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  #421  
Old 17.02.2021, 18:43
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Re: Equity Portfolio Advice

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They'll do a full check before you sell, so anyone using a fake identity wouldn't get far.

I opened my account online whilst in Switzerland (owned via HL before that)
....but you were buying into the main Fundsmith fund right? It's possible to do the full account opening procedure online for that, but the guy on the phone told me that's not possible for the Sustainable fund: only options are phone or post.

Guess I'll be calling them tomorrow :-)
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  #422  
Old 17.02.2021, 18:56
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Re: Equity Portfolio Advice

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....but you were buying into the main Fundsmith fund right? It's possible to do the full account opening procedure online for that, but the guy on the phone told me that's not possible for the Sustainable fund: only options are phone or post.

Guess I'll be calling them tomorrow :-)
Correct. I actually marginally prefer the sustainable fund, but couldn't be arsed to go through calling them up.
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  #423  
Old 17.02.2021, 18:58
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Re: Equity Portfolio Advice

Here is a great graph


I see the difference between Fundsmith and Baillie Gifford is that Fundsmith focus on avoiding stocks in the red area by not buying companies that destroy money. A key factor is that the business should not be "disruptable".

Whereas Baillie Gifford aim to get as many in the green area as possible as early as possible, which requires investing in disruptive businesses that aren't yet profitable. This inevitably results in many of the stocks losing most or even all of their value - i.e. being deep into the red area.

I think they are very complimentary. I do think BG will produce significantly higher returns over time but that it'll be a wild ride.
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  #424  
Old 17.02.2021, 19:31
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Re: Equity Portfolio Advice

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Here is a great graph


I see the difference between Fundsmith and Baillie Gifford is that Fundsmith focus on avoiding stocks in the red area by not buying companies that destroy money. A key factor is that the business should not be "disruptable".

Whereas Baillie Gifford aim to get as many in the green area as possible as early as possible, which requires investing in disruptive businesses that aren't yet profitable. This inevitably results in many of the stocks losing most or even all of their value - i.e. being deep into the red area.

I think they are very complimentary. I do think BG will produce significantly higher returns over time but that it'll be a wild ride.
The question is is the risk adjusted return better. How much does the fund managers invest in their own fund? Fundsmith 1/2 a billion roughly, Lindsal Train a few million BG no idea. If they donít put the majority of their net worth in the fund they donít think itís very good.
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  #425  
Old 17.02.2021, 19:42
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Re: Equity Portfolio Advice

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The question is is the risk adjusted return better. How much does the fund managers invest in their own fund? Fundsmith 1/2 a billion roughly, Lindsal Train a few million BG no idea. If they don’t put the majority of their net worth in the fund they don’t think it’s very good.
SMT's 10 year performance is 895.3% - so I doubt anyone thinks its "not very good".

It wasn't all that long ago it broke into the FTSE 100, now its the 24th biggest company in the UK by market capitalisation.

I doubt it will be all that long before its in the top 10. Its 20% the size of Astrazeneca at number 1 - not inconceivable that it could catch AZ in the future.
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  #426  
Old 17.02.2021, 19:52
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Re: Equity Portfolio Advice

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SMT's 10 year performance is 895.3% - so I doubt anyone thinks its "not very good".
Most of that is recent, the level of risk is key, was the fund manager risking most of his personal wealth or just lucky gambling with other people’s chips? We don’t know the selection criteria, is there even one? Go back the previous 10 years & you would not have picked BG, their luck changed, but is this repeatable? I suspect not. Had you invested 10 years ago you would have picked Woodford.

I got lucky buying BIDU in 06 & Netflix in 07, not been as lucky since
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  #427  
Old 17.02.2021, 20:04
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Re: Equity Portfolio Advice

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Most of that is recent, the level of risk is key, was the fund manager risking most of his personal wealth or just lucky gambling with other people’s chips? We don’t know the selection criteria, is there even one? Go back the previous 10 years & you would not have picked BG, their luck changed, but is this repeatable? I suspect not. Had you invested 10 years ago you would have picked Woodford.

I got lucky buying BIDU in 06 & Netflix in 07, not been as lucky since
I think its harsh to say it is luck - they have outperformed in many different regions with funds that have zero or near zero overlap. That shows that their methodology works.

FWIW from what I've read of Woodford's history he made some good calls before going off the rails and going mad. I've never owned any Woodford going back to 2014/2015 when he set up his own shop, and did have a bit in shares even back then, albeit not much. I don't think my parents did either, but they've owned BG for years and years.

