and you think the company is attractive, then probably your risk is a bit lower. Because if the trend is very negative and you think it’s the best chance ever, maybe you’re overlooking something, or nobody cares about what you’re thinking, or perhaps this changed, or it can take a long time, or even you make a mistake.

If you look at the huge mistakes even big-name investors made, they fell in love with one company. They think, “Yeah, I’m right.” They have big egos, and they’re always buying until the trend goes negative. I don’t want to do that. For sure, I stay invested, but not more than 1%. Even if I make a mistake or something happens that you cannot calculate, the fund performance of this year is not dependent on this 1% position.

Transparency & capability of Philipp’s algorithm

[00:08:15] Tilman Versch: you’ve mentioned two concepts I’m going to do a follow-up question on. One is the algorithm, the other is mistakes. So let’s start with the algorithm. You have a considerable portion of quantitative data in your framework to analyze stocks. Do you worry that this will be copied, and you will lose the alpha generated by this quantitative setup? Or is it very hard to copy it?

[00:08:41] Philipp Haas: I think it’s very hard to copy because the model works for me. I looked at a thousand companies, and I didn’t realize this was my model. I think if you just start. It’s very difficult. You have to have the knowledge of so many different companies that you say, okay, that’s an eight management or six management. And also, like an Alpha idea. It’s not something in the model of some thought you have. And for sure, if somebody sees that’s my Alpha idea, maybe people can copy it. But if I’m invested, it also helps the stock price, so I think I wouldn’t want to complain. And also, what you see on my YouTube channel. I always want to share what I’m doing. A lot of things are going well, but some stuff also doesn’t work, but you learn from it. And often, you get excellent feedback from people. I’m also using that.

It’s not like a quantitative model where you have some formula and then apply it, then somebody can copy it. Because the main input factors are subjective grades from me, from my knowledge, from my judgment, and I think that’s hard to duplicate. People should think more about quality evaluation momentum and alpha and combine those things. It’s maybe also may have been based on my personality. I try to combine the best things that work for me and from different schools of investing. I don’t want to be seen as just a value investor, just a growth investor, just a momentum investor. I try to pick everything that works for me. And if you combine it, I think it can work pretty well.

Mistakes & take-aways

[00:10:25] Tilman Versch: Let’s go to the next point on which I want to do a follow-up question. Its mistakes. What mistakes have you made over time with this model? How has it changed based on the mistakes you made?

[00:10:38] Philipp Haas: I think I made two kinds of mistakes. Mistakes where I didn’t apply the model. Because, in the end, is the trend positive or negative? It’s also a judgment call sometimes. And still, the final decision is made by a human, and sometimes there’s a consequence. That’s a mistake I don’t like. And then there are mistakes that I prefer not to call mistakes, but investments that went wrong. But if the model was suitable, I would do it again. That’s the typical cost of doing business.

I developed those models after huge mistakes I made, such as the fair P/E model. There was a German e-commerce company called Get Goods. It doesn’t exist anymore. That was a mistake. They were growing fast. Their evaluation was much more attractive than competitors, and they had considerable margins in electronic e-commerce. I always wondered, why can’t it be so much better than the others? And the management team had really not good CVs, but it looked so attractive, so I bought it, and it went bankrupt. It was a fraud in the end. Or, I don’t know what it was, but it went zero. And then, I realized that I had to include the soft factors in my model. And also studied at the University of St. Gallen in Switzerland, where we have the St. Gallen Management model with stakeholders, etc. I think they’re pushing there for 20 years. Now, it’s got more mainstream, but maybe that also influenced me.

I think mistakes in the model are more that I don’t apply the model correctly, but I really believe in the model. If the investment doesn’t work, you reduce the risks, etc. The huge mistakes were not on a single-stock basis in the last three or four years, but more like a macro was complicated. I mean, we had two china crises versus Trump now with the regulation. For me, that’s more difficult because I’m, in the end, a bottom-up analyst. I look at the company and try to adjust to the company’s perspective. I think I don’t have an edge on what the FED and Mr. Trump will do. Sometimes you have some feelings. Also, you’re managing the risk a little bit with the momentum. But for sure, it’s hard. Even if you reduce the risk, you still feel it in the performance.

