The Lemon Fool

Hi Lootman,
I wasn't wanting SMT management to change their spots, just acknowledging that selling is as much a skill as buying and it's for both those skills that we pay the management fee. I'm not suggesting that they should (or shouldn't) top slice/sell, it's down to SMT to decide if and when that's appropriate.
Now £9.
Cheers,
BD

The question for me is not so much whether the SMT management should top slice any of their investments but whether I should top slice SMT. It is now comfortably my biggest holding. As any investor is holding it only for the capital gain, it seems to me to be about time again (for the third time this year). I'll think on it.

It is certainly my best investment for some time and is now beginning to remind me of Tullow Oil in its heyday.

Dod

But don't you/we need to look at SMT differently to an individual share?

After all with SMT we're getting diversification into approx. 85 different companies, many of which I wouldn't be able to access. I certainly don't have the time or experience to enable me to monitor anything like that number of companies, most of which are not based in the UK.

Tullow Oil - a single company
SMT - approx 85 different companies

So, for me, SMT are a fund manager who I am very happy to entrust the management of a part of my pension until such time as the story/performance changes.

Tesla at over 11% of the portfolio is a worry - but I've been saying that for about 2 years and so far SMT has proved they know a lot more than I do.

I'm sure that Tom Slater said that they have sold down or out of a few companies in his recent webinar but I can't remember which companies they were.

Laughton wrote:But don't you/we need to look at SMT differently to an individual share?

After all with SMT we're getting diversification into approx. 85 different companies, many of which I wouldn't be able to access. I certainly don't have the time or experience to enable me to monitor anything like that number of companies, most of which are not based in the UK.

Tullow Oil - a single company
SMT - approx 85 different companies

So, for me, SMT are a fund manager who I am very happy to entrust the management of a part of my pension until such time as the story/performance changes.

Tesla at over 11% of the portfolio is a worry - but I've been saying that for about 2 years and so far SMT has proved they know a lot more than I do.

I'm sure that Tom Slater said that they have sold down or out of a few companies in his recent webinar but I can't remember which companies they were.

I agree that one cannot compare SMT with Tullow in any sensible way. The risk profile is much less no doubt and I did not mean to suggest otherwise but at the same time, I hold Scottish Mortgage solely for the capital growth and from time to time, harvest some gains to transfer into a dividend producing company. With the way that the Scottish Mortgage price has grown (it was a mere £7.20 or something like that when I started this thread in May). By any standards it is surely beginning to look like bubble territory, if not directly with Scottish Mortgage then with such of its underlying shareholdings as are pushing its NAV up. Mostly this is Tesla, I think. I totally trust James Anderson and Tom Slater but at the same time their view will be different from mine, and mine quite possibly from yours........I will be most unlikely to sell SMT but as I said I may well top slice it again before long. Tullow was a 14 bagger for me in about 4/5 years. SMT must be approaching that as well but over a very much longer time.

Dod

Dod101 wrote:The question for me is not so much whether the SMT management should top slice any of their investments but whether I should top slice SMT.
Dod

I look forward to being in that same position one day!

I have today voted with my feet, selling my entire holding in SMT,
It accounted for about 20% of my IT portfolio, the proceeds have been re-invested in
the 7 remaining ITs. I will sleep better!

Flint

bluedonkey wrote:Hi Lootman,
I wasn't wanting SMT management to change their spots, just acknowledging that selling is as much a skill as buying and it's for both those skills that we pay the management fee. I'm not suggesting that they should (or shouldn't) top slice/sell, it's down to SMT to decide if and when that's appropriate.
Now £9.
Cheers,
BD

If you are aiming to buy companies that are going to grow strongly for decades, then the skill of choosing them is a lot more important than the skill of selling at the right time. They are not buying for short term gain or to make a profit out of a temporary bubble.

Having said that I recall that when there was a lot of doubt about Tesla, and I think the price was about $200, SMT did do a formal review of it and much against the clamour of the rest of the UK fund management lemmings, decided to continue to hold. The Tesla price has multiplied 5 or 6 times since then.

I'm happy to leave the judgements to them

Monks may be a suitable alternative for those feeling rather too exposed with SMT.

flint wrote:I have today voted with my feet, selling my entire holding in SMT,
It accounted for about 20% of my IT portfolio, the proceeds have been re-invested in
the 7 remaining ITs. I will sleep better!

Flint

Dont look at what its up to today then!

