Interview #91 : Swen Lorenz (Undervalued Shares)
Interview #91 : Swen Lorenz (Undervalued Shares)
Investment opportunities around the world
For this issue we have the pleasure of interviewing Swen Lorenz, Founder of Undervalued Shares and Weird Shit Investing conference.
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Hi Swen, thanks so much for taking the time out to do this interview. Can you please tell readers about your background, and how you got involved in investing?
My very first experiences as an “analyst” involved studying CAPITAL – by which I mean the German business magazine, not Karl Marx' book! That was in the early 1990s, when I was 14 or 15 years old. CAPITAL analysed one stock each month and dedicated an entire page to this analysis.
This is how I got my first serious investment in shares, putting almost 2,000 deutsche mark in Hamburgische Stromwerke (Hamburg Electricity Company). From each of these articles, I tried to learn some new aspects about stock analysis.
In addition, the veteran stock market guru and book author André Kostolany had a monthly column about the stock market in the magazine, which fueled my enthusiasm.
At that time, I earned money outside of school working as a temp in a local mail order company, and with the earnings I gradually acquired a small library of stock market-related books.
Some of these were serious investments in themselves! For example, I purchased a copy of the book "Technical Analysis of Stock Trends" written by John Magee, one of the pioneers of chart analysis.
The humdinger of a book cost 150 deutsche mark at the time, which was a considerable amount for someone who earned 10 deutsche mark an hour.
In the pre-Internet era, sourcing and acquiring knowledge about the stock market was much more time-consuming and expensive. I often skipped school and went to shareholder meetings in the Frankfurt area, where I threw lots of questions at the company reps.
This brought my work to the attention of the then editor-in-chief of the Frankfurter Börsenbriefe, at the time one of the most venerable investment newsletters in Germany which just about every bank subscribed to. Their editor was looking for new talent, which is why he offered me a position as a freelancer.
I wrote two or three articles a month, each earning me 400 deutsche mark. That felt sensationally good for a 16-year-old, and was a useful learning experience, besides giving me more financial resources.
I have pursued a lifelong interest in the stock market ever since, albeit with some variations along the way. E.g., I was once part of a team that launched a USD 150m property fund on the London stock market, and I also once contributed my experience in financial matters to a scientific charity in the Galapagos Islands where I was their CEO for a four-year turnaround period.
In the end, though, I always gravitated towards buying and selling publicly listed stocks. I believe investing is one of the best businesses in the world – and certainly, one of the most interesting and intellectually diverse.
I published research reports on the Internet between the mid-1990s and 2010. After an eight-year hiatus, I relaunched my old website Undervalued-Shares.com in late 2018, with the aim of keeping writing for the rest of my life. It's what I love doing the most!
Can you tell readers about Undervalued Shares? How would you describe your investing style, and what type of companies do you research/invest in?
I am an opportunistic omnivore, at least when it comes to publicly listed stocks. This may actually be due to having lived a very unconstrained life overall, and one that was driven by curiosity.
There isn't any kind of public company I wouldn't look at, no matter its geography, sector, or overall background.
That said, I generally drift towards Old Economy companies, and I do have a bias for Europe and North America. Even if you are fully unconstrained, you end up developing an area of expertise, and a network to go along with it.
I also have a bias towards value, and towards situations where we will see corporate action, such as takeover bids and going privates.