Dealing with small & big companies

[00:13:17] Tilman Versch: Does the model work differently with different company sizes? How does it work with small caps? How does it work with large caps?

[00:13:27] Philipp Haas: Well, the big difference is liquidity. I mean, I managed the model for my private portfolio. I think it has had a return of a thousand or eleven hundred percent since 2012. But in the end, I didn’t have a market impact with this portfolio. So, it was a fund. Maybe it should change the momentum from 4% to 1%, or from 1% to 4%. Then, you would think twice about whether you change these weightings in the small-cap stock. And in the large-cap, you can trade in one day. I think that’s the huge difference. Otherwise, it’s not. And maybe it’s easier to find alpha ideas in a small-cap. But also, I would say there are alpha at least sometimes in large caps, especially if the media is very negative to one topic. Then often, there are chances.

[00:14:20] Tilman Versch: So then, do you think about limiting the size of your investment vehicles to still generate alpha in smaller mid-caps or not?

[00:14:32] Philipp Haas: No. My idea for a fund, it’s called Haas Invest For Innovation Instead. You can invest in all the growth companies. I call it stocks offensive. For sure, in the beginning, small caps have a more significant waiting, and maybe the portfolio would look really different if the fund is huge, but it’s not a small-cap factor. My investment strategy is not based on whether or not it is a small-cap. You can choose from more stocks. If you are small, maybe stocks are a 100 million market cap. There are 10 to 20% of the portfolio. So, it’s something, but it’s not the core of the strategy. And even if you would have 500 million, I think you still can invest in a 100 million company. You just can’t invest in this 4% waiting, then maybe you have it just over 0.5% or something.

Finding inspiration for the YouTube channel

[00:15:30] Tilman Versch: Maybe let’s go to your YouTube channel and look at the video from 2016 how the number of videos has developed till today. And maybe let’s try to scroll through it. Let’s see how many videos there are. YouTube is quite helpful. It gives us a count of the years. There are 1491 videos you’ve put out since 2016, and I calculated it by the days. It’s one video every 1.5 days. This is really impressive. Maybe let’s start with the question here: How did you get the ideas for the videos?

[00:16:07] Philipp Haas: Well, I would say in maybe 500 videos there, there are two minutes where I explain basic stuff. In the end, on YouTube, you have two choices. You can go for the number of searches or go virality. I first wanted to go for a search. The shelf life of this kind is also very long. I don’t know EBITDA or something like that. People are still looking three or four years later. They wanted to start this as a base. I believe it’s not very professional, but the videos are still there. And the other videos we used, I think was my model. I can analyze a stock, produce a video about it in less than one day.

I mean, I was doing that, more or less full-time for two years, trying to do one video a day. And it’s also, I would say, a part of my research process because I had the folders in my prior portfolio. I did the research. And then, as an add-on, I will produce a video. And then, I can help other people. I can discuss the stock. You can also create a part-time business partner because it’s very volatile if you just have the stock market and you lose money in some years. So, that was also the idea to have a side business and prepare to start an investment fund.

I think the model I did, especially with the low fees, I think it’s the cheapest fund for private investors in Germany for stocks. That’s just possible because there’s no middleman, and there’s no provision because people who know me can buy the fund directly. I think that’s interesting. I try to lower the fees for everybody. Like, with TradeRepublic at some time, others have to comply. I don’t know. He also saw there was a broker fee that came down. I mean, also active investing got a little bit like a bad reputation. But the problem is, most funds are too expensive and too close to the index but perceive your index as an independent. If you’re cheap, I think you will always have relevance. I think maybe we will see a revival of that.

Brand- vs. trust-building

[00:18:31] Tilman Versch: The YouTube channel was a tool to create some extra income, but I think it was more a tool to create a trusted brand, and maybe more the trust is as important as the brand. Is this true?

[00:18:45] Philipp Haas: Yeah. I mean, I realized this business at the end is pretty simple. You need 50% performance, 40% brand trust and reach, and maybe 10% intrapreneurship. I tried to focus on those three things, especially the two most important, you have to be good, but also people have to know that you’re good. And often from the personality, a lot of people there may be very good, but I have a friend who’s a very good investor, that if you talk to him, he doesn’t know what he’s doing. And if I don’t know it, he probably has huge problems that other normal investors will understand. I think it’s also helpful that you can explain what you’re doing in normal language. And like you see in my model, that’s not rocket science. But if you’re an experienced investor, you realize, okay, I’m using at the end academic proven outperformance factors and combine it with a bit of alpha and a little bit of knowledge. That worked in the past. Why shouldn’t it work in the future?

