Woodford Patient Capital

bowlhead99

AnotherJoe wrote: »

p.s. BH, I strongly suggest you read the MW report before buying Burford.

I did read it yesterday, as per my comments on the Burford thread, so will keep comments on that over there rather than here. I haven't bought in as yet. I can't remember if the company was a WPCT holding or not; think it was just in WEIF but that may not be the case.

FWIW the LIT share price which I mentioned had recovered to 77p yesterday afternoon opened over 80p this morning and now about 87p. So seems the brief drop to 60p while Burford was falling was indeed just due to sector contagion and a relatively thinly traded stock. As a sub 80p price was no longer available I didn't do my top up there, but will continue to watch it.

iglad

WPCT 1 year -50% 3 year -55% discount 50% share price 40.40p who will buy this falling knife?

atush

LHW99 wrote: »

You're not going to get cold fusion - there are a lot of good physics theories why you won't. Just getting "hot" fusion that was commercially viable would be good.

i'll take that.

boomer69

iglad wrote: »

WPCT 1 year -50% 3 year -55% discount 50% who will buy this falling knife?

Me at 54p. Lets watch and see.

iglad

boomer69 wrote: »

Me at 54p. Lets watch and see.

I'm just watching as it's fun to watch the % losses mount up and people still haven't run for the hills.

Those who have been in the fund for 3 years have 45% of their initial investment left so far.

This reminds me so much of the JP Manek fund who was a pharmacist who won two Sunday Times share investment competitions back to back and then some fool gave him £10m to start his own fund.

https://portfolio-adviser.com/uks-worst-manager-shuts-up-shop/

masonic

iglad wrote: »

I'm just watching as it's fun to watch the % losses mount up and people still haven't run for the hills.

Schadenfreude in action.

Mrs_Hen

If Woodford has done anything good for me, it's to teach me a couple of useful lessons.

I bought at launch - ended up with more shares than I really wanted because the upper limit for shares was hugely increased due to over subscription.

Felt pretty stupid, but stuck with it as I watched the price fall - patience is a virtue after all.

Sold in May at 83p when the "weird stuff" in Guernsey started. Felt like a right idiot then - massive relief now!

Lessons learnt: Don't get caught up in the hype. If you don't understand it GET OUT. Both very useful I think.

iglad

Mrs_Hen wrote: »

If Woodford has done anything good for me, it's to teach me a couple of useful lessons.

I bought at launch - ended up with more shares than I really wanted because the upper limit for shares was hugely increased due to over subscription.

Felt pretty stupid, but stuck with it as I watched the price fall - patience is a virtue after all.

Sold in May at 83p when the "weird stuff" in Guernsey started. Felt like a right idiot then - massive relief now!

Lessons learnt: Don't get caught up in the hype. If you don't understand it GET OUT. Both very useful I think.

Ouch but it could have been worse a lot worse however I don't understand why people are staying in the fund as I doubt if they'll ver get their full investment back.

Brian65

iglad wrote: »

I'm just watching as it's fun to watch the % losses mount up and people still haven't run for the hills.

Why is it fun?
I'm glad I didn't buy in, but take no pleasure in seeing people lose money especially when its much needed British start up companies. Perhaps you won't find it such fun when there are no British Industries left to provide real jobs, pay taxes and fund essential services

bowlhead99

iglad wrote: »

I don't understand why people are staying in the fund as I doubt if they'll ver get their full investment back.

Yes, you've mentioned in other threads that you don't like sitting on a loss so would prefer to sell and get a different holding with which to attempt to make your losses back. Some people are like that. It is psychologically difficult for them to hold a stock that shows red on their portfolio summary, even though the prospects of that stock from that price may be quite reasonable.

However, other people are not on a mission to recover a specific entry price, even if the current price is below the one at which they first bought. Instead they recognise that investing in things with potential can sometimes simply involve forgetting your old expectations and recalibrating them.

For example, a few posts up the thread, AnotherJoe mentioned Burford, a company where the share price went from £15-20 down to £5-6 in a short space of time. It may take a heck of a long time for holders to get back to £15-20. Even with years of patience they may not get to £20 before they give up, because 300% return could take decades.

However, if they had got out yesterday while the market temporarily undervalued the stock at £5.50 they would have missed the increase to £7.50 today, which would have given them more than 33% return in just one day. By contrast, over the same one-day period, Scottish Mortgage only went up 3% while MSCI AWCI went up less than half a percent. So on the face of it, SMT or AWCI wouldn't have been a better place to keep your money, and it can be perfectly reasonable to hold something that has lost a lot of value.

So it goes with WPCT. You think it will never go up 200% from here, to allow the people who invested all their money at the absolute peak, to make a profit. So why would they hold? Perhaps it is because if Woodford or some other manager is able to elicit an undemanding 60p of proceeds per share (midway between current share price and most recent declared NAV, and 25% lower than declared NAV), they will make 50% above today's 40p price. That is a decent enough reason to hold rather than sell, if you think it may transpire.

Of course if you are AnotherJoe and believe the underlying value of WPCT is only 30p, then you would be of the opinion that it's foolish to spend 40p buying WPCT and wait for a 100% NAV increase to get only a 50% share price increase. Investing in hard-to-value shares requires some judgement and it can be easier to leave well alone, instead of risking making mistakes through judgement calls.

But 'don't stay in a fund which shows a share price decline because it could take ages to get your money back, while if you make a clean break and buy something fresh today you might be in profit tomorrow...' is an attitude borne out of naivety or ego / personal psychology, rather than logic.