BH Macro - what is in it....?

aroominyork

The Telegraph has an article about wealth preservation (this link should avoid the firewall) which, alongside the usual CGT, Ruffer, PNL and RIT, mentions BH Macro (BMHG). It has returned 130% in five years so doesn't seem like the the same kind of animal. But I was curious to see what it holds: the factsheet tells you nothing, and the full 56pp report does not list assets but just has this diagram. I will not go through the bits I understand (few) and those I don't (more) but what do people make or know of this Trust?

Cus

My wealth manager has had this as part of my portfolio for the last 5 years, and it looks to me that it is a hedge fund that uses derivatives etc. 

aroominyork

Here's some more intel https://www.trustintelligence.co.uk/investor/articles/fund-research-investor-bh-macro-retail-jan-2022

masonic

Makes me think of the old Standard Life GARS fund, full of all manner of options and derivatives tracking all sorts. See later discussion in this thread: https://forums.moneysavingexpert.com/discussion/5531029/standard-life-investments-global-absolute-return-strategies-gars/p2
It all ended up going south for that fund: https://www.theguardian.com/money/2018/may/26/uk-biggest-fund-standard-life-gars-alan-miller
I've tended to give absolute return strategies a fairly wide berth.

Eyeful

I see from HL, that  their  Domicile is in Guernsey  & they stand at a premium of  11.77%. 

They are a hedge fund which has both ongoing charge plus performance fee of
 6.82%(31.12.20) & 2.43% (31.12.21)

Their Master Hedge Fund is in the Cayman Islands.

Even without knowing what their assets are, I know they are not something I want.

Cus

I recall that at the start I was down on this fund, but it has then turned around and has done well. My guy has recently sold half so maybe he thinks it's about to go a bit south, who knows.  It's 2% of the portfolio so not a concern.

aroominyork

On the basis of "if you don't understand it, don't invest in it" this is the last thing I would buy, however pretty the upwards curve looks. The word 'hedge' is a no-no for me, except in the context of hedging bonds to Sterling.

masonic

Cus said:

I recall that at the start I was down on this fund, but it has then turned around and has done well. My guy has recently sold half so maybe he thinks it's about to go a bit south, who knows.  It's 2% of the portfolio so not a concern.

It's good practice to sell down investment trusts that move to such a juicy premium. By the time people are willing to buy in at silly prices then the party is often just about over.

aroominyork

On the subject of wealth preservation, if the usual funds (CGT, PNL, RICA) manage it over the next couple of years - meeting/beating inflation - they will have many happy customers.