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Fundsmith....New Holding

Closed-end funds and OEICs
KnightOfSpring
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Re: Fundsmith....New Holding

#462989

Postby KnightOfSpring » December 3rd, 2021, 9:11 pm

Thanks and good luck with ULVR. I think next week, I might place an auto sell on ULVR stock so that if the price gets back to what I paid, it gets sold. I am not so far away that a day or two uptick in the price wouldn't break even for me. I think I will start to think about reinvesting the money. I have pretty much lost faith in ULVR.


Thanks. Good luck with what you decide to re-invest the proceeds into.

OLTB
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Re: Fundsmith....New Holding

#463026

Postby OLTB » December 4th, 2021, 9:01 am

KnightOfSpring wrote:
Thanks and good luck with ULVR. I think next week, I might place an auto sell on ULVR stock so that if the price gets back to what I paid, it gets sold. I am not so far away that a day or two uptick in the price wouldn't break even for me. I think I will start to think about reinvesting the money. I have pretty much lost faith in ULVR.


Thanks. Good luck with what you decide to re-invest the proceeds into.


That was a comment that resonated with me during the interview - it’s all well and good selling a holding, but what is the ‘better’ investment to replace it.

Cheers, OLTB.

BullDog
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Re: Fundsmith....New Holding

#463027

Postby BullDog » December 4th, 2021, 9:14 am

OLTB wrote:
KnightOfSpring wrote:
Thanks and good luck with ULVR. I think next week, I might place an auto sell on ULVR stock so that if the price gets back to what I paid, it gets sold. I am not so far away that a day or two uptick in the price wouldn't break even for me. I think I will start to think about reinvesting the money. I have pretty much lost faith in ULVR.


Thanks. Good luck with what you decide to re-invest the proceeds into.


That was a comment that resonated with me during the interview - it’s all well and good selling a holding, but what is the ‘better’ investment to replace it.

Cheers, OLTB.

Absolutely, it's not an easy market at the moment to make decisions like that.

77ss
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Re: Fundsmith....New Holding

#463037

Postby 77ss » December 4th, 2021, 11:13 am

OLTB wrote:
KnightOfSpring wrote:
Thanks and good luck with ULVR. I think next week, I might place an auto sell on ULVR stock so that if the price gets back to what I paid, it gets sold. I am not so far away that a day or two uptick in the price wouldn't break even for me. I think I will start to think about reinvesting the money. I have pretty much lost faith in ULVR.


Thanks. Good luck with what you decide to re-invest the proceeds into.


That was a comment that resonated with me during the interview - it’s all well and good selling a holding, but what is the ‘better’ investment to replace it.

Cheers, OLTB.


One does not necessarily need a single replacement - which carries a fair degree of risk. Depending upon ones objectives/overall portfolio etc.

I sold ULVR earlier his year, using the proceeds to top up a number of my other holdings. About 70% into ITs and the rest into DGE, HLMA and SPX.

This fits with my general direction of travel - fewer holdings and more in ITs.

dealtn
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Re: Fundsmith....New Holding

#463237

Postby dealtn » December 5th, 2021, 12:19 pm

BullDog wrote:
KnightOfSpring wrote:
You know, I think you're right. I apologise if I made a mistake. I can't see a Unilever sale in the last 6 months monthly fact sheets. In fact, having looked, it is Blue Whale Growth Fund (another fund that I follow) that sold out of Unilever this last few months. Sorry about that.


No problem. I'm not normally so sharp on these things but Unilever is about 14% of my portfolio and Terry Smith is my favourite Fund Manager so it's something a keep a close eye on. Terry certainly made reference to Unilever was being in danger of being kicked out but has since said that with the distribution network it has "it should probably be alright".

Thanks and good luck with ULVR. I think next week, I might place an auto sell on ULVR stock so that if the price gets back to what I paid, it gets sold. I am not so far away that a day or two uptick in the price wouldn't break even for me. I think I will start to think about reinvesting the money. I have pretty much lost faith in ULVR.


What's so special about the price you bought it? All you are doing is price anchoring which is a waste of mental energy and purely psychological. Either it's a good investment at the current price, or it isn't and there are better choices.

ADrunkenMarcus
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Re: Fundsmith....New Holding

#463243

Postby ADrunkenMarcus » December 5th, 2021, 12:35 pm

BullDog wrote:I have pretty much lost faith in ULVR.


How long have you held?

Even the best companies can go through periods of 'poor' share price performance. Unilever has current challenges it is dealing with. I don't think it necessarily follows that the business model is broken in the long term. It may in fact be better to accumulate at lower prices.

I bought in 2013 as a long term hold. Although I think it's cheap at today's prices, the shares are up 56% and I'll have had about 43% of the original book cost in dividends by the end of the current year. Not amazing or Tesla-like but it's doubled on a nominal basis in eight years. Dividend per share has compounded over 7% during that time (the same as the CAGR in dividends from 1929 to 2020) and I'm getting a nominal yield of 5.9% on my book cost.

It'll never shoot the lights out but it will grind out respectable returns over long periods of time IMHO.

Best wishes


Mark.

ADrunkenMarcus
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Re: Fundsmith....New Holding

#463245

Postby ADrunkenMarcus » December 5th, 2021, 12:36 pm

77ss wrote: DGE, HLMA and SPX.


I do love DGE and SPX. HLMA, too, if I'd got in when it was less expensive!

Best wishes


Mark.

77ss
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Re: Fundsmith....New Holding

#463294

Postby 77ss » December 5th, 2021, 3:30 pm

ADrunkenMarcus wrote:
77ss wrote: DGE, HLMA and SPX.