YouTube, definitely my idea of it was as a side business. But also for sure to prepare to start a fund and what’s very important for me is the topic of the financial application. I was involved in the start of a company called Finance CTE. I think it’s now the biggest financial education website in Germany, where people get explained how to invest or do taxes because so many mistakes are made, especially in Germany, because the financial literacy is, I would say it’s pretty low. I think it’s improved a lot in the last two or three years. Maybe also, thanks to YouTube channels like yours, but also, like, bigger ones who do more mainstream content. But I think it helped a lot. And yeah, that was also a motivation for me. And also, I wrote a book.

Philipp’s book

[00:20:43] Tilman Versch: Yeah. We have to link it here *, so people can find it.

[00:20:47] Philipp Haas: Yeah, it’s just in German, and it’s more about soft topics in life and why investing is so important. It’s not just about investing. It’s more like a summer book as a road trip, and the contents are a bit included in the summer story.

Early stages of investing

[00:21:07] Tilman Versch: I haven’t read it, but I’ve heard good things about it. So I will put it on my reading list for the summer. It takes a while before summer, but it’s something to be happy about. Maybe it’s also a good reason to thank you for all your work for the investing community because you helped many people understand stock picking.

We’re one of the channels that had a certain quality with it. So, it’s not that often that someone who worked as a fund manager at one big fund in Germany has this quality coming to the public and educating people, especially in Germany where financial education isn’t that big of a topic? Maybe tell us a bit more about the phase where you’ve been a fund manager. What have you taken away from this? Did it work?

[00:21:59] Philipp Haas: Yeah. I mean, I started with an investment blog in 2014. The investment, I think, was beneficial for me because I could develop my investment style. I did a lot of analyses there. You can read it on the Investor Search Book Net. But as a business, I have to say it failed.

I had two targets. I wanted to earn a little bit of money, but this didn’t really work out. I wonder if people know me and then buy my digital books, for example. And that also didn’t happen because people are reading my blog. They were investing in stocks independently, and they didn’t buy the Wikifolio. Wikifolio at that time was still pretty exotic. It still is, to some degree. And this didn’t work out.

I mean from the opportunity because I knew if I have a blog that you can show what you did, it wouldn’t be hard to get an interesting job in an investment company. I didn’t know so many. There was just one big one in Munich, and I applied. They also liked what they saw, and I started there as an analyst. I did the internet sector like the big American and Chinese internet companies. And then, after one year, I also did a fund. I always had to target to understand the industry more from the inside.

I think I definitely would do it again. I learned a lot there. But I also am more confident in my investment thesis that I can do things a little bit differently. I think there are many opportunities to bring the investment fund industry a little bit in the modern world and do things a little bit cheaper, a little bit more digital, a little bit more transparent. That’s what I’m trying to do.

Motivation for content creation

[00:23:48] Tilman Versch: Like being able to put out this 1491 videos over this five years also needs a certain drive, energy, and long-term passion. What factors motivated you the most that aren’t monetization?

[00:24:17] Philipp Haas: I think for me it’s a little bit like sport. I just like the game, and I want to win it. I try to become the best investor I can be. I think that’s the thing where relative to other things I can be or maybe I’m world-class, at least in German-speaking areas. I’m getting ambitious. When I see something, I try to be really good there. I really neglect other topics, but also general life. Money is an add-on, not what motivates me. It’s more like I want to be good. I also got to be correct. Every other investor likes this feeling. If you have a thesis and it works out. It just gives you some pleasure. Monetary, but also emotional. I’m like a sportsman that tries to become the best he can be.

Motivation & passion

[00:25:16] Tilman Versch: This also helped find the discipline to put effort into this competition driver view.

[00:25:25] Philipp Haas: Yeah, competition and passion for the topic. If you do a video, often you have a new idea for stock, and then you do your research. And maybe you find the stock worth 10-bagger, the next 10-bagger, which means a very good performance. Yeah. You never know what you will find unless you start looking. I think it’s very interesting. It’s one of the jobs where every day is different, and you still can do it until you’re 90.

