The Lemon Fool

Board Update

The Board of Scottish Mortgage Investment Trust PLC announces certain role changes on the Board resulting from succession planning which has been developed and supported by all of the directors over the course of the last 12 months: Mr Justin Dowley, the Company's current Senior Independent Director, will succeed Ms Fiona McBain as Chair of the Board with effect from the conclusion of the 2023 AGM, subject to his being re-elected by shareholders at the AGM; Professor Patrick Maxwell will, subject to being re-elected by shareholders, succeed Mr Dowley as the Senior Independent Director; Professor Paola Subacchi will retire from her role as a Director at the conclusion of the 2023 AGM, having served nine years on the Board; and Ms McBain will step down from the Board at the same time.

Justin Dowley, Senior Independent Director, commented: "On behalf of the Board, I would like to thank Paola for her substantial contributions during her nine years as a Non-Executive Director. I would also like to thank Fiona for her 14 years of loyal and exceptional service to the Company, in particular over the last few years (and at the request of her fellow directors) providing essential continuity, reassurance and leadership during the extraordinary circumstances of Covid-19 and through a period of transition on the Board and with the Managers."

In addition, as part of the Board's overall planning, over the last few months the Board has been conducting a recruitment process, using an external search firm, with a view to further Board refreshment. That process is now well advanced.

Finally (and further to the Company's announcement on 17 March 2023), the Board announces that Professor Amar Bhidé has now left the Board and is no longer a director of the Company.

SebsCat wrote:https://www.investegate.co.uk/scot.mort-inv-tst--smt-/rns/board-update/202303210700055951T/

Board Update

The Board of Scottish Mortgage Investment Trust PLC announces certain role changes on the Board resulting from succession planning which has been developed and supported by all of the directors over the course of the last 12 months: Mr Justin Dowley, the Company's current Senior Independent Director, will succeed Ms Fiona McBain as Chair of the Board with effect from the conclusion of the 2023 AGM, subject to his being re-elected by shareholders at the AGM; Professor Patrick Maxwell will, subject to being re-elected by shareholders, succeed Mr Dowley as the Senior Independent Director; Professor Paola Subacchi will retire from her role as a Director at the conclusion of the 2023 AGM, having served nine years on the Board; and Ms McBain will step down from the Board at the same time.

Justin Dowley, Senior Independent Director, commented: "On behalf of the Board, I would like to thank Paola for her substantial contributions during her nine years as a Non-Executive Director. I would also like to thank Fiona for her 14 years of loyal and exceptional service to the Company, in particular over the last few years (and at the request of her fellow directors) providing essential continuity, reassurance and leadership during the extraordinary circumstances of Covid-19 and through a period of transition on the Board and with the Managers."

In addition, as part of the Board's overall planning, over the last few months the Board has been conducting a recruitment process, using an external search firm, with a view to further Board refreshment. That process is now well advanced.

Finally (and further to the Company's announcement on 17 March 2023), the Board announces that Professor Amar Bhidé has now left the Board and is no longer a director of the Company.

scrumpyjack wrote:I was amused to see that Professor Bidet had stepped down as non exec director.

It reminded me of the old joke about Non Execs being rather like Bidets. They look good but no one is quite sure what they are for!

james51 wrote:Article in the FT today: 'Inside the boardroom bust-up that shook Scottish Mortgage'

scrumpyjack wrote:All holdings are valued by four parties: the manager; independent valuer S&P Global; the directors; and auditor PwC. Last year, the trust’s total investments went through 585 revaluations."

The trust can invest up to 30 per cent of its total assets in unlisted securities — typically late-stage private businesses — measured at the time of purchase. The fall in prices for its listed investments has pushed the proportion to 29.9 per cent of total assets at of the end of February.

Pushing up at the threshold limits Scottish Mortgage’s ability to make new investments, meaning it cannot partake in new funding rounds by its portfolio of private companies.

Selling such private holdings is difficult, and would risk setting price benchmarks that further depress valuations and hit the trust’s asset-to-debt ratio. In a worst-case scenario, Scottish Mortgage could find itself in a downward spiral: if markets sell off further it could breach its leverage limit and be forced to sell down listed positions, which in turn could force it to breach the thresholds for private assets and precipitate a fire sale at the worst possible time.

