F and c investment trust

dividendhero

tin586 wrote: »

Survivorship bias is worth bearing in mind.

I can't think of any "old school" IT's which have gone bust, never mind any in the global growth space

bowlhead99

dividendhero wrote: »

tin586 wrote: »

Survivorship bias is worth bearing in mind.

I can't think of any "old school" IT's which have gone bust, never mind any in the global growth space

Could that be because you have some sort of 'bias' to being aware of the ones that have 'survived', rather than the ones that were created in the 1890s and died or were taken private in the 1920s or whatever?

Brian65

FCIT has gone through a good spell recently so the discount has narrowed. I can remember when it had underperformed, was being slated on forums like this, and the discount was bigger. That was the time to buy. Fortunately I did - though not enough.
A friend knows little about finance so he put all his life savings in FCIT through their 'savings' scheme. This lucky novice has probably done better than any of us.

dividendhero

bowlhead99 wrote: »

Could that be because you have some sort of 'bias' to being aware of the ones that have 'survived', rather than the ones that were created in the 1890s and died or were taken private in the 1920s or whatever?

Quite possibly so, but I've been following the markets since the early 80's and I can't recall a single "old school" IT ever going pear shaped...ready to be proved wrong though!

jamei305

Looking at the data on Morning Star the NAV has tracked the benchmark very closely over the last 10 years, so I don't see any argument for owning this over a tracker unless you want to gamble on the discounts and premiums. Especially as it has over 450 holdings with the top five including Amazon, Microsoft, Facebook and Alphabet - seems to be a closet tracker to me.

dividendhero

jamei305 wrote: »

so I don't see any argument for owning this over a tracker.

How many trackers have been going since 1868? :money:

jamei305

dividendhero wrote: »

How many trackers have been going since 1868? :money:

I don't see how that is relevant to anything. My local pub was established in 1608 but the food is dire.

schiff

jamei305 wrote: »

I don't see how that is relevant to anything. My local pub was established in 1608 but the food is dire.

The mead must be good

dividendhero

jamei305 wrote: »

I don't see how that is relevant to anything. My local pub was established in 1608 but the food is dire.

You're reversing my logic - I'm not saying something is perfect JUST because it's withstood the test of time...as Thomas Cook demonstrated only this week.

What I am saying is that it's a negative point if something hasn't got a long term track record. Trackers don't have a long term track record and there are possible issues that could cause them to fail big time...

Think of a small market tracker, eg tracking telecoms companies on the Paraguayan stock exchange. This tracker could well undergo a period of growth, which would lead to more funds going into this tracker which in turn would lead to higher performance..I think you can see where this is going

Also ETF's are recent, it's yet to be seen how they cope with a 1987 style crash. We know that the likes of F&C survived this and many other "Black Swans! intact

AnotherJoe

dividendhero wrote: »

You're reversing my logic - I'm not saying something is perfect JUST because it's withstood the test of time...as Thomas Cook demonstrated only this week.

What I am saying is that it's a negative point if something hasn't got a long term track record. Trackers don't have a long term track record and there are possible issues that could cause them to fail big time...
Trackers that track the wider stock market, lets say the top global 5,000 companies or whatever, dont really have a track record other than what the top global 5,000 companies have done over time. An FTSE100 tracker woudl actually have an effective track record exactly as long as the FTSE100 has existed even if it started last week.

An FTSE100 tracker cant crash in the same way that a Woodford fund can crash, because it is the same as the index. As the index moves so does the tracker, but ABC's FTSE100 tracker cannot crash whilst XYZ's 100 tracker doesn't (aside fraud or similar).


Think of a small market tracker, eg tracking telecoms companies on the Paraguayan stock exchange. This tracker could well undergo a period of growth, which would lead to more funds going into this tracker which in turn would lead to higher performance..I think you can see where this is going


That applies also to an active fund which majored on the Paraguayan stock exchange.


Also ETF's are recent, it's yet to be seen how they cope with a 1987 style crash. We know that the likes of F&C survived this and many other "Black Swans! intact

Trackers dont crash in the same way as a managed fund. The index that they follow may and that will lead to the tracker crahshing. But its just following the index*. But two trackers that track the FTSE100 will (should) have almost identical performance, whilst two managed funds that picked from among the FTSE100 even using the same criteria, lets say "income" or "growth" could be wildly divergent and one could crash whilst the other soared.


* of course you could come up with a theoretical case thats very tiny such as Patagonian stock exchange telecom shares but in the real world, trackers arent big enough to have any kind of feedback effect as you mention nor even in the case of PSE telecom shares is there any difference to a feedback caused by buyers for whatever reason jumping on a bandwagon without a tracker existing.