How to Speculate in Value

The text below is an excerpt from one of last week’s updates sent to subscribers of our Purposeful Investing Course (Pi).

Here is a way to speculate in value.  Increase weighting of good value markets based on economic fundamentals.

I’ll explain a specific example… and special current opportunity in a moment.  First let’s look at last week’s global equity dip.

Financial headlines  two weeks ago read like this:

“With looks of shock and despair, traders reacted after the Dow Jones industrial average plummeted more than 1,0000 points, or 4 percent, minutes before the closing bell on February 5, 2018.”

Ten days later the tone had changed… to this.  “Dow, S&P 500 book 6th straight gain as stocks post best week in years. The drop marks the biggest points drop since the 2008 recession.

The recent stock market drawback and immediate recovery shows why purposeful investing makes so much good sense.  This sudden volatility led nowhere for traders, except to increased fees and lost opportunity.

Those who used math based value and trend analysis hardly saw a blip.  Pi investors didn’t spend a penny dumping shares that they either had to buy back… or give up profit on when share prices recovered.

For example the Keppler Good Value Developed Market Pifolio saw seven of its ten country ETFs obtain a yellow Stock State Indicator alert from at the very bottom of the stock market dip.

Not one of these alerts turned into a sell signal.


Now, just a week later, all ten shares in this Pifolio have green Stock State Indicators at

share chart

This is also true of the Keppler Good Value Emerging Market Pifolio.

For investors who held these Pifolios… nothing statistically happened.


No extra trading fees.

No guessing or fingernails chewed.

Just additional steady profits.

Instead of trying to second guess the impossible-to-know, Pi investors remained steady.

They could be calm… take a nap even.

Or Pi investors could devote more time to life, family and friends and the business of making money with something that’s more enjoyable, better for society and easier to predict than the short term ups and downs of shares.

There you have it… Pi investing is better.

But… we all have a bit of gambler within… don’t we.  So here is a better way to speculate…. by shifting the weighting of value.

ENR Asset Manager’s February 2018 Advisory Extra Bulletin shows us how because France may offer extra value in the years ahead.

The bulletin says:  Big Tax Cuts Attract Foreign Investment and Spur French GDP

Bullish on the Macron Revolution

France is back.

France’s reputation for smothering bureaucracy in addition to high taxes, and a labor code that’s not business friendly, has made it hard for the country to attract foreign investment and talent.  The previous government of Franҫois Hollande was a disappointment for France.  A massive 75% surtax was levied on the wealthy, businesses moved out of the country and labor unrest simmered.  The country struggled to grow its economy while other members of the euro-zone clawed their way out of the eurozone debt crisis starting in 2010.

Then a young Emmanuel Macron was elected last spring, defeating the French far right and resulting in one of the biggest rallies on record for the Paris CAC-40 Index.

Since his election in May 2017, the former investment banker has already pushed through labor law reforms that mak it easier for businesses to fire workers.  He has also sharply cut wealth and capital gains taxes.  He’s capitalizing on high confidence in Europe and uncertainty over Brexit to lure companies to France. Macron is seen as a keen globalist and proponent of free trade and during his recent trip to China, emphasized the need for reciprocal open trade
agreements when meeting President Xi Jinping.

“France has all the assets to succeed. It has top engineers, great entrepreneurs, one of the best education systems in the world, great infrastructure, and successful global companies,” wrote Google CEO Sundar Pichai in a recent blog.

Thirty-eight thousand engineers graduate in France every year. The country is also home to more than 9,400 start-ups and the world’s largest start-up incubator, Station F, which opened in Paris in June.

Macron is “perceived as a pro-business president”, said the Bain report. American investors see this political change as a sign of a major transformation in France, the start of “a French New Deal.”

Venture capital investment increased to more than €2.2 billion in 2016, putting France second only to the UK on the European start-up scene. France took the lead in the first eight months of 2017 raising €2.7 billion–nine times more than for the full year of 2014.

The basis of a speculation in France is that it is already one of the ten good value developed markets according to Keppler Asset Management’s analysis.

share chart

We can compare its financial basics to the entire top value portfolio.

Price to book of the ten markets is 1.58.  The data below from Keppler’s January 2018 analysis shows that France’s market has a price to book of  1.62 (bottom left column in chart below).

Price to earnings of the average of all the Top Value markets is 18.2 compared to 18.9 for France.  Dividend yields at  3.08 and 3.1 for France are also almost the same.

share chart

From page 28 of the 82 page January 2018 Keppler Good Value Developed  Market Analysis we sent you last month.

These numbers suggest that we do not give up any value to shift emphasis towards France.

How to Invest in France

The simplest way to increase profit potential in France is with the country ETF iShares MSCI France.

