MoneyMaker August/September 2012

ISSUE TWO | AUGUST/SEPTEMBER 2012

www.moneymakermagazine.co.uk

PLUS MAKE IT • SPEND IT • LIVE IT

entrepreneur sensation jamal edwards Is fine wine the latest reserve currency?

The world’s most expensive watch

The GOLD RUN MAKE 2012 THE YEAR to start achieving your goals

editor’s letter Hello Reader, If there’s one thing we know here at MoneyMaker, it’s that there’s more than one way to go about the task of acquiring cash. However, whether it be entrepreneurial nous, inspirational genius or a simply a solid understanding of the markets, the most important factor is always to play to your strengths. With that fact in mind, when an opportunity presented itself to me last month to earn a little on the side, the most surprising thing was that it hadn’t really crossed my mind before.

I’ve won a few pub quizzes in my time, and always fancy myself to pull a few quid out of the quiz machine whenever I’m in the local, but above and beyond that I had never really considered putting my general knowledge to work for me before, despite being told it was better than most people’s.

“Have you ever thought about doing some of these TV game shows?” I was asked during a conversation over a pint recently. “It would be free money for you.

In fact you’d be stupid not to do it.”

I thought about it briefly, before coming to the same conclusion. All benefit and no drawbacks seemed like a pretty good deal, and with the sums of money some quizzes are offering these days a second career as a professional quizzer had to potential to be a nice little earner.

Fast forward two weeks and I had applied for my first show (a new pilot I cannot name or describe for legal reasons – official secrecy and all that), got through the auditions, and found myself at a certain television centre in White City ready to get on with the job of taking home some dollars.

And how does this tale end? I’m sure you already know by now from my tone that the answer is “not well”. The short version of the story is that, having sat around waiting for something to happen for ten hours, the filming was cancelled and everybody went home not only empty-handed, but with a severely shortened temper that lasted for days.

So what’s the moral of this anecdote? It’s this; nothing, particularly making money, is ever as easy as it seems. If an idea seems too good to be true, or doesn’t appear to require hard work, dedication and skill to execute, then you’re probably not seeing the full picture.

But will I be applying for another quiz show any time soon? Well maybe. But from now on I’ll be doing so with my eyes open. Because when somebody offers you money for nothing, there’s probably going to be more than one catch involved.

I hope you enjoy the issue.

Best wishes Alex Hammond Editor in Chief, MoneyMaker Magazine

Editor in Chief Alex Hammond Features Editor Mark Southern Web Editor Annaliece Lloyd Features Writers Eve Hartridge Phil Green Jo Franks Natasha Heard Alessio Rastani Chris Powell Contributors Louise Hinchen Simon Smith Michael Derks David Munro Declan Fallon Chris Smith Quintessentially Wine Michael Hewson Colin Cieszynski Art Director IF Design & Art Direction Videography Adrian Butterworth Photography Simon Jessop Head of Sales Kyle Haddon 01162 605 665 sales@moneymakermagazine.co.uk Marketing & PR Polygon PR Research Analysis Simon Wiltshire

06 | MONEYMAKER MAGAZINE

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contents AUG/SEPT 2012 UPFRONT 10 12 14

News In Brief OANDA - The Billionth Transaction Book Club

20

Entrepreneur 16 18 20 24 28

Levi Roots Venture Capital Jamal Edwards Dreamchasers Sports Agent

Trading 32 34 36 38 42 44 46 48 50

Europe Global Markets The Stupid Test David Munro Market Trends Binary Trading Equities K Duker Charting

Assets 52 56 58 62 64

Wine Markets Pontet-Canet Art Investment Eco Homes Property of the Month

66 68

70

Lifestyle 66 68 70 74 76 78

Golfer’s Guide Watches Washington Swimwear Restaurants Holidays

Sport 83 84 88 92 94

Sports News England vs South Africa Olympics Punter’s Post Poker

08 | MONEYMAKER MAGAZINE

36

Send in your stories: Got a story MoneyMaker should be reporting on?

Contact us at www.moneymaker magazine.co.uk

News in Brief what we’re talking about right now

London’s Shard Opening Celebrated with Laser Show London’s tallest building inaugurated to the Capital’s skyline in style

“The light show will mark a key moment for the Shard, and one people around the world can enjoy” 10 | MONEYMAKER MAGAZINE

After many months of anticipation the London Shard has finally been inaugurated, adding yet another iconic silhouette to the London skyline.

The Duke of York and the Qatari prime minister, who’s National Bank has financed the building development, were in attendance at the landmark’s opening ceremony which included a laser light show that could be seen across London.

As the new tallest building in the City with a prime location in Southwark overlooking many of London’s landmarks, tourist demand for the Shard’s viewing platform is expected to be extremely high.

The Shard will also be home to offices

and luxury apartments that will cost up to £65m apiece.

Sheikh Abdullah Bin Saoud Al Thani, governor of Qatar Central Bank, which joint-owns the tower, said: “The Shard is the newest London landmark and a beacon of the city of London’s resilience and expansion, even during tough economic times.

“The light show will mark a key moment for the Shard, and one people around the world can enjoy.”

How Londoners take to The Shard is yet to be seen, what we do know though is that the Capital’s landscape has been changed forever.

MINISTERS BACK IN MEETINGS AS eurozone fears continue to grow

Man Utd Turns its Back on Asia IPO, Heads to US Instead Manchester United, the most valuable sports team in the world, has cancelled plans to launch an IPO in Asia later this year, and instead will pursue similar opportunities in the United States, according to reports.

For some time The Red Devils had been exploring listing on either the Hong Kong or Singapore Stock Exchanges, with most analysts predicting a billion dollar IPO on the latter some time before the end of 2012.

However plans have changed, with the club’s American owners deciding to move the venture back to their homeland, meaning an expected float on either the NYSE or NASDAQ is imminent. A final decision of where the float will take place is expected in the near future, but with NASDAQ currently suffering heavy criticism for its poor handling of the recent Facebook IPO, suggestions are that the NYSE is currently favoured.

The original bookrunners for the listing,

Credit Suisse, JPMorgan and Morgan Stanley, may also change as a result of the Stock Exchange shift.

Sceptics have stated that listing a football club in a country that isn’t in love with the game will be difficult for United, but this seems to be a little short-sighted. In addition to its 650 million global fans (by far the most of any sports franchise) United also boast commercial partnership deals in over 70 countries, including with All-American cultural cornerstones General Motors and the New York Yankees.

A large percentage of United’s fan base is in Asia, but the IPO location switch shouldn’t make the club any less attractive to investors.

News of the cancelled Asian IPO is the second blow to the SGX, after Formula One announced it was delaying its IPO on the Exchange.

Spanish 10-year bonds have risen above the danger mark of 7% ahead of a summit of eurozone finance ministers to tackle the on-going struggles of major euro economies.

Italian bonds also rose to 6.1%, and seem to be inching ever nearer the 7% danger mark. Spain and Italy are seen as cornerstones of the eurozone, and anything close to a repeat to the current economic situation in Greece would be catastrophic for the makeup of the economic coalition in its current form.

Meetings in Brussels will focus on the terms of a Spanish bailout and the formation of a single institution to consolidate all of Spain’s toxic banking debts. However, market indications stemming from the bond yield rise are that financers are currently unimpressed by plans to stabilise the Spanish economy.

The news on Spain and Italy is in stark contrast to that of Germany and France, suggesting once again that the eurozone is ultimately destined for a two-tiered split system, if it were to remain intact at all.

The last auction of German and French bonds, held earlier this month, fell to negative rates, effectively meaning that investors were paying Germany and France to lend them money. Despite German yields falling to a record low of -0.03% the auction was still oversubscribed.

Investors have seen France as Germany as a safe haven from problems across the rest of the eurozone, and this trend seems set to continue.

Wimbledon Win for High Street Charity Federer victory nets Oxfam £100k bonus after punter leaves betting slip predicting Wimbledon result The majority of British tennis fans will look back at the Mens Wimbledon final 2012 as being a lamentable day after Andy Murray fell agonisingly short of becoming the first Britsh man to win the sport’s greatest honour since Fred Perry in 1936.

One body that won’t be so downhearted though is

Oxfam, after learning that Roger Federer’s seventh Wimbledon title had netted the charity over £100,000 from a bequeathed betting slip.

Long-time gambler Nick Newlife made a £1,520 wager back in 2003 that Federer would equal Pete Sampras’ Wimbledon record of seven SW19 titles, at the then

optimistic odds of 66/1. Less than a decade later and those odds now seem laughable.

Mr Newlife died in 2009 but left the betting slip along with all his other possessions to Oxfam, who now have a piece of paper worth £101,840 on their hands.

Newlife specialised in long term bets, predicting the future

success of sportsmen such as Lewis Hamilton in their early teens.

Oxfam spokesman Stuart Fowkes reacted positively to the news, saying “Legacies amount to 10 per cent of our total income from individuals, so they’re essential to us, and as this case proves they can come in all shapes and sizes.”

MONEYMAKER MAGAZINE | 11

UPFRONT

TRADING MILESTONE OANDA’S BILLIONTH TRANSACTION The FX trading technology pioneer will award $10,000 USD to the client who makes the 1,000,000,001st trade—expected to happen sometime this summer.

Innovative tech for retail traders OANDA introduced its award-winning online trading platform, fxTrade, back in 2001. This year the broker-dealer is set to celebrate another major milestone: the platform’s billionth transaction.

The company is running a contest for clients as part of the milestone celebration.

OANDA will award $10,000 USD to the customer who makes the first trade immediately after the platform’s transaction counter hits 1,000,000, 000. Prizes will also be awarded to the second and third trades following the billionth transaction ($1,000 USD and $500 USD, respectively).

A sophisticated trading system built with patented market-making and riskmanagement technology, OANDA fxTrade is tailored to the needs of retail traders and smaller institutions.

“One billion transactions is a testament to the fact that we can cater to traders of any size with utmost flexibility, which is one of the key reasons investors both large and small choose OANDA,” said Tony Savor, who is the company’s Chief Technology Officer.

“Our trading system is entirely automated. It uses advanced algorithms that allow us to net large numbers of small tickets simultaneously and process orders

“Engineering excellence, price transparency, and a commitment to customer satisfaction make OANDA one of the most respected players in the market.”

The Chart: EURUSD from OANDA fxTrade at incredibly high speeds,” explained Savor.

“This efficiency provides our customers with industry-leading execution and pricing.”

The OANDA advantage Only OANDA offers investors the ability to trade any amount, from one unit to 10 million units, and to open a trading account with as little as a single pound sterling. New features, tools, and tradable instruments are added to the trading platform frequently. OANDA also dedicates resources to improve customer experience through the development of leading-edge mobile and social trading applications.

“Engineering excellence, price transparency, and a commitment to customer satisfaction make OANDA one of the most respected players in the market. As we continue to innovate we will reach new targets that make a billion transactions seem small in comparison,” said Savor.

All trades executed on the fxTrade platform—including forex, precious metals,

and CFDs—are eligible to win the OANDA Race to the Billionth Transaction contest. Follow @OANDA on Twitter for hourly updates on the transaction count, and read our contest rules and regulations for more information.

TWITTER @OANDA Go for gold with OANDA this summer in the race to our billionth transaction fxtrade2win.com #oanda #forex @OANDA This summer’s biggest forex trading competition is here: fxtrade2win.com #oanda #forex @OANDA Now’s your chance to win $10,000 from OANDA as the race to one billion continues: fxtrade2win.com #oanda #forex

MONEYMAKER MAGAZINE | 13

The Traders

Book Club

All three books from featured in this month’s Traders Book Club can be found at www.harrimanhouse.com

MoneyMaker’s answer to Oprah

4 Keys to Profitable Forex Trend Trading: Unlocking the Profit Potential of Trending Currency Pairs

by Christopher Weaver

n Invariably the foreign exchange market provides traders with some of the clearest and most reliable trends. This is in the most part due to the high daily liquidity, or volume, of the market. The FX market as a whole trades around US$4 trillion every day - far more than all of the major stock markets in the world combined, and all of these transactions inevitably creates strong trends.

In 4 Keys to Profitable Forex Trend Trading, technical analyst Christopher Weaver covers four different approaches to trend trading the foreign exchange market.

The four Keys covered are trend lines, channels, fibonacci retracements and symmetrical triangles. Weaver explores the primary strengths of each key, why it is useful, and the different variations seen in the market. He then goes on to explain two practical strategies for maximizing the utility of each key, and how to use them to execute successful trades.

The Keys and their corresponding strategies are designed to be traded in the foreign exchange spot market, but are are equally applicable to trading CFDs or spread betting.

4 Keys to Profitable Forex Trend Trading is an excellent guide for experienced traders and investors who are keen to master the complex forex market. The concepts behind the 4 Keys can sound mysterious, but Weaver lays bare their workings with plain English and sharp insight. Fully illustrated with charts and examples, this is a unique and essential guide to making successful trades in probably the most exciting, and most dangerous, market out there.

14 | MONEYMAKER MAGAZINE

“4 keys is an excellent guide for experienced traders who are keen to master the complex forex markets”

The Naked Trader: How anyone can make money trading shares 3rd Edition n Robbie Burns’ bestseller The Naked Trader is back. This hugely popular trading guide – now on its third edition – provides a richly informative and humorous introduction to just about everything related to the stock markets.

With twice the strategies, cautionary tales, and cartoons of previous editions, Burns really does lay everything bare.

He is remarkably revealing about how he made it from being a novice to an expert, from how he does his research and picks good value stocks, to working out the best times to buy and sell them, and where he looks to find interesting new prospects.

He also shares how he cuts out the useless information and gets instantly to the meat of company reports without falling asleep, and the key metric he checks with every share to ensure it won’t go bust on him. These

two insights are probably worth the price of admission to Burns’ world alone.

All this makes it an excellent read for anyone who’s curious about trading either professionally or as a part time cash builder, but its detailed strategies also make it perfect for the established trader. Burns eschews almost all technical analysis, and his strategies are not only refreshingly commonsensical, but are also backed up with dozens of examples.

If this book teaches us anything it is that you don’t necessarily have to be up your ears in charting jargon to make a success of trading. The Naked Trader has made over a million pounds in the markets from being averagely thoughtful and shrewd. There’s really no reason others can’t learn from him and repeat his success.

High Performance Trading: 35 Practical Strategies and Techniques to Enhance Your Trading Psychology and Performance by Steve Ward n In 2005, sports and performance psychology coach Steve Ward received an invitation from an unexpected quarter: a major trading institution in London.

Up to that point he had only worked with elite athletes, sports teams and corporate clients, teaching them key techniques for operating under mental pressure. Now he found himself on a trading floor in the heart of the City, tasked with helping traders to improve their profitability.

The two worlds turned out to be surprisingly similar.

Over the next year Ward led the traders through a course that focused on maximising performance by reducing psychological weaknesses and bolstering discipline and resilience. He went on to work with other financial institutions across the globe.

The results of all this work

are now available in his well-regarded book High Performance Trading, which brings together 35 core psychological strategies for successful market navigation.

The book is structured around the three key stages of trading: preparation, execution and evaluation. For each, the author introduces a range of techniques to help minimise unhelpful trading behaviour and maximise effective actions. The book has a strong practical dimension, with exercises and examples throughout, and the advice is all reassuringly concrete – so whilst the subject matter is often psychological, things never descend into psychobabble.

Successful traders know that an effective trading strategy is only one half of the battle. There couldn’t be a more helpful handbook for those who want to get on top of the other: the mental game of the markets.

MONEYMAKER MAGAZINE | 15

Levi Roots Tips for Pitching To The Dragons

1 2 3

The first thing is you need a great business plan, with a beginning, a middle and an end.

And you need to know it inside out.

You need to have a really strong vision and long-term plan, because an investor wants to make money. So know where you want to go.

Most importantly be yourself and be passionate about what you’ve chosen to do.

Choose your passion carefully, so when you talk about it your love for it comes through. When you sell it to the Dragons, they need to look into your eyes and see you believe it. If I didn’t believe in Reggae Reggae Sauce, then all of this wouldn’t have happened.

E ntrepreneur

levi roots

cooking with the

dragon slayer Levi Roots is the Reggae Reggae Sauce entrepreneur who charmed the nation and celebrity investors on the BBC’s Dragon’s Den, and went on to become the show’s most successful investment. Mark Southern met the man behind the most famous dreadlocks in British business.

S

ome call them the gateway to life-changing opportunity, whilst others simply talk of them as the most feared steps on British television. The short staircase that leads into the studio set of the BBC’s Dragon’s Den has divided the hundreds of UK entrepreneurs who have pitched their businesses to the celebrity investors, with many ripped to pieces in front of the nation, and only a few walking away with their investment.

And it’s generally the car-crash pitches that we as viewers remember best. Whether it be the cringe-inducing ideas, (roller-skates for the knees, anyone?), or the cripplingly awful presentations, the bad pitches are the ones that stick in the mind. Apart from one.

In 2007, a British Jamaican singer/ songwriter made his own personal journey up the infamous stairs, and made the most remarkable first impression in the show’s annals. Levi Roots, with his Rastafarian dreadlocks cascading over his dark suit, stepped into the Den, strumming a guitar and exuding warmth and charisma. He gently sang his Reggae Reggae song to introduce his sauce of the same name, and the rest is history.

Levi secured investment from Peter Jones and Richard Farleigh, giving away 40 percent of his business for £50,000, although shortly after Farleigh departed and Jones took up his share of the investment.

Mobile phone entrepreneur Jones did what all good investors should and provided some influence as well as cash, making a phone call to the Sainsbury’s CEO Justin King. What started off as a small order became a phenomenon, with Levi’s Reggae Reggae Sauce now available in every UK supermarket, netting the entrepreneur an

estimated £35 million in the process.

It’s some life change for the man who still rents the same £450 a month Brixton flat he’s called home for the past twenty years.

