1. 22 November 2016 CERN Finance Club joaquim.creus@cern.ch
Hands on investing
Introduction to FIS
22 November 2016
CERN Finance Club

2. Study base System Goal Conditions Long term investment simulation
minimum yearly 5% Capital Gain
Conditions
Capital CHF100,000
US market
Financial crash period
Stocks that do not soar or plunge
Invest in three symbols from:
1st NASDAQ
2nd NYSE
Decision: Fundamental Analysis
Trading platform
Low cost broker Charles Schwab
Base country: Switzerland
Dividends are reinvested

3. NASDAQ:COKE 2006 2004 Share Price USD 48.25 USD 57.05 Revenue
USD B.
USD 21.9 B.
Net Profit
USD 5.1 B.
USD 4.9 B.
EPS
USD 2.2
2.0
Dividends
USD 1.24
USD 1.00
#shares
Market Cap
USD B.
USD B
P/S
4.60
6.20
Revenue= gross operation income
Earnings Per Share (EPS)= Net Profit/#shares
Market cap= #shares*Share Price
P/S= Market cap/Revenue

4. NASDAQ:COKE

5. NYSE:FDX 2006 2004 Share Price USD 107.5 USD 94.9 Revenue USD 32.2 B.
Net Profit
USD 1.8 B.
USD 0.84 B.
EPS
USD 5.8
USD 2.3
Dividends
USD 0.31
USD 0.27
Shares
Market Cap
USD B.
USD 28.5 B.
P/S
1.02
0.86

6. NYSE:JPM 2006 2004 Share Price USD 48.0 USD 37.8 Revenue USD 61.4 B.
Net Profit
USD 14.4 B.
USD 10.3 B.
EPS:
USD 5.8
USD 2.9
Dividends
USD 1.30
USD 1.36
Shares
35,000,000
Not available
Market Cap
USD B.
P/S
2.72

7. BUY OPERATION (01/01/2007) CHF 1 = USD 1,23
Open Brokerage Account with Charles Schwab
0,0% custody fee
USD 9,95 for every operation
0% dividend fee
Position of USD 81,300 (CHF account.
Buy:
COKE USD 32, shares
FDX USD 32, shares
JPM USD 12, shares
4,000 USD left in brokerage account to collect and pay
Taxes
Fees
Reinvestment remainder

8. COKE EVOLUTION
Data from Google Finance

9. FDX EVOLUTION
Data from Morningstar

10. JPM EVOLUTION
Data from Yahoo Finance

11. ACCOUNT EVOULUTION dividends paid to our brokerage account
only some stocks pay dividends
paid several times a year
taxed in the US rate 30%
+shares with dividends income
operation once a year to save on buy fee

12. SELL OPERATION (31/12/2013) CHF 1=USD 0,955
Position on our account brokerage is USD 118,200
COKE USD 54, % 749 shares (674)
FDX USD 43, % 312 shares (304)
JPM USD 18, % 307 shares (255)
No US taxes of capital gain (not resident)
Transfer the money to USD account in CH
Swiss income tax is 16% (CHF 100,000 income bracket-Geneva)
Tax is applied regardless of currency

13. OPERATION ANALYSIS Broker Fees US dividend tax CH income tax USD 90
2007 POSITION
USD 81,300
2013 POSITION
USD 112,300
USD 90
USD 2,300
CAPITAL GAIN USD 31,000
INFLATION ADJ. USD 17,800

14. OPERATION PERFROMANCE
Two options:
OPEN USD SWISS ACCOUNT – US period inflation 13.7%
TRANSFER TO CHF SWISS ACCOUNT – CH period inflation 2.6%
ROI
Yearly ROI
Nominal
38.1%
5.5%
Adjusted for US inflation
21.5%
3.3%
ROI
Yearly ROI
Nominal
7.2%
1.2%
Adjusted for CH inflation
4.5%
0.7%

15. USE OTHER BROKERS SCHWAB UBS SWISSQUOTE USD 90 USD 6,400 USD 477
SWISSQUOTE – swiss discount broker
Custody fees 0,1% of portfolio/year (min CHF 15 quarter)
Brokerage fee USA USD 25 (USD 500 to 2000)
Brokerage fee USA USD 125 (USD 25k to 50k)
Swiss stamp tax 0,075% transaction position (only Swiss shares)
UBS Switzerland – traditional bank
Custody fees 0,3+0,2% of portfolio/year
Brokerage fee USA 1,8% ( up to USD 50k)
Swiss stamp tax 0,075% transaction position (only Swiss shares)
SCHWAB
UBS
SWISSQUOTE
USD 90
USD 6,400
USD 477

16. INVESTMENT PORTFOLIO for CERN Finance Club operations team
code a portfolio investment model with real market data
Prepare stock pitches for new acquisitions
decision organism: Finance Club
stock pitches are performed
buy/sell by finance club members
proposed investment constraints
starting portfolio of CHF2,000,000
Work net income of CHF50,000/year
STOCK PITCHES

17. Bibliography Pat Dorsey, Little Book That Builds Wealth
Corporate reports: corporate accounting + stock performance
Website of any public company -> INVESTOR RELATIONS
Stock data: limited to stock price history
Google finance
Yahoo finance
QUANDL database
Inflation rate
World bank