A look at the 22 year chart at shows how this ETF (dark blue line) outperformed the S&% 500 (dark blue) in the run up  of the 2003 to 2007 bull market.  Yet we can see that France has lagged far behind the US since 2012.

share chart

We can also see from that this low risk (13.6 VQ) ETF has a green Stock State Indicator and in the $32 range  is about 10% above its $27.92 stop price.

share chart

Eric Roseman CEO of ENR Asset Management has a different idea for investors who want to do a bit more work and take added risk.

Eric says:  With European markets now at their highest levels since 2007 or in many cases, trading near all-time highs, investors must be selective. The bull market in global equities is mature and prospective investors would be wise to purchase only high-value stocks offering compelling multiples in a world marked by asset inflation.

In the developed world, the euro-zone is probably ‘fair value’ at best at current levels but much less expensive compared to New York in early 2018.

Stocks in Europe continue to provide much better relative and absolute values compared to bonds; the MSCI Eurozone Index of shares currently yields 3% compared to just 0.69% for a benchmark ten-year German government bund.  In Paris, the CAC-40 Index of large-cap stocks offers a 2.6% yield compared to 0.98% for a ten-year French government bond. Stocks remain attractively-priced even as the yield-curve in the eurozone has steepened along with the United States since last fall.  And as bond interest rates rise, banks typically earn a greater spread on deposits and loans.

Instead of buying a French index fund trading near all-time highs, I prefer to peruse the universe of CAC-40 Index blue-chips for bargains. And several are still available.  Industrials, consumer discretionary, telecom, energy and consumer staple stocks have all rallied over the past 12 months along with the banks. But bargains do beckon in Paris.

The two French stocks I’m recommending today rank among the Top Ten dividend-paying companies on the CAC-40 Index and trade at very attractive multiples.  Furthermore, they are both beneficiaries of the Macron tax cuts amid a restructuring of the French economy.

You can learn these two shares when you subscribe to the Purposeful Investing Course described below.

These are both medium risk shares with VQs in the 20’s.

There you have it…  two ways to speculate by shifting the weighting of your portfolio within the realms of value.  Add more ETFs that invest in France or  in good value French shares.  You have some extra profit to gain, but still minimal chance of  long term loss.

Long term Keppler’s analysis suggests that the best results come from equal diversification in all good value markets… but in the short term France may see an extra bump up economically and more weighting in this market could result in increased profit.

There may be one more benefit.

Check with your tax advisor.  You might be able to deduct (at least partially) a trip to Paris to investigate the value of investing in France.


The Only 3 Reasons to Invest


There are only three reasons why we should invest.  We invest for income.  We invest to resell our investments for more than we had invested.  We invest to make our world a better place.

We should not invest for fun, excitement or to get rich quick, or in a panic due to market corrections.

This is why the core Pi model portfolio (that forms the bulk of my own equity portfolio) consists of 19 shares and this position has not changed in over two years.  During these two years we have been steadily accumulating the same 19 shares and have not traded once.

The portfolio has done well in 2017, up 22.6%, better than the DJI Index.


However one or even two year’s performance is not enough data to create a safe strategy.

The good value portfolio above is based entirely on good value financial information and mathematically based safety programs developed around models that date back 91 and 24 years.

The Pifolio is a theoretical portfolio of MSCI Country Benchmark Index ETFs that cover all the good value markets developed combining my 50 years of investing experience with study of the mathematical market value analysis of Keppler Asset Management and the mathematical trend analysis of

In my opinion, Keppler is one of the best market statisticians in the world.  Numerous very large fund managers, such as State Street Global Advisers, use his analysis to manage over $2.5 billion of funds.

The Pifolio analysis begins with Keppler who continually researches international major stock markets and compares their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.  He compares each major stock market’s history.

Fwd: keppler

Michael Kepler CEO Keppler Asset Management.

Michael is a brilliant mathematician.  We have tracked his analysis for over 20 years.   He continually researches international major stock markets and compares their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.  He compares each stock market’s history.  From this, he develops his Good Value Stock Market Strategy and rates each market as a Buy, Neutral or Sell market.  His analysis is rational, mathematical and does not cause worry about short term ups and downs.  Keppler’s strategy is to diversify into an equally weighted portfolio of the MSCI Indices of each BUY market.

This is an easy, simple and effective approach to zeroing in on value because little time, management and guesswork is required.  You are investing in a diversified portfolio of good value indices.

A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to spend hours of research aimed at picking specific shares.  It is not appropriate or enough to instruct a stockbroker to simply select stocks in the BUY rated countries.  Investing in the index is like investing in all the shares in the index.  You save time because all you have to do is invest in the ETF to gain the profit potential of the entire market.

