thowed
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@bizaro86 Sure. They're strange ones.
1: Lindsell Train Investment Trust. About 60% of it is 10 quality (dull) de-rated blue chips: LSEG, NTDOY, RELX, ULVR, MDLZ, DEO etc. 40% is the Fund Management Co. This is massively profitable, & AUM grew & grew, but their strategies just haven't worked post-COVID (partly having no MAG7). Before that they were darlings of the UK Fund Management world (& track record neck & neck with Fundsmith) & pre-COVID it had outperformed NASDAQ since 2001. It is Extremely illiquid. Divi of about 5/6%. They have 2 main funds: Global (which is 35 US, 45 UK/Europe & 20 Japan) and UK (which is 20% non-UK) so have also struggled with general performance of UK market.
So buying it now is banking on their companies coming back into fashion, which would then produce a virtuous circle as the AUM increased, and clients came back. Which would also possibly return the discount to a premium. If you can get hold of enough shares, it could be interesting.
As you may know, they are VERY long-term buy & hold, Akre-style. About one new company a year goes into the portfolio. Latest two have been RMV in the UK, which has derated due to possible competition from CoStar (I don't think CoStar will dislodge the first-mover personally), but is insanely profitable, and they also bought FICO for their Global fund in late 2021, which... has done alright for them! So their talent remains I believe. On the other hand they can be arguably overly stubborn about selling, and
2: BH Macro. A feeder fund to the Brevan Howard Macro Hedge Fund. Stellar long-term record, especially in 2008, but suffered from low volatility in 2011-17 period. Since 2018 has been roaring up & matching S&P500 with low volatility. Unusual opportunity for Retail to be able to access a top Macro fund, and with liquidity. 2 & 20 fees obvs. Main Hedge Fund closed now, so only way to access it, which led to 10% premium. This year hasn't been so good for them but -1% so if you use it as a Bond-proxy diversifier, as I do, it's not a disaster. But others have been unimpressed & has gone to 10% discount. There is also concern over share overhang. A recent UK wealth management merger has meant the new combined co has about 30% of the Trust, and so may sell a fair bit down. Macro is a funny beast, and of course there is danger that their top traders will be poached by others. But on the other hand, you can now buy a top Macro fund at a 10% discount, which is potentially quite appealing if you're looking for a non-equity, low volatility diversifier.
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To offer some diversification from all of these great results (congratulations all of you!), I had a frustrating & very low-returning year.
The Bad
Two of my larger holdings are closed-end funds, and they re-rated heavily downwards (from their historical premiums). Their performance was OK, not great (& longer-term performance is terrific), but when you go from a 10%+ Premium to a 10-15% Discount in a year, it doesn't end well.
China - ugh. I thought it might turnaround this year after last Autumn. I am almost out now, though suspect it may finally turn in January as it is so hated now.
Similarly my Japan small-caps trod water again, but again I am more hopeful for next year. Vietnam started well, but suffered in the Autumn. Again bullish for the next decade, though stock-picking required.
All this Asia exposure meant that yet again I was underweight the US which I am slowly addressing.
I bought COST and CSU pretty much at the bottom in May/October 2022, but didn't have the courage of my conviction so they were in tiny amounts, which has been very frustrating, though at least means I am on the right track.
The Good
On the other hand, I feel like I learnt a fair bit.
I bought a few of my 'forever' stocks in October e.g. Ashtead, having waited too long, plus some other stuff like PSH.
My best trade was buying a fair bit more of TPL at around 1300 when it was really hated & people had given up. Followed by buying AMT gradually as it came down this year to multi-year lows. It is a truism that most of the best purchases have been the least comfortable at the time.
My India fund did incredibly well, which I didn't expect.
The board has been a huge help as always - this year the FFH material from @Viking has been invaluable, following FRPH last year from @BG2008.
Having Gold as 'Cash' seems to have worked again, if one accepts the volatility, esp. as over 5 years or so it has matched MSCI World.
I continue to evolve as an investor, my longer-term performance is 'acceptable' & will hopefully improve with time, and I hope I have learnt from mistakes made this year.
