chiangmai
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Post by chiangmai on Oct 10, 2020 8:32:59 GMT 7
We were talking recently about the sense of buying into popular investment funds, invariably these are run by popular and well regarded Fund Managers. A decent article below from Trustnet which states: "As the table below shows, there are 272 funds that have an FE fundinfo Alpha Manager working on them and 107 of these – or 39 per cent – have made top-quartile total returns over the opening half of the year. Another 60 (or 22 per cent) are in the second quartile and just 53 – or 19 per cent – are at the bottom of their peer group". FE Fund Managers include names such as Nick Train and Terry Smith who run two of the investing worlds most popular funds. In simple terms...if you want to invest in a successful fund you will need to identify a successful Fund Manager, that in turn may point you to successful funds that they manage. The question is whether successful funds should be ignored, just because they are successful/popular and despite the fact they are managed by successful and proven Fund Managers...it makes little sense to me that anyone should do that, especially investing newbies. The full article is linked here: www.trustnet.com/News/7465332/has-it-been-worth-backing-an-fe-fundinfo-alpha-manager-in-2020/
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Post by rgs2001uk on Oct 10, 2020 20:55:45 GMT 7
I am not a fan of buzz words, eg alpha manager. I am more a fan of investing in long established funds with a proven record, eg Baillie Giford, however I do concede, follow the fund or the manager is problematic. The comment from Theo sums it up for me. "dmb1, The picture you are painting is very real and applies to most private investors.. This bear market has shown that one cannot rely for his living on dividends from income funds because in a severe price fall that sector is the worst place to be. A much better strategy is to invest in trackers and growth funds and skim off some of their total returns. It needs a little mote work, but it is worth it." Just about sums up my approach of going for capital growth rather than regular income, if needs be I can take profits. Check out this dividend hero, www.hl.co.uk/shares/shares-search-results/w/witan-investment-trust-plc-ord-gbp0.05
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AyG
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Post by AyG on Oct 10, 2020 21:08:38 GMT 7
It would have helped if you'd put an emoji to let us know whether you're being serious or not. I do note its biggest holding (over 10%) is Vanguard Funds plc S&P 500 ETF USD(GBP). Why pay 0.91%/year to have your money invested in a simple tracker?
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Post by rgs2001uk on Oct 10, 2020 21:11:49 GMT 7
AyG, you should know me by now, , yes i was being serious, Thankfully I offloaded it a while back, p**s poor performance, eg , capital growth.
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AyG
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Post by AyG on Oct 13, 2020 13:15:41 GMT 7
Chiangmai There is a massive difference between popular fund managers and well-regarded fund managers. The FE Alpha Managers are selected based upon performance, not popularity (though there is some overlap between the two categories). Anyway, the reason I'm posting here (which I'd kind of promised myself I wouldn't do) is a Trustnet article today "The warning signs that your top performing fund is at its peak". Plenty of food for thought there. For example “Funds charge their fees as a percentage of the size of the fund; their mission is to earn more by growing more. And this is easiest achieved by convincing investors to keep buying”.and “What is the balance [on the website] between the photos of your star manager and meaningful facts about the fund? The right mix is roughly 1-99 per cent.”www.trustnet.com/news/5053068/the-warning-signs-that-your-top-performing-fund-is-at-its-peak
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chiangmai
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Post by chiangmai on Oct 13, 2020 15:49:52 GMT 7
Quibbling over the difference between a Fund Manager who is popular versus one that is well regarded, I mean really!
Average Joe Public, if not 99.9% of the public, wouldn't know whether an FM was well regarded or just popular or perhaps just being promoted by industry related press, a person would have to be in the industry to understand that. The term well regarded is synonymous with managing a successful investment fund, a FM starts off being well regarded within the industry and then becomes popular amongst the general public, it doesn't happen the other way round!