DavidM13 wrote:

flint wrote:I have today voted with my feet, selling my entire holding in SMT,
It accounted for about 20% of my IT portfolio, the proceeds have been re-invested in
the 7 remaining ITs. I will sleep better!

Flint

Dont look at what its up to today then!

The law of Sod states that sold shares will go up upon disposal but I thought that was just my shares...

Its a difficult decision - jump or stay with SMT. Fortunately its a modest part of my portfolio, so currently its stay. If I jumped, and decided to re-invest elsewhere, where would I go? I suspect that a lot of other ITs are now following SMT's lead - into the Nasdaq-type investments that seem to have benefited from Covid-19. I suspect that this benefit is getting a bit over-egged, and some correction is likely - but when? So I guess I will do nothing, and hope for a gentle correction - eventually. Its a policy that failed me in the dot-com bubble way back twenty years ago. Old fools not learning from past experience comes to mind!

I used to be pleasantly satisfied if a share I bought went up 5% or so in the days shortly after purchase. My SMT purchase two months ago is now up 28%.
I really have to stop watching it and posting because this is becoming obsessive, very bad for a dispassionate investment outlook. And breath ...

£9.17 was getting a bit rich for me so I have for the third time this year top sliced and this time bought more Legal & General. That accords with my general philosophy in using growth shares to fund an increasing income, well at least for so long as L & G keeps paying its dividend.

SMT remains my biggest holding and if the price keeps rising I will be delighted.

Dod

Interesting Dod.Why do you prefer to get an income by selling SMT and buying Legal General, rather than selling some SMT from time to time and using this as “income”. I also have a (relatively) large Legal General holding, but I was thinking of drawing money (in due course) by simply selling a few SMT, rather than adding to my Legal General.

unperplex wrote:Interesting Dod.Why do you prefer to get an income by selling SMT and buying Legal General, rather than selling some SMT from time to time and using this as “income”. I also have a (relatively) large Legal General holding, but I was thinking of drawing money (in due course) by simply selling a few SMT, rather than adding to my Legal General.

===========================

yes.

it seems simple and obvious to my ( probably simple ) mind.

unperplex wrote:Interesting Dod.Why do you prefer to get an income by selling SMT and buying Legal General, rather than selling some SMT from time to time and using this as “income”. I also have a (relatively) large Legal General holding, but I was thinking of drawing money (in due course) by simply selling a few SMT, rather than adding to my Legal General.

Because Legal & General has a habit of continuing to give with a more regular increase in the income than I can reliably expect from SMT. With capital once it's gone it's gone. I am maybe old fashioned but I do not like to spend capital to live off and in any case, SMT cannot carry on at its current pace for ever. I felt that this was the time to top slice SMT and I currently have no need for the cash so I wanted to reinvest it. It represents about 4 month's spending anyway.

Dod

Dod,
Might be a coincidence but the slight price dip mid-day appears to coincide with the time of your sale. I guess when you put through a £1m trade, it's bound to have an effect.
BD

bluedonkey wrote:Dod,
Might be a coincidence but the slight price dip mid-day appears to coincide with the time of your sale. I guess when you put through a £1m trade, it's bound to have an effect.
BD

Alas it was but a fraction of that but I did seem to get about the best price for the day, so far anyway. I always place buys and sales with a limit order just a bit above the prevailing price for sales and usually get it. Obviously you need to be selling into a strong market.

Dod

bluedonkey wrote:Dod,
Might be a coincidence but the slight price dip mid-day appears to coincide with the time of your sale. I guess when you put through a £1m trade, it's bound to have an effect.
BD

That was me ha ha! (well a tiny fraction of that was me!)
I was getting nervous as SMT started in mid-March as 24% of my pension and due to stellar performance was 33% this morning. I chopped it down to 22%. It really is something else but surely surely surely it cant keep heading North forever! Got to hand it to them though they are doing something right.

Now I need to work out what to invest in with this 10% of my pot or so. Got UK Small Companies x2, Got Private Equity, Got Global got UK, Got European and Got Asia. So probably pick another player in one of those areas unless anyone has any bright ideas.

DavidM13 wrote:I was getting nervous as SMT started in mid-March as 24% of my pension and due to stellar performance was 33% this morning. I chopped it down to 22%.

Mr Anderson was asked about diversification in a recent QA. He said that investors should consider their position and not hold too much SMT. That few have more than 10% and very few more than 20%.

FWIW it's 10% of my directly administered portfolio. Very happy with them and won't be selling until it's more like 20%.