Well looking at the one year chart, it's due to come down a bit soon, but then to hopefully resume it's long term ride north, I'm only just in and will give it at least a year to see how things are...
"Identifying tomorrow's winning investments is ultimately what all fund managers are paid to do for a living. However, the statistics show that many active fund managers fail to add value over the long term, when measured against a ..."
On the occasions when I have "taken profits" I have usually regretted it as the stock continues to climb.
A better strategy is to put in a limit sell, regularly revised, at a price of (say) 5% below the current price to lock in profits while allowing for market dips whilst protecting against a slump.
Ben Alligin: but if you "take profits", you will only have to redeploy the money somewhere else (I am assuming you're a long-term growth investor and aren't taking money out of your SIPP or ISAs). Will the new investment perform any better than SMT, or offer you other factors like improved income or a reduced risk profile? If you can't find a rationale for where else to invest your profits, there is an alternative phrase that springs to mind: "run your winners".
SMT has given you roughly 24% p.a. over 1, 3 and 5 years: that is pretty consistent and worth sticking with in my view.
I took some profits in 2010 after a strong performance. Then, SMT was probably my 8th largest investment. It is now my largest even though I've not bought any more shares and have made many other investments. Perhaps it's now time to think about taking more profits?
In totes agreement. First purchased in 2006 and have added to frequently since. It is still one of my five largest holdings after selling down 20% of my stake a year ago to redeploy in 'safer' investments. The BG team have done an astonishing job. Long may they continue to do so.
Well done to James Anderson and Tom Slater and the rest of the BG team on this milestone. For long time holders like myself this works out at £25 a share taking account of the 5 for 1 split a few years ago. Shows you that a combination of analysis, commitment to a strategy, and downright curiosity about how the world is evolving is still a powerful force in investment. As I bought in almost 20 years ago (the first IT I ever bought) at just over £2.50 a share that makes it my first IT 10 bagger (taking dividends into account).
Questor: Britain may have no Googles but this UK stock lets you buy into the global tech story
Amazon is Scottish Mortgages largest holding, accounting for 7.7pc of assets Credit: Richard Drew/AP
6 May 2018 8:12am
It is often lamented that the FTSE 100 has no Facebook or Google. Britain has not so far created one of the vast platform companies that dominate our digital lives. That is bad news for skills and investment, but also for UK tracker funds.
They would have fared better if they followed the S&P 500 index of leading US shares, which has soared by two thirds in value in the past five years thanks to its heavy technology component. The FTSE 100 has risen by 13pc by comparison.
But there is nothing to stop British investors buying into the best of global technology. They might even do it through Scottish Mortgage investment trust, which has quietly been climbing the ranks of the FTSE 100 itself.
A market value of £6.6bn puts the dour-sounding company in the same league as the blue-chip clubs biggest tech names Just Eat, Sage and Rightmove. In fact, its assets have limited links to Scotland although it is run by the Edinburgh-based fund manager Baillie Gifford and even less to do with mortgages.
The portfolio has 47pc of its assets in North America and the total return from investing in its shares over the five years to September was 223pc, compared with 102pc for the FTSE All-World index.
Scottish Mortgage invests for the long term, steered by manager James Anderson, who has been at the helm for 18 years and takes positions with a minimum five-year view.
It is at pains to say it is not just a so-called Fang investor although Facebook, Amazon, Netflix and Googles parent company Alphabet all feature in its top 15 holdings.
What has been key to its recent success is the scaling up of the proportion of unlisted stocks in its portfolio, reflecting the trend for fast-growing firms to stay private for longer.
The trust took the bold move in 2012 of investing $50m (£37m) in unlisted convertible preference shares in Alibaba, the Chinese e-commerce firm that at the time was struggling to attract backers. The holding became ordinary shares at the time of the 2014 flotation and Scottish Mortgages stake was valued at £409m at the last count.
