Rate my SIPP - ITV high conviction

Hoenir

Juno_Moneta said:

Wow - how did you find out all my other investments?

Were you an investor in Micro Focus as well. 

TheTelltaleChart

There is some evidence that there is a value premium, i.e. expected returns are higher for value shares than other shares. (The evidence is mainly for small value, i.e. for shares that are also small-cap, but let's pass over that.) But many investors, who call themselves value investors, aren't.

The evidence for value is based on various metrics (e.g. high book-to-value ratio, low price-earnings ratio). There is some evidence that a diversified portfolio, consisting of shares that score favourably on these metrics, may be expected to outperform the market portfolio (consisting of all shares). That doesn't mean in all periods: there are years and decades in which value underperforms the broader market.

There are collective investment vehicles which follow such a value strategy, either using a mechanical approach (which may or may not involve following an index) or with disciplined active management. There are also collective investments whose descriptions of their method mention "value" but who don't hold a value portfolio in any rigorous sense.

Such collectives usually hold at least 100s of different shares. It is dubious whether a personal portfolio of (say) 20 shares selected on value criteria is going to give you effective exposure to the value premium. Or whether any value effect will be overwhelmed by stock-specific risks.

When we get to a single share, that is clearly not value investing. If you don't have the time to research 20 shares (as the OP admits), you don't know what is good value. If all your "knowledge and insight" is about one share, then a lot of it isn't really knowledge and insight, it's confirmation bias.

Ultimately, saying there is risk in all things is true but facile. It's like going onto a road safety forum and saying: yes, I've heard of the Green Cross Code, but my strategy is to run across a busy road as fast as possible and blindfolded. High risk, high reward! Rate my strategy.

Mr_Benn

Surely if you hold just one share, you have a stop loss on them, so if they did crash , hopefully you would still get out with a profit ?

MeteredOut

Hoenir said:

Juno_Moneta said:

Wow - how did you find out all my other investments?

Were you an investor in Micro Focus as well. 

I was going to ask if he had any jewellery from Ratners

MeteredOut

Mr_Benn said:

Surely if you hold just one share, you have a stop loss on them, so if they did crash , hopefully you would still get out with a profit ?

Stop losses don't necessarily protect an individual investor from a black swan event.

booneruk

MeteredOut said:

Mr_Benn said:

Surely if you hold just one share, you have a stop loss on them, so if they did crash , hopefully you would still get out with a profit ?

Stop losses don't necessarily protect an individual investor from a black swan event.

Indeed. Stop losses are just market orders triggered at a certain price. It doesn't mean you'll get that price, especially if there are no buyers interested! For every sale there has to be a buy.

Cus

Juno_Moneta said:

MeteredOut said:

It looks to me this is more of a humble-brag post rather that you really expecting anyone to provide any useful feedback on your SIPP.

Not entirely sure I agree, there have been about 200 replies now and I've found many of them interesting and thought provoking so on balance it was worth making the post to benefit from those.

And have any of those comments resulted in a change of opinion or future action on your behalf?
Oh, and did you say you have a price where you would sell (high or low)?

Juno_Moneta

Um, yes there were a lot of posts about global trackers about half way through the pages so far that caused me to research them more for future use.

And I gave 2 price targets in a post on 17th Feb (* based on holding size at the time). 

Cus

Juno_Moneta said:

Um, yes there were a lot of posts about global trackers about half way through the pages so far that caused me to research them more for future use.

And I gave 2 price targets in a post on 17th Feb (* based on holding size at the time). 

Thanks, found it, 96p. Couldn't find a panic selling price if it drops a lot but let's hope that never occurs.

I think it's great that you are doing this, despite not really knowing the relevance to you of the ITV amount versus other savings etc etc, as it's a good read versus the 'global index trackers only, no one can beat the market' mantra type threads.

If you are all in on ITV and relying on this SIPP for future lifestyle then to me this doesn't seem too different to the impression I get from all-in HODL bitcoin holders, in that this is a way to get ahead versus the rest with lots of hope and self convincing. But what's wrong with that