Roots is just as likable in the flesh as on television. In fact, a more charming and inclusive entrepreneur you couldn’t hope to meet. He spins tales of his beloved borough of London into stories of multi-million pound business, and does it all with his trademark self-effacing humility. It’s fair to say he’s not like most entrepreneurs.

“I was lucky”, he says modestly. “Most people who go on Dragon’s Den don’t get a chance to get the BBC behind them, and if they had a TV show behind them I’m sure they would do better than me. But, being me, just being natural, that’s what I went in there to do, and I’m willing to learn about everything else. I think the Dragons saw that.”

Dragon’s Den was truly life-changing for Roots, but unlike the vast majority of the show’s victims, he seemed so relaxed for much of his pitch. Was that how it felt to him? “It’s like the duck in the water thing, man. He’s so cool on the surface but underneath the water he’s working his feet off. Singing the song was fine, as I’ve been singing my whole life, but it was the bit after when they ripped my business plan to shreds, that what was the part you saw me starting to sweat profusely.”

What has the show taught him? “It’s nice that people like you, but you have to build a brilliant team around you as soon as you can, and that’s what we’ve done with Reggae Reggae. I’d done my bit to introduce the sauce, but it’s then the team you have that do the real work, like Peter making that call to Justin King. Because no matter what I sang about, it was that one telephone call that really did it for me.”

Would he recommend the show for all entrepreneurs? “No”, he roars with contagious laughter. “It worked for me, but we all know that most people that go on the show don’t get what they’re looking for. I think if you have a really good idea then it can work for you, but I still think the same old route of getting a good business plan together, getting a good reputation for the business, then going out and getting finance from the bank is the best way for most businesses.”

Levi has become something of an icon, with young people looking to him and other black entrepreneurs from similar backgrounds as a real inspiration in making better lives for themselves. Roots visits around 15 schools every week to spread his message, and it’s something that clearly means a lot to him. But would he one day fancy taking his own seat amongst the Dragons to dispense this influence further afield?

“Never say never, but I don’t think so.

I love the show, but my main job is to get out to schools and prisons, and anywhere where young people in my community will have me, and tell these kids how they can make it too. I think we need more positive black business role models for these kids to look up to, and I think I can do more good helping real people who need inspiring than I can with an entrepreneur on the show.”

Levi Roots’ new book, Sweet, featuring irresistible desserts, drinks, cakes and bakes is in good book shops in July 2012.

MONEYMAKER MAGAZINE | 17

E ntrepreneur

Strategy

RAISING THE STAKES Need some extra capital to get your business off the ground?

Well if you’re going to pitch to Venture Capitalists, make sure to avoid making a wrong turn.

E

ntrepreneurs seeking to raise finance from venture capital houses often find it notoriously difficult to get seen, let alone invested in. The stark truth about the nature of the European start-up market is that there are many more talented entrepreneurs seeking finance than there are venture capitalists with funds to invest.

Nonetheless, as an ambitious

18 | MONEYMAKER MAGAZINE

entrepreneur looking to accelerate his or her business, finding a suitable venture capital house to partner with can be game-changing. But how do you go about choosing which of the many venture capital houses to approach?

Where are you likely to have the most success? And what are venture capitalists looking for? We asked Alliott Cole from the ventures team at Octopus Investments for his ten top tips on how to ensure you give yourself the best chance of success.

1

A perfect match Stop, and really consider whether seeking a venture capital house as a partner is the right option for your business. Are there sources of capital that are a better fit for your business at this stage in its development or the sector it is in? Venture capital is appropriate to only a very small fraction of businesses.

Depending on the stage of the business, venture capital houses may look for five or ten times the return on their investment, and often more. Can your business really

questions and discover best practice from those who have been there and done it.

Don’t be nervous about this – there are many treading in the same shoes as you, carrying the same hopes and aspirations.

Join the movement.

4

Warm introductions do help Approaching investors is an art not a science, so think tactically. Seek out those who have done business with your short list of investors, perhaps an entrepreneur that they have already backed, or an adviser they may trust or work closely with. Again, doing your research on these people will pay off.

The press releases or portfolio pages on their website is a good place to start to discover this intelligence.

5

Present in a simple and straightforward way If you do manage to set up a meeting, always assume that your audience will have no knowledge of your business. Start with the key facts, use simple language and avoid technical wording. You need to inspire and inform. Ten slides are all it should take.

Aim for a 20 minute presentation and keep it high-level. Let your audience determine which areas they wish to focus on and explore further. Never freestyle, and don’t use video to explain your concept. If you are unable to explain your business proposition verbally, you run the risk of losing your audience. Get the presentation right.

grow this quickly and to this extent? Don’t fall into the trap of trying to optimise your business for a certain subset of investors.

2

Respect the investor Research the community of investors. Understand from their news feeds, blogs and websites the stage and sector of businesses each investor wishes to partner. Take a focused, tailored approach to investment. Putting time in up front to research the market will minimise the risk of wasted time and frustration later on, and won’t annoy investors who will quickly detect when an entrepreneur hasn’t put the ground work in.

3

Network There are a wide range of online forums and social communities where entrepreneurs and investors share thoughts and learn from each other. Start engaging with these communities, ask

6

Eliminate mistakes Your investor wants you to shine, but silly mistakes will turn them off even the best idea. Nothing is more frustrating than when things go wrong and an entrepreneur makes unnecessary basic errors - it makes the entrepreneur look incompetent and undeserving of investment. Give yourself the best chance of success in your presentation by doing the preparation, getting to the meeting an hour early and get into the meeting room immediately to set up your presentation.

Bring hard copies of your presentation as back up and, as obvious as it may seem, never forget to bring a laptop charger.

7

Present to the slide deck Always, always, present to the slides, whether in hard copy or on a screen.

Structure is critical. Investors will always ask you questions and lead you down different paths, but the presentation is your friend and your means to keep on track and cover

“your investor wants you to shine, but silly mistakes will turn them off even the best idea” off all the main points.

8

Sell your vision and show enthusiasm Show your passion and enthusiasm.

Bring energy into the room and demonstrate that you have the conviction and resilience to make your business grow explosively. You not only need to prove to a venture capitalist that they can trust you to grow their investment, but you also need to show that you could work well as a team together.

9

Clear milestones and key performance indicators The flip side to the previous point is that this enthusiasm must not cross the line from visionary to fantasy. Show that you understand your industry, logically explain why your business will succeed, and clearly indicate what will drive value and what the limitations on growth will be. We like management teams who work on data-led decisions, so know your financials inside out and back to front. No investor will ever criticise you for knowing your numbers too well, so use them to convincingly illustrate how you to intend to rapidly grow your business.

10

Ask for, and then listen to, feedback Feedback is invaluable, and will help you along your path, regardless of if you secure investment from a pitch.

Are you receiving consistent messages from those you have approached? Be careful not to ignore feedback - investors are generally consistent beings in that they want as close to a guaranteed ROI as possible, so if one says one thing then there is a very good chance the next will say the same.

Alliot Cole is a member of Octopus Investments, who offer innovative investment solutions to UK investors, and a wide range of funding options for exceptional companies. www. octopusinvestments.com

MONEYMAKER MAGAZINE | 19

E ntrepreneur

jamal edwards

Acton Thriller Last year tens of millions of people watched a short film by Google telling the story of Jamal Edwards, a young man from an estate in London, who had built a music business by channeling his energy into filming movies for Youtube. Mark Southern met up with the young entrepreneur and viral sensation, who many are claiming could well be the next generation’s Branson.

20 | MONEYMAKER MAGAZINE

C

ast your mind back to when you were fifteen years old, and ask yourself what were you doing? Sloping around a park somewhere? Mumbling incoherently in a shopping centre? Well hang your head in shame, as that’s how old Jamal Edwards was when he began creating a media empire.

We meet Jamal six years after he started his online TV channel SBTV, just as he comes out of a filming shoot. He has an impulsive brightness about him, and the kind of burgeoning ambition shining from his eyes that you only ever see in the best entrepreneurs.

Jamal, now 21, is something of a big deal in the world of music and now also politics, being the young man who worked his way out of humble and tough beginnings on an Acton estate to being a nationally recognised business-star. He was first given a video camera by his mother in 2006, quickly realised the potential of Youtube as a communication medium, and so started his own multimedia channel on the video-sharing site.

“I was just filming foxes in my garden and then people started to watch it, so I thought I’d go out and film local rappers on my estate” he remembers.

It wasn’t long before these interviews and performances from local rappers grew to include nationally recognised artists, and it was only a short while after that until the young man from Acton was interviewing Grammy winners from the US urban music scene.

He recalls, “When I was younger I didn’t necessarily set out to become an entrepreneur, but I wanted to create a platform that the music that meant

“when i was young I DIDN’t NECESSARILY SET OUT TO become an entrepreneur, i just wanted to create a platform” 22 | MONEYMAKER MAGAZINE

something to me could be heard on, because MTV didn’t play it. They didn’t cut it, so I said I will.”

This meteoric rise was finally confirmed when, at the age of just 20, Jamal signed a deal with Sony RCA, making him the proud CEO of his own record label - Just Jam Records.

If Jamal’s story sounds familiar to you, there’s a very good chance you were one of the hundreds of millions of people who watched his story play out in a 90 second Google Chrome short film, which charted his rise to prominence. It’s a short film that helps to define him, and establishes him firmly as one the top young entrepreneurs in the UK, and maybe even further afield.

A meeting with Richard Branson followed after his business talents were recognised, and he now counts the Virgin billionaire as a confidante, with the two recently appearing together on a panel to promote entrepreneurialism. What characteristics do they have in common?

“Passion for whatever we’re doing, and entrepreneurial spirit”, Jamal instantly replies, “and a belief that young people of today are the business leaders of tomorrow, so let’s invest in them today, not tomorrow.”

So does he believe that there are huge swathes of young people with real

potential, who just simply don’t realise it, and lack opportunity? “Yeah, there’s millions of young people who want to make it, but who aren’t sure how. I get hundreds of emails every week from people my age asking me for advice, and although I’ve got a bit more experience than them thanks to the past few years, it’s overwhelming. I try to help as much as I can, and I say to them all, look, I’m just like you, and any other young boy or girl trying to make it, and you can do it if you want it enough.”

Many have focused on Jamal’s background and the estate he gre up on, but the entrepreneur himself carries no time for this. “I hate that ‘I came from nothing to something’ thing that degrades where you came from. It separates people, and I don’t like that - we’re all the same, and I’m proud of where I came from.”

“I say, don’t play the blame game. I’m not speaking for all young people here, but I’ve come up against a lot of people blaming the government or other people for their situation, and I just say don’t blame anyone or anything. You can do whatever you want, and you can make your own future.”

In an industry of shining starlets, his Google film has made Jamal a star in his own right, so what impact has that had

jamal edwards

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“the key is being innovative. we need to think about how we differentiate ourselves from the rest. you’ve got to keep people locked in”

on his life? “It was crazy, man. It came out in August last year, in the first ad break of that season’s X Factor, and the only other people to have had the same Google treatment were Justin Bieber and Lady Gaga!”

The exposure has clearly been positive for Jamal, and he appears completely at ease in his dealings with the media since hitting the big time. But does he believe that in today’s media-obsessed world, entrepreneurs must learn to deal with them effectively or fail? “I think it’s important if you have a story to tell, or you have something to say, but I don’t think

people should court the media just to be on TV. You have to do something and be credible.”

The past year has been a whirl of activity for the entrepreneur, he now employs a team of twelve across multiple marketing disciples to run his online channel, SBTV, and has big plans for the future. “The music side of the business is going well, but I want to build it up across other underexposed areas like fashion, comedy and sports.

The key is being innovative, as the online market is so saturated. I’m pleased that people like me have inspired others to get involved but it has meant that I need to

think about how we differentiate ourselves from the rest. You’ve got to keep people locked in and make the user interaction as smooth as possible.”

SBTV has recently smashed through the 100 million views marker, and Jamal’s continued success, and very public recognition, means many young people look up to him as a role model. But how does he feel about this? “I try to keep a level head, and be myself. When I’m out and about people yell at me, ‘Jamal, Jamal’ it’s because people feel they know me, and they can connect with me. It’s the main thing that’s important and it’s something I learnt from Richard Branson, that they feel I am like them, because I really am. And if I can do it, then so can they.

“The SB in my SBTV stands for ‘SmokeyBarz’, but I like to think it also means ‘Self Belief’. Once a month I pay for a top London studio for the day, and get in a load of talented kids who have never been to anything like that before. When I see their faces, I can tell that they’re inspired, and that’s what I do it for. I’ve been given this opportunity, and I want to give it back.”

“I see a collective lack of self-belief out there, and I always just say to people, ‘just do it’. What’s the worst that will happen?

Someone might say no. The more people there are with that attitude, the more positivity will come out of it. The big artists I work with, the Chipmunks and Tinchy’s have all come through together because they didn’t stop trying until they had made it, and they’ve inspired each other and all pushed the door at the same time. That’s how I see my business attitude. I’m doing it, and I’d love to see other people my age doing it too. It’ll work, man.”

And with that our time with the young entrepreneur is up, and he is off to his next film shoot. He leaves us by quoting George Bernard Shaw and Bobby Kennedy, “I want young people to understand that there are those who look at things the way they are, and ask why, but I say dream things that never were and say why not”.

Jamal’s online TV channel, SBTV can be found at at www.youtube.com/sbtv and follow Jamal on Twitter at @jamaledwards

MONEYMAKER MAGAZINE | 23

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dreamchasers

gowest LIFE IS (SOMETIMES) PEACEFUL THERE

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Each issue we profile an entrepreneur who dared to dream, left their drab 9-5 behind them to pursue a life of their own choice, and succeeded. This month we met Philippa Barton, Founder and Partner of Boutique Retreats, who said goodbye to the City and hello to an idyllic Cornish lifestyle.

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dreamchasers

Tell us what you were doing before you became a dream chaser.

I qualified as a barrister but was working on the trading floor as an equity derivatives lawyer, sometimes crossing over into structured debt work. Eventually I became frustrated with my repetitious life - work hard, play hard, get a promotion, get a bonus, spend the bonus, work harder, play harder, repeat. I became disillusioned with where my life was going and could see it panning out in front of me - quite a scary thing to visualise at 27.

I wasn’t happy, and wanted a life where I was in control of my own destiny, where I could re-ignite my crushed creative side, so I changed my life to make myself happy.

What was your dream that you decided to chase?

My dream was to create a brand that would challenge the drab and over-priced selfcatering market in Cornwall that existed at the time. I had a vision that I could market Cornwall to the boutique hotel set, and open up the county to the SoHo House mini-breakers.

My passion for property was already there (I have a desperate ‘RightMove’ habit), so I sold my London flat, bought two and a half dilapidated wrecks in Mousehole, Cornwall (the prettiest fishing village that I lost my heart to at the age of 6), and the dream chasing began.

I would love to say there were business plans and profit forecasts, but I would be telling you a dreadful lie.

Was it daunting to leave what you knew behind?

Surprisingly, not. I was hugely naïve, and full of the bravado of a bull market and a secure, employed world. I had no idea of what was really ahead. It’s a bit like learning to drive - you think that passing your test is the big thing, but actually this is just when you start to learn.

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There have been a few near misses, and a few costly mistakes, but you learn, and are most certainly a better driver and a businessperson for it.

When did it first sink in that you were starting to live your dream?

There is a honeymoon period when everything is wonderful. However, this was very short lived for me and there were a few years of harsh reality. I was a single mother, a long way from the City and my friends, and I had run out of money.

But then after four years it all began to make sense, and began to be really worthwhile in all respects. I realised the hard times had made me a better businessperson.

All these years later, does it still feel that you are living your dream lifestyle?

I now have many luxury properties across Cornwall, and I personally get involved with the interior design by sourcing beautiful and quirky pieces from all around the county

to create stunning luxury homes that guests can enjoy.

On a personal level, I live a moment from the North coast, my office has panoramic views of the Atlantic, and the business is going from strength to strength. I work around my little boy, and get to spend more time with him that I could in the City, plus he’ll grow up in a place where children can still be children.

Every day I am learning how to be a better businesswoman and mother. Life is good.

What advice would you give to other people living lives that are not their dream lives?

If it’s in your blood then you will do it, and I think it’s the bravest thing a person can do.

You have to work at the lifestyle, as it’s far from an easy option to walk away from the safety of the salaried world. I thought that City hours were pretty demanding, but then I realised that you were always paid, and got weekends and holidays. When you start out on your own its 24/7, and you will be the last person to take home a salary of any sort.

But never let go of those aspirations, and I’d advise anyone who wants more from their life to chase their dream - make it happen yourself today... you have to put in a whole lot of hard work and time, and then

“If dreamchasing is in your blood then you will do it and succeed. i think that it is the bravest thing that a person can do” suddenly it will all seem to be worth the sacrifice.

What’s the best thing about being a dream chaser?

You never wonder ‘what if?’

Do you have any regrets about chasing your dream?

No, not at all. There are things I would have done differently in hindsight, but it’s all part of the learning curve.

Regrets are for people with too much time on their hands – if you get something wrong, say so, put it right and crack on.... it’s a very British attitude but it makes a whole lot of sense.

The luxury properties that Philippa Barton’s Boutique Retreats owns in Cornwall are available to rent 365 days per year, and have been road-tested by MoneyMaker Magazine, with our Travel Editor declaring them “the most glorious way to experience Cornwall”. Find out more at www.boutique-retreats.co.uk.

MONEYMAKER MAGAZINE | 27

Playing the Business Game In our latest look at exciting alternative careers we talk to commercial sports agent Nicola Benn to discover what makes the business side of the beautiful game so appealing to entrepreneurs

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When did you decide you wanted to get into the business side of sport?

I knew from an early age that I would end up working in and around sport in some capacity. My family have always been active and my brother and I were always encouraged to fulfil whatever potential we may have had in our chosen sports. I swam competitively throughout my childhood, and followed a variety of sports, especially football. But I always associated working in sport with coaching and volunteer roles, or as a struggling athlete having to live like a student in order to continue with their passion.

