The Naked Trader – Final Review
We have reached the end of our trial of the Naked Trader, but rather than doing our normal numbers table summarising the results, we thought it would be more useful to sketch out our final conclusions on what we have found by following Robbie’s service.
So here are our findings:-
1. There is no point following Robbie’s trades
As we suspected, there is absolutely no point in copying Robbie’s trades based on the results of our trial.
After more than four months of trying to copy his trades, whilst Robbie has made over 200% profit, we have in fact made over 100% loss!
Yes I will repeat that again just in case you missed it – whilst he made a whopping profit, we made a substantial loss. Ouch.
You can view full results here.
Basically the problem is that by the time you have found out about a trade that Robbie has made – which is usually a week or two after he has bought or sold the share, the price will invariably have moved against you.
Now you may be wondering why this is. Surely, all else being equal, at least a portion of the shares would stay roughly the same price, or on a few you would expect the share to fall after Robbie has bought it, or rise after he has sold it.
Well sadly not.
This may be because Robbie is so damn good at picking shares, he knows when to buy (just as a share is about to go up) and when to sell (just when a share is about to go down).
Or the cynical among you may think that there is the possibility of what is often called “aftertiming” – i.e. picking shares after they have gone up and then saying you had bought them earlier.
Who knows? We don’t think that is the case as frankly we don’t think Robbie could have maintained his reputation and made as much money as he apparently has if he wasn’t actually very good at picking shares but was just aftertiming. Plus he seems like a standup guy from what we know of him.
Either way, the bottom line is you shouldn’t try copying his trades because in all likelihood you will lose money based on the results of our trial.
It would be great if Robbie offered a share picks service where he sent out e-mails or texts right after he has bought or sold a share, like many services we know do, but alas he seems reluctant to do so.
Hopefully at some point in the future he will consider doing so…
2. Robbie has big bucks to trade with
When you look at Robbie’s results, it is tempting to think you can make similar amounts to him by following his process.
Beware though that Robbie has huge amounts of money to invest. At any one time, he may have well over £100,000 invested in shares and sometimes closer to £200,000.
For most people, investing those amounts is not feasible. You may look at his results and see that he has made say £80,000 profit in a year and think you can make similar amount.
But that would only be realistic if you had the huge sums that Robbie does to invest, often buying £10,000 worth of shares in a company.
In one of his books, Robbie says that realistically, if you are really disciplined, follow his advice and do all the things a good trader does, you could make around 15-20% profit per year.
If you have £10,000 to invest, that would £1,500 to £2,000 profit per year. Think about that and whether it is worth the time needed and the risk to make that kind of money.
For some people it will be and they enjoy doing the research and the enjoyment of owning shares, but for others it may be better off looking to an investment trust or index fund.
But either way you are unlikely to become a millionaire trading shares unless you have a large amount to invest in the first place and are prepared to wait a number of years.
3. A few big winners make all the difference
Looking at Robbie’s trading history and reading his books, the thing that jumps out is how significant some of his trades have been.
Just the top 30 trades he has done have made over £230,000 in themselves and the top 10 have made over £118,000.
And that doesn’t include those shares that he still holds, some of which go back many years.
Some of these have gone up hugely, by 10 or even 15 times, so those will be worth many tens of thousands of pounds now as well.
So it really does emphasise the point Robbie makes in his books about riding the winners and shedding the losers.
If you can turn a few into 10 or 20-baggers, you can put up with quite a lot of shares that don’t do very much or make a small loss.
4. His books are very good
We have read a lot of books over the years about buying shares and making money in general and we have to say that Robbie’s are among the best.
They are amazingly easy to understand and very clearly written. So much of the jargon of share dealing is demystified and things explained in plain English. There is a lot people not just in the financial sector but anyone writing a how-to guide or self-help book could learn.
The other thing that is so good about the Naked Trader is that it gives you a step-by-step guide to picking shares that is very specific. So many books like this talk in theory and generalities which sounds good but then you think “what am I actually meant to do to implement the ideas?”
You won’t have that here – everything is set out for you so will know exactly what to do.
So there you have it, hopefully that has given you a bit of a sense of how best to follow the Naked Trader and what to expect if you do. Ultimately it is not a get-rich-quick-scheme but rather a useful guide to buying and selling shares and that is what you should take it for.
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The Naked Trader – Results Update
10th October 2016
There has been a reasonable amount of activity from the Naked Trader (aka Robbie Burns) since our last update at the end of August.
