Current market carnage - anyone selling or buying?

eskbanker

Sapphire wrote: »

Just curious: what do all you investors in shares think the serious wars Middle East, which appear to be dragging in much of the world – Europe, the US, Russia, China, Africa and so on – with perhaps unpredictable results, will have on stock markets. Do you feel that it depends on how severely the countries that have been dragged in will be affected (in terms of invasions/repelling them, civil unrest, going to war and so on)? It might sound like a stupid question (and perhaps it is), but it would be good to know what people think about the effects on economies/stock markets.

There are always wars going on somewhere - markets will inevitably get short term jitters from time to time depending on how serious or significant these are perceived to be but ultimately demand for commodities, pharmaceuticals, banks and the myriad of other goods and services continues so there's no reason to believe that wars equal negative market sentiment if that's what you were implying?

masonic

Rollinghome wrote: »

It did but 91% was still pretty good going and puts the average Global Equity UT to shame with a 5 year return of 25%. Only 4 out of 200 in the sector did better than 80% and three of those were specialist healthcare/pharma funds. Vanguard LS 100% equity with some UK bias returned 35% over four and a half years and well out-performed the sector..

91% overall I'm sure was a lot better than me (though I haven't checked) despite a useful contribution from a very large holding in Dr Pepper giving a return of 170% (about 270% over the 8 years I've held it) and a few others. Goes to show it helps to be in the right place. How was your luck?

Oh, I don't disagree. 91% is a great return - but a comparison with the FTSE100 is going to flatter even a sub-par portfolio. Personally, I've not done that well, having retained a significant (~30%) EM overweight and building up a position in commodities over the past couple of years, but on a unitised basis I've managed a little under 60%. Clearly my market timing leaves a lot to be desired, but over the long term I remain somewhat optimistic.

InvestInPoker

masonic wrote: »

aving retained a significant (~30%) EM overweight and building up a position in commodities

If you don't mind me asking masonic can I ask what funds (or other devices) you use for your exposure to Emerging Markets and Commodities. Thanks

Rollinghome

masonic wrote: »

Oh, I don't disagree. 91% is a great return - but a comparison with the FTSE100 is going to flatter even a sub-par portfolio. Personally, I've not done that well, having retained a significant (~30%) EM overweight and building up a position in commodities over the past couple of years, but on a unitised basis I've managed a little under 60%. Clearly my market timing leaves a lot to be desired, but over the long term I remain somewhat optimistic.

It wasn't intended in order to flatter. It was meant as a reminder of the other extreme.

As you say, most people would spread their nets though I doubt many outside of the US would have a portfolio that is both 100% in equities and 100% in the S&P 500.

In contrast, I suspect there are more than a few around these parts with the Virgin FTSE 100 tracker as their sole equity investment (or perhaps a basket of FTSE blue chips) and wondering why with an annualised total return of 2.6% over the last five years they haven't done so well (even compared with the ~5.0% 5 year fixed rate savings rates on offer then).

On that basis, a 91% return over the period is an exceptional return by any measure. Beaten only by 4 funds of the hundreds in the IMA Global UT sector, three of those specialist healthcare funds, and where the average Global equity fund returned just 25% over the last 5 years. (4.5% annualised) The price of the average Global IT increased by 33%, in part due to the increased premiums being paid, but with a lower increase in the average NAV.

So congratulations to anyone who came even close to equalling the 77% return of the S&P with a diversified portfolio, let alone substantially beating it.

If comparing yourself with a professional fund manager then achieving a return of 60% despite being 30% overweight in EMs where the sector has lost 22% in 5 years, doesn't suggest too much wrong with your timing.

If a diversified portfolio then certainly not in comparison to the average return for UTs in any of the IMA Mixed Investment sectors either - the best being the 40-85% sector with an average total return before platform fees of 22% over 5 years (4.05% annualised).

So 91% is rather good.

Voyager2002

gadgetmind wrote: »

Well, you can't accuse that active manager of being a closet tracker! Care to name and shame?

Of course, fees will still have rolled in and yacht will getting upgrade as usual.

When I bought it five years ago, it was called 'Opportunities USA'. It did so badly (I think because it was overweight on companies that profited from people buying gold) that it was liquidated and merged into the Parvest Equity USA Value CC.

gadgetmind

Ah yes, the old liquidate and merge, the way that active funds that underperform are discreetly removed from the statistics.

masonic

InvestInPoker wrote: »

If you don't mind me asking masonic can I ask what funds (or other devices) you use for your exposure to Emerging Markets and Commodities. Thanks

Sure, my core holding has been First State Global Emerging Markets Leaders (now "Stewart Investors..."), which I bought into around 10 years ago, but stopped adding to after it soft-closed a couple of years ago. Over the past 6-9 months I've been selling this down to buy into Templeton Emerging Markets, which I thought looked like a decent fund going through some short-term performance issues (it hasn't been a great time for value investing in general) - it's continued to tank while I've held it, so here's hoping the new manager can turn it around. I've also held Scottish Oriental Smaller Companies for the past 5 or so years.

For commodities, I've been building a position in City Natural Resources. I was tempted in after it had already fallen nearly 50% and was trading at a 20% discount. I started off with a very conservative 2.5% allocation (which is 30% down), but I'll be building this up to 5% over the course of this year.

Linton

Voyager2002 wrote: »

When I bought it five years ago, it was called 'Opportunities USA'. It did so badly (I think because it was overweight on companies that profited from people buying gold) that it was liquidated and merged into the Parvest Equity USA Value CC.

mmm - looks like it wasnt really an equity fund as it focussed on Basic Materials and hedged away a significant amount of correlation with the wider S&P500. See here. It doesnt sound like a mainstream choice for any investor.

Linton

masonic wrote: »

Sure, my core holding has been First State Global Emerging Markets Leaders (now "Stewart Investors..."), which I bought into around 10 years ago, but stopped adding to after it soft-closed a couple of years ago. Over the past 6-9 months I've been selling this down to buy into Templeton Emerging Markets, which I thought looked like a decent fund going through some short-term performance issues (it hasn't been a great time for value investing in general) - it's continued to tank while I've held it, so here's hoping the new manager can turn it around. I've also held Scottish Oriental Smaller Companies for the past 5 or so years.

For commodities, I've been building a position in City Natural Resources. I was tempted in after it had already fallen nearly 50% and was trading at a 20% discount. I started off with a very conservative 2.5% allocation (which is 30% down), but I'll be building this up to 5% over the course of this year.

Can you divulge where the 60% in 5 years come from? Not from EM and Natural Resources.

Linton

gadgetmind wrote: »

Ah yes, the old liquidate and merge, the way that active funds that underperform are discreetly removed from the statistics.

Hardly - which sector would you have put it in to compare against the equivalent index fund?