I think that the moment I seriously considered a career in sport for myself was my first taste of corporate hospitality at a big football match as a young teenager.

I was introduced to ex-players who I realised had been paid to ‘just turn up’, brands who had paid to have a presence in the ground, and sponsors of individual players. I remember thinking that there was a way to make a decent living within sport, and consequently to have a career being involved in something you love.

What did you do before you became a commercial sports agent?

I went to Loughborough University, and then went on to gain my Master’s Degree in Management and the Business of Football at Birkbeck University, where I wrote a paper on ‘The Future of Sports Agents’.

From there I have only ever worked in sport. My first job after University was working in the Development Team at The FA, I loved the nature of the role and the feel good factor that came with grassroots football. I gained my coaching badges, was involved in grant applications for local communities, and also started to run the Coaches and Managers Association. This was my first experience of dealing with well-known football personalities and I enjoyed organising events where I had to

sports agent

arrange Championship and Premiership Managers’ schedules and dealings with the press. That’s when I thought that representing football personalities with a commercial value could be something I would enjoy and be potentially good at, so I went on to find a role at a football agency to gain experience.

Can you describe a typical day in the life of a commercial sports agent?

The day usually begins with dealing with emails at home that have come in overnight. Football being a global sport means that transfers and deals are transnational and I am often dealing with brands, clients, and associations worldwide and in different time zones.

Every morning I read all the back pages of the papers so that I am aware of not only any news that concerns my clients, but industry news generally. Throughout the day in the office we have Sky Sports News on and I also listen to radio stations, such as Talksport, to keep on top of what is happening in the sporting world.

Nowadays it is also important to scan the internet and social networking sites, luckily there is a system that can do this for you otherwise it could be an endless task!

Days when I am in the office usually involve approving interviews, images and other media that clients have undertaken with their sponsorship brands.

Base Soccer currently represents some big names in football that attract brands and corporations wanting them to endorse their products or campaigns, so I screen a lot of this interest. Although we see the value in commercial activity for our clients, our number one priority is their performance on the pitch and at training, so no activity is agreed to lightly.

Days in the office are also useful for me to catch up with the football agents at Base Soccer. For instance some of our up and coming younger players who are not yet mainstream newsworthy may have

MONEYMAKER MAGAZINE | 29

E ntrpreneur

sports agent

“I think the most important characteristic is the ability to be honest with your client, and sometimes that involves telling a client what they need to hear” achieved something that could still be used to promote them in future, or is good for me to be aware of (for example, receiving their first professional contract, starting to travel with the first team, or nominated for an award).

When I am not in the office I am usually meeting brands or PR companies, either to highlight to them our stable of talent, or because they have shown an interest in using a client in a campaign. I also attend any commercial activity that a client undertakes, whether this is a photo-shoot, filming for an advertisement, a signing session, an appearance, or press activity. It is important that a client feels comfortable and protected at all times during such events and I attend to ensure that they are not asked to do extra activity outside of their agreement or contract.

any profession after doing it for a number of years, but I think in this case that’s often a good thing. I think that clients appreciate their representatives being honest with them and not pandering too much. I do not think it would work if you were ‘star-struck’ by your own clients as not only would this be unprofessional and I imagine irritating for them, but being too much of a fan could cloud your judgement and bring emotion into important business decisions.

On the other hand, I do of course sometimes pinch myself at the situations my job finds me in and I do acknowledge that I am lucky to enjoy what I do. I have attended some brilliants events, been able to spectate at top sporting competitions, and had the privileged of meeting some of the best athletes in the world.

Do you get the opportunity to travel and go to a lot of games, or is the majority of work done on the office?

A typical football agent does not spend too much time in the office as they are at games, tournaments, or having meetings on behalf of their clients. The agents that I work with also attend youth international tournaments, such as Marveld in Holland, The Algarve tournament, and The Milk Cup in Ireland, to scout for up and coming talent. As a commercial agent I used to go to more games when I was starting out for networking purposes and to learn as much as I could about the industry. Nowadays I tend to go to games to support a client or team that I am working with, or as a guest of a brand that might be interesting in using or already using our talent.

What characteristics do you think make up the perfect agent?

I think the most important characteristic is the ability to be honest with your client.

An agent educates, and sometimes that involves telling a client what they need to hear rather than what they want to hear.

Transparency and integrity are also important qualities to have. A good agent should have nothing to hide in terms of their fees earned, correspondence with clubs/brands, and their business activities generally.

Finally being an agent who focuses on quality and not quantity is crucial. Firstly this applies in terms of an agent’s client list, as a good agent would not want to take on too many clients that he/she cannot realistically manage properly. It is important for clients to feel that they can rely on us any time, and we couldn’t guarantee that if our client list was too long. And then from a commercial perspective I am selective about which activities and brands my clients are associated to and definitely chose on the basis of quality of activity, which does not

Being a sports agent sounds like many people’s ideal job, is it as exciting as it sounds?

I try not to take for granted what I do, as I know that it is a competitive industry and a lot of people are trying to get into it. Naturally the novelty wears off as with

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necessarily always mean the most lucrative financially.

Do you have to work for a larger firm or can you branch out on your own as an independent and survive in the industry?

This definitely depends on the individual, as some people are more motivated and successful working on their own, whereas some really struggle with it. I do not believe a successful agent can work completely single-handedly. Negotiating contracts requires a financial background, legal expertise, and sometimes the use of other languages. Representing high profile individuals can also require an understanding of commercial and PR activity. If one person can encompass all of

Have you ever had a phone call in the middle of the night from a client in “trouble”?

Of course, but I cannot say who.

What are the best things and worst things about the industry?

I cannot think of many negatives. Being asked the ‘female in a male dominated industry’ question is a personal niggle for me. It is no issue in itself, but being asked whether it is by a lot of people you meet gets tedious. I have never felt that being a female has given me any disadvantages or advantages in my career, and I have no opinion on sexism in football. I do not like the fact that I am expected to have a strong opinion about it and stories to tell.

The best part of my job is the different types of people I get to meet and deal with from all over the world. I have always loved to travel and learn about other cultures and backgrounds so I am lucky my work brings me in contact with so many different characters. I also like the fact that I get insight into so many different fields. I deal with television companies, radio broadcasters, film producers, music producers, athletes, brands, PR companies, concierge companies, charities, fashion designers; it’s interesting to me to meet people who are passionate and skilled about what they do, especially in areas I know little about.

these skills, I cannot comprehend how they would have the time to execute them!

I personally prefer working as part of a team and for a company that offers all of the services needed under one roof. I thrive in an environment whereby I can call upon the knowledge and specialist skills of others to enhance my own.

Football businessmen and agents sometimes garner a negative reputation in the media. Is there a seedier side to the industry?

There are many non-licensed football agents in The UK trying to make a living from the game, but there also some licensed ones that I do not believe operate with a moral high-ground either.

The Football Association do a good job

of investigating and disciplining any untoward dealings, but it is difficult to assess how much goes on under the radar.

A lot of it comes out in the wash though, and it is pretty hard to rid yourself of a bad reputation in this industry. I just hope that the careers that these less respectable agents come into contact with are not damaged in the meantime.

The press have always liked to tarnish all sports agents with the same negative brush, but I think that this could be because it is not truly understood what we do. Running a successful agency like Base Soccer is unachievable unless it works with total transparency and in full co-operation with the governing bodies and associations in the sport. In general the people who are successful in this industry are the ones who approch it the right way.

What advice would you give people trying to get into your industry?

Networking is essential, but there is no point meeting people already in the industry if you do not stay in contact with them so that you are in their mind when opportunities come up. A large pile of business cards is pretty useless if none of the people on them know who you are.

Gaining work experience to establish what area you want to work in is also important. There are so many different types of roles within this industry, be clear about which one you want to focus on.

Finally, become a niche. It is such a completive industry so I think that having a specialist skill-set can really make you stand out and gives you something to offer potential employers. This could be a legal or financial background, or a language so you could target specific territories that the company may not have considered venturing into before.

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T H E T R AD E

Europe

Bridging the divide in Europe

Concentrating on patching up the eurozone economies has distanced it from the reaching any viable return to the good old days n Simon Smith, Chief Economist - FxPro

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ne thing Europe has not been short of over the past few years is analogies to describe its current predicament, generally involving patients, burning buildings and pretty much every apocoltyptic symbology you can think of. It’s worth throwing one more into the pot, because right now the sense I get is that the eurozone is sat atop a melting iceberg, slowly drifting away from the mainland.

For the past two years the gap between the mainland has been growing, but rather than work on narrowing that gap (such as all paddling towards it), European leaders have mostly been concerned with stopping the iceberg melting. All well and good, but melt it will. Furthermore, even though there is a life-boat, it looks to be holed below the water line.

Reaching the mainland again means getting to a stage where the single currency can survive in a viable form for the future.

These are the long-term institutional reforms that are needed, rather than the firefighting measures required just to stop

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the situation getting worse. To many, myself included, this has always meant either reducing the eurozone to a more closelyknit group of core countries, or moving decisively down the road of political and fiscal integration. On the latter, we’re not talking full union - nor an arrangement without any conditions - but building a form of financing (i.e. a bond market) that can act as a liquid, international market for euro-denominated debt.

But to achieve this, there are two hurdles to be overcome. The first is political. Leaders don’t tend to climb the political ladder only to give power away once they are there, and so long as they are voted in by domestic electorates, this is not going to change. The latest EU summit of leaders was notable for just how little was said on the subject of further integration.

The second is the financial divide.

Implementing a system of common bonds, one that avoids the issue of less creditworthy countries ‘free-riding’ on the strong credit rating, could be done, but how do we get from where we are now to such a stage? Germany fears that it will involve the mutualisation of currently unsustainable

debt levels and, quite rightly, it questions why it should pay for the past mistakes of others. In which case, there are only four other ways of dealing with these past mistakes: either refuse to pay back creditors (default); lend them more money (which would lead to the same thing, only bigger); inflate them away (difficult in a monetary union); or combine both with a currency depreciation (euro exit).

This sort of reform would have been hard to implement at the best of times (i.e. when borrowing rates were far cheaper and debt much lower), but you can see just how much bigger the divide is now is. Since 2007 eurozone public debt has increased by 37%, or EUR 2.3trln. At the same time, the (GDP-weighted) average of peripheral bond spreads has increased by 6%, or by 4.8% from when Greece was first bailed out in 2010. It’s not an absolutely true comparison, but to a fair degree that 4.8% represents the cost of not making a concerted effort to paddle back to the mainland.

Equally worrying are the holes in the ESM lifeboat (the European Stability Mechanism). The trouble is that the ESM was conceived (late in 2010) when

“Reaching the mainland again means getting to a stage where the single currency can survive in a viable form for the future” European leaders believed that at the time of its launch (originally scheduled for 2014) the worst of the sovereign crisis would be behind them. The EU’s piecemeal approach means that the supposedly new and improved lifeboat is set to be launched in the midst of a storm that was expected to have passed when the plan was first mooted. Unfortunately, there is a real danger that, rather than serving to save the eurozone, it may hasten its demise. At present, there are four countries signed up for financial assistance from the troika (EU,

ECB and IMF) in various forms, including Spain’s bank loan-program. Spain itself will struggle to survive at current market rates, especially given the rising debt burden from the bank deal. All these countries must still contribute to the capital of the ESM. The only provision allowing for leniency relates to those with per capita GDP 75% or less of the European Union average, but only applicable to new ESM members (i.e. accession countries).

If Spain were to be formally ‘bailed out’ however (i.e. sovereign debt, not

just the banks), then there would be four countries whose capital contributions to the ESM (payable by instalment over the next five years) would still have to be paid.

Without direct market access, these would be indirectly paid by the ESM, unless the IMF was to take a greater role. In other words, the contributions would feature in their funding requirements and (ESM) loan calculations for the coming years. The lifeboat is holed below the waterline, even before launch. I still fear the eurozone’s ‘Lehman moment’ is still ahead of us.

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T H E T R AD E

Global Markets

The case for more yuan weakness Chinese currency expected to slide before the end of 2012 n Michael Derks, Chief Strategist, FxPro

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lthough the Chinese renminbi depreciated slightly in the first six months of 2012, very few commentators or traders expect to see much change in the currency throughout the second half of this year. In our view, a powerful case exists for the depreciation of the renminbi to accelerate in the months ahead.

In the first instance, it is clear that the Chinese economy requires even easier financial conditions. The momentum lost over the back end of last year and so far in 2012 is not recoverable, despite the actions of policy-makers. Exporters are suffering a significant weakening in demand, especially from Europe, while the pace of imports has hardly slowed at all. Consumers have become more cautious, investment spending has softened and the pace of lending growth is much less frenetic, in part because of various measures put in place by Beijing.

PRESSURES Certainly bank reserve ratios have been reduced, key short-term interest rates were recently lowered for the first time since 2008 and there have also been various targeted measures designed to remove growth impediments in certain sectors. But with reduced inflationary pressures, especially in the housing market, and the pace of recovery still tepid, the economy requires a further dose of both monetary and fiscal medicine. As such, we can expect more rate cuts and reductions. In addition, exporters will welcome a further weakening of the currency.

Secondly, there has been an enormous

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shift in China’s underlying demand for dollars, which has huge ramifications for both the economy and currency. In recent years the corporate sector in China has been a massive seller of dollars, the corollary of a large trade surplus and the requirement to convert greenback receivables into local currency. However, in recent quarters this has all changed. The flow of net corporate sector dollar sales has completely stalled because export receipts have weakened and the import bill has not. Indeed, it could very well be argued that the decision to widen the trading band of the currency earlier this year had much more to do with an underlying shortage of dollars than any renewed commitment to exchange rateflexibility. Importers for one are apparently big buyers of dollars these days, perhaps because they suspect the currency will fall further in value.

Furthermore, it is very likely the case that the trade sector in China is sitting on a huge net short position in dollars accumulated over many years, and that it now wants to reverse this situation. Some estimates suggest this net short position could be at least USD 0.5trln. Needless to say, should expectations of renminbi depreciation intensify then the demand for dollars and the supply of local currency unleashed could be extremely powerful.

Thirdly, there is a growing disparity between the fix for the CNY (as set each day by the PBOC) and the market rate. The latter is moving further away from the former. In other words, the PBOC is actively preventing further CNY depreciation and indeed may well have been intervening surreptitiously on occasional days throughout the first half of this year. Therefore, it may well be that the

PBOC is holding back additional currency depreciation, fearing that expectations for a lower currency might become selfperpetuating. From the perspective of macro policy-administration, the PBOC will be of the view that, with the economy under a lot of strain and adjustment, it wants to keep the currency as stable as possible. The issue for the PBOC is that, by intervening, they are draining their (still enormous) stockpile of FX reserves, which in turn necessitates drawing yuan out of the local economy, thereby amplifying the slowdown.

A MOVE AWAY Finally, there is plenty of anecdotal evidence suggesting that high net worth investors in China have been accelerating their efforts to convert their local currency wealth into hard currency over the past year. This has been taking place at a time when high net worth individuals in Europe have similarly been shifting some of their assets out of the single currency. As a result, Chinese individuals have been lifting their exposure to residential property in desirable locations (London, various American cities, Hong Kong, Tokyo, etc), and parking some of their liquid funds in safe-haven locations such as Switzerland, Japan, America, Australia and the UK. Against a backdrop of weak demand for their exports, a significant net dollar short position in the corporate sector, and a clear desire by the wealthy to convert their assets into hard currencies, the pressure for further, faster renminbi depreciation will increase in coming months. The PBOC will be determined to hold it as best it can, and its intervention forays will increase in both size and frequency, but keeping the pressure contained will be no easy task.

“Consumers have become more cautous, investment spending has softened and the pace of lending growth is much less frenetic” MONEYMAKER MAGAZINE | 15

T H E T R AD E

AlessiO rastani

THE stupid test

Be a sheep, follow the crowd, and make some quick money. Sounds easy, right? Well if you said yes, you’ve just failed the Stupid Test n By Alessio Rastani

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y best friend doesn’t buy stocks. However, a month ago he phoned me up to, amongst other things, ask whether I was buying Facebook.

Immediately, and perhaps more assertively than he was expecting, I replied that “I wasn’t touching it even with his money”.

He was puzzled, after all his only information on the IPO had come from a media frenzy labelling it as one of the biggest investment bonanzas of all time.

“But surely if everyone else is buying it, then maybe I should as well” was his reply. This conversation made me remember the “Stupid Test”.

The Stupid Test is perhaps the finest

assessment ever devised to judge whether a particular investment or trading decision is the right one, and the reason it is so effective is that it’s so simple. You don’t have to have any investment or trading knowledge at all to understand and apply it.

The Stupid Test, in its most basic form, was stated as below by Wall Street analyst Jeff DeGraaf: 1. It is impossible for everyone to be rich.

2. It is impossible for everyone to get rich following a similar strategy.

3. Comfortable strategies tend to attract everybody.

4. See Rule 1 to clarify the problem of Rule 3.

To put it another way, if an investment (or trading idea) sounds like easy money,

then most likely you are not the only person who has thought of it. There are probably an awful lot of other people who have had the same idea as you.

Therefore, since 90% of people who play the markets lose money, there is a very high probability that the investment idea in question is not going to be a profitable one.

You see, most people don’t realise that the best trades are those that are absolutely boring, unpopular or just dead difficult. Actually, scratch difficult.

Let’s say “impossible”. That’s because it’s going against the grain of popular opinion, and establishing a position before the general population, that will net significant income.

The hoopla surrounding the Facebook IPO is a classic example of the Stupid Test in action – and how a lot of people just failed to see this train wreck of an investment opportunity approaching.

Over a month ago, before Facebook was launched on the stock market, I warned about the risks of buying the Facebook IPO, but the overwhelming hype and excitement surrounding Facebook stock should have been warning enough.