To achieve this goal of diversification the Pifolio consists of Country Index ETFs.

Country Index ETFs are similar to an index mutual fund but are shares normally traded on a major stock exchange that tracks an index of shares in a specific country.  ETFs do not try to beat the index they represent.  The management is passive and tries to emulate the performance of the index.

A country ETF provides diversification into a basket of equities in the country covered.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

Here is the Pifolio I personally use.

70% is diversified into Keppler’s good value (BUY rated) developed markets: Australia, Austria, France, Germany, Hong Kong, Italy, Japan, Norway, Singapore and the United Kingdom.

30% of the Pifolio is invested in Keppler’s good value (BUY rated) emerging markets: Brazil, Chile, China, Colombia, the Czech Republic, South Korea, Malaysia and Taiwan.

The Pifolio consists of iShares ETFs that invested in each of the MSCI indicies of the good value BUY markets.

For example, the iShares MSCI Australia (symbol EWA) is a Country Index ETF that tracks the investment results the Morgan Stanley Capital Index MSCI Australia Index which is composed mainly of large cap and small cap stocks traded primarily on the Australian Stock Exchange mainly of companies in consumer staples, financials and materials. This ETF is non-diversified outside of Australia.

iShares is owned by Black Rock, Inc. the world’s largest asset manager with over $4 trillion in assets under management.

Pi uses math to reveal the best value markets then protects its positions using more math created by Richard Smith founder and CEO of to track each share’s trend.

We use Smith’s  algorithms that calculate momentum of the good value markets.

dr richard smith

The Stock State Indicators at act as a full life-cycle measure that indicates the health of each stock. They are designed to tell you at a glance exactly where any stock stands relative to Dr. Smith’s proprietary algorithms.

Kepppler’s analysis shows the value of markets.  The SSI signal indicates the current trend of each stock (performing well, or in a period of correction, or stopped out).

The SSI tells you one of five things:

Screen Shot 2017-08-08 at 6.51.59 AM

Screen Shot 2017-08-08 at 6.52.12 AM

Screen Shot 2017-08-08 at 6.52.22 AM

Akey component of the Stock State Indicator (SSI) system is momentum based on the latest 521 days of trading.  A stock changes from red to green in the SSI system only after it has already gone up a healthy amount and has started a solid uptrend.

How SSI Alerts Are Triggered

If the position has already moved more than its Volatility Quotient below a recent high, the SSI Stop Loss will trigger.  This is an indicator that the position has corrected more than what is normal for this stock.  It means to take caution.

Below is an example of how SSIs work.  This example shows the Developed Market Pifolio that we track at


Equal Weight Good Value Developed Market Pifolio.

At the time this example was copied, all the ETFs in the Developed Market Pifolio (above) currently had a green SSI.

We do not know when the US market will fall.  We only do know that it will.  We also do not know if, when the US market corrects, global markets will follow or rise instead.

The fact that the Pifilios are invested in good value markets reduces long term risk.

Additional protection is added by using trailing stops based on the 521 day momentum of each stock in the Pifolio.

Take for example the graph below from our Tradestops account that shows the iShares MSCI United Kingdom ETF.  This ETF had a green SSI and a Volatility Index (VQ) of 13.26%.  This means the share can move 13.26% before there is a trend shift.


iShares MSCI United Kingdom ETF (Symbol EWU)

Pi purchased the share at$31.26 and in this example the share was $34.43 and rising.  Tradestop’s algorithms suggested that if the price drops to $31.69 its momentum would have stopped and it would have shifted into trading sideways.   The stop loss price is currently $29.86.  If EWU continues to rise, both the yellow warning and the stop loss price will rise as well.

When the US stock market bull ends, know one knows for sure how long or how severe the correction will be.

When the bear arrives, what will happen to global and especially good value markets?

No  one knows the answer to this question.

What we do know is that the equally weighted, good value market Pifolios have the greatest potential long term and that math based trailing stops can be used to protect against a secular global stock market correction when it comes.

My fifty years of global investing experience helps take advantage of numerous long term cycles that are part of the universal math that affects all investments.

What you get when you subscribe to Pi.

You immediately receive a 120 page basic training course that teaches the Pi Strategy.   You learn all the Pi strategies, what they are, how to use them and what each can do for you, your lifestyle and investing.

You also begin receiving regular emailed Pifiolio updates and online access to all the Pifolio updates of the last two years.  Each update examines the current activity in a Pifolio, how it is changing, why and how the changes might help your investing or not.

Included in the basic training is an additional 120 page PDF value analysis of 46 stock markets (23 developed markets and 23 emerging stock markets).  This analysis looks at the price to book, price to earnings, average yield and much more.

You also receive two special reports.