This success goes some way to explaining why the board was given investor approval in 2016 to put up to 25pc of total assets into unquoted holdings. It participated in a pre-listing, private funding round of Spotify, the music streaming service.
Another investment to flag is Grail, a cancer detection start-up spun out of genomics firm Illumina, which Scottish Mortgage backed in its defeat of Roches hostile bid several years ago.
Company watchers at Jefferies say the value of these relationships should not be underestimated, with 50pc of unquoted ideas generated from current holdings.
Scottish Mortgage shares typically trade close to net asset value, which increased by 17.5pc in the first half of the financial year to 420p. Annual results are due this month. One outstanding question is whether concerns over privacy will curb the runaway success of some of the large tech stocks that the trust holds.
Facebook was hard hit in March by news of the Cambridge Analytica data leak. Even though the threat of regulation and compensation hangs over the social media giant, its shares have regained most of their value.
And Amazon Scottish Mortgages largest holding, accounting for 7.7pc of assets touched fresh highs recently after strong trading that demonstrated its advance on several fronts, including cloud computing.
What with two more Chinese stars, Tencent and Baidu, in his portfolio, Anderson and his partner Tom Slater would appear to have all bases covered. At an investor forum in January they stressed that it was not time to sell some of their largest holdings even though shares in those stocks had rocketed.
There are some risks. Spreading inves
Walter Price of Allianz Tech 11.4.18 (from their trust website)
Our position in electric vehicle maker, Tesla, was a top detractor during the period. Tesla shares traded lower after its debt was downgraded by Moodys in part due to liquidity concerns surrounding the companys ability to raise additional capital. However, Tesla has many sources of cash including unsecured credit lines, securitisation of leases, favourable payment terms, product deposits, stock issuance, and strategic third party investments.
Ok, don't hold as much as SMT cos smaller trust and lower %, but they DO hold it.
There was an article in last week's Money Week which advised shorting Tesla. Not just their current production problems but the fact that the major car manufacturers are fast catching up and will soon be offering all electric vehicles of quality.
However SMT remains a core holding for me but due to its exposure to tech stocks this January I rebalanced by selling half and investing that in Monks IT. Over exposure to SMT may prove damaging when the crash occurs.
BUT this other £1.4billion fund has a SHORT, yes a SHORT on Tesla, in other words they believe that Tesla will continue to burn cash, not make enough profits even if it does manage to sell as many cars as the opposition one day, and the Tesla sp will fall massively.
4.9% of SMT is in Tesla, 5th biggest holding. 9.9% in Amazon, top holding. Who th is Illumina? They are 4th. These guys are definitely not seeking to track any indexes.
Not sure I would buy today, but I recommended SMT to my son and no regrets.
This other fund has a massive SHORT on Tesla .......
Who is right ? .....who will win ? .....
£1.4bn fund manager: 'I've bet against Tesla the story doesn't match the reality'
Tesla roadster launch
Tesla is burning through cash at a rapid rate CREDIT: TESLA/REUTERS
1 MAY 2018 1:09PM
Investors looking to add protection to their portfolios amid stock market volatility face a difficult choice.
Bonds, the traditional safe haven asset, face a number of risks after three decades of rising prices.
Absolute return funds, which aim to deliver a positive return regardless of market conditions, provide one option.
The £1.4bn Jupiter Absolute Return fund, managed by James Clunie since 2013, aims to deliver a positive return over any three year period.
The fund makes heavy use of so-called short selling betting against individual stocks.
Telegraph Money spoke to Mr Clunie about what makes him short a stock, when his fund will perform well, and why he doesnt buy into the Tesla hype.
Whats in the portfolio?
The portfolio has around 40pc in global shares, 42pc in shorts against global shares mostly in America and assets such as gold to make the fund more robust. Those weightings change gradually over time.
If youre an active manager you have to have an edge, otherwise theres no real purpose in existing shorting stocks is our edge. It has been my research focus for 15 years.
