Trick or Treat: Stock Tips, Savings and What's Behind the Mask

Welcome back to Inside 25/8 Fintech.

Today is October 31. In many countries that means Halloween: masks, costumes and children at the door asking "trick or treat?". In Austria it is also World Savings Day. As children we carried our piggy banks to the bank and came home with a small gift.

Last week I promised to come back to World Savings Day. Looking at my posts from this week, I noticed that Halloween fits just as well. All three were about the same thing: what is behind the mask?

1. The Trick: A List That Looks Strong

On Friday I shared a small experiment. I took 28 issues of a stock magazine and had every one of the 992 buy recommendations followed up. Each one came with a price target and a stop. One question per pick: what came first?

On paper the list looks impressive. The best pick doubled in 19 days. Several others gained 40 to 60 percent. If you only remember the winners, you remember a great track record.

Behind the mask: 16 percent reached the target, 28 percent hit the stop first, the rest are still open. On average plus 0.9 percent per recommendation, against plus 0.4 percent for the DAX over the same periods. The median was even slightly negative. Fewer than half of the picks beat the index.

The most interesting detail for me: the more spectacular the label, the worse the result. The "hot" tips and the "signal of the week" did clearly worse than the calm, regular stock analyses.

I still read the magazine. It is a good source of ideas. But a recommendation is not a signal. The question I now ask every time is the one from Friday: compared to what?

2. The Treat: The Boring Things That Work

Here is the irony. The benchmark that 28 issues of reading and a lot of nerves could not clearly beat is the one you get without any reading at all: the index itself.

That is the real treat on World Savings Day. Not the next hot tip, but the unspectacular things done consistently. A household plan where you know what comes in and what goes out. A cushion for the unexpected. A fixed amount that goes into your investments every month, whether the headlines are scary or exciting.

Last week I described the three steps of my DO IT Strategy: safety, freedom, independence. None of them needs a hot tip. All of them need patience.

This is my personal approach, not investment advice. But after this experiment I am more convinced than ever: what makes the difference is not the brilliant pick, it is the habit.

3. Without the Mask: What Really Connects People

The other two posts this week were not about money at all, and still the same pattern showed up.

On Wednesday I wrote about how I started in sales at 19. I was no born salesman. My mentor Alfred Langmann taught me the craft: write down every name, keep a contact list, follow up. Not glamorous, but it worked. Today, people get to know me through posts and comments long before we meet. And still, the moment that turns someone into a real contact is sitting across from each other over a coffee.

On Thursday I told the story of a talk in Serbia. My first sentence was the greeting in Serbian, the interpreters had taught it to me. My second was: "That's all I can say, I'm afraid." The room laughed, and the ice was broken. Not because of a perfect opening, but because I dropped the mask of the polished speaker.

Next week I am in Vienna for a few days. Several people I got to know here in the comments have said yes to a coffee. I am looking forward to meeting them without any masks.

A list of 992 stock tips, a contact list from the year 2000 and one sentence in Serbian. Different stories, the same lesson: the shiny version is the trick, the consistent one is the treat.

So here is my invitation for this World Savings Day: pick one money habit you want to keep for the next twelve months, and write it down. Not the most exciting one. The one you will actually do.

Thank you, as always, for reading. And if you have children at the door tonight: give them a treat, and maybe a coin for the piggy bank.

Stay focused and trust the process.
Your Thomas