Why was that anticipation a warning?

Because usually when everyone is expecting a particular market to do something, it does the opposite!

For example, if everyone is “bullish” on a stock – such as the investors who thought Facebook would sky-rocket in value as Google did in 2004 – that means they have already bought. If everyone has already bought, then there is nobody left to buy. If there is nobody left to buy, then demand dries up, supply opens, and therefore the stock has to fall. That’s the way the markets have always operated, and will continue to operate.

Facebook suffered a similar fate. On the day of its launch shares peaked at $42, only to crash and bleed like a pig.

Two weeks later it was trading at almost half of its original price.

But stocks are not the only “animal” that the Stupid Test applies to. Other

“if an investment (or trading idea) sounds like easy money, then most likely you are not the only person who has thought of it” 36 | MONEYMAKER MAGAZINE

assets, such as precious metals, are not immune to it either.

This premise is exactly why Google skyrocketed back in 2004, and why Facebook didn’t. In 2004 people still had the bitter memory of the Dot-Com crash of 2000 fresh in their minds. Web stocks were still unpopular, so when Google went public its shares were considerably undervalued.

Compare that with when Facebook went public. Not only were its shares extremely popular with the masses, but it turned out that some big players like Goldman Sachs were selling fifty percent of their holdings.

So ask yourself this question, who is the smarter investor - Goldman Sachs or the “Average Joe” trying to make a buck?

The smart money had already made their profit in Facebook, and now they were dumping it on to the herd.

But consider this. Which markets are unpopular with investors right now?

Well, as of right now Facebook stock

is clearly hated by investors. The same financial media channels that were pumping the Facebook tune have now turned against it.

In addition, European stocks as a whole are deeply unpopular – what with what is happening in Greece, Spain and the entire eurozone mess.

Precious metals have also taken a beating since last year (gold and silver are down 18 and 48 percent respectively from their highs).

The difficult trades right now are buying European stocks and Facebook stock. So if you’re saying to yourself right now “why would anyone be crazy enough to buy them?” you may already be closer to the answer than you think.

And when you get your head around that concept, you could well be on your way to becoming a truly successful investor.

For further information about trading the markets visit www.leadingtrader.com.

Alessio Rastani Alessio Rastani is a 10 year financial markets trading veteran, and at the age of 34 has become a widely followed and respected trading mentor.

In 2011 he gained fame and caused controversy when he stated on live TV news that he “dreams of another recession” and that Goldman Sachs, not governments, run the world.

The YouTube clip has since been watched over 2 million times, and Alessio has since been interviewed by figures such as Sir David Frost.

Alessio hosts free online training sessions where he gives the most up-to-date information on trading to professionals and newbies at www.LeadingTrader.com

MONEYMAKER MAGAZINE | 37

T H E T R AD E

David Munro

Puffer fish and the peter Pan Principle Moby Dick, or Tempest in a Teapot? n David Munro

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T

he media has had fun portraying Bruno Iksil, the notorious “hedger” from JPMorgan’s Chief Investment office, as a whale; a large and lumbering krill-eating mammal from prehistoric times. While his short CDS (long credit or risk-on) position in the vintage Index of North American investment grade credits was probably large relative to both the liquidity of that series and, one would guess, his trading limits, Iksil’s long-term impact on JPMorgan may turn out to be more qualitative than quantitative. The JPMorgan ship is not likely to capsize, but the salt water splashed upon its open credit trading wound may sting a bit.

A US$2billion loss (that admittedly could get much larger) doesn’t seem terribly significant when one considers that the chief investment office was managing assets in excess of US$350 billion. Bradley Keoun of Bloomberg reported that “by 2010, the VaR on his [Iksil’s] trading book was about half that of JPMorgan’s entire chief investment

office.” US$2 billion out of capital of $175 billion equals a loss of 1.1% of capital. Am I missing something here, or is this trading loss just a tempest in a tea pot and not the revenge of Moby Dick as portrayed by the media?

The Peter [Pan] Principle My initial take is that this saga is a simple case of a trading manager rewarding a successful trader with progressively larger limits until that trader ultimately loses more money than he has ever made. It is the trading version of the 1969 classic book The Peter Principle, which suggests that “employees tend to rise to their level of incompetence.” If we tweak the expression for traders or hedge funds, the principle comes across as “traders tend to receive increased capital and trading limits until they reach the level where they blow up.” The belief by traders and their overseers that profitability will forever soar - avoiding gravity despite leviathan limits - might be referred to as the Peter Pan Principle.

Wanting to avoid the inevitable might be cute for children’s fairy tales, but it is a behavioural characteristic best absent among those managing your capital.

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T H E T R AD E

David Munro

London Whale or Tropical Puffer fish Iksil is probably more toxic than large.

JPMorgan will easily recover from this loss and probably report a significant quarterly profit. But their reputation as the gold standard in banking risk management has been tarnished. Judging by the media frenzy his trading loss has created, Iksil might more closely resemble a puffer fish than a whale. A whale can easily tip over a sailboat (which can be righted with effort), but a puffer fish can be deadly.

Touch these aquatic caricatures of a porcupine and they might just blow up and poison you.

As one pro-puffer fish blog informs, “They make cute faces, which look beautiful to the observer [but] bear in mind that the puffer fish has the tendency to eat other fish in the aquarium.” The blogger fails to note that puffer fish are “generally believed to be the second-most poisonous vertebrates in the world,” piped in the toxicity race only by the golden poison dart frog.

Jamie Dimon, Chairman and CEO of JPMorgan Chase, finds that his heretofore risk-worthy bank has been dangerously poisoned and is now in dire need of a detox. The recommended treatment for a poisonous puffer fish attack is intestinal decontamination with gastric lavage and activated charcoal. JPMorgan’s cure may be slightly less biological, but it would not be unreasonable to expect a major flushing of proprietary risk-taking at the bank.

“Iskil is probably more toxic than large, more closely resembling a puffer fish than a whale” Media on a Wild Goose Chase Most reports about Iksil (and indeed, there have been many) delve into the details of his credit positions and itemize the credit series, corporate names, maturity, liquidity, speculate on his hedge fund counterparts, and try to determine whether he was increasing/decreasing/spreading risk or simply prop trading the bank’s balance sheet. The media, while recognizing that the size of the loss in relation to the overall profitability of the bank is just moderate, are drooling at the prospect that Teflon Dimon may finally have a bit of a comeuppance.

The Volker Rule, which attempts to differentiate between banking and gambling (which is a bit like differentiating between housing and real estate, or bonds and interest rates), has been suggested as a cure-all for bank trading losses. “More regulation!” cry the voices of prudence and reason; “off with their bonuses!” But banks don’t need proprietary traders to put them out of business. About 250 US banks failed in 2010 and 2011, largely due to mortgagerelated losses. The real problem in this case is being excessively positioned on the wrong side of the market when it turns. Mortgage lenders were long overpriced collateral in

2005 and JP Morgan’s Bruno Iksil was long overpriced investment grade credit early in 2012.

Simplicity, Not Complexity While the inability to comprehend complexity is indeed a problem within financial institutions, in this case, complexity is an inappropriate excuse.

In a recent Financial Times article, Sally Krawcheck notes that “the JPMorgan loss demonstrated once again that risk measurements have struggled to keep up with complexity.” But a US investment grade credit index is not a complicated product. All we need to do is overlay the credit index (inverted) with S&P 500 index and it becomes clear that, in terms of movement and – until recently – magnitude, the two indices have traded identically. Indeed, many traders spread credit indices against stock indices, or use one to hedge the other.

It would be difficult to sell the notion that a simple long futures position on the S&P 500 index is complex. It could be dangerous, but it certainly isn’t complex.

Why then do analysts, in lemming-like progression, claim complexity when dissecting a simple long credit position?

The JPMorgan ship has been rocked by toxic puffer fish simplicity, not killer whale complexity.

Mark to Magic Our aquatic celebrity seems to have been long credit (apparently a lot) in an off-therun (and thus illiquid) series in a market that went against him. Losses were reputedly not evident due to less-than-accurate markto-markets. Instead of ranting about the complexity of bank-wide risk, we should be more concerned with basic trading issues such as position size, risk limits, marking the book and how to manage a trader.

JPMorgan’s chief investment office appears to have followed a classic selfdestructive progression of: a) Increased capital (Peter Pan Principle), In an earlier article on dollar-weighted returns, we discussed how hedge fund

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“position size and trader management are are given little consideration today”

returns tend to deteriorate when their assets under management increase too rapidly.

It simply takes time to develop the skills and behavioural composure required to manage large sums of money. Successful small hedge fund managers often become unsuccessful large hedge fund managers.

In a similar fashion, banks chase profits by allocating more capital to winning traders. Over the years, many small and successful bank and hedge fund traders have received larger capital allocations based on a profit streak only to blow up. The losses may not be immediate, and indeed some traders perform well for several years before evaporating. But ultimately, they tend to lose more money than they have ever made.

Bruno Iksil has reportedly been a profitable trader over the years and made more than $100 million in 2011. It is not difficult to see

why his limits might have been increased.

His trading manager must have made the decision to increase limits. b) Reduced VaR assumptions (leading to increased limits – more Peter pan), The change in VaR assumptions that led to reported risk falling by one half (again reported by Keoun) is an old trick. When historic volatility - an input to the VaR model - is high, switching to a more recent and lower volatility measure will increase your trading limits. And when recent volatility has been high, switching back to a lower historic volatility measure will give you more rope. The risk manager must have been involved in the decision to double trading limits by halving VaR. c) An appetite for illiquid off-the-run securities The decision to manage a portfolio of credit risk by selling less liquid off the run series instead of the more liquid current series (or the series on the books) is unfortunately not uncommon. Losing credit and rates traders have been known to trade illiquid off-the-run products in an effort to “repair” a portfolio, exchanging extra pips

now for a difficult exit later. d) Dodgy marks This last faux pas, marking your book at levels materially different from the market and even other departments at the same institution, is quite serious and will probably be the issue that puts the kibosh on aggressive proprietary trading at JPMorgan.

Conclusion Position size and trader management are two important metrics from the old days of trading and risk management that are given little consideration in today’s world of quantitative risk modelling.

Reducing VaR, increasing trading limits, and trading off-the-run less liquid contracts are all signs that the trader and their manager are trying to increase position size in the hopes of capturing larger profits. No model is going to uncover this sequence of events. Indeed the models are often tools used to increase limits. A good old dose of sober trader oversight might have helped prevent JPMorgan’s imminent detoxification.

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T H E T R AD E

Markets

How Does The Economy Drive Market Trends?

Understanding the links between how the world is running and its effect on market prices n By Colin Cieszynski, CFA, CMT, Market Analyst, CMC Markets

Market prices, whether stocks, commodities, or currencies, are based on supply and demand, and are driven by expectations of future prices. Traders going long hope to profit from prices climbing, while traders going short hope to benefit from prices falling in the future. Economic trends play a major role in shaping expectations which then tend to be reflected in market price trends.

Commodities Commodities in many ways are the market most closely tied to economic conditions.

During prosperous times demand for goods and services increases, increasing demand not only for physical goods but also for energy as people drive more for work, transport more goods, travel and also consume more electric power.

When economic activity decreases on the other hand, as in a recession, demand for resources tends to decline.

The commodity that is generally regarded as most sensitive to economic conditions is copper because it has so many applications.

Crude oil also tends to rise and fall with the economy, but also carries within it a premium for the risk of supply disruptions that that rise and fall depending on political tensions in producing regions such as

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the Middle East and Africa. Longer-term economic trends can have some impact on agricultural pricing as diets change as economies develop. Shorter-term trading in grains, however, tends to be impacted more by weather conditions.

Stock Markets Interest in stocks also rises and falls with the economy. Stock prices are driven by expectations of future earnings and dividends, and because of this broad market indices tend to reflect expectations for the economy and business conditions six to nine months in the future.

Stocks can also be grouped into industries that respond differently to changing economic conditions.

1) Interest Sensitive – Financials, Utilities, Telecommunictions Interest costs are a major component of these industries’ expenses. Because of this they tend to outperform the broad market when interest rates decline and tend to underperform when rates rise. As central banks use interest rates to manage the economy the performance of these groups tends to lead the economic cycle.

2) Defensives (Consumer Staples and Health Care) These are products and services that people use every day regardless of economic conditions. Because of this, they tend to

grow at a slower pace during expansions but fall off less during recessions. These sectors tend to outperform during times of economic stress and financial turmoil and underperform in the good times.

3) Economic Sensitive (Industrials and Consumer Discretionary, includes Transportation, Communications and Merchandising) These areas tend so see their fortunes rise and fall along with the broad economy and their trends tend to move in tandem with economic expectations.

4) Capital Spending Sensitive / Late Stage (Technology, Energy, Materials) Growth for companies in these sectors tends to be impacted by larger scale projects

“Economic trends play a major role in shaping expectations which tend to be reflected in market price trends”

can also impact index performance. US and Canadian indices, for example, do not always move in tandem. While both countries have large financial sectors, US indices also tend to be heavily weighted in Technology and Consumer Discretionary, while Canadian indices are more slanted toward Energy and Materials.

that can take several months or years to complete. In recessions, companies tend to hold off on approving new capital spending until signs of an economic turnaround are more visible. Following peaks, companies tend to complete projects they have committed to before cutting their budgets.

Because of this, these groups tend to lag a bit behind the economic cycle.

The peak of the last cycle provides a good example of this, as Financials in the US topped out in March of 2007, the S&P 500 peaked in October 2007 and the Energy sector didn’t peak until the summer of 2008.

The structure of each country’s economy and the weighting of industries within it

Currencies and Treasuries Trading in currency and government bond markets is more sensitive to developments affecting the economy as a whole and less influenced by individual companies and sectors. Generally speaking countries with stable growing economies tend to attract higher capital flows.

In treasury markets for example, the interest rate is the benchmark used to rate the stability of countries. Traders demand countries considered to be riskier (whether because of economic volatility, national debt load or other factors) to pay a higher interest rate in order to compensate them for taking on more risk. Bond prices move opposite to interest rates so a higher interest rate means a lower treasury price.

Generally speaking, currency traders

tend to base their trading decisions on monetary policy and economic strength.

Because inflation and stimulative monetary policies undermine the value of paper money, currencies where the economy is stronger, inflation is low, the financial system is stable and monetary policy has the potential to be stable or tightened tend to outperform.

Currencies are traded in pairs, which involves being long one currency and short another. This means that GBP may perform differently depending on what currency it is being traded against. It could be climbing against the Euro, for example, while falling against the USD. Economic Indicators and Markets Each day countries from around the world publish data that moves the markets to varying degrees. The more important indicators include Gross Domestic Product, Employment, Retail Sales, Industrial Production and Monetary Policy Decisions.

These numbers provide ongoing insight into economic trends and changes which can create trading opportunities.

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T H E T R AD E

CHRIS POWELL

Trading Stock Market Volatility Using Binary Betting In the first instalment of this three part trading series, Chris Powell introduces us to the idea of using binary betting to profit during periods of high volatility 44 | MONEYMAKER MAGAZINE

A

t the time of writing this article Greece is preparing for yet another election, which could signal the beginning of the end of the Euro as we know it. Or not. Nobody really knows.

In fact, ever since the Greek Debt crisis started to unfold a couple of years ago, the markets have consistently been a bit… unpredictable. The FTSE 100 particularly has been characterised by periods of stomachchurning volatility.

It has become unsettlingly common to have weeks with the market up a few percent one day, then down a few percent later the same week, or vice versa. This seesawing are often followed by apparent calm periods, which last just long enough for traders and pundits to drop their guards and start calling a new trend.

Many traders (this author included) have gradually come to the realisation that ‘wisest trader is he/she who knows they do not know’.

The stream of highly paid sell-side ‘experts’, strategists and economists offering their daily market-close analyses are being exposed en masse as retrospective yarnspinners; no one really knows why the market is up or down on a given timescale anymore. Good news is bad and bad news is good, and in the panic individual shares are correlated to such a degree that stockpickers are getting slaughtered too.

RIDING OUT THE STORM Against this backdrop, it is no bad idea to simply take a break from trading full-stop, and look for the best bank rate available.

Perhaps top up the index-tracking ISAs after each downward lurch, with a Buffett-like stoicism, but basically keep the trading fund under the mattress. However, for those who still want or need to trade these treacherous markets, a different and very short-term approach is required.

That approach needs to be one which actually rides the roller-coaster itself rather than trying to second-guess how markets will trend and react to Bernanke’s latest QE non-pronouncement, or Merkel’s newest Eurobond ‘nein’.

A binary bet is nothing more than a live, continuously quoted and changing bet of a fixed duration. However, the key distinguishing factor is that the odds are quoted in a so-called binary format, ie in the range 0-100, instead of the more familiar fractional odds offered by a traditional bookmaker.

THE BASICS These articles will explore profitable trading strategies for the major stock market indices, but to start with it is conceptually easier to use familiar sports to illustrate the idea.

If you see a Bookie quoting Euro 2012 odds of 3-1 on England winning a particular game, this equates to a binary price of 25.0.

If you were to buy the binary bet at 25.0, and hold to expiry, your profit would be 75.0, multiplied by your stake per point, and the loss would be 25.0 multiplied by your stake. All such a binary bet does is settle at full-time at 100 if the event is true (England win) or settle at zero if not true (England draw or lose).

The crucial point is that the binary price is live and changes (as a continually quoted spread - eg 55.0-57.0, where you buy at the higher price if you believe the event will happen, and sell at the lower price if you conversely do not) throughout the game.

can never lose more than their agreed initial deposit, unlike traditional financial spreadbetting.

The Factors Daily binary betting is in fact very close to options trading as the same elements are taken into account, namely time to maturity (eight and a half hours for a standard FTSE session), volatility (what range is the market trading in) and the underlying direction of the market in question. The fundamental trick to spotting good value entry points into binary markets and when to get out and take fast profits rests on the nature of how the binary betting provider prices the bets it is quoting.

