AyG
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Post by AyG on May 15, 2018 7:05:36 GMT 7
Yet the FTSE is up a mere 0.3% YTD. Nothing to write home about. The SET has performed nearly 4x better, being up 1.11%. And the IBC Caracas is up an impressive 1477.61%. Nicolas Maduro is clearly doing a wonderful job.
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Post by rgs2001uk on May 15, 2018 21:06:54 GMT 7
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chiangmai
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Post by chiangmai on May 17, 2018 7:39:36 GMT 7
Coincidentally, this week marks the point that my holdings recovered from an average 10% fall in the indices, to their peak value dated 24 January 2018, almost exactly four months.
Did I avoid loss by increasing my cash reserves to 32% at end January and reinvesting early April, I think I probably did, but others may see it differently.
Would I do the same again, definitely? Was I lucky, absolutely?
Odd the things a person remembers from days of old but when it comes to investments, one rule that has always stuck in my head is not to ignore your gut.
Another long-standing rule that all of this has reinforced, in spades, is to only do the things you do well and to contract out to third parties the things that you don't.
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AyG
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Post by AyG on May 17, 2018 8:17:18 GMT 7
Just looking at the Investment Trusts there, the YTD returns have been:
SMT 12.81% ATST 0.51% MNKS 8.06% WTAN 2.23%
The top two performers are both heavy on technology which explains in part the outperformance. The other two are much more on a par with the FTSE.
One of my long term holdings is IIT which this year is up 17.33%. Unfortunately, it's now at a very large premium to NAV. My brain tells me to sell, but my heart says no.
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chiangmai
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Post by chiangmai on May 17, 2018 12:45:46 GMT 7
Lindsell Train Global Equity and Fidelity Asia have both done very well for me, almost 20% each as I write. Baillie Gifford International at 15% has also done very well. Smith and Williamson Far East was doing stellar things but has fallen back to 15% but holds much promise for the future.
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AyG
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Post by AyG on May 17, 2018 12:51:00 GMT 7
Lindsell Train Global Equity and Fidelity Asia have both done very well for me, almost 20% each as I write. Baillie Gifford International at 15% has also done very well. Smith and Williamson Far East was doing stellar things but has fallen back to 15% but holds much promise for the future. Of course, some of that performance is because of the fall in value of Sterling.
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chiangmai
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Post by chiangmai on May 17, 2018 13:54:48 GMT 7
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AyG
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Post by AyG on May 22, 2018 18:17:08 GMT 7
And in the latest on IPE: "Invesco Perpetual seeks to oust loan fund chair in fee row" "Invesco, which is supported by Practical Investment Fund and GAM Star Credit Opportunities, which owns 8%, wants investors to vote on whether Donald Adamson, IPE’s chairman, and Richard Williams, chair of its management engagement committee, should be removed as directors." "Invesco’s resignation from IPE, whose star bond fund managers Paul Causer and Paul Read have run the £125 million investment company since launch 17 years ago, is highly unusual. It followed lengthy negotiations over expenses, centring on the performance fee Invesco is entitled to when its managers generate annual returns over 7%." citywire.co.uk/investment-trust-insider/news/invesco-perpetual-seeks-to-oust-loan-fund-chair-in-fee-row/a1121786
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Post by Fletchsmile on May 23, 2018 11:30:36 GMT 7
Another of the unfortunate quirks of investment trusts I want the fund managers, in this case the 2 Paul's and the support they get from their fund management house. That's why I buy the fund. I don't give a stuff about who the Chairman and other directors are. They add very little value. The fund after charges has outperformed its sector significantly. The 2 Pauls are excellent bond fund managers. Invesco is a decent fund management house. It's not broken, so why try and fix it? If someone doesn't understand or like the fee structure don't buy it. Simple. More and more I reach the conclusion Investment Trusts are only suitable for mainly equity only funds. Bond funds just bring too many hassles. Life is much simpler with unit trusts
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AyG
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Post by AyG on May 23, 2018 11:47:24 GMT 7
I don't give a stuff about who the Chairman and other directors are. They add very little value. I don't agree 100% with that, though to be honest when screening an investment trust, I only look at the board members to see if there's anyone I've worked with in the past and whether I respect them. A bad board can do a lot of damage. Consider the case of Alliance Trust. Conversely, the board at Witan did a lot of good with trust's restructuring.
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AyG
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Post by AyG on May 23, 2018 11:53:41 GMT 7
The 2 Pauls are excellent bond fund managers. I would have agreed with you a few years ago, but I suspect they've gone off the boil. Perhaps their most flexible mandate is Invesco Perpetual Tactical Bond fund, so that's the fund that should benefit most from their skills. I's 5 year annualised return is 1.88%, which is frankly disappointing. In contrast, the top performer in the sector has returned over 7% annualised.