It also has its downsides. You cannot really do vacations. In the short term, you have to depend on the mercy of the market. And sometimes, it can be very frustrating. Also, a lot of friends of mine who are very ambitious, I think they couldn’t be good at the stock market investors because then they’re used to it. If they work more, the result is better. And the stock market, at least in the short term, that’s not the case. If you’re under pressure or underwater and work 80 hours instead of 60 hours, the result doesn’t improve. Maybe even worse because you have to be in a good mood. Also, with a good combination of confidence, but also risk-averse. You cannot put richer goals with pressure in the short term. This is maybe the downside, but yeah, I think you see it in the videos. And then before I was watching the blog, I was really like two years, in the end, looking at the wall in this small flat in Munich and writing this. But I always had this part target, I want to start a fun business one day. I think that was motivating me as well.

[00:27:20] Tilman Versch: But there’s also a certain risk if you have fulfilled this target being one of the best investors in Germany and posting about it. And you’ve reached it. The question is, how do you get to try to find the next target? How are you thinking about this?

[00:27:37] Philipp Haas: I still have some targets in life even if I reach that. Maybe now that I helped more people invest better and have better financially independent lives, I think, yeah. You never will be able to say that’s the best investor. I think it’s always a little bit.

[00:27:58] Tilman Versch: One of the best assets.

[00:28:02] Philipp Haas: Yeah. And to be honest, it’s not like, I’m not like this sport of ego, that I have to be the best and others are worse. That’s not what’s motivating me. I think it’s also a strength for me as an investor. I don’t have this big ego. I always know that I’m wrong. And if I’m wrong, I cut my losses or reduce the risk.

I just want to create a nice business. I have some ideas about investing. I just like it. Maybe in 20-30 years, we’ll see. I don’t know. Now, I’m pretty happy with what I’m doing. I also asked myself, “What would you do if your money wouldn’t play a role?” Slowly, I reached this level. I would just read books about investing or topics related to that. Most topics are around investing in people and maybe travel. In the end, you can combine those three things pretty well in investing. It’s also a lifestyle decision a little bit because the nice thing about investing is that you can have a scalable business without managing a hundred people or something. The same with media and on YouTube as well. You also know this. Sometimes, videos are a lot of work. Sometimes one video you worked a lot on won’t get a lot of views, and another video you didn’t work on as much gets 10 times more views. This relationship between input and output is not always concurrent in this world, so I also like this.

Factors for success on the internet

[00:29:39] Tilman Versch: Let’s take a look again at the YouTube channel. You have this 26,000 subscribers, which is strong for a German finance channel. In hindsight, what have been the factors that have made you successful?

[00:29:56] Philipp Haas: I would say that I’m not super successful for the input and the year past because I also didn’t do so much mainstream content. You can do two kinds of videos. For most of my videos, I didn’t limit them for myself. I was doing research on some under research companies. For sure about a stock, nobody knows that people are clicking less about. I don’t know the next Tesla video, nor do I see how your dollar doubles your money next month, etc.

I would say it’s the continuity that everyday video and more and more people realize, “Okay. He knows what he’s doing.” I have to check the record of Wikifolio. I have a professional background from University Banking and Finance. I worked in the industry, and you compare that with others, for sure a lot of people don’t realize. And then, a lot of people said, “Okay, he has a little bit more professional background. In the long term, maybe his information is more valuable than the other.” And that’s the end. It depends on the YouTube algorithm. The algorithm relies on how long people view the video and how much they click on it. So

Wikifolio

[00:31:13] Tilman Versch: Interesting. Maybe let’s move to your second or most important social media presence or social investing presence. It’s Wikifolio. Perhaps you can explain to the viewers who have never heard Wikifolio what it is.

[00:31:27] Philipp Haas: Yeah, Wikifolio. Everybody can become a fund manager. Sounds a bit scary, but it’s not real fund. It’s a certificate. That’s not so popular in the US, so that’s the big downside that you have a risk that the company that’s emitting those certificates goes bankrupt. It’s protected to some degree. Yeah. But it’s for sure not the same protection as a real fund.