Without getting into the complex maths of how to price a bet, which was worthy of a Nobel Prize for the analogous option theory’s original co-researchers, the key is in heuristically understanding how the

“an approach is needed that rides the roller-coaster rather than relying on secondguessing market trends” Thus you can open and close the bet at any time during the 90 minutes, locking in profits without having to wait for the final whistle to crystallise an overall profit or loss. And this live feature is why binary betting gets very interesting, and volatility can become your friend if you learn to use it in a disciplined fashion, exercising proper caution and cash management.

How often have we witnessed a sporting fixture, where an underdog performs ‘surprisingly well’ for a short period, scares the favourite into action, and perhaps pushes the eventual winner right to the end of the game? True, there are times when the 100-1 outsider actually lifts the trophy, but more frequently they cause a temporary scare whilst ultimately succumbing to the favourite.

This ‘unexpected resistance’ to what might have been expected before the start is an example of volatility in play, and it occurs surprisingly frequently in the behaviour of key stock market indices such as the FTSE and Dow Jones. By using a binary betting in running strategy, the trader’s insight that ‘things are going to be less straightforward than the experts seem to be calling it’ can reap huge profits with losses capped and quantified. Binary betters

binary price responds to a sudden sharp and unexpected change in the FTSE. If at the start of a seemingly quiet session (let’s say the first 45 minutes) the volatility suddenly picks up and turns out to be higher than the spread initially predicted (say the quote goes to 15/85 levels), then an opportunity often emerges in respect of undervalued remaining time premium. In other words, there is a far greater chance of the market moving back towards the earlier level than the current price suggests.

To simplfy, just as with a ‘surprise’ goal against Barcelona in the first few minutes of a football match, the FTSE unexpectedly moving sharply lower or higher in the first 45 minutes of the session is actually ‘self-detecting’ in nature. The bookies have probably priced it wrong in the run-up to the kick-off and now we have strong indications of under-priced volatility. In Part 2, we will look at specific FTSE 100 intra-day strategies and real binary trading examples that put an intuitive knowledge of volatility into practice.

The author is an experienced derivatives trader.

You should always understand the financial consequences before entering into any spread bet, binary or derivative bet.

MONEYMAKER MAGAZINE | 45

Commodity price slide suggests further equity market weakness Appetite for market investment falling as economic outlook n By Michael Hewson, senior market analyst, CMC Markets

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Equities

G

iven events in Europe, equity markets have by and large held up fairly well. However recent declines in commodity prices have started to weigh as concerns increase that there is unlikely to be an easy solution to the euro crisis.

These fears about Europe are now translating across to Asian markets with the recent growth spurt in China starting to falter.

The recent downgrade by Chinese authorities to the lowest levels since 1990 has raised concerns that China could well be heading for a sharper slowdown than originally envisaged.

Disappointment surrounding the Fed’s recent decision to merely extend “operation twist” and not embark on fully blown QE has taken away the comfort of the “Bernanke put” in the short term. This has made investors much more cautious about buying equities against a backdrop of slowing growth and rising tension and political deadlock in Europe.

The FTSE100 has held up fairly well despite these concerns. Nevertheless the recent sharp declines in commodity prices has raised fears that demand destruction and the lack of growth could well undermine sentiment further in the absence of further concerted central bank intervention.

The Reuters CRB index looks set to post its biggest quarterly fall in over a year while Brent oil prices have fallen to levels last seen in November 2010.

The index is now approaching a key retracement and support level from the 2009 lows of $200.16 to the highs in 2011 at $370.72. The 61.8% retracement level of this move currently lies at $265.45 which has so far acted as supported over the last four weeks.

This is especially important for the FTSE100 which has a higher than average weighting of commodity related stocks, and as such is quite sensitive to the ebb and flow of commodity price movements.

The recent break out in the Brent oil price below $100 a barrel suggests that we could well see further weakness in this commodity, which could well augur badly for further gains in equity markets going forward.

This double top break lower indicates that we could well see further declines towards $76 a barrel on a break below the 200 week MA at $88.

While problems in Europe are likely to

T H E T R AD E

“the key levels to watch in the are likely to be the lows this year at 5,230 with a break targeting levels last seen in december last year at 5,075” continue to dominate sentiment throughout the rest of the year, investors had been hoping that China would continue to take up the slack. This view is slowly starting to diminish given that Europe is one of China’s biggest export markets and the likelihood of a recovery there appears slim in the short and medium term.

As Chinese authorities strive to boost domestic demand in the face of a slowing property market to offset the likely fall in its exports to Europe, commodity prices look likely to remain under pressure, especially given that the US growth story looks to be running out of steam as well.

This is likely to weigh on the FTSE100 given the heavy weighting of the index towards basic resource stocks, and the recent bearish technical signals given out on copper prices as well as the FTSE itself.

The key levels to watch in the FTSE are likely to be the lows this year at 5,230 with a break targeting levels last seen in December last year at 5,075.

On the upside, since the peaks seen in March at 5,990 the FTSE has slowly been trending lower with trend line resistance just above the 5,620 level keeping a cap on any rallies.

Investors need to bear in mind that given the politics at play in Europe equity markets are likely to remain choppy for some time to come as EU leaders wrestle with potential solutions to the problems in Europe.

There is unlikely to be any quick and easy solution given that politicians of all persuasions will focus first and foremost on what their own voters want ahead of what markets need to make long term investment decisions.

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interview

The Forex Files:

K Duker

Last month FX trading platform OANDA announced that long-time CEO Dr Michael Stumm has decided to step down, and would be replaced by K Duker. We were curious, so we spoke to the new man in charge to find out what the changes mean for OANDA and the forex industry Who is K Duker?

I am the CEO of OANDA Corporation.

OANDA is a globally-recognized provider of online exchange rate information and is a trusted foreign exchange market-maker providing currency trading services though the OANDA fxTrade online platform. I am currently based in Singapore, but will soon be relocating to our head office in Canada.

When did you join OANDA and in what role?

I joined OANDA in 2008 as Managing Director of OANDA Asia Pacific. My first task was to establish the Singapore office and oversee the company’s growing operations in the region.

Who will take up your previous role?

A new Managing Director will be announced shortly.

What is your background prior to OANDA? During my career, I have been fortunate to have been associated with some of the industry’s leading institutions. Immediately prior to joining OANDA, I spent ten years with Deutsche Bank, heading up the bank’s eFX business in Asia Pacific. During my tenure, I implemented dbFX – the first retail online forex trading platform from a major bank. In addition to my duties as OANDA CEO, I am the Chairman of FX Architects and serve as a Non-Executive Director of Fidelity Bank in Ghana.

What is your vision for OANDA? Whilst our longer-term strategies will naturally evolve in response to business and industry conditions, OANDA’s overall strategy of being the world’s best online

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provider of foreign exchange services remains our primary goal. As such, my vision is very much focused around OANDA’s commitment to superior customer service and the provision of a fair, open and transparent trading platform.

Why is OANDA making this change and why now?

In the weeks leading up to the CEO announcement, several large projects were completed, including the addition of CFDs and the launch of the fxUnity social trading platform. Michael Stumm played an important role in guiding both projects and with their successful launch, it seemed an opportune time to formerly announce the change.

Is this the last we will see of Michael Stumm?

As the founder of OANDA, Michael Stumm remains an integral member of OANDA’s Board of Directors and will continue to offer his guidance and vision.

Michael is also a well-respected professor at the world-renowned University of Toronto Computer Science department, so OANDA will continue to benefit from Mr. Stumm’s technological expertise.

What long term changes can the forex industry expect?

There are a number of changes coming to the forex industry and these represent some exciting opportunities for OANDA. First off, I believe that forex is growing in awareness as an alternative asset class, and investors are increasingly considering how they can include currencies in their portfolio.

Global growth projections also suggest economic expansion will continue to underperform, likely resulting in a continuation

of a near-zero interest rate policy for many of the world’s larger economies. This means that low yields on fixed income will be with us for some time yet and this is just one more reason why investors are looking more closely at forex as an investment option worth exploring.

I also expect to see retail forex expand into new markets beyond the more traditional American and European markets. Asia Pacific in particular has the potential to become a major hub for forex activity and OANDA’s Singapore office is well-positioned to service this increasingly important market.

One final point I would like to make is how innovation will continue to drive the forex market. OANDA helped define webbased, retail forex trading when it launched the fxTrade platform in 2001.

What is the best piece advice you would give to those new to forex trading?

The most important piece advice I can offer anyone new to forex trading would be to trade within your means. There is risk in any form of investing, but for those lacking sufficient experience, the risk is amplified.

This brings me to my second piece of important advice – practise before trading with your hard-earned money.

For instance, OANDA offers a forex demonstration platform – OANDA fxTrade Practise – that realistically replicates the online forex trading experience.

Finally, I feel it is imperative that all traders understand the effect that news events can have on exchange rates. Fundamental analysis can be anything from the latest unemployment reports, to the potential impact storms or other natural phenomena can have on the health of an economy and, by extension, its currency.

“OANDA’s overall strategy of being the world’s best online provider of foreign exchange services remains our primary goal”

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charting

Technical Analysis Tools: Linear Regression Slope

Measure trend strength using Linear Regression Slope, says Declan Fallon of Zignals.com What does it all mean?

The Linear Regression Slope is based on a best fit line for a price series and is typically calculated using closing price.

Slope helps measure trend strength and resembles a momentum oscillator in form.

Strong bullish trends have high positive values. Strong bearish trends have low negative values. Trends which are weak oscillate near the zero line.

How does it work?

The slope of a linear regression trend line, fitted using the method of least squares, is the Linear Regression Slope. The slope shows how prices have changed per unit time. Note, Slope values change as old data points are dropped and new ones added.

The timeframe used for the Slope calculation depends on the number of days; 20 or less represents a short-term trend, up to 100 days for an intermediate term trend and 250 or higher for a longterm trend.

Slope does not predict trend, it measures the strength of trend for a series of price points, therefore it will lag changes in trend.

So what are the signals to look for?

At its simplest, a cross of the zero line marks a shift in trend; a bullish uptrend when Slope crosses above 0; a bearish downtrend when Slope crosses below 0.

However, the direction of Slope can also warn of shifts in trend strength. By applying a moving average to Slope it’s possible to identify such shifts. A negative, but rising Slope represents a weakening downtrend. Likewise a positive, but falling Slope suggests a weakening uptrend. A crossover between Slope and a moving average of Slope does not indicate a trend reversal is imminent, more the rate of ascent or descent of a trend is slowing.

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The Chart: EURUSD from Zignals.com charting application

On December 3rd 2010 in EURUSD, there was a weakening in the downtrend as Slope crossed above its 5-day Moving Average. A new uptrend signal was triggered on a cross of the zero line on December 13th. However, this new uptrend failed to emerge as a period of whipsaw followed. An additional uptrend signal was triggered on January 20th 2011 which was confirmed by a break of the then well defined, 1.3450 resistance level.

A lengthy period of positive, if somewhat flat Slope values, was maintained until Slope dropped below zero on May 11th. There was a also brief trip below zero in early February 2011, although this was not confirmed by price action as 1.3450 support held before Slope regained positive values.

Incidences of whipsaw can be reduced if Slope is used in conjunction with r-squared, another measure of trend strength (also available on Zignals.com).

When using r-squared there is a critical threshold value which dictates if a trend

is in play. This critical r-squared value is dependent on the confidence interval employed (typically 95%) and the look back period; in the case of a 20-day look back period, r-squared should be greater than 0.20 to confirm a trend. However, while it can reduce whipsaw it does not always eliminate it. Whipsaw signals remained an issue even with the addition of a r-squared filter for EURUSD in December 2010.

When do I make my move?

Slope is best used in conjunction with other indicators. Slope can be used as a filter alongside a momentum oscillator.

Signals generated by a momentum oscillator are used to generate trades in the direction of the Slope-defined trend, effectively using the momentum oscillator to time entries. Where Slope is used to define trend, a longer time period should be employed. Examples of momentum oscillators to use are Relative Strength Index, Stochastics and Williams %R.

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wine

Liquid Gold: is Fine Wine a New Reserve Commodity?

As investors look for a new safe haven to avoid losing out to another financial crisis, an increasingly enticing option is not gold but instead the fine wine markets, says The Wine Investment Fund

T

oday, gold is bought and sold primarily as a hedge against uncertainty in other markets and asset classes. It is therefore easy to explain why prices rose sharply during the recent financial crisis, and have remained high amidst uncertainty over the future of the eurozone. September 2009 saw gold above $1,000 per ounce for the first time (apart from a few days in March 2008) and in September 2011 it reached a high of $1,895.

These increases have prompted a search for other ‘safe havens’ which have similar characteristics. Obvious substitutes are other precious metals (silver, platinum etc) but these tend to suffer higher volatility and have less favourable tax treatment. Oil is the largest commodity market, but has also shown high volatility.

One commodity which has many of the desirable characteristics of gold, without some of the drawbacks of its rivals, is fine wine. This article explores the parallels and differences between gold and fine wine as assets, and reviews their historical performance, to assess whether fine wine really is or could be the ‘new gold’.

Investment characteristics of gold and fine wine Gold has a number of defining characteristics that make it desirable to investors as a hedge against economic and political uncertainty:

l Fixed supply The quantity of gold available does not change significantly because very little of it is mined (around 2,500 tonnes per year) relative to its existing stock (of around 165,000 tonnes), whilst 2,0002,500 tonnes is estimated to leave the market each year (according to World Gold Council figures). Therefore the total supply of gold typically increases by no more than 1% per annum.

The wine market is smaller, but the effect is similar. According to The Wine Investment Fund’s definition of fine wine, total market size is £5-6bn, with annual inflows (new production) and outflows (wine which is drunk) of around £1 billion each. The stock of fine wine is therefore relatively constant. l Inherent value Currencies today have minimal inherent value. Their use derives from legislation stating that they must be accepted, but also the public having confidence that the currency will retain its value.

By contrast gold has no legal backing from any government but is accepted worldwide as valuable. This acceptance has existed for thousands of years and across very varied cultures. The same is true of fine wine: historically, demand dates back at least to the twelfth century (when the English owned Bordeaux); and geographically, fine wine is today appreciated all over the world and is

sought after by a growing number of consumers, whatever the economic and social conditions. Even at the height of the economic turmoil of late 2008, Château Pétrus 1982 still commanded in excess of £2,500 per bottle. l Cannot be debased Currencies are created by governments, and governments can reduce their value by printing money, which generates inflation. The same mechanism can be used to reduce most government debt.

If the government borrows £1bn, it can halve the real value of its debts by creating enough inflation to halve the purchasing power of £1.

Advocates of a return to gold-backed currencies suggest that all paper currencies are eventually rendered worthless by inflation.

Gold’s value is not at the whim of governments and therefore cannot be debased in the same way. In this respect fine wine is identical to gold. l Scarcity Gold’s value depends on its scarcity: the world’s entire stock of gold could be contained within a cube with sides approximately 20 metres long.

Fine wine’s situation is actually more favourable for an investment commodity.

Although a significant amount of wine is made each year, once that wine is bottled the supply of that particular vintage

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1

cannot ever increase - for example, no more Château Latour 2000 can ever be made.

Even more strikingly, supply must in fact decrease over time as the wine is drunk. l Quality does not reduce over time Gold is a highly stable metal: it is inert and does not rust, corrode, or otherwise deteriorate. Again fine wine actually has an advantage in this respect as its quality improves over time as the wine matures. l Tax Free In order to promote gold as a financial instrument, a European Directive of 1998 exempted transactions of gold for investment purposes from VAT. The tax regime for wine has a similar effect. As long as wine is held in an authorised bonded warehouse, it is not subject to duty (currently just over £20 per case in the UK) or VAT (20% in the UK, charged on both the wine and the duty).

Duty and VAT only become payable when the wine is released from bond.

Both wine and gold (at least in some forms) are also free of Capital Gains Tax in the UK, subject to certain conditions.

Summary of characteristics Many of the key features of gold as an investment also apply to wine. They both have inherent value; there is a relatively fixed supply; and they cannot be debased.

In other respects gold has some advantages: in particular a larger market size, and a longer history.

These are more than balanced though by factors weighing in favour of wine: for example the unique supply and demand dynamic which means that prices naturally tend to rise over time, and beneficial tax wrappers which can significantly enhance the attractiveness of the investment.

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2

Statistical comparison In theory, then, gold and wine are substitutes as investment commodities - at least to some extent. But how have the two markets performed historically?

The longest available reliable monthly index on wine, the Liv-ex ‘Investables’ Index, starts in January 1993. Since then, wine prices have increased more than twelve fold, while gold prices have increased less than five fold - and incidentally, the FTSE 100 has not even doubled.

Moreover, gold’s volatility is much higher than that of fine wine. Not surprisingly, then, combining the return and volatility measures to produce a Sharpe ratio (measuring risk-adjusted returns) produces a much stronger result for fine wine than for gold.

All these charts suggest that fine wine has historically been a superior investment to gold. However, the original question was whether wine is becoming, or has the potential to become, a genuine substitute for gold as a ‘reserve commodity’.

3

Development of Correlation Coefficient between gold and wine over time This chart shows the correlation coefficient between monthly movements in wine and gold prices across a number of recent years, where data has been recorded and analysed to prouce an accurate projection of an coefficiency. The graph stops at May 2011 as after this date there are too few

observations for the data to be reliable.

Although the line becomes rather erratic towards the end of the period, the overall trend is clear: over time, wine and gold have become more correlated. So to answer the original question: yes, fine wine is increasingly acting like a reserve commodity.

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wine

Bordeaux’s Rising star Pontet-Canet

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n the early 18th century, JeanFrançois de Pontet, royal governor of the Médoc, combined several vineyard plots in Pauillac, Bordeaux. Years later, his descendants added neighbouring vines in a place named Canet. This was the beginning of one of the largest estates in the Médoc, Château Pontet-Canet.