Good luck to all for 2024!
p.s. Other mitigation is that I had a better year in 2022 as didn't have a lot of the Tech stuff that went down.
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8 hours ago, james22 said:
I just believe it's hard for investors to wrap our heads around exponential growth and that it might be different this time.
And so if we're anywhere near the inflection point, the growth of Tech is underestimated.
You're sure it's not?
I feel like this was the case 10 years ago. I'm less sure now - 'exponential growth' is a fairly well-established term at this point, and I would suggest is more priced in now.
I think there is an element where you need to trust in management to be 'lucky' in terms of new products now, & I mean that in the sense that the more skilful the management, the more likely they are to be lucky. The obvious example is that in the past no one included AWS in their valuation of Amazon.
The FAANG/MAG7 run has been extraordinary - they are incredible companies in oligopolistic situations, BUT we've all known that for years, & personally I thought it was all priced in & I was too late. This has so far been a big mistake, so I could be wrong again!
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On 9/21/2023 at 10:26 PM, dealraker said:
AJG clean coal business and of course tax credits
I saw this on a presentation: "Gallagher's investments in new clean energy projects and the wind-up of its investments in clean coal production plants."
But I can't find any more details - does anyone have any info? Seems like some people decided that 'clean coal' wasn't actually that clean (I don't know enough to comment) which is presumably why they wound it up, but am curious what they've replaced them with.
Thanks in advance. -
14 hours ago, Gregmal said:
watermelon art
Amazing!
To clarify on the Hot Pot / Fondue, there are different types of fondue. Most people associate it with cheese, but I am particularly fond of Fondue Chinoise, which is very thin slivers of meat put in broth then eaten with sauces & also Fondue Bourgignonne, which is bits of beef cooked in oil.
Happy Thanksgiving to all for yesterday & thanks given to Sanjay for the community here.
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Do you have any shares in the Polish subsidiary? I looked at it & it seems interesting, though fairly illiquid, & I didn't get a fill when I put a (cheap) bid in on a down day.
Thanks for the discussion on this - if I'd been more on it, probably should have added to Lumine recently, but maybe there'll be another chance in the next year.
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Yes, extremely grateful to @Viking and everyone else who has contributed. The research has been top-notch.
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Yes, this is a very tempting argument & quite convincing.
On the other hand, is this not a rehash of the Nifty 50 argument, which worked... eventually, if you waited 30-40 years from the peak? And particularly when it feels like an increasingly consensus view?
On the other hand again, even if they do turn out like the Nifty 50, the top might be 5-10 years away, and they'll carry on (& may grow more into their valuations with new technological additions to their arsenal).
I know you're flexible, so are your MGK Puts in case they turn out not to be bond subs?
Anyway, I fear that I have my own bias to deal with as I'm woefully underweight these ultras, apart from the tiniest amount I bought at the bottom last year, before I lost my nerve. So I'm struggling to buy more at a much higher price.
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I suspect that this is one of those temporary dislocation opportunities to buy Consumer Snack companies cheaper than usual, while the Ozempic hype goes overboard.
I have no idea of the GLP-1 efficacy, but from crowd psychology it seems reasonable that people are getting over-excited about its effects in relation to snacking.
Similar sort of thing to 2021 when V & MA came down because they were going to be disrupted by BNPL and Crypto.
Anyways, snack cos aren't my favourite things generally, but at the right price, as 'bond proxies' you could arguably do a lot worse than Pepsi, Mondelez & possibly Hershey (as a US-only play).
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3 hours ago, Gregmal said:
Closed this out which now makes the higher leverage MGK puts totally on the house and then some. Also funded more Nintendo
This comment was in reply to a question I asked. I'm extremely grateful to you for the explanation - it helped me think about options differently, and consequently has made the last week a lot more comfortable for me than it otherwise would have. Thanks again! And congrats.
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18 hours ago, rkbabang said:
I always hesitate to buy mining companies.
This.
I'm happy with one or two Oil Royalty Cos where management is OK, but for Uranium Gold etc. Physical is generally more reliable.
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3 minutes ago, UK said:
Does anyone here think differently?
Nope. I've been reading about Uranium occasionally for years, but never 100% understood it & prefer stuff where there's a really smart CEO in charge to help things along.