Theres evidence that there are information signals that can be identified to gain an edge when choosing companies to short. Weve read all, and written a number of, the academic papers on the topic.
We are patient, waiting to short a stock until others do too, and accept our losses if theres news that contradicts our thinking.
If others short the company you want to bet against, they have seen what you see, and together you are more likely to succeed against a mass of optimistic buyers.
How do you pick stocks?
For both picking stocks to invest in and bet against, there are multiple stages.
First, we screen accounting data, pricing data and other information on companies, and plug that data into formulae, which ranks stocks from top to bottom.
Then, we look at the market value and determine if the cashflow a company needs to sustain that share price can realistically be attained.
We then look at factors such as directors buying shares, short sellers building positions, and activist investor.
Where companies score favourably in all these areas, we invest a small amount in to start with.
If companies score badly in all these areas, we start to bet against it. We then invest more, or abandon the idea, depending on news and whether it confirms our thinking.
Right now, our biggest investment is in oil giant BP. People think its a rubbish company, but it has been disciplined with its spending, which will show up in its results. It should increase in price once people realise its not as bad as they thought.
Our biggest short position is against electric car firm Tesla (see box, below), as the story isnt backed up by fundamentals.
When does the fund do well?
Our fund has an inverse correlation to stock markets, which is the exact opposite of most funds.
If share prices fall, either due to rising interest rates or an economic recession, we expect the fund to go up. If the market fell 20pc, wed expect to be up 4pc.
The biggest risk to the fund is that share prices keep going up. We dont like steady markets where shares go up in a straight line, led by stocks that have already gone up a lot.
We hated 2013 to 2014, and last year, when markets rose strongly. We just hunker down and try to survive those periods. Performance was flat in 2013 to 2014, and the fund lost around 3pc in 2017.
But the insurance the fund offers hasnt come at a big price the fund is up 10pc over three years, and 16pc over five y
> On 23 April 2018, owing to demand in the market, the Company announces the issuance of 1,150,000 Ordinary Shares of 5p each fully paid from Treasury. Following the issuance there will be 1,398,313,209 Ordinary Shares in issue (excluding the remaining 23,417,671 shares held in Treasury). These shares were issued for cash on 23 April 2018 at a price of 463.00p per share and at a premium to the prevailing net asset value.
I am sorry but I feel that the recent drop is all my fault!!
I should have known better but I bought in last week at 442p per share. Luck / good fortune seems seldom to be on my side. I thought that this looked an exciting home for my ISA ( two years accumulated ISA's in fact.)
Ah well, I can't take it with me as they say so I just hope that my investment can build over the next few years so as my grandchildren might reap the benefit.
If you have been looking at the Dow over the last few days you have to keep your eyes open all the time, One blink and it moves 100 points or so. Ou American cousins don't do steady, one tweet from the White House sends the whole market into a tailspin!
Kind regards and good luck to all my new fellow investors.
I suspect that the answer is different depending upon the timescale that you are looking at. The headwinds against Tesla, Facebook, Amazon et al seem pretty strong at the moment, but in the medium to long term they may still turn out to be a good bet. The problems with longer timescales are that the number of unknowns multiply. For example- How will Tesla fare when the major players in the car and truck market increase their focus on electric vehicles? How will Tesla cope with high debt levels as interest rates rise? Will the tax take rise on Amazon? Will regulation push up Facebook's cost base? I suspect that the answer to all of these (and many other) questions will be largely negative. However, weighed against this are the positive unknowns of how many rabbits they are able to pull out of the hat.
James Anderson has tied his flag to the FANG shares in recent years along with other
cutting edge companies such as TESLA and similar high tech outfits.
After a number of years of amazing growth and little or no critical comment on his
strategy, the non stop upside seems to have ground to a halt.
Some commentators think this is a temporary glitch in the never ending rise of
tech stocks. Others are doubtful and cite the inevitability of regulation which will
put a blanket on the spectacular growth we have seen from SMT in recent years.