I doubt I would have ever bought a UK or European focused fund. Also - I don't buy into any trend that's going. I don't and won't ever own crypto.
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  #428  
Old 17.02.2021, 20:21
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Re: Equity Portfolio Advice

Nothing better than reading mutually respectful conversations between seasoned investors and younger ones.

This sub-forum is oozing with knowledge, pure gold for young investors like myself.
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  #429  
Old 17.02.2021, 20:29
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Re: Equity Portfolio Advice

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Here is a great graph
Having owned 9 of the 10 (not BRK) - it makes me wonder whether I was right to sell 5 of them.
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  #430  
Old 17.02.2021, 20:36
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Re: Equity Portfolio Advice

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SMT's 10 year performance is 895.3% - so I doubt anyone thinks its "not very good".
I am not sure how the no's are worked out, From the 31 March 2008 the highest NAV was 746.5p The highest NAV in the 2012 accounts is 861.6p

5 year return on latest accounts 124.6, 10 year return 360.8

They have been buying their own shares for years if you look at companies house, I don't understand what is going on, but it's not as rosy as you claim.

In theory Rolls Royce fell over 60% 1 day when they did the rights issue, investors were in profit as the rights value was not accounted for in the share price fall, they were up 15% that day!

I will do some digging as to holdings, the fund is also geared. £166 million of share buy backs.

I would love to know the combined PE 100? 200?
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  #431  
Old 17.02.2021, 20:42
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Re: Equity Portfolio Advice

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I am not sure how the no's are worked out, From the 31 March 2008 the highest NAV was 746.5p The highest NAV in the 2012 accounts is 861.6p

5 year return on latest accounts 124.6, 10 year return 360.8

They have been buying their own shares for years if you look at companies house, I don't understand what is going on, but it's not as rosy as you claim.

In theory Rolls Royce fell over 60% 1 day when they did the rights issue, investors were in profit as the rights value was not accounted for in the share price fall, they were up 15% that day!

I will do some digging as to holdings
From what I can see nav in 2012 was 100 something p.

I imagine the reason for buying their own shares is because performance has been so good that the trust is too big for demand for their shares?
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  #432  
Old 17.02.2021, 20:44
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Re: Equity Portfolio Advice

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Nothing better than reading mutually respectful conversations between seasoned investors and younger ones.

This sub-forum is oozing with knowledge, pure gold for young investors like myself.
Couldnít agree more!
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  #433  
Old 17.02.2021, 20:55
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Re: Equity Portfolio Advice

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From what I can see nav in 2012 was 100 something p.

I imagine the reason for buying their own shares is because performance has been so good that the trust is too big for demand for their shares?
Ramping their own shares with borrowed money, what could possibly go wrong. About 25% of the portfolio is unquoted & the value of those shares is a guess as Woodford shareholders found out. The more I look the less I like it.
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From what I can see nav in 2012 was 100 something p.

I imagine the reason for buying their own shares is because performance has been so good that the trust is too big for demand for their shares?
Accounts filed at companies house show a range of nav for 2012 of 621.0 to 861.6 see below
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  #434  
Old 17.02.2021, 20:59
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Re: Equity Portfolio Advice

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Couldn’t agree more!
The thing is I actually agree with FMF about most things. I would be doing a very very similar thing to him at his age.

I'd probably be in something like 40% Fundsmith, 40% Smithson, 10% Scottish Mortgage, 10% PHI.

I think he got umbrige (sp?) with me calling Fundsmith a "grandpa" fund. I actually didn't mean that altogether in a bad way - its the best fund for people with relatively low risk tolerances (like pensioners) - delivering market beating returns at lower than market risk. A hell of lot better than buying what grandpa's actually buy - which is terrible dividend stocks.

My own grandpa seemed to own mostly banks and utilities (he died fairly recently).
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  #435  
Old 17.02.2021, 21:01
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Re: Equity Portfolio Advice

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Ramping their own shares with borrowed money, what could possibly go wrong. About 25% of the portfolio is unquoted & the value of those shares is a guess as Woodford shareholders found out. The more I look the less I like it.


Accounts filed at companies house show a range of nav for 2012 of 621.0 to 861.6 see below
Well you could avoid these issues and still buy into BG's style by going for a fund rather than a trust. Unlike Woodford BG don't put unlisted investments in open ended funds. The performance of the funds has been very nearly as good as the trusts. They want to get involved in private equity as companies are listing later and later and their style is to buy growth companies early in development.