Over two centuries Pontet-Canet has been owned by three different families with contrasting levels of success. Today it is run by Alfred Tesseron who, with the help of Michel Rolland as a consultant, has reinvigorated the vineyard sites and embraced all the modern oenological and viticultural techniques. Changing these ancient methods to becoming practically bio-dynamic and spending more time in the vineyards initially shocked the grapes, but in the early 2000s their efforts were rewarded by stunning results. The most improved of all Left Bank Châteaux in the last decade, this vast development has not gone unnoticed and Pontet-Canet was recently named in “The Magical 20” list of estates

by Robert Parker, the world’s foremost wine critic.

Its finest vintages include the epic 1961, but most feature in the last decade with 2003, 2005 and 2006 setting a new tremendously high standard before the outstanding 2009 vintage was rated a perfect 100pts score by Robert Parker.

Historically Château Pontet-Canet was never regarded as an investible wine, however the price rises in the last 5 years suggests the trend has changed and the consistently increasing release prices is a good enough indication to its growing popularity. The 2005 vintage was available for en primeur purchase at £360 per case of 12 bottles in 2006,

whilst the 2010 vintage was released last year at £1,020 per case of 12 bottles. The average market price for the 2005 vintage is currently £1,150 per case of 12 bottles.

Château Pontet-Canet has moved from strength to strength in the last 15 years, and as the vines settle properly into their new way of life set up under the new regime of the Tesseron family and Michel Rolland, only the sky is the limit. No one can deny the pedigree of the terroir with neighbours such as Mouton Rothschild, and the ever growing popularity can only reinforce the up coming prospects of this 5th Growth estate.

The future is bright in this little corner of Pauillac, so do keep a close eye on the development of Pontet-Canet in the coming decades – as far as an investment opportunity goes, this has all the hallmarks for success.

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2009 Château Pontet-Canet, 5th Growth, Pauillac, Bordeaux - Robert Parker - The Wine Advocate: This classic, full-bodied Pauillac is the quintessential Pontet Canet from proprietor Alfred Tesseron, who continues to reduce yields and farms his vineyards biodynamically – a rarity in Bordeaux.

Black as a moonless night, the 2009 Pontet Canet offers up notes of incense, graphite, smoke, licorice, creme de cassis and blackberries. A wine of irrefutable purity, laser-like precision, colossal weight and richness, and sensational freshness, this is a tour de force in winemaking that is capable of lasting 50 or more years.

The tannins are elevated, but they are sweet and beautifully integrated as are the acidity, wood and alcohol (which must be in excess of 14%). This vineyard, which is situated on the high plateau of Pauillac adjacent to Mouton Rothschild, appears to have done everything perfectly in 2009. This cuvee should shut down in the cellar and re-open in a decade or more.

Anticipated maturity: 2025-2075.

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ART

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investing in Art a beginners guide Chinese Contemporary Art Expert and Hua Gallery Owner Shanyan Koder gives us her top five tips for getting started in the world of contemporary art investment

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ART

1

Do your research Understand the basic background of contemporary art, the history of how the movement has progressed to the present day, and what art is prevalent right now.

Given how quickly the contemporary art world has expanded and evolved over the past fifty years it is important to familiarise yourself with a brief background on what has happened.

You will also find it fascinating and informative from an investment aspect to keep up to date on what is happening in the contemporary art world now, as things are changing day by day.

One of the most important factors that distinguishes contemporary art from other movements is that contemporary art responds to or triggers issues in our world today. It is very relevant culturally, politically, and socially, and this affects is desirability and consequently its value. Visiting the latest exhibitions at museums and galleries will give you a sense of what issues are hot commodities in the contemporary art world, and in addition joining gallery mailing lists to keep up to date on the newest exhibition openings will help keep your finger on the trend pulse, as well as getting you invited to previews. Attend art fairs, and subscribe to art magazines to find out who the established names are as well as what is happening in the auction market.

2

Focus on emerging talent When looking to purchase art for profit it’s clear that getting a piece of art at a good price but that also has the capability of rising in value over time is imperative. In this regard emerging artists have more upside potential tahn established names. Of course it is good to own a work by an established artist as its price is less likely to fall, but the investment potential for such artists has usualy already been defined. Spotting emerging artists before their market explodes can reap huge profits.

3

Buy from the right sources Buy art from fine art galleries.

And if you want to invest in art for profit, I would suggest that you buy works from galleries that have a programme for new and emerging artists.

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“spotting emerging artists before their market explodes can reap huge profits” Galleries are constantly on the lookout for contemporary artists who have undiscovered talent and upside potential, and, essentially, in most cases have done all the research and hard work for you.

Gallerists filter through artists every day, and when a gallery decides to represent a new artist it means that they believe in the artist’s talent, and think he or she will be a critical and commercial success.

Buying from a gallery will help you build a relationship with the gallery, and also understand the artist and his or her creative philosophies (in many instances you will meet the artist or be invited to his or her studio). The best galleries are always happy to give catalogues and offer any kind of assistance to help their collectors understand the art they are collecting. Some galleries, such as Hua Gallery, will also offer a professional consulting service to help you build a collection that you love, and that has investment upside.

4

Love your collection Be sure to purchase art that says something to you. Being able to respond to and connect with the work you buy is one of the best

indicators that a piece of art has value, both to you and the market.

I think buying a work of art often requires a degree of self-reflection and self-knowledge. Art appreciation is subjective, and when collecting a work of art it is important that you to respond to the work on some personal level. You may respond to a work because it is poetic and beautiful, or you may respond to it because the messages are powerful, haunting, or disturbing. You will have to dig deep in some cases, where the creative concept may be difficult to digest at first sight, but in every case, it is important to make a connection, be it emotional or spiritual, with the work you collect.

5

Treat your investment…as an investment Remember to consider any purchase as a long term investment, rather than a speedy buy and sell for a quick profit. Whilst the future value of an artwork is never guaranteed, it is often the case that a work of art will hold or increase in value over time.

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properties

the not so rocky road Whilst many property developers of traditional homes are struggling, those with the foresight to plan and build more eco-friendly developments are beating the global economic downturn

W

e all dream of getting out of the big city every now and then some more than others. And when you next gaze wearily out of that busy commuter tube window, where do you wish you would rather be?

Did you say Cornwall?

If so, you’re in the 71% of professional Londoners who say they would rather be in the Prince of Wales’ Duchy than any other county in the UK. But that’s the thing with day-dreams, they’re here one minute and gone the next, aren’t they?

Well, no, not for some. Some like Simon Blackburn, the entrepreneur behind ecoproperty development company Living Structures.

For when Simon said farewell to smogfilled cities, he meant it. A relocation to the Cornish village of St Agnes was on the cards, where he has built a small but sensational eco-community of environmentally-friendly luxury superhomes, Rocky Lane.

So how did he do what so many of us dream of but don’t follow through with?

When did you first start getting involved in property development?

My wife and I had wanted to build our own home for some time, and were dismayed at what was on offer in the UK. We had long been fans of the homes

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erected on the West Coast of the US during the Fifties and Sixties. These homes were designed by such greats as Ralph Rapson, John Rex, Richard Neutra and, of course Charles Eames, and we had hoped to find an operation in the UK which might offer the same kind of thoughtful modernist design, but to no avail.

My wife is American, and eventually we found a company called Deck House which had been created in the early 1950’s by Harvard School of Design graduate Bill Berkes. These homes perfectly suited our taste, so much so that we approached Deck House to represent their company in the UK, which we successfully set up in 1996.

We did that for nine years, and we now employ our own engineers and architects for design and construction, enabling us to manage the entire process in-house.

What attracted you to property development?

The fact that we wanted to create homes which understood and sympathised with their environment, whilst giving one a feeling of well-being. Basically, we wanted to build homes owners could be be proud of.

How do you see the future of property development?

Whatever the market is doing in terms of property values, the bottom line is that our country is in desperate need of new homes. For the smaller developer I see no reason for this to abate unless something really drastic happens with the planning process.

What advice would you give to wouldbe property developers?

Get experience, understand what you are building, and understand the trades and engineering involved.

The best developers of the kind of houses we produce are noticeable by their presence.

Is investing in property a sensible idea in the current climate?

We are constantly receiving sales calls from buyers who feel houses remain a solid investment now and in the long term. We certainly believe this is to be true.

Did you need to drum up investment to get it off the ground and how?

Investment and bank funding in these times is a near impossibility. However, my JV partner Oliver Hookway from The Point Cornwall, a qualified accountant, manages this smoothly.

To make this possible experience in property development is essential these days. Without experience, property development funding just won’t happen.

Is the future of property development eco and ethical homes?

Most definitely, but there has to be a financial incentive. Most eco-features just make sense anyway. For example, why would you not want to install heat pumps which utilise the ambient air temp to provide all your water and heating needs? The heat pumps we are installing convert every KW of electricity into 3KW of heating energy.

What attracted you to the Rocky Lane project?

The woodland setting, the topography of the site, the proximity to the beach and the challenge! And the fact that I have been visiting the area since I was a boy and love the place. The Rocky Lane development is not simply about great architecture set in the most stunning landscape. It is also about St. Agnes and its inhabitants.

What is different about Rocky Lane?

The images of the development make it self-evident, what is harder to convey is the feel of the place. It’s quite magical and has a quality of life that makes you feel not so much close to nature, as part of it.

What’s next for you?

We doubt whether we can find somewhere quite like St. Agnes so maybe something totally different - a London development possibly. And despite the fact that the first phase of Rocky Lane in St Agnes have all sold, there is still availability for phase two. l www.rockylanecornwall.com

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properties

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PROPERTY OF THE MONTH Every month at MoneyMaker Magazine we bring you the most stunning properties on the market.

This month’s must-have is All Saints House in Richmond, a converted church on the former Bute House estate. With over 13,000 sq ft of living space, a subterranean swimming pool, and a hugely impressive 118 ft tower, it’s a highly unique blend of classic and modern design, creating a property deserving of its big price tag. l All Saints House Richmond, Surrey l Cost: £9.5million l Marketed by Knight Frank. Call 020 8939 2801 for more details.

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golfer’s guide

GOLFER’S GUIDE

MoneyMaker’s golf expert Sophie Horn takes us around some of her favourite courses in the world The Carrick on Loch Lomond l Par 71 course - designed by the acclaimed Doug Carrick

B

eing from Norfolk, the first thing that strikes me about The Carrick is the breath-takingly stunning scenery and rolling undulations that add a sense of drama and excitement to this superb venue.

The second is the fantastic facilities The Carrick has to offer. Not only is the hotel, Cameron House, one of the most luxurious golf resorts I’ve stayed at, but also the course is absolutely excellent to play. It has some fantastic, challenging holes, but for those who sometimes go a little off-piste it’s still ‘pretty’ forgiving.

One of my favourite parts of The Carrick (in addition to the many kilts being worn in a stiff breeze) was the course’s amazing spa, which I first caught sight of it on the back nine after spotting some steam rising up over the roof of the clubhouse. You can imagine my surprise though when through the mist emerged a number of scantily clad bodies! Unsurprisingly catching a glimpse of this caused me to miss my par putt, it was only later that I realised what I was looking at was in fact a roof top spa! It made me slightly jealous at the time, but eager to get my round finished so I could also enjoy a treatment or two.

My round took a little longer than

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usual to complete, not because I was in the bushes all afternoon before you ask, but because I just had to stop and take in the views surrounding some of the holes, particularly from the course’s elevated tees. Up there though the wind really added to the challenge of staying straight, but the weather stayed warm, giving the course a feeling as though it sits inside its own micro-climate. And even when it did get a little chillier, a whiskey at the half way house always adds a little extra to the Scottish experience, and my distance off the tee!

As the song goes, ‘every rose has its thorns’, and this rose’s thorns comes in the form of 118 bunkers!

Fortunately for my scorecard I only

became acquainted with a few of them, and believe me the velvet greens and immaculate fairways more than make up for the abundance of sand you may find yourself in on your round.

All in all The Garrick course perfectly complements all the other gems this resort has to offer.

The food at the Carrick is just as gorgeous as the surroundings, and there is plenty of choice of where and what to eat. One of my favourite meals whilst visiting the resort was at The Boat House overlooking the Loch, which serves lovely fresh fish and a fab selection of wines, although I didn’t quite manage to try them all.

One final tip before you jump in the car to experience The Carrick for yourself, although the course is spectacular in summer a good time to visit is when it’s just coming into the Winter season, if only so that you can make the most of the cosy log fires after battling the elements!

As you may have guessed, I’m quite a fan of the Carrick. You really do have to go a long way to find a better golfing weekend spot in the UK. To find out more about Sophie’s travels visit her website at www.sophiehorn. com or follow her on Twitter @ SophieHorn

SOPHIE’s VIEW As this is one of my first columns for Money Maker I thought I should start as I mean to go on, so with this in mind I have devised an index (the HORNdex) for each place I visit.

The HORNdex takes into account aspects of the golf course and facilities itself, alongside such things as the Club Sandwich and the local beers on offer.

COURSE:

FACILITIES:

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washington

Pride and Presidents The US capital city, Washington D.C. is growing in reputation for Brits looking to absorb more culture than a weekender in NYC. Mark Southern visited to discover if it really was the home of American dreams

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n the USA they say that politics is simply showbiz for ugly people. They say it, but they don’t mean it. Because, unlike Albion, where Parliament really is the spiritual home for the aesthetically-challenged, US politics is a global stage where glitz, glamour and a bit of jazz hands are the name of the game. And its players are stars.

Unlike their less-slick brethren in Britain,

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American law-makers are commonly to be found with perfectly moulded teeth and hair, stuck onto firmly ironed skin, placed inside impeccably tailored suits, and then media-trained to within an inch of their lives.

These political creatures live for the flash of the camera and the allure of the adulation. They are the De Niros of democracy, the Spielbergs of the Senate, the Lorens of liberty, shining brightly, adored by half the population, and loathed by the other. Those at the top stay there because of their star-power, and the young wannabes who prize their influence gaze enviously up at them.

And where do these starlets with dreams of power in their eyes go to make

it big? Where else, but the Hollywood for the politically-motivated, Washington D.C. As every waiter is impossibly goodlooking in Los Angeles, so every cafe in D.C. is staffed by political doctorates and uncorrupted dreamers. And like its Californian cousin, the aroma of success fills the air with glorious abandon, seducing newcomers with its promises of hope and fulfilled ambition.

There are however fundamental differences between Capitol Hill and its Hollywood counterpart – most obviously that Washington has that rare feel amongst major world cities in that it exists primarily to rule.

It’s the second most visited tourist city in the US after New York, but, make no mistake, this is a town where stuff happens, and it rarely feels touristy. In fact, in the same way it doesn’t take a pure and irreproachable candidate long to succumb to the corporate political machine, so it takes D.C. outsiders no time at all to shift into a local mindset, as walking around Washington feels like living there.

The most notable thing about being in Washington as opposed to most other US cities is the sense of history and purpose, with some of the most

“the most notable thing about being in washington as opposed to most other US cities is the sense of history and purpose” magnificent and well-intentioned buildings and monuments you would see anywhere. From the splendour of the Lincoln Memorial to the powerfullyaffecting Martin Luther King tribute, a feel of lineage and place surrounds the city,.

Wide boulevards intersect some of the world’s most iconic modern sights, and an astonishing number of museums provide a learning experience unlike many others.

As with all aspect of the entertainment industry, the underbelly is well hidden in plain sight. It is visible by taking just one wrong turn, but it must also be said that the much discussed crime rate is also kept mostly away from the main public areas, and it feels like a safe city.

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washington

Overall, Washington D.C. represents an unusual but thoroughly enjoyable short break, and is a city built on the American Dream, presenting a platform of patriotic virtue, whilst hiding the less savoury behind a facade of makeup and showmanship.

And that’s showbiz, baby. l www.discoveramerica.com

STAY If there’s one thing you can say about American cities it’s that they’re never short of luxury hotels, and Washington is no different. This is a city for visiting dignitaries, and they know how to cater for the top end of the market.

The best place to stay is the Four Seasons, which is located near enough to the main sights you’ll want to see, but enough of a distance from the throngs of tourists to maintain the kind of Obama cool that you’ll be wanting to project. It’s also the nearest five star hotel to the White House, and is walking distance from downtown, where the main nightlife happens.

It seems only appropriate that when in the Rome-inspired city you indulge suitably, and it’s worth booking the Royal Suite in the pleasingly coincidental West Wing of the hotel.

Here you’ll find the biggest suite in town, with a stunning roof terrace, a palatial marble bathroom, and around 4,000 square feet of contemporary yet classical decor, with just the hint of an art deco finish.

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A perfect mix of calming luxury. l www.fourseasons.com

EAT Anyone who has seen any kind of US political drama understands that business gets done over lunch. Or dinner. Or, maybe, breakfast.

Food in Washington matters, which is just as well as there are more choices for a foodie connoisseur than you could wave a constitution at. It’s hard to pick an absolute best, but make sure you visit The Inn at Little Washington, for

something truly special.

For those who enjoy Heston et al’s fun with food, you’ll love the little quirks and wit they serve up here, including the ‘world’s smallest baked potato’ and a robot cow to serve cheese. It’s all exquisite, but make sure you try the tasting menu, with the macaroni and cheese something far more than the sum of its parts. l www.theinnatlittlewashington.com

PARTY In a city of corporate white collars and

Apple’s dominance over retail therapy.

Downtown is full of boutiques and department stores, but the real value is in the shopping outlet centres, and Premium Outlets is the undisputed number one shopping stop in not just the Washington area, but across North America.

Just a short trip out of the D.C. centre, Premium Outlets has three centres filled with designer stores at outstandingly low prices, including Gucci, Calvin Klein and Coach.