It works like that. You manage a portfolio. You buy 2%, but you don’t buy it virtually. It’s just a game. And another company is guaranteeing the performance of this portfolio. And you can buy the certificate with the guarantee of the performance of this portfolio. So they also have to hatch. They have to buy the stocks, especially if you have a big Wikifolio that they don’t want to risk your stocks doubled, and they have to pay the investors. So, I think it’s very interesting. For me, it was one of the most interesting FinTech companies in Europe, and I’m still a big, big fan.

I don’t know why it doesn’t exist in years, probably a bit about regulation. You have a lot of transparency. You see what’s in it and what the people are doing all the time. Also, I think it gave me some credibility combined with YouTube because you could see how I’m working and what I’m doing on YouTube. In Wikifolio, you could see it’s not just a private portfolio. It was even much better. You can also have an investable product. I think like they fought each other. If you’re relevant on both platforms, you have a little bit of a flywheel effect.

Managing 8 strategies at once

[00:33:14] Tilman Versch: Let’s take a look at the eight Wikifolio you have managed. It had different strategies. I think your biggest Wikifolio with 15 million invested is the “Nebenwerte Europa” – like small and mid-caps Europe, but you also have the “Sustainable Dividend Stars”, or “It’s the brand stupid”, “Digital revolution”, 2Invest research stock picker”, “Venture capital strategies”, “Owner-operators” and “Invest research multi strategies”. How do you have the capability to manage eight strategies simultaneously?

[00:33:54] Philipp Haas: I also think the QFMA model or this fair PE model helped me a lot because for sure some stocks there in the Wikifolio are not entirely new portfolios. I don’t know. I mean, I’m doing this research full-time.  If you think the company is good for the long-term, then you buy it. And maybe the ratings change a little bit through momentum, but it worked for me, I have to say. There are fund managers who manage four or five funds. It was billions under management. I think it’s possible, especially if you have a long-term vision or long-term perspective. It gets much more work if you play the quarter game. What am I not doing? How will be the next quarter play? What are the possible quarterly numbers? Typically, in corporations, yes. But usually, I don’t care. Yeah, I don’t have an action on that.

Example of Midcaps Europe

[00:34:51] Tilman Versch: Let’s take a deeper look at the “Nebenwerte Europa” – or small and mid-caps Europe Wikifolio, which is the biggest. How would you describe the strategy in this Wikifolio? What is your general approach here?

[00:35:10] Philipp Haas: Well, as the name suggests, it’s more of a mid-cap in whole Europe. As I said, I manage it with the QFMA model. Quality is the first step, then fundamental is the second, momentum and alpha idea. I think the performance is good or excellent but what’s really impressive is the maximum risk of 20% over six or seven years because I believe two or three times the small-cap market tanked 40% or something. So, what works with this QFMA model is the more momentum gets negative in stocks, I automatically go 1% weighting of the portfolio then I have cash that I’m not investing at the moment. So, that also works well as a risk model. But for sure, in Wikifolio, I could.

I don’t know whether I did it. Maybe you can go to 80% cash for a short time, but you cannot do that with an investment fund. You always have to be at least 51% invested. So, it’s limited for sure. It’s not an apples-to-apples comparison, but I think it’s a sign, and the performance should be even better. Because you see, the first one and a half years I was doing nothing. That was really stupid. And so, the performance per year should be even better if you say the strategy started one-half years later. And so, we have a 20% plus performance per year. The maximum risk was 20%.

I think the ideas are good for sure. I’m investing more in technology and quality. But also, I try to combine different industries, different countries. And usually, I’m not in the highflyer stocks. They’re really expensive and just momentum-driven. I’m not invested. But often then, they go down and one day minus 30%. Usually, I’m not invested in them. Maybe maximum like a quality position or risk 0.5%. I also think a lot about the risk. And like an artist about the combination of this painting. You have a little bit from everything. I think it worked pretty well for sure. Not every time, but over the last six or seven years, I think it’s a pretty good product in this area.

Managing a large portfolio

[00:37:19] Tilman Versch: Taking this picture of the artist, currently, you have 95 positions in the portfolio. So, we’re drawing with 95 colors at the moment. The other videos with guests usually have 10 or maybe five to 20 positions in their portfolio. Why weren’t you boiling it down to fewer positions? Why did you go for this big, colorful portfolio?