TUK020 wrote:article in FT today suggesting that short sellers are now paring back their positions on SMT.
If true, this might be a buy signal

Avantegarde wrote:I read an astonishing fact in the latest edition of Trust, the quarterly publication from Baillie Gifford for its investment trust investors. https://www.bailliegifford.com/en/uk/in ... -magazine/ In the last two decades (since the start of 2003) the Scottish Mortgage trust has owned 749 shares or bonds, of which 680 (91%) have made no contribution to the trust's overall return. The 12-times return earned in that time by the trust has come from just 69 investments. And 14 of them accounted for half of the trust's growth. Has this been revealed before? I know the trust has previously publicly favoured the idea that good stock market returns hinge on the picking few companies that do spectacularly well. Even so, to see the figures as starkly as this was something of a surprise. I suppose you could conclude that 91% of the trust's investment effort was a waste of time.

Avantegarde wrote:I read an astonishing fact in the latest edition of Trust, the quarterly publication from Baillie Gifford for its investment trust investors. https://www.bailliegifford.com/en/uk/in ... -magazine/ In the last two decades (since the start of 2003) the Scottish Mortgage trust has owned 749 shares or bonds, of which 680 (91%) have made no contribution to the trust's overall return. The 12-times return earned in that time by the trust has come from just 69 investments. And 14 of them accounted for half of the trust's growth. Has this been revealed before? I know the trust has previously publicly favoured the idea that good stock market returns hinge on the picking few companies that do spectacularly well. Even so, to see the figures as starkly as this was something of a surprise. I suppose you could conclude that 91% of the trust's investment effort was a waste of time.

To conduct the study, Bessembinder and his team examined the performance of 62,000 stocks traded in more than 40 countries, covering the time span of 1990 to 2018.
...
Taking a step back, the top 306 stocks in the global study — about 0.5% of the total — accounted for an incredible 73% of equity wealth creation. Almost three quarters of the stock market gains, across the entire planet over nearly 30 years, came from 306 names.

If you zoom out a little further to the top 811 stocks — about 1.3% of the total pie — the performance of that exclusive group covers the entire $44 trillion worth of net equity wealth created circa 1990-2018.

Far more than just 1.3% of stock names were profitable, of course. Out of 62,000-plus names, the percentage with positive returns in the period was about 39%.

But roughly 61% of names in that period had negative (wealth-destroying) returns, which canceled out about $22 trillion worth of gains. That is why the top 811 stocks represent the net gain of $44 trillion.

Again, the sobering reality here is that most stocks lose money — even over long periods, and even with historic bull runs factored in. But it doesn’t have to be bad news, as we shall soon see.

https://tradesmith.com/best-of-most-sto ... in-anyway/

Avantegarde wrote:I read an astonishing fact in the latest edition of Trust, the quarterly publication from Baillie Gifford for its investment trust investors. https://www.bailliegifford.com/en/uk/in ... -magazine/ In the last two decades (since the start of 2003) the Scottish Mortgage trust has owned 749 shares or bonds, of which 680 (91%) have made no contribution to the trust's overall return. The 12-times return earned in that time by the trust has come from just 69 investments. And 14 of them accounted for half of the trust's growth. Has this been revealed before? I know the trust has previously publicly favoured the idea that good stock market returns hinge on the picking few companies that do spectacularly well. Even so, to see the figures as starkly as this was something of a surprise. I suppose you could conclude that 91% of the trust's investment effort was a waste of time.

Avantegarde wrote:I read an astonishing fact in the latest edition of Trust, the quarterly publication from Baillie Gifford for its investment trust investors. https://www.bailliegifford.com/en/uk/in ... -magazine/ In the last two decades (since the start of 2003) the Scottish Mortgage trust has owned 749 shares or bonds, of which 680 (91%) have made no contribution to the trust's overall return. The 12-times return earned in that time by the trust has come from just 69 investments. And 14 of them accounted for half of the trust's growth. Has this been revealed before? I know the trust has previously publicly favoured the idea that good stock market returns hinge on the picking few companies that do spectacularly well. Even so, to see the figures as starkly as this was something of a surprise. I suppose you could conclude that 91% of the trust's investment effort was a waste of time.