For those wanting a more culturally enriching shopping experience, hire a car and head down the coast to the historic Civil War town of Williamsburg, which has kept its authentic charm from days of old, and which hosts an expansive luxury Premium Outlets centre. l www.premiumoutlets.com

SIGHTS

“there are a lot of things to see in washington, and it’s a delightful experience to wander around a corner only to see an iconic building you once saw in a movie”

There really are a lot of things to see in Washington, and it’s a delightful experience to wander around a corner only to see an iconic building you once saw in a movie.

To get the most out of the city a tour is recommended, and there are very decent bus and segway tours. However, Washington is a city made for cycling, with its many flat parks and byways, and there are Boris-bike-esque bicycles dotted around that are a perfect way of getting all the photos you’ll need.

Understandably the famous gates outside the White House get very busy during the daytime, but early in the morning and in the evening they are very quiet, so it’s advisable to plan your getting about.

AIRPORT

sharp suits, the Chi-Cha Lounge stands out from the crowd in its somewhat incongruous setting of a former fire station, turned latino hotspot.

Latin jazz is the soundtrack to your night here, with warm decor and hospitality making this a home from home, where all comers are welcome. l www.latinconcepts.com

SHOP For decades NYC has been the go-to destination for US shopping weekends, but Washington is challenging the Big

Say goodbye to the hassle of airport parking with the brilliant Pronto Parking, who will collect your car at the passenger drop-off point, before valeting it and returning it to you from the same place. l www.prontoparking.co.uk

GET THERE Virgin Atlantic fly from Heathrow to Washington Dulles. Make sure you upgrade to Virgin’s award-winning Upper Class, and get to the airport early to enjoy the unique hospitality of the Virgin Clubhouse, with its private members’ club feel. l www.virgin-atlantic.com

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watches

Once Upon a A Time In times gone by it would be quite normal for a person of means to have a private jeweller, but the trend tailed off for decades. However, with the luxury watch industry so crowded at the top end, more and more high net worth individuals are appointing their own expert to personally advise them on their personal needs. We caught up with Kevin Reynolds from Monaco Diamonds and Watches, one of Europe’s leading private jewellers, to ask him about his favourite time piece.

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lmost every day I get asked by people “What is your favourite time piece?” Well, quite simply it is the Franck Muller Aeternitas Mega 4.

Why? Well, this may surprise watch connoisseurs, but first and foremost it is not the complications, fine craftsmanship or any of the technical detail about this amazing creation, although they are all stunning in their own right. No, instead I am going to set aside my professional views and be brutally honest - I just love the look, the touch and form of the Mega 4 - it’s the most beautiful watch I have ever seen.

In my profession I see countless magnificent time pieces every day. I touch them and wear them, but it’s fair to say I sometimes take even the finest of clockwork creations for granted, like a Ferrari salesman might sometimes forget how privileged they are to be

working with such exquisite examples of engineering. I can honestly say I have never had that feeling with the Mega 4.

I had the pleasure of wearing this masterpiece last week, found myself checking the time every couple of minutes, and still ended up falling in love with it over and over again each time.

At the end of the day, I carefully placed it back in its box, and had to admire it some more. I just couldn’t bring myself to pry my eyes away from its face, it stirred in me that fuzzy feeling in my stomach - anyone, from prince to pauper, would be proud to be wearing this amazing watch on their arm.

The masterpiece of engineering was designed and manufactured by the Franck Muller Group at Watchland, overlooking Lake Geneva, considered the cradle of horology since the 15th century. The watch was launched in 2010, with 36 complications, 1483 components and 99 jewels, and that’s just where the technological genius of the timepiece starts. I could spend many more hours detailing the tourbillon, the movement and the complications.

However, my favourite features of the watch include some of its quirks. For example, the Mega 4 astronomic moon phases are displayed on the dial with the utmost precision.

Likewise, the Grande Sonnerie (Grand strike) strikes the hours and quarters automatically, with a distinctive feature of chiming the same notes as the clock tower of Westminster Cathedral. For instance, at 3.15pm the wearer will hear three low pitched sounds (din din din) followed by the first four notes of the

“I found myself checking the time every couple of minutes, and still ended up falling in love with it over and over again each time” Westminster chines (mi do re sol).

The watch is the pinnacle of Swiss watchmaking, and represents a climax in the profession post the early 90’s, when the famed industry hit a slump due to the quartz movement. However, Franck Muller focused purely on mechanical watches with complications, and this beautiful time piece demonstrates their exquisite gifts and innovations in the art of Haute horology. It has put Swiss clockwork back to its undisputed place as the best in the world.

The Aeternitas Mega 4 has reinforced the brand’s label as the ‘Master of Complications’ and is an exceptional timepiece, with a price tag of £1.8 million, placing it firmly in the top echelons of the watch market.

Kevin Reynolds is the spokesperson from Monaco Diamonds and Watches (www. monacodiamondsandwatches.com).

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l i fest y le

swimwear

make a splash this summer Now we’re (allegedly) into summer, getting beach-ready doesn’t just mean hitting the gym and cutting carbs. You’ll need some killer beach wear, so draw a line in the sand and bid adieu to terrible swimwear and hola to this collection of hot holiday musthaves from www.matchesfashion.com

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Mens 1. Myo - £138 2. Olebar Brown sky blue £120 3. Olebar Brown black and white - £139 4. Paul Smith - £85 5. Ralph Lauren - £85

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Womens 6. Lisa Marie Fernandez £425 7. Heidi Klein Top - £95 8. We are handsome - £190 9. Missoni - £198 10. Lisa Marie for Peter Pilotto - £355 11. Vix – Top £120, bottoms £98 12. Tara Matthews – top £138, bottoms £138 13. Zimmerman - £170

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“The menu at fallowfields offers something different each day, depending on what has been growing in the kitchen garden”

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restaurant

Fallowfields

A food destination worth travelling for Roving restaurant reporter Natasha Heard left the city and headed to the Oxfordshire countryside to experience a new name on the British foodie’s radar

O

xford may be known for its spiralling steeples, centres of learning and grumpy detectives, but it’s also maintained a reputation in the restaurant industry as something of a culinary hot-spot, with a host of Michelin stars to prove it.

However, there’s a new name on the lips of food lovers in the city of Matthew Arnold’s dreaming spires, and that’s Fallowfields - a rather unique and interesting hotel and restaurant, set in the Oxfordshire countryside.

Fallowfields is an elegant hotel in the rustling green countryside, hidden away from the world in a pock of glorious peace, offering exquisite food in its award-winning restaurant.

Head chef Shaun Dickens aims to ‘bring you a dining experience that showcases our ethos, a passion for the freshest of food, where care is intrinsic and absolute dedication to the quality and taste of the finished product is paramount.’

The ambitious head chef’s bold words are every bit true, and the hotel gives you a hard fought dining experience sumptuous enough to make you want to return every day.

Largely self-sufficient, the menu at Fallowfields offers something different each day, depending on what has been growing in the kitchen garden or smallholding outside.

During my time at the country house hotel I was lucky enough to sample a variety of cuisine, including the tasting menu, which is rapidly growing in fame.

Expect canapés and a chef’s appetiser to set you off on your journey of discovery before the menu takes you from Chile to France to South Africa on your wine tour, and from rich, deep and meaty to sweet, light and tangy on a slaloming ride for your taste buds.

Personal highlights of the tasting menu included the confit salmon (served with vanilla, pink grapefruit, compressed cucumber and watercress), the terrine of foie gras with garden rhubarb chutney, ginger and toasted brioche, and the pan roasted halibut with oxtail, broad bean, tomato and shallot fricassee - a delightful mixture of flavours that leaves my mouth watering at the very thought.

Each item on the menu has been carefully considered and prepared then cooked to perfection to give the utmost quality and experience to the diner, and every dish is accompanied by a wine impeccably matched.

The hotel itself offers just ten delightful rooms which have been beautifully decorated to make your stay a relaxed and comfortable one. It provides a perfect tranquil escape to the countryside, yet is only a 20 minute drive to central Oxford.

The family owned and run hotel is set in twelve acres, and encourages visitors to explore the grounds and also take part in regular outdoor pursuits.

It’s a genuine joy to be a part of something before everyone else does, so I’d strongly recommend experiencing the joy of Fallowfields before the whispered secret of this part of the world becomes the talk of the town further afield.

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l i fest y le

Holidays

don’t forget your ice pick Travel is meant to excite.

What’s the point of breaking out of your busy day-today life to not feel the blood pumping around your veins? Surely you owe it to yourself to feel alive whilst topping up your tan? Mark Southern set off around the world to experience the very best global travel experiences to set the pulses racing.

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Getting Back to Nature, at Vassaliki Naturist Resort Kefalonia Adventure holidays needn’t be white knuckle to be daunting - sometimes to face true fear, you have to let it all hang out.

Europe’s number one naturist resort is Vassaliki, nestled into a quiet corner of the idyllic island of Kefalonia, where a small secluded oasis of skin-coloured calm has been created for holiday makers who want to go au naturel.

Naturism is a growing trend across the world, with numbers of people travelling to naturist resorts up nearly 200% in three years. And it’s easy to see why, as the pressures of business and finances build up on successful people, stifling them in both literal and metaphorical senses. What better way to say goodbye to one way of life, and hello to another than doing the one thing you would never do in the office?

At Vassaliki, husband and wife owners Mark and Sam Taylor have cultivated a wonderful hidden gem of a resort, welcoming to both experienced and first time naturists, and it’s surprising how quickly the nerves disappear within moments of de-robing.

When we first exposed ourselves to the elements, we had a momentary bout of supreme anxiousness. However, the joys of naturism are manifold, with a genuine feeling of relaxation and calmness flowing through your veins once you overcome the fears that millennia of fashion repression have caused.

There’s an old Chinese saying that translates loosely to ‘only without clothes can our souls be free’, and all hang-ups vanish once you’ve taken the step to rid yourself of the fabric that we identify our personalities by. Here, no-one is a CEO, no-one is struggling at work, no-one is pressured into being people they are not everyone is themselves, and it’s liberating in the extreme.

Kefalonia’s almost guaranteed sunshine, so you can lounge around by the pool, or try out some of the excellent excursions, like the fun boat trip around the thousands of empty beaches around the island. All whilst wearing nothing more than a smile, of course.

For a travel experience unlike any other you’ll go on, we couldn’t recommend this more highly, and Vassaliki’s the one resort in the world where we would advise first timers to experience the wonders of holidaying sans tan lines. l www.viglanatura.com

MONEYMAKER

MAGAZINE | 35

l i fest y le

holidays

Running With the Bulls Pamplona, Spain It’s not to everyone’s tastes, but there’s nothing quite like angry bulls running at you in cobbled streets to put that email you forgot to send to the back of your mind.

The famous Running With the Bulls festival in the historic town of Pamplona is an annual Spanish celebration of San Fermin, and is amongst the most surreal days away you’ll ever experience. The event was originally conceived centuries ago to move the bulls to the bullring, but these days is an excuse for a seven day party, with one extreme twist.

For those looking for an animal encounter to remember listen out for the firecracker that tells you that the six bulls are free. Then run. Runners sprint through the tight winding streets that maze through the old town, whilst hundreds of tipsy fellow runners career into them, all whilst having indulged in too much sangria.

Many find the practice cruel to the animals, but no one can deny its place on this list for the heart-racing terror it induces. l www.pptravel.com

Cycling the Road of Death Camino de las Yungas, La Paz, Bolivia If cycling to you means a pleasant afternoon amble on a bicycle with a basket and bell then this may not be for you. If, however, you’re a little more enamoured with the idea of extreme experiences on two wheels, then read on.

The infamous ‘Road of Death‘ in Bolivia is not named so lightly. The world’s most feared stretch of tarmac stretches for over 40 miles from the Amazon rainforest region to the Bolivian Capital city, and is considered the most dangerous road on Earth by many.

Whilst we fear the M25 for different reasons, the Camino de las Yungas

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snakes through mountain ranges, with sheer 600m canyons dropping out from the edge of the single track road, and accounts for 300 deaths every year.

So, with this in mind, the petrifying passage has become a badge of honour for downhill cyclists who like to feel the wind in their hair, and ideally the ground beneath their feet. Specially adapted mountain bikes are used to send their riders hurtling down the almost all down-hill track at speeds of over 40 mph, and it’s a sure-fire way to both give you the thrill of a lifetime, and the nervous disposition of an omniphobic. l www.xtremedownhill.com

Ice climbing Rjukan, Norway They say a child is born with only two natural fears, with any future fears picked up by their life experiences. Those two fears? Loud noises and falling. The final death-defying holiday on our list looks the latter square in the eyes and laughs at it, although if one isn’t too careful they could end up making the former whilst plummeting to the depths below.

Ice climbing is for those for whom climbing a regular mountain seems a bit tame; The kind of person who looks at Tom Cruise’s Mission Impossible 2 opening stunt as a Sunday afternoon hobby.

You’ll require an admirable amount of courage to climb up a frozen waterfall, and no shortage of skills, but the experienced and helpful guides at Kelso Travel will ensure you go safely down as well as up the solid ice wall.

The thrill of the cold ice against your face as you haul yourself up over the icy edge is absolute, and rarely will you feel every nerve twitching in your body quite the way you do when you take a glimpse around you and see the white-capped backdrop rolling into the distance whilst you hang from what was once a running waterfall. l www.kelsotravel.com

White Water Rafting With Crocodiles Zambezi River, Zambia

Get There British Airways fly to all our five destinations. Check out www. ba.com, and don’t forget to upgrade to their award-winning First Class for the ultimate in relaxing travel.

Widely considered the very best white water rafting experience you’ll ever enjoy, the Zambezi is thrilling for two reasons.

The first is the unparalleled ups and downs rafters absorb, as they career along the explosive river. The second?

The crocodiles that swim beneath the raft for anything, or anyone, that may fall out.

Don’t worry too much though, as the crocs are on the smaller side of maneating, meaning you might get nipped but you won’t be dinner. What is more likely is your knuckles will never be white as you grip onto the oar and boat with more force than you thought possible.

As you whisk along the sliding water

it won’t just be your raft dropping down steep slopes, as your jaw will be glued to the bottom of your boat at the stunning vistas you’ll glide past, from thick jungle to the majestic Victoria Falls - the largest waterfall on planet Earth. l www.waterbynature.com

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The finest courses on the Algarve‌ At Executive Golf we know a thing or two about creating the ultimate golfing experience, after all our team of hand-picked PGA professionals are selected for their outstanding coaching ability and are amongst the best in the business.

Your hotel or private villa will be selected to your exacting standards and of course we only partner with the very best coaching academies and courses on the Algarve. We appreciate that your leisure time is valuable and will see to every detail of your stay – allowing you to spend your days improving your handicap in the company of our Golfing Professionals and your evenings at the finest restaurants the region can offer.

You should return home relaxed, refreshed and a better golfer!

www.executive-golf.co.uk

E X E C UT I V E

sportsnews

fight odds:

Haye and Chisora Set for East End Brawl ig time boxing returns to the Capital this month as, despite the condemnations of the British Boxing Board of Control, British heavyweight boxers David Haye and Dereck Chisora settle their long running dispute at Upton Park on 14th July.

Boxing’s biggest bouts are surrounded by glitz and glamour, not only is the build-up decked with razzmatazz but fights in Vegas and New York tend to attract some of the biggest celebrities in town.

However there’s been little excitement surrounding the fight since its initial announcement and perhaps with good reason (in addition to the fact that the fight still isn’t being officially sanctioned by the BBBoC). The reason is that on paper it’s not a particularly interesting

B

fight.

Boxing fans will remember the last all-British heavyweight “superfight” – between Haye and Audley Harrison, as one of the worst mismatches in boxing history. It was so bad that after a dismal three round fight in which he landed just half a dozen punches before being knocked out there was clamour for Harrison to be stripped of his purse for the shambles. Although he did end up keeping the cash, Big Audley’s reputation would be damaged forever.

Haye vs Chisora has all the makings for a similar outcome. Haye is the more skilful boxer and should win the fight easily, but after a period away from the sport just what shape he’ll be has to be in question. If Haye underestimates Chisora and underprepares, then what he could see from the former World Champ is

Fight Winner David Haye 1/3 Dereck Chisora 5/2 Draw 28/1 Round Group Betting David Haye Rounds 1-6 4/1 David Haye Rounds 7-12 7/2 David Haye on Points 11/8 Dereck Chisora Rounds 1-6 11/1 Dereck Chisora Rounds 7-12 9/1 Dereck Chisora on Points 11/2 Method Of Victory David Haye by KO, TKO or DQ 8/5 David Haye by Decision/Tech Dec 11/8 Dereck Chisora by KO, TKO or DQ 9/2 Dereck Chisora by Decision/Tech Dec 11/2

three rounds of dominance followed by a stroll to a points win finish.

Chisora has a good chin and has never been knocked out but lacks the hand speed to cause Haye any real difficulties, making a points win for Haye even more likely.

The animosity between the pair could spark a frantic beginning to the fight, so a hedge on a first or second round knockout by either fighter would be prudent, but our money is still on a points victory for the Hayamaker.

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sport

cricket

Betting on the Boys of Summer England’s Cricketers are Back for a Summer Showdown with South Africa ith a summer of European Championship football and The Olympics packing out the sporting calendar you can be forgiven for forgetting that our national sporting summer pastime is cricket. And despite going somewhat under the radar in 2012, according to official ICC rankings England are still the best Test side in the world.

Now, after a comprehensive whitewashing of the West Indies last month, England head into one of the most anticipated Test series in years, as South Africa come to these shores for the first time since 2008.

The South Africans will be coming into the series full of confidence. In the past nine months Graeme Smith’s men have enjoyed successful campaigns against New Zealand and Sri Lanka, and will fancy getting a similar result against England.

When the tourists were last on English soil

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in 2008 they left with a 2-1 series win, and despite the shortened series will have a similar score line in mind.