I can see Uranium working big time, but I've learned that it's safer not to get involved with stuff you don't fully understand. I'll stick with my Oil Royalty Cos for now.
Edit: Just so everyone is aware, Kuppy has blown up big time in the past. So while sometimes he gets it really right, the opposite can also apply, so I'd say be wary of coat-tailing him if you don't fully understand it.
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TMO. I know it's not cheap, but I think it's overearning, and the post-Covid hangover is overdone.
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Amen, Sanjeev!
I may be a bit biased as an England supporter.
But yes, can't deny that phenomenal Sam Kerr goal.
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Lots of nonsense here - for starters the float is tiny as almost all the shares are owned by 'Vietnam's richest man' who has a big Vietnam-listed conglomerate. Finance people I know in Vietnam aren't massive fans of the other businesses.
But a great headline for the Summer Silly Season
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Fascinating, thanks!
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I'm attaching a letter from a Fund House I greatly respect - I got it from their website, but sadly they don't post them any more - I'd love to know their current thoughts.
Anyway, this was what finally put me off Europe (as someone who lives in it, or perhaps not since 2016!).
Of course there are some exceptions like LVMH, ASML etc. though at a price.
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1 hour ago, Lance said:
STR
Thanks
Lance
I struggled with management (as a Brigham holder) & the raise is questionable? I continue to prefer DMLP or BSM (the time to add to TPL seems to have passed).
But I get it's down today.
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V interesting, UK. I think it's true that many of us (myself included) try to be too clever, to our detriment.
If you are concerned about the market, often the easiest thing is to just increase your cash weighting (esp. if IB are paying you decent interest).
It's so easy to get Puts etc. wrong, so just KISS.
(of course, I can't help myself and have a few protective Puts at the moment...).
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Yes, many thanks. I knew a little bit about Fairfax before, but it has been this Board, and especially your posts that have been the foundation for my understanding of the company that has led to my investments.
Also thanks to Sanjeev.
And we shouldn't forget Prem and the Fairfax team, too!
Cheers!
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56 minutes ago, Spooky said:
I bought an S&P 600 ETF at a p/e of 12x.
Nice one. S&P 600 is an underrated index - I've never understood why the Russell 2000 is so much better known - by my understanding the 600 has stricter criteria on profitability.
Incidentally one of the best US small-cap fund houses I know moved into large-caps in about 2010, and is just moving back more into small & mid-caps on valuation grounds.
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@thepupil Personally, while I think US index investing makes total sense for large-caps (how many funds beat them?), I think EM indices are pretty rubbish & there are some decent active managers to choose from.
Separately I also think that over 10 years, Vietnam should be one of the best-performing EMs (well, technically Frontier, but it's all marketing...).
Europe... I thought this was the way back in 2010, 'because the US market is expensive', so I'm a bit scarred there. But undeniably some great companies on much lower ratings than their US equivalent (there's been some good material from Lindsell Train in their UK strategy on this e.g. Experian vs. Equifax).
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14 hours ago, james22 said:
FAANG worked pretty well for over a decade.
Absolutely, but how long did the Nifty Fifty work for? You can still overpay for great companies. But timing, I have no idea.
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General thing would be chasing 'styles' after they've gone up that I don't have an edge.
Most recently would be Energy last year - the big moves were made by the time I was ready, & I started buying amidst the frenzy. I did manage to figure out over time which of the Oil Royalty cos I liked/didn't like for the long-term. This also applies to Fertilizer, which was going to be such a big thing! Overall it wasn't too bad, but I should have gone in smaller while I was figuring out which stocks worked best.
I didn't buy BABA, but I did go into an China Growth fund with dazzling performance near the top.
Hopefully as time goes by, one learns different sectors, so you're ready to pounce when they go down. But it is still psychologically tempting to buy into something that is 'doing well'.
Nestle call options
in General Discussion
Posted
Bump - did anyone do this?
Seemed to suffer last year, whether GLP-1 related or otherwise, alongside other Consumer Staples. Wonder if the sector might turn in 2023?
Up 2.5% today but that's from a multi-year bottom.