I'm still knocked out by the fact that SMT made it into the FTSE100.
"With the end of the tax year drawing near, the Association of Investment Companies (AIC) has collated investment companyÂ ISAÂ recommendations from financial advisers for all ages.MillennialsDennis Hall, CEO and chartered financial planner at ..."
Well, I for one have found these KIIDs a revelation - at least the bit right at the end that tells you what the actual ongoing costs of the product are. Who knew, for instance, that RIT's costs are touching 4% instead of the 1.and-a-bit % that always appeared as their annual costs in all previous documentation and web info?
If the changes are annoying that's the fault of XO and other brokers who haven't got their acts together. It surely can't be that difficult for them to set up a tick box or two on the trading page so you can say you've read the KIIDs. I suspect they have been dilatory in getting hold of them from investment houses or doing the necessary IT work to get them uploaded etc.
Blaming the EU for our own shortcomings, what a novelty ......
Different brokers are handling KIDs in different ways.
On HSDL, you have to tick on the KID document to download it and then click on a box to say you've read it. The HSDL system will not allow you to click on the "I have read it" box unless you initiate a download.
Barclays also requires that you click on a box to say you've read the KID before you can initiate a trade. Some of the KIDs are missing that are relevant to me - MRCH (Merchants) and BRGE (Blackrock Greater European Emerging Markets) so you can sell but not buy. Barclays say they haven't been provided with the KIDs but they are on the IT's own web site so they're not being proactive to get it sorted out.
There is an anomaly. The Barclays system will conduct an automatic divi reinvestment without having indicated you've read the KID (if one exists) and without a KID being in place for the "Buy" function if you want a new tranche. Makes a bit of a mockery of the regulations.
I spoke to XO in the phone this morning afterI was informed by the web platform that I couldn't buy any SMT because I had not confirmed I had read the KID.
The lady i spoke to unlocked it for me on the phone and then sent me the KID by email, which was absolute tosh and a total waste of my time to read.
I am very disappointed that the EU has just placed an irritating barrier in the way of me investing in things I have researched and chosen. As far as I can tell, the only place I could actually get a copy of the wretched document was from X-O themselves, so obviously, no, I have not read the silly thing. Its pure nannying, and pretty much pointless too. In future, I am just going to say that I have read the KID, but I won't actually read it. I expect most will do the same.
Back to practicalities, the lady I spoke to said that in future I can just send them an email with a list of tickers I have "read the KID" for, and they will tick the box for me so I can trade them in future. What a pointless charade.
She also said that the devs are working on putting a tick box on the trading page where this requirement applies so you can just tick the box and get in with it, but they haven't got it in place yet.
Good to know the EU is wasting so much of their and our time and money on pointless hoops for us to jump through that add absolutely zero value.
Amusingly, this is what Scottish Mortgage thinks of this new KID nonsense:
I think those are 2 different things.....I have just been sent one by Jarvis for complex instruments because of my holdings in 3UKS...a leveraged short tracker....so I can understand that, but has anyone ever even come across a KIID for an investment trust (I am not even sure they exist)
I had to fill out a questionnaire for HL if I wanted to continue to deal in index-linked gilts, as this was considered to be a complex / risky investment. HL didn't need any such thing for my Investment Trust investments, however risky they might be. I'd consider an investment in Scottish Mortgage to be more risky than one in gilts.
On 28 November 2017, owing to demand in the market, the Company announces the issuance of 650,000 Ordinary Shares of 5p each fully paid from Treasury. Following the issuance there will be 1,402,119,485 Ordinary Shares in issue (excluding the remaining 19,611,395 shares held in Treasury). These shares were issued for cash on 28 November 2017 at a price of 466.90p per share and at a premium to the prevailing net asset value.
Baillie Gifford & Co Limited
28 November 2017
Regulated Information Classification: Acquisition or disposal of the
issuer's own shares
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