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AyG
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Post by AyG on Oct 13, 2020 17:16:18 GMT 7
Quibbling over the difference between a Fund Manager who is popular versus one that is well regarded, I mean really! You're clearly missing the point. There are serious issues with highly popular fund managers, as are explained in the article I linked to. Did you bother reading it? And did you understand it? There are plenty of well regarded fund managers who don't spent loads of time courting the media with the aim of puffing up their reputations, attracting funds, and raking in more fees
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chiangmai
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Post by chiangmai on Oct 13, 2020 18:01:21 GMT 7
Quibbling over the difference between a Fund Manager who is popular versus one that is well regarded, I mean really! You're clearly missing the point. There are serious issues with highly popular fund managers, as are explained in the article I linked to. Did you bother reading it? And did you understand it? There are plenty of well regarded fund managers who don't spent loads of time courting the media with the aim of puffing up their reputations, attracting funds, and raking in more feesJust to be clear, we're discussing this issue from the perspective of the investor in the street rather than the seasoned pro. who has shed loads of industry experience. The man in the street wouldn't know who those well regarded FM's are who don't appear very often in the media, not until their fund(s) have been successful for long periods of time and they cannot avoid the media spotlight, even if they never sought it in the first place. I can't begin to relate to many of the comments in the article you linked to because I've never tried to speak to a FM, I don't go to investment seminars and I rarely use the Funds web site until last thing. I can't help but believe those comments and the article are geared towards more seasoned and professional investors, rather than the man in the street. I don't doubt those types of problems exist but I also don't doubt that very few average investors experience them. I regard myself as an investor in the street and when I look at funds I do so almost exclusively via third party stats. using Trustnet and Morningstar et al. I will then look for articles relating to the fund and its manager but again, all from third parties. After a while I'll end up with a picture of the fund and its manager and much of it will have been acquired from the media and press, if there's nothing available in the media or press I'm unlikely to research the fund further. Confirmation bias via the media....probably to a certain degree, how else do expats do their research other than paying a fee to a third party such as IFA's are us, office on Soi Nana?
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Post by rgs2001uk on Oct 14, 2020 21:44:25 GMT 7
^^^ took me years to suss it out, I am just another grease monkey from the soi, found my own personal jesus in baille gifford.
Stockbroker sent me reccomendations for years, some were kept, eg, Polar and worlwid heathcare, others were tossed in the bin, p**s poor performance.
I dont doubt there are new turks out there, their problem is, no track record, here today gone tomorrow types.
Its like building a pyramid, boring, mundane defenders like bankers and brunner, attacking midfielders like scott mort, monks etc, and the front three like, polar capital, worldwide healthcare etc.
I am the first to admit, I wont be swapping out my shares in my top performers to top up my bottom peformers, if anything, the bottom performers are on borrowed time.
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chiangmai
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Post by chiangmai on Oct 15, 2020 5:21:17 GMT 7
Selecting an appropriate investment fund takes a lot of skill, research and knowledge, it's a task that is beyond many average people who have not had training, education or possess a natural ability, which is why IFA's and the UK's money service are promoted so heavily by the government. With all due respect to AyG's intelligence and experience I think he has massively underestimated the skills required to do the task well and has taken for granted his years of investment industry-related experience and assumed others are capable of the same levels of performance as he is. I have two degrees from good universities plus I've worked in financial services for a number of years and I have found the task very difficult, it's only now after three years of constant reading, research and trial and error that I'm starting to feel a little bit comfortable but I've got miles and miles to go before I get good at it.
My experience is that many IFA's are not that well equipped to advise clients appropriately plus the cost of their services has become prohibitive. Most IFA's that I have met are in the business to make as much money as possible and offering an appropriate and quality service is secondary by a long way. The IFA pool is close to being a shark pool which again is why the UK FCA is so heavily involved in administering and monitoring the services they offer. Personally, I would never use an IFA again, not even a UK based accredited one because all of my experiences with them have been so poor.
The average man in the street investor can be forgiven for looking at the likes of Nick Train's Global, seen how well it's performed over the past X years, how many people have piled in and have said, that'll do me nicely, especially when Trustnet and Morningstar tell us these are all 5-star funds run by highly rated FM's. The Woodward debacle may have changed this picture slightly but not by much, I'm convinced people will still seek out popular funds that are highly visible in the media because in many cases, being highly successful is how they get into the national media in the first place. And I think that most people are smart enough to cross-reference the things they read these days so successful self-promotion is actually not that easy to do well.
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Post by rgs2001uk on Oct 15, 2020 20:11:01 GMT 7
^^^^ CM, I get it, others dont.
I had a quick look today, Croda, Edninburgh and Scott Mort up, Monks and Mid Wynd down, nothing new there, not all stocks will behave the same way at the same time.
I went throught this years ago, an independant broker was taken over by those bastids at Barclays wealth, all they wanted to do was push their own products, I closed the acccount and went to another independant, now taken over by rathbones.
Too me they are all shysters and crooks in fancy suits.
My problem as an expat is trying to find someone who will accept me as an investor, then the bastids will rip me off for being an overseas investor, FFS, we live in a digital age, please explain why my expat account costs 50% more to administer than a uk based account.
Ref degrees, and I dont want to demean you, they open doors, but are not a sign of intelligence, I worked with guys with better qualifications than me, they just couldnt "get it" when it came to explaining simple concepts like thinking in 4d, these guys were linear thinkers as opposed to systems thinkers.
