Artemis Income Retail Inc

A_Flock_Of_Sheep

Linton wrote: »

I hold Kier, Aviva, and Cineworld all of which showed a >40% return in the past 6 months. With your stockpicking skills why didnt you go for them? Any of these shares, and easyjet, could just as easily drop 20% or more in the next 6 months.

As regards the posts on the RM thread I agree with your assessment. The danger is that newbie investors holding their first shares will think that its easy and they are well on their way to their first £1M . They will then come very unstuck when the short term variation goes the other way.

I do in a fashion hold Cineworld as it's in unicorn uk income. There is an investment trust I have been eyeballing for a while that contains kier. Easyjet was my first share I had ever purchased myself. So from a newb point of view I guess I didn't do bad on that.

Part of my portfolio is for the longer term while part is more a short term gamble type of section. The profits if any made are then fed into the longer term part. The longer term part though has no emerging markets or overseas exposure at the moment. I hold Royal Mail and that is in my long term section. I was surprised at the short termism on the Royal Mail thread.

Perelandra

Derren Brown did a great programme, in which he proved that he was able to pick winners from horse races. Five weeks in succession, he correctly gave a racing tip to his chosen person, getting her to place larger and larger bets on the horses. His tip consistently won, she won a lot of cash, and he'd proven his system for picking winners worked.

Of course (spoiler alert! :P ) his "system" actually involved contacting a very large number of people initially, and only contacting the prior week's winners each time for the next "tip". Ultimately the woman featured on the show was the perfect case of survivorship bias. From her perspective, betting on horses was a winner (as looking back she'd made the right choice every time). Clearly, though, it's not a great investment strategy.

A_Flock_Of_Sheep

Perelandra wrote: »

Derren Brown did a great programme, in which he proved that he was able to pick winners from horse races. Five weeks in succession, he correctly gave a racing tip to his chosen person, getting her to place larger and larger bets on the horses. His tip consistently won, she won a lot of cash, and he'd proven his system for picking winners worked.

Of course (spoiler alert! :P ) his "system" actually involved contacting a very large number of people initially, and only contacting the prior week's winners each time for the next "tip". Ultimately the woman featured on the show was the perfect case of survivorship bias. From her perspective, betting on horses was a winner (as looking back she'd made the right choice every time). Clearly, though, it's not a great investment strategy.

There is a bit of a difference selecting horses in a race to selecting shares having spent time seeing if the company involved is a viable investment.

I don't think you can compare betting on horses to selecting stocks and shares.

Don't get me wrong I havn't always backed total winners. I hold Unilever and that is sitting at a -2.84% deficit currently.

Linton

A_Flock_Of_Sheep wrote: »

I do in a fashion hold Cineworld as it's in unicorn uk income. There is an investment trust I have been eyeballing for a while that contains kier. Easyjet was my first share I had ever purchased myself. So from a newb point of view I guess I didn't do bad on that.

Part of my portfolio is for the longer term while part is more a short term gamble type of section. The profits if any made are then fed into the longer term part. The longer term part though has no emerging markets or overseas exposure at the moment. I hold Royal Mail and that is in my long term section. I was surprised at the short termism on the Royal Mail thread.

I thought I could pick stocks during the tech bubble. Then I chose Marconi, the UKs largest electronics company formerly GEC. In September 2001 it was worth more than £12/share. One year later following disastrous management errors the price had dropped to around 40p. Cost me about £1000.

Why dont you hold EM? Surely now is the time to buy when its cheap. It seems to me you are taking a risky approach with no overseas holdings.

A_Flock_Of_Sheep

Linton wrote: »

I thought I could pick stocks during the tech bubble. Then I chose Marconi, the UKs largest electronics company formerly GEC. In September 2001 it was worth more than £12/share. One year later following disastrous management errors the price had dropped to around 40p. Cost me about £1000.

Why dont you hold EM? Surely now is the time to buy when its cheap. It seems to me you are taking a risky approach with no overseas holdings.

To be honest my reason is purely lack of knowledge and understanding of that sector. I guess I feel suspicious of it. I wouldn't know which fund or investment trust to choose. In fact the majority of my portfolio is Real Estate ITs

Perelandra

A_Flock_Of_Sheep wrote: »

There is a bit of a difference selecting horses in a race to selecting shares having spent time seeing if the company involved is a viable investment.

I don't think you can compare betting on horses to selecting stocks and shares.

Don't get me wrong I havn't always backed total winners. I hold Unilever and that is sitting at a -2.84% deficit currently.

True... you've probably got a 55% chance of winning on stocks.

But there's still a large element of chance in buying individual shares. The odds are in your favour (since prices tend to go upwards), and as long as you pick winners you'll feel like you know what you're doing. But whether you're "good" or just lucky, you'll never really know.

jamesd

torus wrote: »

Good Luck -I have just started investing in shares and funds in my 50s and wish I'd done it 30 years ago. But I have spent a LOT of time reading about it first before investing.

You clearly have a lot of learning to do when you're blaming the fund managers you've selected for the performance of the sectors you've chosen.

You pick the brief the manager has when you select the sector. Then the manager gets judged on how well they do compared to other funds in the sector. If you pick a sector that does badly then the best the manager can do is do less badly than the whole sector. What your posts says is mainly that you're unhappy with some of your sector choices but blaming the funds instead of yourself. Until you correct that, you're going to be significantly handicapped in your investing.

But you also seem to have another issue: declining to buy during a sale and waiting until the end of the sale before you buy. Sectors do well or badly at different times for different sectors. Now is a time when bond funds have done well and emerging markets and natural resources badly. Investing in those two based on what has happened is a classic mistake made by consumers, who buy high and sell low instead of the opposite.