Re: NAV - I presume that's because of a stock split? Edit: it seems to be a 5:1 split in 2014 https://www.marketscreener.com/quote...0stock%20price. So that 621 to 861 is c. 125 to 170.
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  #436  
Old 17.02.2021, 21:03
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Re: Equity Portfolio Advice

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Well you could avoid these issues and still buy into BG's style by going for a fund rather than a trust. The performance of the funds has been very nearly as good as the trusts.
The trust had an 18% discount looking at accounts going back to about 2000, something is wrong with NAV figures, mine are from the accounts. There seems to be no transparency of personal investment by fund managers, possibly will show in fund accounts.
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Old 17.02.2021, 21:17
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Re: Equity Portfolio Advice

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I would love to know the combined PE 100? 200?
It'll be huge. Looking at the top 10:

1 Tencent c.50
2 Illumina c. 110 (I know this company very well having represented them in their core genome sequencing patent portfolio and would back them to the hilt - i've never been as impressed with a client's innovation, and my job is innovation).
3 Amazon.com c. 120
4 Tesla Inc c. 1300
5 NIO not yet profitable
6 Alibaba c. 40
7 Meituan Dianping c. 670
8 ASML c. 60
9 Moderna not yet profitable (I've also represented Moderna, although more briefly and was also impressed)
10 Delivery Hero not yet profitable

Of the companies that aren't yet profitable or have crazy P/Es:

Tesla - 1 year performance 330%
NIO - 1 year performance 1500% (!!!)
Meituan Dianping - 1 year performance 345%
Moderna - 1 year performance 840%
Delivery Hero - c. 55% (ok more modest here, relatively speaking)

I don't think they'll be regretting any of those buys.

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  #438  
Old 17.02.2021, 21:26
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Re: Equity Portfolio Advice

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It'll be huge. Looking at the top 10:

1 Tencent c.50
2 Illumina c. 110 (I know this company very well having represented them in their core genome sequence patent portfolio and would back them to the hilt).
3 Amazon.com c. 120
4 Tesla Inc c. 1300
5 NIO not yet profitable
6 Alibaba c. 40
7 Meituan Dianping c. 670
8 ASML c. 60
9 Moderna not yet profitable
10 Delivery Hero not yet profitable
As the old bloke in the video said, 'The more you pay the less your future returns will be' PE must be around 200 - 300 which is insane. Potentially great companies with very little earnings.

I stopped doing punts about 8 years ago & generally only invest in a company if I was prepared to put 50% plus of my net worth into them. I bought about 0.5% in SMT without my normal due diligence, I suspect I won't be adding & more likely to sell.
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  #439  
Old 17.02.2021, 21:41
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Re: Equity Portfolio Advice

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As the old bloke in the video said, 'The more you pay the less your future returns will be' PE must be around 200 - 300 which is insane. Potentially great companies with very little earnings.

I stopped doing punts about 8 years ago & generally only invest in a company if I was prepared to put 50% plus of my net worth into them. I bought about 0.5% in SMT without my normal due diligence, I suspect I won't be adding & more likely to sell.
You bought netflix in 2007 - that's exactly the type of thing they do. I imagine netflix wasn't profitable then, but look at it now. Up 200 times since then.

Terry wouldn't touch it with a bargepole now or then, but his style of investing is not the only way to get high returns, even though it is a highly admirable, structured and sensible way of doing so. He even says he doesn't pick winners, he buys stocks when they've already won. So he's not going to get stocks going up 1000% in a year. That's not a criticism - just an indication that SMT can do things FS can't.

SMT picks winners (and some losers too, but the crazy returns on the winners mean that returns are still excellent). I've exemplified some of the crazy returns in my post above.

You can get away with an awful lot of "punts" and misses if you buy stocks like netflix early in their development.

This is why so many of their investments are unlisted - SMT is not for the faint hearted and is looking for extreme growth. BG have made tens of billions on Tesla stock sold already - SMT is a significant part of that. If the remaining Tesla stock goes to zero it's still a historic return on investment.

None of this is a criticism of Terry investing. I am a fan too. He is almost guaranteed to protect your money from a crash waaay more than the index. SMT won't do that. I think having both in your portfolio makes a lot of sense. Terry for outperformance in bad years, BG for outperformance in good years.

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  #440  
Old 18.02.2021, 09:33
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Re: Equity Portfolio Advice

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I bought about 0.5% in SMT without my normal due diligence, I suspect I won't be adding & more likely to sell.
So you bought Tesla And Tesla just bought some Bitcoin, so you own that now too

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I don't and won't ever own crypto.
See above.
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