From following his trades, of those that are closed, we are currently 4.5% in profit, versus Robbie’s profit of 93.7%.
You can view full results here.
So a huge difference there and it underlines the difficulty of making any money from following his trades.
Of those trades that are still open, we are generally also buying at much higher prices than Robbie, so it looks like this is not really an avenue to profit.
Of our own trades, MXCP has fallen slightly to 2.92 and Opti has stayed steady at 70.45, whilst Purplebricks has risen to 134.50.
Back soon with more updates.
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The Naked Trader – Results Update
29th August 2016
Not much to report for the Naked Trader, as Robbie is on holiday until 8th September so new trades or closed trades from him since our last update.
In terms of my own trades following the advice in Robbie’s books, both are going well.
MXCP, which I bought at 2.9p is now up to 3.19p at the time of writing and Purplebricks, which I shorted at 145p, is now trading at 129.2p.
I have also invested in Optibiotix Health (OPTI) at 71p.
This is a very interesting little biotech company that works in the field of the microbiome.
If you don’t know what the microbiome is, don’t worry, neither did I. It is basically all the billions of microbes that live in your gut and around your body.
It is a relatively new area of science but they are discovering that by tinkering with these microbes they can have a huge impact on human health. It’s kind of like those yoghurts with “good bacteria” in them, except with much more potential.
Anyway, OPTI are making great strides in this field and have over 40 patents already secured. They are focusing on the foods markets for things like cholestorel, weight loss and diabetes, which are much quicker to market than going down the drug trials route, which can take 10-15 years.
They already have deals signed with some big multinational players and have a number of other deals pending.
If any of their patented strains really hit the mark then this could be huge, but even if they don’t they should be generating steady revenues soon and there is room for solid growth. One to tuck away in a draw for a while and see how big it can become.
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The Naked Trader – Results Update
2nd August 2016
At the time of our last update on the Naked Trader, we said we would be focusing more on the overall package offered rather than just following the trades blindly.
So we are going to take a look at a couple of things in this update – firstly our own share trades based on the advice in Robbie’s books.
Secondly, we have recently purchased and read his book “Trade like a Shark,” so will give our initial thoughts on that.
Robbie’s Trades
But before that, a quick word on how Robbie’s own trades have been going.
Well to be honest, the main takeaway we have so far is that it seems fairly pointless, in that by the time they are posted on his website or in his fortnightly e-mail, the prices have changed completely.
You can view full results here.
This is akin to the popular tipsters like Pricewise and Hugh Taylor, who once they have given out a selection, the price crashes and all the value is gone.
Well here we have a situation where pretty much all the shares Robbie has bought have gone up considerably in price by the time you hear about them.
So not ideal by any means.
Own Share Trades
Right, moving on to our own share trades, we have made two so far.
MXC Capital (MXCP)
First up I have bought into a company called MXC Capital. They are a merchant bank that specialises in the technology and IT sector.
They have a great business model, in that they basically advise companies in the tech sector on takeovers and mergers etc. In doing this, they advise on and execute the transaction, secure the funding and then add the operational management experience to drive the strategy of a particular company.
So they get big fat fees for advising on the transaction, get shares in said company at a considerable discount, then use their expertise to drive it forward and make the shares that they hold worth more! Clever stuff.
So far they have done this with spectacular success, with all seven investments they have made growing considerably. Their investments of £31m are now worth £73m in a short space of time.
Plus they posted £12m in post-tax profits this year from what they have been making on the deals.
They have a policy of returning some of the returns to shareholders, which was done this year by way of a share buy-back, thus increasing the attractiveness of the holding.
I really can’t understand how they are only valued at a market cap of just over £100m with investments worth £73m plus posting £12m a year in profits.
So MXCP seems to fulfill all of Robbie’s criteria set out in the Naked Trader – all of its statement are very positive and produce plentiful green under his traffic light system. Its profits are well over 10x its market cap, it is a good size company (over £100m) and has a clear, effective business model with experienced and skilled management.
So I bought in at 2.9p and expect to hold this for a good time if it grows as anticipated. I have put in a stop loss at 15% below my buy price.
Purplebricks (PURP)
At the other end of the spectrum in terms of value is the online estate agent Purplebricks.
This is a classic example to me of a company that is overhyped and is valued almost entirely on PR rather than actual numbers.
If you break it down, they are valued at over £350m and yet they only generated £18.6m in revenue and made a £10.5m loss last year.
They have a target of 3,500 new instructions pcm to maintain their own growth forecasts, but at the moment are barely managing 2,800.