The different performances of different sectors at different times is part of why IFAs are likely to use portfolios with rebalancing to exploit those differences, doing some selling at highs and buying at lows in the process.

The Cazenove UK Smaller Companies Class B Accumulation fund has done pretty well recently compared to smaller companies funds as a whole. That's because it has a high component in the smaller AIM-listed companies compared to the sector as a whole. So more risk does better when the sector is rising, as smaller companies in general have been doing. But also more badly when the sector is doing badly. Good stock selection can help to increase the gains or moderate the losses but not eliminate the whole trend, usually.

A_Flock_Of_Sheep

jamesd wrote: »

You clearly have a lot of learning to do when you're blaming the fund managers you've selected for the performance of the sectors you've chosen.

You pick the brief the manager has when you select the sector. Then the manager gets judged on how well they do compared to other funds in the sector. If you pick a sector that does badly then the best the manager can do is do less badly than the whole sector. What your posts says is mainly that you're unhappy with some of your sector choices but blaming the funds instead of yourself. Until you correct that, you're going to be significantly handicapped in your investing.

But you also seem to have another issue: declining to buy during a sale and waiting until the end of the sale before you buy. Sectors do well or badly at different times for different sectors. Now is a time when bond funds have done well and emerging markets and natural resources badly. Investing in those two based on what has happened is a classic mistake made by consumers, who buy high and sell low instead of the opposite.

The different performances of different sectors at different times is part of why IFAs are likely to use portfolios with rebalancing to exploit those differences, doing some selling at highs and buying at lows in the process.

The Cazenove UK Smaller Companies Class B Accumulation fund has done pretty well recently compared to smaller companies funds as a whole. That's because it has a high component in the smaller AIM-listed companies compared to the sector as a whole. So more risk does better when the sector is rising, as smaller companies in general have been doing. But also more badly when the sector is doing badly. Good stock selection can help to increase the gains or moderate the losses but not eliminate the whole trend, usually.

I have been doing a little reading on emerging markets and they have certainly suffered as a result of Bernankes threat of tapering QE. Not sure from the small amount of reading I have done if the EM sector has reached the bottom or not. The way I see it at the moment the mere mention of reducing QE made EM shares fall from the sky - so what will happen when they withdraw QE totally?:eek:

jamesd

I don't even try to time the exact bottom or top. Never can hit those perfectly and you don't need to. Here are some sample Pound unit prices from my own data collection:

JPM Natural Resources
2008-11-21 2.9710
2009-02-20 4.4600 low+3 months
2009-05-21 5.8620 low+6 months
2009-11-20 7.8870 low+12 months
2010-11-22 10.5000
2011-01-04 11.9400 high
2011-11-21 8.3960 manager leaving announcement 2011-10-26
2012-11-20 7.3010
2013-10-17 6.0000 now

Notice it could halve still to get to the 2008 low... or double to get to the 2011 high. It seems like a reasonable time to be buying natural resources, though maybe not this specific fund. Also notice the manager's leaving timing decision and the common advice to sell a managed fund when the manager leaves. The manager seems to have correctly read the way the market was going.

Aberdeen Emerging markets
2008-10 2.0 approximate (HL graph source)
2009-05 2.7 approximate (HL graph source)
2010-03-17 4.5092
2010-11-22 5.1559
2011-11-21 4.7005
2012-11-20 5.3918
2013-05-22 6.2760 high or close to it
2013-10-17 5.5807 now

A_Flock_Of_Sheep wrote: »

Not sure from the small amount of reading I have done if the EM sector has reached the bottom or not

For emerging markets there's a conflict between hot money flowing into them in the short term and many being natural resources sources or manufacturing centres that benefit from economic recovery. QE ending hurts in the short term, economic recovery helps over the next year or two. I'm currently not adding much to this sector but I do have a regular buy still in place. I want to see what QE ending and recovery signs do before I do more bulky moves into this sector.

The really big message from both sets of data is expect huge volatility. This is not the FTSE All Share Index where a typical very bad year is 45-50% down. These can drop by 75% (JPM Natural Resources high to 2008 low) and 69% (Aberdeen Emerging Markets).

Losing three quarters of your money by buying at the peak and selling at the bottom would not be fun.

But notice what developed markets were doing at the same time and what sector rebalancing would have done...

A_Flock_Of_Sheep wrote: »

The way I see it at the moment the mere mention of reducing QE made EM shares fall from the sky - so what will happen when they withdraw QE totally?:eek:

Depends what you mean by withdraw, just stopping buying or selling everything bought so far as well?

Easy case first: the Fed could not both stop QE buying and sell everything purchased so far within say a month. There wouldn't be enough buyers because it would completely destroy the price and cause a massive recession starting around the time they tried it. China wouldn't declare war but might decide that Taiwan has nice potential as a holiday resort they should own and do something about that while the economic world was plunging into temporary chaos. Best to sell fast if you think this is going to happen, you won't find a lot of buyers until prices get very low.

But the senior people at the Fed aren't elected tea drinking politicians not satisfied with a 50% reduction in the US deficit over the last few years, so they aren't that stupid. What they will really do is very gradual tapering of buying and switching to gradual selling by normal redemptions at first, over years. Buying the VIX and deep short options on the major US indexes if there's any sign of a Republican President, House and Senate might be a great move though.

I'll put away my crystal ball now. Just be prepared for volatility and accept that sometimes good enough is sufficient to get the job done.

It's worth learning something about options and covered warrants. They cost money but sometimes protection from uncertainty is worth paying for.

Party_Animal

Just read the Telegraph finance page, yet again this fund is recommended as an alternative to Invesco. The Artemis Income is top of the broker's list.