Dear investors,
November was a very good month for the AEX, with an increase of +6.46%.
In total, the AEX fell more than 10% from its peak in July 2023 to its low in October, but then rebounded sharply in November.
RVM Strategy gained +2.43% in November, and RVM Retirement gained +4.89%.
The market recovered strongly in November. Whereas Adyen's decline in August was a determining factor in the downturn of the AEX, Adyen's explosive recovery in November was one of the driving forces behind the AEX's recovery.
Was the recovery a surprise to us?
No, we have and maintain higher long-term price targets for the AEX.
Was the decline in August, September, and October a surprise?
A little more.
But as investors and stock market specialists, we never really know what the short term will bring. It is impossible to know. The algorithm we use must be able to focus sharply on the short term when it comes to choosing which position to take.
CHARLIE MUNGER
But the recently deceased Charlie Munger remains a beacon for investors. One of his truths: when investing, "waiting" is essential. An investor must be patient. When I (RvM) first started investing, the best advice I ever received was from an old bond specialist who was about to retire: "Sleep on your investments." He explained how disastrous it was for managers to constantly monitor their accounts. "Let go, don't look back most of the time."
Of course, this advice mainly applied to portfolios that were actually composed for the long term and that were only changed occasionally, at fixed times. But it is also good advice when working in the shorter term, with shorter-term risks. These shorter-term risks, which are well calculated, are also best 'let go'.
Almost always, when an investment decision is made because the account is losing value, that decision turns out to be wrong in hindsight. An investment decision should never be motivated by the value of an account, or whether it is increasing or decreasing. An investment decision should only be motivated by the system or methodology that is being followed.
Both RVM Strategy and RVM Retirement took up some longer-term positions in November, with good results so far.
Despite reasonable results for the month of November, not everything went as planned at Retirement. We did not reach full investment, as we waited too long to take up some of the desired positions. But perhaps this disadvantage will turn out to be an advantage. Here too, we should listen to Charlie Munger: wait. Waiting can be one of the best investment decisions, and we hope that this will now prove to be the case.
The basic idea is that November has realized a significant portion of the upward potential we still expected for 2023. We expect a corrective decline in December, but then another increase in value. All in all, the outlook for December is therefore positive.
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If you are not yet a follower of RVM Strategy or RVM Retirement, you are welcome!
Sincerely,
On behalf of Van Megen Systematic Trading,
Ruud van Megen