South Africa are currently ranked second just behind England in the ICC Test rankings, and can re-take top spot before the end of the summer. So with the world’s two best international teams set to lock horns with the title of “Number One Team in the World” at stake, we could be in for one of the best summers of cricket since the 2005 Ashes.

It’s sure to be a much closer series than England vs West Indies earlier in the summer, but for our money England should be the favourites, if only for having the advantage of home conditions on their side.

But will we be putting our money where our mouth is? Well we won’t be so quick with that one.

Our Series Prediction: England 2-1 South Africa

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sport

cricket

Calendar 1st Test – The Oval, 19th-23rd July Despite having a reputation for being something of a flat track and the site of many a bore draw, The Oval has been a good ground for England. They’ve only lost there once since 2005 (a defeat to Pakistan last year), and with only one draw as well Andrew Strauss and Andy Flower will fancy their chances of jumping out to an early series lead in London. Furthermore The Oval was the site of England’s sole victory in the 2008 series, so they’ve got good recent form against South Africa there also.

Runs on the board early are key to gaining the upper hand at The Oval, so pressure will be straight on England’s top three to perform with the bat. Graeme Smith and Hashim Amla will look to do the same for South Africa, our feeling is a big hundred from one player could be the difference here.

2nd Test – Headingly, 2nd – 6th August The England test side will be back in Leeds for the first time since the 2009 Ashes, but won’t have particularly fond memories of that visit. After being skittled out for 102 in their first innings England lost the game by an innings and 80 runs, their only defeat of the series.

England won the toss and elected to bat that day, but regretted it. Conditions are always the key to any test match at Headingley, as winning the toss and fielding first usually reaps rewards when the sky is overcast. Bowling well in Leeds is all about finding movement through the air, so expect Jimmy Anderson to have a big game if England are to prevail in this one.

Australia’s quicks took 20 England wickets under 100 overs in 2009, Dale Steyn and Co. will be looking to do something similar in 2012. No doubt about it, the side that uses the new ball most effectively will take this Test match.

3rd Test – Lords, 16th – 20th August If the first Test was one for the batsmen, and the second one for the bowlers, the potential series decider at Lords will be a far more even affair.

In favourable conditions Lords can be a batsman’s paradise, but with the famous slope in play bowlers will fancy getting

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rewards for hitting good lines and lengths, making the home of cricket the perfect venue if the series does indeed come down to a one game shootout.

2008’s game finished as draw, but England have a great record at Lords since then, winning seven of eight tests. The England top order also have a great record of getting runs there, with Jonathan Trott, Ian Bell and Andrew Strauss in particular have all recorded big scores on the ground.

However Graeme Smith will point to his score of 259 on the Lords honours board, made in 2003, as proof that he knows how to play on the slope as well, so with the series looking as though it will go down to the wire the Third Test really could be one for the ages.

We give the edge to England in this one, but with so many quality players on show don’t be surprised if all three results are still possible in the final session of the final day.

Key Men to Watch Kevin Pietersen With quality batting line-ups on both sides and favourable mid-summer conditions it’s almost inevitable that it is going to be a series of big scores. Andrew Strauss’ return to form against the West Indies has England looking solid at the top of the card, but it’s the middle order that will have England supporters more concerned.

Ian Bell has developed well over the past couple of years into one of the more dependable batsmen in world cricket, but still has the tendency to let particular bowlers get inside his head and dominate him over the course of a series (see Bell’s problems against Saeed Ajmal last winter, which were as much psychological as they were technical). Jonny Bairstow took the spot as the sixth batsman against the West Indies, but didn’t produce in that series.

Bairstow should get the nod again over Ravi Bopara and will develop as a Test player over time, but will need players scoring around him to help keep the pressure of his shoulders for now.

All eyes will therefore be on Kevin Pietersen, who Andy Flower will be relying on to be the glue holding the England innings together. For all the reliability Alastair Cook and Jonathan Trott provide at the top of the order Pietersen is still the

“for all the reliability at the top of the order, pietersen is still the team’s game changer” team’s game changer, capable of taking any bowling attack apart and winning any game from almost any situation. With the two best sides in the world squaring off, the series will be decided as much by inspiration as perspiration, and that’s the climate in which Pietersen’s at his most destructive.

And the series will carry more significance for him of course. Not only is South Africa the country of his birth (against whom he has historically done well, much to the chagrin of South Africa Captain Graeme Smith), but there has been a mixed response from both teammates and England supporters alike to his premature retirement from International One Day Cricket. Critics say he’s turning his back on the national side to pursue more lucrative opportunities as a hired gun in the major Twenty20 competitions that have sprung up around the world, and with perhaps a few fans to win back don’t be surprised if Pietersen returns to mercurial form to remind writers and the English public what he still offers to the national side.

Pietersen’s weakness historically has been against spin, but with South Africa’s frontline offense being predominantly pace led the matchup should be in his favour. If England are going to prove once and for all just who the best side in the world are, there’s a feeling that it’s going to be Pietersen who is going to have to lead the line of attack.

James Anderson Over the past eighteen months England have developed into the most threatening bowling attack in the world, with four bowlers ranked inside the ICC Test Rankings’ top fourteen and a host of up and coming talent waiting in the wings to pick up the slack if any of the frontline are

current odds To Win the Series England 5/4 South Africa 15/8 Draw 3/1 Top England Batsman Alastair Cook 7/2 Jonathan Trott 7/2 Kevin Pietersen 4/1 Top South Africa Batsman AB de Villiers 7/2 Hashim Amla 7/2 Jacques Kllis 7/2 Top England Bowler James Anderson 9/4 Graeme Swann 11/4 Stuart Broad 11/4 Top South Africa Bowler Dale Steyn 2/1 Vernon Philander 11/4 Morne Morkel 7/2

felled by injury.

The unquestioned leader of the pack though is opening bowler James Anderson.

The Lancastrian pace man is the tonesetter at the start of the innings; not only is he England’s most consistent performer with the ball but more often than not it’s Anderson’ energy and aggression that dictates how the rest of the attack will perform.

This couldn’t have been more evident than when England elected to rest him for the last Test against the West Indies, with the tourists scoring over 400 for the first time in the series. Anderson is Andrew Strauss’ go-to man when a partnership needs to be broken, and with such a formidable batting line up needing to be bowled out twice to win a game key wickets at important times will be crucial to England’s success.

Anderson is currently ranked as the third best bowler in the world by the ICC and will be keen to prove his class on the same field as world number one Dale Steyn. If Anderson has the better summer of the two then England will be huge favourites to take the series.

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olympics

sport

BACK IN BLACK We caught up with Olympic medallist Roger Black in the buildup to what promises to be the most spectacular summer of sport Britain has ever seen.

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sport

olympics

ver since that fateful moment seven years ago when IOC president Jacques Rogge announced that Games of the 30th Olympiad in 2012 would be hosted by London, British sport has been simmering with an anticipation that reaches its burning conclusion on 27th July, when the first Olympic Games in the UK since 1948 are opened.

When that day arrives one Olympian who knows exactly what it takes to win a medal will be closely watching.

He’s an athlete with multiple Olympic medals nestling in pride of place amongst his parade of gold medals from World, Commonwealth and European Championships, and he’s a sportsman who won the hearts of a nation during his glittering career, former 400 metre world champion, Roger Black MBE. Black is no normal ex-Olympic medallist, if such a misnomer exists. He is a fierce competitor, whose success and innate charm have combined to make him synonymous with British athletics, so much so that he had a role in bringing the Games to Britain. He won two Olympic silvers in the 1996 Atlanta Games and a bronze at Barcelona ’92, and has forged an exceptional career off the track with his media work and business interests.

We sat down with youthful-looking exathlete with the world’s biggest sporting even less than a month away to find out who he is backing to feature on the winner’s podium in 2012.

London’s Time Black was in a radio studio when it was announced that London had won the bid in 2005, and was as surprised as many that the strong Paris and Madrid bids had been defeated after years of fevered speculation. He recalls, “I was an ambassador for the bid for many years, and there was a feeling that Paris would be awarded it, after bidding for it so many times before, but you have to give great credit to Seb Coe and Tony Blair, as it was their last minute politicking that swung it. When it comes down to those small margins, you take every advantage you can, and that’s what the guys did.”

Black talks like an athlete at all times, but unlike some ex-sports pros he is

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able to transpose his sports psychology vocabulary to life away from the track.

“That’s the thing with athletes”, he says of Coe’s single-mindedness in securing the Games, and ensuring they are ready on time. “If you give an athlete a goal, a very clear target, then they can build on the absolutes and achieve the objective. Seb was naturally wired in to do that from the start.”

So does he think that Britain will do well with the home crowd behind them, after their excellent performance in 2008?

“I don’t think it’s brash to say I think we’ll do better than we did in Beijing” he replies instantly. The nearer we get to the Games people are showing their hands, and you look at the form and confidence of Chris Hoy, of Ben Ainslee, of Rebecca Adlington, these are people are all capable of becoming multiple-time Olympic

champions, and we’ve got an awful lot of other guys who are in the same position.

But, this is the Olympic Games, and everyone has to turn up and deliver. But I think they will.”

Home advantage What about the much talked-of home influence. Does he believe this will make a difference? “Totally. It’s been proven time and time again. It’s a strange phenomenon, and it’s a big factor.

Some people say it’s a 20 percent factor, but even if it’s five percent, you’re still looking at the difference between fourth and bronze, bronze and silver, silver and gold.”

“Why that should be is still not really fully understood. I think it’s beyond our comprehension in many cases, and, without sounding too wacky, I think it’s

“if you give an athlete a goal, a very clear target, then they can build on the absolutes and achieve the objective”

Roger Black’s Five Betting Tips for Gold

an energy thing - when you’ve got 80,000 people in a stadium, and 70,000 of them are willing you on, stuff happens. In the Beijing Olympics the German track and field team got one bronze medal, but then just one year later at the World Championships in Germany, they got nine medals and came sixth in the table.

There’s a heightened awareness of the forthcoming event for the home team, and they’ve had plenty of time to visualise this success on their own soil.”

Legacy Coe and his team won the bid thanks to their very clear direction that the London Games would be about the next generation, and inspiring kids from around the world to make the most of their lives. Does he believe that the much vaunted legacy will come to fruition?

“The word ‘legacy’ is very important.

Of course it’s important to have a great Games, win loads of medals, and experience a national high. But I think London 2012 is about pride. Afterwards the nation will be able to look back and be proud of what we have achieved, that area of London will be regenerated, and

You’d be surprised as, despite being a track and field athlete, I have avoided athletic medal hopes like Mo Farrah and Jessica Ennis as there are so many potential variables, so if I was a betting man I would be putting my money on the cycling and rowing, which has had enormous funding pumped into it since the National Lottery started, and has greater barriers to entry, which mean our teams are amongst the world’s best funded and trained.

Mark Cavendish, Cycling Ben Ainslie, Sailing Katherine Grainger and Anna Wakins , Double Sculls, Rowing Women’s Team Pursuit, Cycling Men’s Four, Rowing

a whole generation will be inspired to do something more with their lives.”

“It’s particularly inspirational for British young people. There’s a far greater and heightened awareness of the Olympic Games around younger generations around Britain, and that wouldn’t be anywhere near as acute if the Games weren’t in this country. They know it’s here, they understand the principles behind it, and now we have an opportunity to inspire kids to have a dream and make it happen. It’s unlike any other event on the planet in that regard.”

Black and his now business partner, javelin World Champion Steve Backley, understand the absolute focus running through the minds of every competitor taking part in the Games, and they have built a strong business helping corporate organisations learn from their successes, and mistakes. BackleyBlack is unique in its delivery of their inspirational message, and they sport a who’s who of happy clients energised by the duo’s positive teachings.

“Since retiring I’ve done media, but my real passion is helping people make the most of their talent. Steve has a real interest in psychology, and between us we’ve amalgamated the Olympic speaking with top business coaches, and we can translate our experiences into the businesses we work with to make it relevant.

“The outcomes are not always the ones you expect. In many ways, it gives the clients an engaging experience which challenges their performance, and it reenergises them and they really consider where they are going individually and collectively.”

For someone not enormously enthused with the coming Olympic spectacle, spending time with Black is to re-evaluate the Games and see them for what they are - a genuine coup for the country to enjoy from their doorsteps, and a chance for real change in the mindsets of young people. As he dashes off in predictably quick fashion, the challenge for us will be to ensure we make the most of the cultural experience that may be here once in our lifetimes.

More details on Roger Black and Steve Backley’s corporate performance coaching company BackleyBlack can be found at www.backleyblack.com.

MONEYMAKER MAGAZINE | 91

Punter’s Post

MoneyMaker and Sportingbet team up to bring you this month’s hot tickets

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uly is traditionally the quietest month of the year for bookmakers; the European football seasons are still several weeks away, the Euros or World Cups are consigned to the history books, and large swathes of punters take time off from betting to hit the beach. This summer looks set to change all that though, with an array of sporting events on the horizon that are sure to keep punters with one eye glued to TV screens and the other to their betting balance through to the Autumn.

To kick off golf punters will get their fix as the Open Championship returns to Royal Lytham and St Annes. The Open is a notoriously difficult event to pick a winner, with history and form offering little to no help to those looking to profit this time round.

The Claret Jug was last fought for at the course in 2001. David Duval was victorious that year, with 2011 winner Darren Clarke finishing in joint third alongside Ernie Els, Miguel Angel Jimenez and Ian Woosnam amongst others. But who came second?

That would be Swede Niclas Fasth, the Gothenburg pro who has never bettered his runner’s up spot in a major.

Looking at this year’s betting, the return to form of Tiger Woods has seen bookmakers install him as the 6/1 favourite to get back to winning ways, but unless you’re supremely confident in golf’s prodigal son then it may be wiser to look lower down the field. Lee Westwood and Rory McIlroy, there or there abouts with the bookies in most tournaments, are 11/1, while Phil Mickelson looks a more interesting proposition at 25/1. Big hitting Dustin Johnson has hit form at the right time and can be backed along with US Open Champion Webb Simpson at 40/1, while last year’s winner Darren Clarke can be backed to win again at 100/1.

Remember though that with four days to play an ante post bet is not the only way to go. Sportingbet are paying six places on ante post bets but you’ll often be able to get far better value on the top priced players once the action has already begun. If Luke Donald ends the first day outside the top 15 places you’ll be ruing the 14/1 ante post price and eyeing up his closer to 40/1 price on Day 2. Of course the flip side is that the 100/1 shots will come plummeting down if they can get

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off to strong start.

You’re probably aware of this by now that London is hosting a rather large athletics gathering at the back end of the month as Mr Usain Bolt & Co. arrive for the Olympics. Bigger and better than ever before, bookies will be offering markets on events you’ll have forgotten existed, with handball and taekwondo the kind of sports that we’ll be taking huge sums on in addition to the Blue Riband events.

There will be unlimited in-play betting opportunities available, with tennis, basketball and football expected to be the punters’ top three picks. In the outright football market we make Brazil the 7/4 favourites, with Spain 12/5, but write off team GB at your peril – or better still back them at 5/1.

When it comes to the medal table the USA are the 8/15 favourites to win the most golds, ahead of China at 11/8. The third favourites are Russia at 100/1 – so it’s pretty much a two way fight between East and West. And those who think Team GB can exceed expectations in this Jubilee year can back them to win 23 or more medals at 4/5.

Our pick though: Great Britain to win football gold at 5/1 Those who can’t satiate their desire for football in July with the Olympics alone will be pleased to hear the Brazilian Campeonato will be in full swing by the middle of summer. Every Saturday and Sunday night we’ll be offering over 50 markets on every single top flight

Brazilian game, as Neymar and Santos go in search of their first title since 2004.

Current champions Corinthians will be out to stop them though, while Vasco da Gama, Flamengo and Botafogo will all be representing the city of Rio de Janeiro in South America’s finest league.

Sharp eyed punters will know the Brazilian league is often a graveyard for bookmakers due to the sheer number of goals scored, and light work can almost always be made on the over 2.5 and even over 3.5 goal markets along with the both sides to score. It’s also worth remembering that due to the vast distances sides have to travel to play their matches, home advantage is considerably more important than it is in the English Premier League. As an example a side such as Internacional, who play at home on a Wednesday night, can easily suffer a lack of form when they travel well over 1,000 miles three days later for an away game at Goianiense – so be sure to factor in distances travelled and time since a side’s previous game into any calculations. It can often explain why a highly skilful side such as Botafogo can be backed at a huge 4/1 when up against a team several places below them in the table but a couple of thousand miles away!

Open a Sportingbet account and you’re first bet is completely risk free up to £50.

That means you can have a £50 bet and if it loses, Sportingbet will refund your bet with a free bet! Visit www.sportingbet. com and sign up today!

MONEYMAKER MAGAZINE | 93

sport

poker

Esfandiari scoops biggest ever poker tournament, takes home over $18m as Vegas is currently packed to the rafters with poker players from across as the globe as the 2012 World Series of Poker reaches its climax. Over 6,500 players are expected to pony up the $10,000 entrance fee to compete in the 2012 Main Event, the iconic tournament of the No Limit Hold’em year, in search of an eight figure payday and a place in poker history.

One man who already has both though is Antonio Esfandiari, the American who took down the inaugural WSOP Big One for One Drop tournament earlier this month.

The tournament, organised by The One Drop Foundation and Cirque du Soleil founder Guy Laliberté, was the biggest in poker history, with a buy in of $1,000,000

photo credit: JOE GIRON/WSOP

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just for chips and a chair. The 48 player field pitted some of the best poker players in the world against a number of wealthy businessmen over three days of intense competition, and when all was said and done it was poker pro Esfandiari that finished on top.

With the win “Magic Antonio” took home over $18m, taking his lifetime tournament earnings past $23m and into first place in the all-time money winners list. British pro Sam Trickett, who already held the UK tournament earnings lead, finished second for a $10m payday.

Greenlight Capital President and amateur poker player David Einhorn finished third.

The Big One raised over $5m for The One Drop Foundation.