Orbis £100 match offer - Now Ended

cjv

Alexland wrote: »

Thanks I have clearly missed this Tesco debit card opportunity. We also have Nutmeg LISAs to fill next tax year so if we get a joint account then £12k of JISA and LISA contributions could be £60 in Pizza Express food vouchers. Does it use the same login as the Tesco credit card account?

Yes all your accounts with Tesco should use the same login and you can see your current accounts, credit cards and savings all in one overview.

The current accounts usually appear active/manageable after you activate your debit card.

Did you see the Tesco Clubcard news? seems they are taking some of your Pizza bonus away! damn them

Alexland

cjv wrote: »

Yes all your accounts with Tesco should use the same login and you can see your current accounts, credit cards and savings all in one overview.

The current accounts usually appear active/manageable after you activate your debit card.

Did you see the Tesco Clubcard news? seems they are taking some of your Pizza bonus away! damn them

That's good (I am drowning under too many logins) but yes my wife just told me Tesco have changed Clubcard so the points are now only worth 3x value at Pizza Express, etc. Hmmmmm...... We don't want 3/4 of a pizza!

Voyager2002

Alexland wrote: »

VLS100 tracks all the world stock markets in proportion to their relative size (but with a UK bias) using index funds for each region which include most of the shares available in that area in volumes proportionate to the market capitalisation of those companies. There are thousands of underlying holdings.

Orbis are focused only holding select companies where their global team strategy determines there is an opportunity for higher return and have the freedom to weight the portfolio as they see best to control risk and deliver returns. It is more concentrated and focused.

In terms of risk VLS will get you close to the average market result but the market cap approach means it stocks up on the big popular shares which can sometimes suffer the greatest declines. Orbis are investing in value not quality so although they are not overpaying for the holdings they are often out of favour with the current market sentiment.

Alex.

While that is a good explanation of what Orbis says about its fund, the portfolio seems to tell a different story: 23 per cent of the fund is in Information Technology; 17 per cent in Consumer Discretionary; 15 per cent in Financials. These are sectors that do well in times like the present but suffer badly when there is a 'correction'. So the present choice of investments looks sensible but not 'contrarian', and certainly not what I would want to hold if I thought there was going to be a crash tomorrow!

Of course the fund managers can and do sell and buy shares every day, but it is not easy to restructure an entire fund portfolio overnight!

Temrael

Thanks for sharing this, on the face of it I can't see there's very much risk. I put in £100, they put in £100...

If, over the course of the year markets crash, they'd have to do so by more than 50% for me to actually be out of pocket. Certainly not impossible, but if that happens the £100 I have put in here will be the least of my worries! Hehe

The approach to fees is interesting though (if I'm reading it right), basically they take half of any over-performance. The downside of which is that (conceptually) if markets dropped 60% and Orbis' fund only dropped 50% then presumably they have over-performed by 20% and you'd owe them half of that (as well as having the bonus wiped out by the drop). I'm not sure how likely that scenario is but it would be very possible that you'd see less than the full £100 bonus in 12 month's time.

I've done similar legwork for smaller likely returns though so I might give it a go (whilst understanding the risk and that it's a bit of a punt).

Alexland

Voyager2002 wrote: »

While that is a good explanation of what Orbis says about its fund, the portfolio seems to tell a different story: 23 per cent of the fund is in Information Technology; 17 per cent in Consumer Discretionary; 15 per cent in Financials.

You have to look deeper than sector analysis to understand the actual holdings. So looking at the technology in their Global Equity fund I don't see Apple, Facebook or Alphabet - it's companies like Motorola who hold a lot of valuable patents. Again on the financials it's not the big western Morgan Stanley but Sberbank of Russia. These are different investments for which your sector assumptions for tracker portfolios may not apply. Who knows if their contrarian strategy will work going forwards but it seems to have worked for a long time now. Having said that in a global crisis sometimes everything drops and given this is not mainstream I wouldn't put too much into it.

Alex.

TheLastMongoose

Thanks Alex for the find. Bonuses like these make a big difference to small investors like me.

Temrael wrote: »

The approach to fees is interesting though (if I'm reading it right), basically they take half of any over-performance. The downside of which is that (conceptually) if markets dropped 60% and Orbis' fund only dropped 50% then presumably they have over-performed by 20% and you'd owe them half of that (as well as having the bonus wiped out by the drop). I'm not sure how likely that scenario is but it would be very possible that you'd see less than the full £100 bonus in 12 month's time.

In that scenario I figure you would be left with £90 but if you invested £100 in a global equity tracker in the same scenario you would be left with £40. Even without the £100 bonus you would be £5 better off with the Orbis fund with £45 instead of £40. Somebody feel free to correct me!

That's assuming they calculate fees fairly. I noticed that the benchmark for the balanced fund is based on 40% bonds 60% equities but their current allocation is 87% equities. Clearly in a rising market that will result in "over performance" and so incur significant fees. If the managers can achieve that whilst minimising losses in a downturn then they deserve their fees but it's what happens during the downturn that I am a little sceptical about. Are they labelling a high risk fund as a medium risk fund? I am going to invest a small amount in this fund anyway, it's too interesting not to!

Alexland

Also in that example Orbis have a 2.5% annual cap on how much they can draw out of the reserve tank so although the fund would look like you have paid a large performance fee most of the money would be sitting in the fund reserve in case of future underperformance. And if the reserve runs dry they don't get paid anything until the next period of over performance.

EJS_Superted wrote: »

That's assuming they calculate fees fairly. I noticed that the benchmark for the balanced fund is based on 40% bonds 60% equities but their current allocation is over 80% equities. Clearly in a rising market that will result in "over performance" and so incur significant fees. If the managers can achieve that whilst minimising losses in a downturn then they deserve their fees but it's what happens during the downturn that I am a little sceptical about. Are they labelling a high risk fund as a medium risk fund? I am going to invest a small amount in this fund anyway, it's too interesting not to!

Yes but they are hedging circa 20% of the equities exposure to get the capital volatility down. They saw the bond market issues coming so structured their portfolios differently. Ok they are still a bit overweight on equities but that's probably fine as their holdings are not exactly hyped up and volatile. You could argue that the global benchmark is inappropriate as they are overweight in some countries - but then if you designed a benchmark that exactly matched their holdings then it would be impossible to outperform.

Basically the Orbis Balanced fund is VLS60's evil brother - not like the HSBC GS Balanced which is the nice one. We hold all 3 in varying quantities and together they make a family. VLS60 holds more government bonds so wants to be a civil servant, HSBC GS Balanced holds more corporate bonds and wants a career in industry and we're really not sure how Orbis Balanced will turn out, he's really quirky and likes strange things, but hopefully he will find his way in life!

I have similar concerns about my son who keeps putting things in the toilet then clapping his achievement so he's a good match for Orbis.

Underfunded-overworked

HI , signed up for this for a bit of fun , thanks for the heads up , they had the option to open a joint account as well , would this attract a second £100 match ?

Temrael

Underfunded-overworked wrote: »

HI , signed up for this for a bit of fun , thanks for the heads up , they had the option to open a joint account as well , would this attract a second £100 match ?

Bottom of the Ts and Cs...

"The Offer is only available for one Standard Investment Account per person and is not available on New Standard Investment Accounts for individuals who have an existing Standard Investment Account with Orbis Access."

a_silver_lining

Hi all, I'm wondering if people are opening the stock and shares ISA or the investment account in order to take advantage of this deal?