I can well understand the concept of, follow the money, I pull up performance charts etc etc, do comparisons etc etc, but and I know this is a negative aspect of my investing, I follow old established companies with a proved track record, I understand I may well be missing out on an extra few bucks, I want peace of mind.
The stockbroker tells me of the latest bunch of freshies and new turks visiting him, with very impressive powerpoint demonstrations and buzzwords, he tells them, we deal with old faashioned conservative investors.
There is no right or wrong, there is only whats right for you and what allows you to sleep at night.
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chiangmai
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Post by chiangmai on Oct 16, 2020 6:43:06 GMT 7
"My problem as an expat is trying to find someone who will accept me as an investor, then the bastids will rip me off for being an overseas investor, FFS, we live in a digital age, please explain why my expat account costs 50% more to administer than a uk based account."
Agreed, this is a massive problem for expats who don't get things sorted before they expatriate but also afterwards when things change unexpectedly, eg your trusted IFA/broker etc dies, ceases to trade, gets taken over by another firm, all of which happened to me.
"Ref degrees, and I dont want to demean you, they open doors, but are not a sign of intelligence, I worked with guys with better qualifications than me, they just couldnt "get it" when it came to explaining simple concepts like thinking in 4d, these guys were linear thinkers as opposed to systems thinkers."
Yes sure, it's not measure of intelligence at all. But it does teach you how to study.
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Post by rgs2001uk on Oct 16, 2020 20:37:55 GMT 7
^^^, , I hear you, there are people who can recite the whole koran and not understand a word it says, those right wing nut jobs in america claim to be christains, yet display anything like christain behaviour, however I digress. We all invest for differing reasons. Like others on here we tend to live in an expat bubble, salaries others can only dream of, flights and hotels paid for, free insurance, company share options etc etc, if the truth be told, it was almost impossible for me to spend my salary, hence investing was the way to go. Not mentioned, company pensions kicking in, not mentioned being burned, in my case by those bastids at barclays wealth, once bitten twice shy, I will bad mouth them til the day I die, not mentioned, are you living off your savings or supplementing your pension with investments, not you persoanlly, just a figure of speach. Not mentioned, p**s poor interest rates, who in their right mind would leave money in a bank account these days? I certainly dont claim to be correct in my investment approach, and in fact on these very pages you will find me telling others not to invest in what I have invested in, horses for courses. I am not bragging, I can take the hit, and earlier this year took a effin hit to the financial goolies, if you cant take a hit, maybe the stock market isnt for you, gaing not you personally.
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chiangmai
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Post by chiangmai on Oct 17, 2020 6:02:20 GMT 7
As you know I've been investing in the markets for only a relatively short time, global markets took a hit shortly after I jumped in and I lost money and that was scary at the time. But now my investments have recovered and subsequently I've built up a cushion so I'm quite relaxed about taking further hits. So when you talk about investing not being for everyone I can agree, but I think it depends where you are in the cycle that has a bearing also, it's one thing to lose paper profit but it's something else to lose real money.
The picture today is very different from when I was earning big money over fifteen years ago, back then I was quite happy to take my 6 per cent risk free fixed deposits from banks plus a few extra shekels from playing the overnight funds....todays interest rates are almost non-existent so many people have become forced investors because there is no other game to be had. If anything that scenario has upped the risk for many people, especially those in their 50's who have built up a nest egg and are hoping to make it through to retirement, a significant move in the markets could see their retirement dreams shattered and something on the scale of a pandemic could just be that mover. It's scary stuff and I'm glad I'm 70 and not 50.
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Post by rgs2001uk on Oct 17, 2020 21:02:16 GMT 7
^^^, , popped your cherry, welcome to the club, I defy anyone invested in the markets to tell me they didnt make a paper loss.. I concur ref investing, was it you who posted about savers leaving NS&I and investing elsewhere?, Reluctant investors I call them, pensioners being shafted, some of them may never recover. I mentioned before about regarding Bankers and Brunner as nothing more than a savings account paying 2%, I hold both. , I would bite your hand off today if I could park my wonga and get a guaranteed 6% pa. The market isnt for the faint of heart, thankfully everytime I went through a correction, be it interest rates, exchange rates or market downturn I at least was in secure employment, my heart goes out to the youth of today, where do they turn. Concur ref the picture today, is it really any better with almost zero interest rates, how many jobs has it created? I well remember people in the uk being stuck with a house they couldnt shift, the same house they thought they could offload and downsize to fund their retirement. The pensioners that offloaded their properties and retired to Spain, and thought they could live off the 15% interest rates, interest rates dropped, and they could no longer afford to buy back the same property they had offloaded. At the end of the day, I am thankfull I have maxed out in the company pension scheme, not reduced to shopping at Big C just yet, .
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