[00:37:50] Philipp Haas: For sure, if I have 10 ideas, I am completely convinced. Then, maybe I would also invest more in them. But also, I tried from the risk perspective. If you just have 10 ideas, you have much more volatility. I also think the ranking in Wikifolio and the risk method, you benefit a little bit with if you are more diversified. But for sure, if I’m convinced of something, I can go. I don’t say all in, but I have a maximum of 10% position. There are some stocks I couldn’t find in Wikifolio, and maybe where we would have done it. And we also have to say the valuations are pretty high in a lot of markets. So, I don’t have these no-brainer stocks at the moment. It’s difficult to find. There are some no-brainer stocks in China, but you have the regulation risk from the valuation perspective. This is a long-term risk you cannot completely rule out. It’s difficult. I try more to combine the different stocks. Also, I’m interested in a lot of topics.

Community exclusive

[00:39:12] Tilman Versch: yeah. Suppose you think about your top 10 positions and the amount of research you do for these top 10 positions. In that case, I should have calculated how many they are, but I think they might be around 20-24% of the portfolio. How deep is the research you’re investing into these ideas? How deep are you digging to make it a 3-point position or something like this?

Hey, Tilman here. I’m sure you’re curious about the answer to this question. But this answer is exclusive to the members of my community Good Investing Plus. Good Investing Plus is a place where we help each other get better as investors day by day. If you are an ambitious long-term-oriented investor that likes to share, please apply for Good Investing Plus. Just go to Good-Investing.net/plus. You can also find this link in the show notes. I’m waiting for your application. And without further ado, let’s go back to the conversation.

Fund vs. portfolio

[00:40:20] Tilman Versch: Compared to Wikifolio, what do you want to do differently in the fund? Are you planning to do more profound research and concentrate there or not?

[00:40:32] Philipp Haas: Well, if you compare Wikifolio and the fund, we talked about the fund as a professional investment vehicle that people can invest millions to. I can invest in more stocks. And also, I can trade more cheaply, and the fund is even a little bit cheaper than Wikifolio.

I personally just get a 5% performance fee, and the annual cost is 0.7%, but I almost get nothing from that. It’s just for running the business with partners. I think the incentives are right there. And yeah, if I’m seeing something interesting, I would definitely do more core positions. I mean, I had in my private portfolio, sometimes 10-15% rating. If it’s even more, I cannot do it anymore. Sometimes this happens if the stock multiplies. Your stock is four or 5%. And then it increases, and I’m not selling then if I still think the company’s attractively valued and the trend was right. But yeah, for sure, for the first five weeks. Now I invested the whole spectrum of stocks, but I’m not invested so much in core positions.

I would need more time. I won’t say I’m scared of the market. I’m now much more optimistic. But in summary, it feels a little bit like 2018 when we had the first China problem, then you had the interest rate topic. Some markers were not working, and just to us was working. I think this is not the case now. But for this, I was a bit reluctant to go with very high weightings, and we still see the market. Sometimes the stock is hitting its numbers, and the stock tanks 30% at the moment. So, maybe you have to be a little bit careful, especially as you start a fund you don’t want to have crazy volatility. It’s like a race. If you are 10% in front, then you can do more.

Building based on Wikifolio & social media

[00:42:43] Tilman Versch: Let’s look a bit back to the last five years and see what you’ve done on Wikifolio and YouTube. How did both of these help in setting up the fund? What were the advantages of doing these?

[00:42:56] Philipp Haas: I think it helped a lot. Starting a fund wouldn’t have been possible for me five years ago. I think YouTube and Wikifolio helped a lot. For sure, as well as my professional background and social media. I don’t have anybody who invested 10 million as a seed investor with what’s like a typical case. And so, I own 100% of the company that advises this fund. I think I got the reach with YouTube. I have 25,000. For sure, many private investors and people from the industry are watching that because a lot of my stock analyzer is off the beaten track. Wikifolio gave me credibility that I have a track record. So yeah, I think it’s a combination. I’m on both platforms. There are bigger ones, but I think I’m a relevant player. And if you combine it, I think, in combination, there’s nobody and both very strong. So, I think that helped a lot. But also, even if you just have, it works. And also like that you have a professional background and know how the industry is working. Because it’s different from managing Wikifolio compared to a fund. You have to fund flows, etc. It’s not so easy.