In the 1980s, a remarkable set of two economic circumstances helped anyone who spotted them become remarkably rich.  Some of my readers made enough to retire.  Others picked up 50% currency gains.  Then the cycle ended.  Warren Buffett explained the importance of this ending in a 1999 Fortune magazine interview.  He said:  Let me summarize what I’ve been saying about the stock market: I think it’s very hard to come up with a persuasive case that equities will over the next 17 years perform anything like—anything like—they’ve performed in the past 17!

I did well then, but always thought, “I should have invested more!”  Now those circumstances have come together and I am investing in them again.

The circumstances that created fortunes 30 years ago were an overvalued US market (compared to global markets) and an overvalued US dollar.  The two conditions are in place again!

30 years ago, the US dollar rose along with Wall Street.  Profits came quickly over three years.  Then the dollar dropped like a stone, by 51%  in just two years.  A repeat of this pattern is growing and could create up to 50% extra profit if we start using strong dollars to accumulate good value stock market ETFs in other currencies.

This is the most exciting opportunity I have seen since we started sending our reports on international investing ideas more than three decades ago.  The trends are so clear that I have created a short, but powerful report “Three Currency Patterns for 50% Profits or More.”   This report shows how to earn an extra 50% from currency shifts with even small investments.  I kept the report short and simple, but included links to 153 pages of  Good Value Stock Market research and Asset Allocation Analysis.

The report shows 20 good value investments and a really powerful tactic that shows the most effective and least expensive way to accumulate these bargains in large or even very small amounts (less than $5,000).  There is extra profit potential of at least 50% so the report is worth a lot.

This report sells for $29.95 but in this special offer, you receive the report, “Three Currency Patterns for 50% Profits or More” FREE when you subscribe to Pi.

Plus get the $39.95 report “The Platinum Dip 2018” free.

With investors watching global stock markets bounce up and down, many missed two really important profit generating events over the last two years.  The price of silver dipped below $14 an ounce as did shares of the iShares Silver ETF (SLV).   The second event is that the silver gold ratio hit 80, compared to a ratio of 230 only two years before.

In September 2015, I prepared a special report “Silver Dip 2015” about a silver speculation, leveraged with a British pound loan, that could increase the returns in a safe portfolio by as much as eight times.  The tactics described in that report generated 62.48% profit in just nine months.

I have updated this report and added how to use the Dip Strategy with platinum.   The “Platinum Dip 2018” report shares the latest in a series of long term lessons gained through 40 years of speculating and investing in precious metals.  I released the 2015 report, when the gold silver ratio slipped to 80.  The ratio has corrected and that profit has been taken and now a new precious metals dip has emerged.

I have prepared a new special report “Platinum Dip 2018” about a leveraged speculation that can increase the returns in a safe portfolio by as much as eight times.

You also learn from the Value Investing Seminar, our premier course, that we have been conducting for over 30 years.  Tens of thousands of delegates have paid up to $999 to attend.  Now you can join the seminar online FREE in this special offer.

This three day course is available in sessions that are 10 to 20 minutes long for easy, convenient learning.   You can listen to each session any time and as often as you desire.

The sooner you hear what I have to say about current markets, the better you’ll be able to cash in on perhaps the best investing opportunity since 1982.


Tens of thousands have paid up to $999 to attend.

In 2018 I celebrate my 52nd anniversary in the investing business and 50th year of writing about global investing.  Our reports and seminars have helped readers have better lives, with less stress yet make fortunes during up and down markets for decades.  This information is invaluable to investors large and small because even small amounts can easily be invested in the good value shares we cover in our seminar.

Stock and currency markets are cyclical.  These cycles create extra profit for value investors who invest when everyone else has the markets wrong.  One special seminar session looks at how to spot value from cycles.  Stocks rise from the cycle of war, productivity and demographics.  Cycles create recurring profits.  Economies and stock markets cycle up and down around every 15 to 20 years as shown in this graph.


The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns can create war.

The chart above shows the war – stock market cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WW III) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Details in the online seminar include:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios). His big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on a 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of out performance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  The best ratio is normally 1.6 to 1.  We’ll sum up the strategy; how to leverage cheap, safe, quality stocks and for what period of time based on the times and each individual’s circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

The online seminar also reveals  the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed this test.

I have good news about the cost of the seminar as well.   For almost three decades the seminar fee has been $799 for one or $999 for a couple. Tens of thousands paid this price, but online the seminar is $297.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.


Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Platinum Dip 2018” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

Subscribe to a Pi annual subscription for $197 and receive all the above.


For more details on ENR Asset Management contact Thomas Fischer at

Read ENR Asset Management’s ENR Advisory Extra Bulletin (FEBRUARY 2018) here

For more details on click here

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