I do love DGE and SPX. HLMA, too, if I'd got in when it was less expensive!

Best wishes


Mark.


Don't we all!

But having missed a better entry point doesn't make a share uninvestable. Lots of psychology here. Better late than never.

I was late to the party and have only held them for 5/3.5/2 years. Happy, so far...

Easier (and safer) to top up winners, as I have done, than to buy a whole new holding.

wrt to your earlier post about ULVR;

It'll never shoot the lights out but it will grind out respectable returns over long periods of time IMHO.

I quite agree. I sold for various reasons, but may well rebuy in the next tax year.

I held it in my dealing account, so there were tax/CGT considerations. Next year's ISA perhaps.

ADrunkenMarcus
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Re: Fundsmith....New Holding

#463298

Postby ADrunkenMarcus » December 5th, 2021, 4:05 pm

77ss wrote:But having missed a better entry point doesn't make a share uninvestable. Lots of psychology here. Better late than never.


Very true.

Spirax looked expensive when I bought at a p/e of 23 in 2015. Then the p/e more than doubled - as did earnings! It's compounded at 32% over the six years since and is up over five-fold.

Best wishes


Mark.

doug2500
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Re: Fundsmith....New Holding

#463334

Postby doug2500 » December 5th, 2021, 7:04 pm

Indeed, I have a wee bit of DGE via a holding of fundsmith and I think some spirax via SSON but I've had spirax and halma on my watchlist for years watching them get more expensive and yes, I wouldn't buy now but I sure wish I'd bought years ago when they were just expensive (rather than really expensive) instead of just adding them to a list.

ADrunkenMarcus
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Re: Fundsmith....New Holding

#463340

Postby ADrunkenMarcus » December 5th, 2021, 8:25 pm

doug2500 wrote:Indeed, I have a wee bit of DGE via a holding of fundsmith and I think some spirax via SSON but I've had spirax and halma on my watchlist for years watching them get more expensive and yes, I wouldn't buy now but I sure wish I'd bought years ago when they were just expensive (rather than really expensive) instead of just adding them to a list.


Even DGE has become more highly rated to quite a significant degree, over time. My own holding dates back to 1998 and the dividend yield then was about 3.2%. Despite consistent dividend growth, compounding somewhat under 7% p.a., even the projected yield for the coming year has slipped under 2%.

I know of someone who trimmed SPX earlier this year a little over £100 a share, because they thought it was expensive, yet it touched £172.25 some weeks back. They missed a huge annual gain. I recognise SPX is expensive but won't take any action to trim. If it ever gets substantially cheaper, I may even add.

I do like quality and I hold loads of Smithson, but potential valuation compression may provide a headwind in the coming years.

Best wishes


Mark.

Backache
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Re: Fundsmith....New Holding

#469990

Postby Backache » January 3rd, 2022, 5:35 pm

Interesting in October they announced they were building a new holding and disclosed a new country undisclosed holding of 0.4% of the fund which appeared to fall to 0.1% by the end of the month of November and now appears to have been sold altogether.

BullDog
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Re: Fundsmith....New Holding

#472224

Postby BullDog » January 11th, 2022, 9:59 pm

Those who are interested may wish to read Smith's annual letter to shareholders.

https://www.fundsmith.co.uk/media/3wcng ... olders.pdf

Humeau
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Re: Fundsmith....New Holding

#472972

Postby Humeau » January 14th, 2022, 8:17 am

The contrast between Stephen Yiu's views and Terry Smith's on AMZN is pretty stark. Blue Whale started to exit just as Fundsmith were buying.

Although TS was slow in understanding that AMZN was very much more than a low margin retail business, I think Yiu has come to the wrong conclusions here and his analysis is correct in parts, but essentially flawed as a whole.

In my view, short term margin pressures on the retail side and some erosion of market share in the cloud business, will be outweighed by the transition to higher margin businesses longer term. Amazon has an impressive array of businesses that have highly beneficial unit economics and I fully expect these to be further developed and added to in the future.

I don't think Terry Smith has bought any duds in recent years and don't expect this to change with his latest purchase. He might have been too patient with some underperformers, but adverse comments normally signal the exit door is close. Sage being a recent example and Unilever looking like the next. PM looked to be entering the jury is out territory at last year's AGM too.

I have added AMZN to my portfolio.

BullDog
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Re: Fundsmith....New Holding

#472978

Postby BullDog » January 14th, 2022, 8:37 am

Humeau wrote:The contrast between Stephen Yiu's views and Terry Smith's on AMZN is pretty stark. Blue Whale started to exit just as Fundsmith were buying.

Although TS was slow in understanding that AMZN was very much more than a low margin retail business, I think Yiu has come to the wrong conclusions here and his analysis is correct in parts, but essentially flawed as a whole.

In my view, short term margin pressures on the retail side and some erosion of market share in the cloud business, will be outweighed by the transition to higher margin businesses longer term. Amazon has an impressive array of businesses that have highly beneficial unit economics and I fully expect these to be further developed and added to in the future.

I don't think Terry Smith has bought any duds in recent years and don't expect this to change with his latest purchase. He might have been too patient with some underperformers, but adverse comments normally signal the exit door is close. Sage being a recent example and Unilever looking like the next. PM looked to be entering the jury is out territory at last year's AGM too.

I have added AMZN to my portfolio.

Indeed. Interesting, only one of them can be right. I think Yiu is more active in portfolio churn than Smith anyhow. Yiu exited Unilever a while ago while Smith still holds it for example. I still have both BW and FS.


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