Thoughts on fees

[00:44:20] Tilman Versch: How have you thought about fees for the fund you’ve set up? What is your take on this?

[00:44:28] Philipp Haas: I think I mentioned before. For me, it’s always important to save the reputation of active investors. If you do it cheaper, your performance is also better. I also invest a lot of money in the fund on my own, so I don’t want to pay too many fees. And for sure, I also have the idea that if I create a cheaper product and maybe the performance is better, then it can become huge and people will talk about it and say, “Hey, that’s fair.”

I think people often don’t want to invest in stocks on their own. A lot of people do, but some people don’t want to. It’s a full-time job. I mean, I’m doing 50-60 hours a week or more for nine years. If you have a regular job, I think it’s pretty hard that you try to say, “Okay, I can do it better.” Maybe in some months but from the setup. Also, you have some tax advantages of unrealized gains and all things. I tried to create a product I would recommend to my friends, even if I wasn’t the adviser. That was a little bit the idea behind this topic, financial literacy, that you really have a product that can compete with MSC? Because if somebody asks you why I should invest 10-20,000 Euro, your standard answer is how you establish an MSCI World ETF. I think it’s right. It was 10,000 Euro. But if you have a little more, I think you wouldn’t put everything there. So you would combine a little bit different approaches and topics. And suppose you’re almost as cheap as a passive index fund. In that case, I think your chances of outperformance are pretty, pretty high, even if you don’t believe that I’m the super-duper investor. And yeah, and at the end industry, I don’t need to fund business to live from my own investments. The costs are not so high. Normally, the salaries are very high for those people, but I don’t need a salary if I’m the owner. I can do it extremely cheap in comparison to others.

Being invested in own fund

[00:46:45] Tilman Versch: Did you also recommend the fund to you, not only to your friends? So, are you investing yourself with a significant portion of the money?

[00:46:52] Philipp Haas: Yeah, I just did a video. In the end, it’s for me. It’s a private family office. The majority of my liquid net versus in there. I showed it’s over one million euros. I think the incentives are right. I just earn if I perform, and I won’t do much. I won’t go in a risky way because most of my money’s in there. So I invested like my own money because it’s my own money in the end.

[00:47:20] Tilman Versch: So you have this feed of 0.7 that covers the external costs. And you earn when you hit this 5% performance fee. The performance is more significant as 5%, or how is it?

[00:47:34] Philipp Haas: No, no. The 5% performance fee means if the fund does 20%, 1% goes to me and 90% to the investors. But it started at zero. It has no hurdle rate, but it has a high watermark that doesn’t reset every year. So, I think it’s pretty fair. A hedge fund has 2% and 20%, so we get just 5% at the end of the fund, but bits get bigger. It has a 0.5% cost, so it’s one-quarter of the cost if you compare it to a hedge fund. Suppose you compare a typical investment with what a typical private investor would buy. You have probably 2% yearly costs and maybe a 10% performance fee in that case. So, I would say it’s less than a half.

Community exclusive

[00:48:21] Tilman Versch: Maybe let’s go back to your portfolio and help me understand one thing I haven’t fully understood. When do you buy and sell such securities or stocks you have in your fund? What are the factors that play a role in this?

Hey, Tilman here. I’m sure you’re curious about the answer to this question. But this answer is exclusive to the members of my community Good Investing Plus. Good Investing Plus is a place where we help each other get better as investors day by day. If you are an ambitious long-term-oriented investor that likes to share, please apply for Good Investing Plus. Just go to Good-Investing.net/plus. You can also find this link in the show notes. I’m waiting for your application. And without further ado, let’s go back to the conversation.

Managing time between YouTube, Wikifolio, and the fund

[00:49:17] Tilman Versch: One can say that you now bought into the fund. Does this mean that you sold YouTube and Wikifolio to a certain extent? How are you waiting for these activities in the future?

[00:49:29] Philipp Haas: YouTube and Wikifolio will always be an essential part, but for Wikifolio, I will surely make a video every day. In YouTube, the topics will change a little bit. Maybe I will focus more on longer and quality videos and do interviews, for example, with CEOs, which can show my research to others. I think it’s also efficient that the CEO doesn’t have to answer the 20 silly questions a hundred times. You can also do it online and show what you do with investors.