They have the difficulties of a slowing housing market following Brexit and a rapidly decreasing number of sales, plus new rivals to contend with like Yopa.
In their results a lot of this is glossed over by mention of “£2.8 billion of house sales,” which is actually irrelevant when you consider they charge a fixed fee and that any company involved in housing can make figures look good by quoting aggregate house price sales in today’s market.
So on the basis of all this, I think they are one of the most overvalued companies in the history of the market and have put in a big SHORT of them on the spreads at 145p.
Trade Like a Shark
Finally, as I mentioned, Robbie has released a new book called Trade Like a Shark which we will be reviewing separately, but a quick heads up that it is very good guide to trading psychology and could be applied to all forms of investing, not just share trading.
Back soon with more updates.
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The Naked Trader – New Review
24th June 2016
We just wanted to do a quick update on our review of the Naked Trader (aka Robbie Burns).
It is not that we have any results yet, but rather than we received an e-mail from Robbie pointing out the dangers of copying his trades.
We did mention this when kicking off the review below, but did want to stress again that Robbie does not advised copying his trades.
Robbie has emphasised that those “copying” him would be buying a share blindly that might already have risen a lot and he might be considering selling.
If you “copied” a trade there is a danger that there could be a profits warning. Robbie would be out
and take his loss. However someone who “copied” may not know. A share he bought
recently issued a surprise profits warning. He got out fast but still lost £1,000. Anyone still
holding it a day later would have lost more than half their money.
To be honest, we would have to agree with Robbie’s sentiments and strongly advise against copying his trades.
Notwithstanding the advice that we always give about only risking what you can afford to lose, being responsible for your own positions and never following a system until we have at the very least completed our own three month trial and given a clear recommendation, we can see the downsides of trading on a “delayed” basis as you would be here.
We will be paper trading the shares for the review – as much for an academic exercise but also to see how the advice on Robbie’s books and e-mails translates into actual trades and what we can learn from them.
We will also be seeing if we can choose our own shares based on what we have learned and whether we can make a profit ourselves.
So please don’t risk any of your earned cash on copying the trades – keep it in your pocket, or if you do want to spend something, buy one of Robbie’s books and get a good introduction to buying and selling shares.
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The Naked Trader – New Review
2nd June 2016
When I started out investing in the stockmarket I began by reading Robbie Burns’ book the Naked Trader, which is an excellent guide for those new to buying shares.
It is one of those how-to guides that really takes you through the process step and step and tells you how to make money from shares.
Robbie himself claims to have made over £1 million from trading shares, which is a sizeable sum indeed.
So after reading his book and seeing how successful he had been, I took to the internet to see if there was more I could find out about him.
And so I came across the Naked Trader website, on which Robbie helpfully records all his trades.
At the time of writing, Robbie is over £1,256,000 in profit from all his share trades, plus his spread bets and Big Brother bets.
The thought occurred to me – and I accept I am certainly not the first person who has thought this – what if I just copied all Robbie’s trades?
Could I, too, become a millionaire?
How nice it would be, just wake up, check the stocks, then off to play golf and spend the afternoon down the pub.
Well sadly as seems to always be the case with these things, it was not quite as easy as it at first appeared.
Robbie only updates the trades every couple of weeks, so often the price of a stock will have changed quite a bit between when Robbie bought or sold it and when it is posted on the website.
But just how much does it change? Can you still make a nice profit?
Having looked at the history on the site, there are some shares that Robbie holds for many months or even years that double or treble in price, so you should not be losing out much by missing a couple of ticks here or there.
However, to be sure about how much money you could actually make following Robbie’s trades, I thought the only fair way would be to run a live trial.
So here is what I will do – I will sign up to Robbie’s e-mails and then buy the exact same shares Robbie does as soon as I receive the emails.
Then I will record the results here on the website and see how much money I make.
We will probably need to run the trial for longer than the normal three months, so six months is probably more reasonable to get an accurate picture of what kind of money you can make.
Now just to say that Robbie doesn’t actually advise following his trades – but then who is he to stop us!
Anyway, it should be a fun trial and it will be interesting to see if we can learn anything from a master. Robbie is primarily a fundamentals man and looks at a company’s performance and likely direction rather than studying charts and using complex software.
In fact his approach is refreshingly simple and is quite unusual in this day and age when everyone seems to want to make everything more and more complicated.
Let’s see how Mr Burns does under the spotlight and hopefully he can make us a few bob.
In the meantime you can check out the Naked Trader website here.