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Post by Fletchsmile on May 23, 2018 12:34:41 GMT 7
The 2 Pauls are excellent bond fund managers. I would have agreed with you a few years ago, but I suspect they've gone off the boil. Perhaps their most flexible mandate is Invesco Perpetual Tactical Bond fund, so that's the fund that should benefit most from their skills. I's 5 year annualised return is 1.88%, which is frankly disappointing. In contrast, the top performer in the sector has returned over 7% annualised. Using a tactical bond fund as comparison isn't like for like, and not a good comparison in mandate. In general I dislike many tactical bond funds. I wouldn't touch their tactical bond fund.
Nor does it reflect them having gone off the boil.
At most someone could perhaps claim that tactical bond funds aren't their forte and that's not their skill set. It doesn't make sense to then extend that claim to IPE's bond sector where they've been leaders.
Much better to look at IPE fund itself.
5 year performance:share price: +57.5%, 1st in sector. NAV +41.3%, 1st in sector. Why compare it to a different fund, with a different mandate, which is obviously not their forte, and only earns 13%? Doesn't follow.
41.3% over 5 years is of course over 7% annualised (7.4% pa), which would put them right up there with the top performer in the sector.
Definitely suggests IPE hasn't gone off the boil yet, and is up there with the best. That's what makes it annoying that the directors are making changes to a fund that's a leader in it's field in terms of net performance.
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AyG
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Post by AyG on May 23, 2018 13:37:17 GMT 7
Using a tactical bond fund as comparison isn't like for like, and not a good comparison in mandate. It may not be a good comparison in mandate, but it's an excellent metric of their skill (or lack thereof). With the fund they can do pretty much whatever they want, use all their best ideas. Unfortunately, they have not done particularly well. As for the relative performance of IPE, as far as I can tell it's not hedged, so the performance will have been boosted by a fall in the value of Sterling. That, for Read/Causer, was simply good luck.
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Post by Fletchsmile on May 23, 2018 14:03:17 GMT 7
Using a tactical bond fund as comparison isn't like for like, and not a good comparison in mandate. It may not be a good comparison in mandate, but it's an excellent metric of their skill (or lack thereof). With the fund they can do pretty much whatever they want, use all their best ideas. Unfortunately, they have not done particularly well. As for the relative performance of IPE, as far as I can tell it's not hedged, so the performance will have been boosted by a fall in the value of Sterling. That, for Read/Causer, was simply good luck. The simple conclusion is don't invest in the tactical bond fund, that's not where their skill sets seems to be.
To say they lack skill in another field is meaningless unless someone plans to invest in that field, which I wouldn't recommend.
An analogy would be Anthony Bolton. It's like saying he was a poor equity investor and lacked skills because he did poorly in investing in China equities. A more discerning investor though would highlight that he was an excellent fund manager in the UK special situations field, where he excelled for years.
No point judging his UK special situation fund skills based on his Chinese equity skills. The former is well worth it, but the latter don't touch with a barge pole
Neil Woodford is possibly another. He has excellent skills in UK equity income. Much less convincing (though early days) is his skills in UK venture capital investments.
I also used to see this regularly in investment banks. Spot traders don't necessarily make gone strategic derivative traders and vice versa. Their skill sets are different. To judge a spot trader on his derivative investing skills makes no sense. Differentiate.
The point to draw from your analysis is while the 2 Pauls do very well on the more plain vanilla bond stuff (like the spot trader), they don't seem do so well on the strategic stuff (like the derivative trader)
If you want bread, buy it from a baker, not a blacksmith
It's rather disingenuous to put their out-performance in that particular field down to luck. Don't forget: 1)they've been doing this for the best part of two decades. Not just since Sterling's devaluation 2)every other fund manager would have been subject to this same "luck". Many global bond funds denominated in sterling are unhedged. Probably most. Even if random winners and losers, this is very unlikely to be the reason they are near the top of the performance table you describe and have exceeded that 7%. If luck, we'd expect quite a lot more lucky investors up there too, they are unlikely to be the only ones, given the level of not hedging in the sector
3) the positions they have now in currencies are snap shots in time and may bear no reflection to what they did in the past
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Post by rgs2001uk on May 23, 2018 22:06:24 GMT 7
I don't give a stuff about who the Chairman and other directors are. They add very little value. I don't agree 100% with that, though to be honest when screening an investment trust, I only look at the board members to see if there's anyone I've worked with in the past and whether I respect them. A bad board can do a lot of damage. Consider the case of Alliance Trust.Conversely, the board at Witan did a lot of good with trust's restructuring. Well said, what happened there was a disgrace.
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