For Wikifolio, you see the “Nebenwerte Europa”/small-cap is a different strategy than the fund. I will manage it as before. In the other Wikifolio, I will do a little more passive, like not trading every day. I think it doesn’t have to harm the performance. And maybe the maximum risk can increase a little bit that I’m not trying to do so much market timing than in the past. I think I still have a lot of freed-up time because we were doing less YouTube. I guess it won’t suffer, but for sure. YouTube, you won’t see everyday videos from me. But also I think you can do it for two years, but at some time, then it’s pretty stressful. You also know that it can be a lot of work. At some time, it’s also good to slow down a little bit.

Long-term plans

[00:50:57] Tilman Versch: Yeah, I feel you. Sometimes it’s hard to keep with this output pace. In the beginning, we look back five years. Maybe let’s try to look out five years and see where you might be in 2026. What is your long-term plan for the next five years?

[00:51:18] Philipp Haas: I don’t know whether I’m happy to share that here.

[00:51:22] Tilman Versch: It’s the best news. Please share.

[00:51:26] Philipp Haas: For me, it is definitely important to start a fund now. It’s not a secret that it was a 10 years plan for me. Now it looks pretty good, and at least it worked. When that works well, I have maybe more ideas for funding to create and make the company a little bit bigger because now I’m it’s pretty small. But I will never want to create a huge company. Yeah, but maybe you have some people to talk to about the different investment products and perhaps create a very inspiring company culture. I think that’s also what’s missing in the industry. And that could also motivate me to create a second family. I don’t know. But also, living quality.

At the moment, you’re very free. That’s also very nice. And as soon as you have employees, you also have more responsibility. So, I have to think about it. I wouldn’t be too unhappy if it wouldn’t work out. But yeah, we’ll see how the performance will be. This is also in this business. If the fund doubles in one or two years, the money comes. And if not, not. So, we’ll see. I’m optimistic, and I have some ideas in my life even if the fund end isn’t successful.

External help?

[00:52:48] Tilman Versch: In which spaces do you need help? Because currently, you’re doing it as a one-man-band. You have some tasks that might be better if you have someone who helps you and specializes in this.

[00:53:00] Philipp Haas: Yeah. I think it wouldn’t be bad to have one analyst who can help you with some tasks on investing. I would say my specialty is the big picture and being fast. And then maybe I do the more detailed work, yeah. And maybe also in the content business, sales, for sure. But this automates the business. You don’t need too many people.

I was thinking about doing a startup when I was young after university, but I never found a real co-founder. I’m from a business University. I believe you need a technical co-founder. It was pretty challenging to find, especially if you want diversity and don’t have much to show for. I decided to go for business where you don’t need a co-founder. I’m also happy about that. Because if you have 100% of a company, it doesn’t have to become such a big deck. You can live pretty well off, and you don’t have to compromise with co-founders, investors, etc. So, yeah, I’m also happy with that decision.

Where to find Philipp

[00:54:14] Tilman Versch: I have come to an end with my questions. Is there anything you want to add to the end of our interview that gives us new context on you that needed context?

[00:54:26] Philipp Haas: You can find many things about me and my book on YouTube. How I’m thinking is all in German. My target market is Germany. So, if you’re German, feel free to contact me. If you’re, for example, interested in fund, let’s make a short video call to show more information if you have questions. And yeah, I think you realize I’m motivated to improve the industry, improve the products, and improve some people’s lives. Yeah, that’s something that you can not just hopefully see from this interview but maybe also from the things I did. I think that’s it.

Goodbye

[00:55:08] Tilman Versch: Thank you very much for the value you offered. And thank you very much to the audience for staying up till now. Bye-bye to you all.

[00:55:15] Philipp Haas: Thank, Tilman. Bye-bye.

Disclaimer

Finally, here is the disclaimer. Please check it out as this content is no advice and no recommendation!

Written by:

108 Posts

Tilman is a very enthusiastic, long-term investor. Over the last years he has taught himself important investing concepts autodidactically. He tries to combine a positive climate and environmental impact with his investments.
View All Posts
Follow Me :