The Lemon Fool

ReallyVeryFoolish wrote:A very successful three years for Blue Whale Growth Fund -

https://bluewhale.co.uk/wealth-of-exper ... iling-list

Very happy to hold long term.

RVF

I do not hold but there is a lot of sense in the blogs and reports although Yiu sounds more like Terry Smith than James Anderson. He is another conviction fund man by the sound of it. I do not much like the OEIC structure though.

Dod

ReallyVeryFoolish wrote:

Dod101 wrote:

ReallyVeryFoolish wrote:A very successful three years for Blue Whale Growth Fund -

https://bluewhale.co.uk/wealth-of-exper ... iling-list

Very happy to hold long term.

RVF

I do not hold but there is a lot of sense in the blogs and reports although Yiu sounds more like Terry Smith than James Anderson. He is another conviction fund man by the sound of it. I do not much like the OEIC structure though.

Dod

Importantly, for the future, Yiu is maybe 25 years younger than Smith, Train etc... (no idea about Anderson's age). He's a very smart guy, it seems to me.

Regarding OEIC status, it's a complete non-issue. What truly matters is the money he makes for his investors, everything else is a distant second at best.

RVF

Thanks. That is interesting. James Anderson is 60, although his no 2, Tom Slater is much younger.

The OEIC status may be a distant second but to me the IT structure has many advantages over an OEIC. I would not regard it as a non issue, and I do not quite trust Peter Hargreaves (do not ask me why; I have no idea)

Dod

ReallyVeryFoolish wrote:Interesting thoughts from the management of Blue Whale Growth Fund. I have high regard for Stephen Yiu, manager of the fund hand picked by Peter Hargreaves to run the fund seeded from his own wealth pile. Disclosure - Blue Whale Growth Fund is one of three investments that combines form well over half my total investments.

Three types of companies to avoid after Covid -

https://bluewhale.co.uk/blog/2020/06/02 ... iling-list

RVF

Hi, I'm just wondering if you bought directly with BW or with another platform? The reason I ask, is they state that they don't charge any platform fees if you buy directly with them.

I did hold for a while and was pleased with the performance but in the end the OEIC structure became too much of an issue for me too. I am with HL and so get hammered on fees for OEICs as compared to ITs which are very competitive. If you need a reason to doubt Peter Hargreaves good faith (or ruthless business acumen), this is probably a good example. BW have said that they will consider an IT in the future, but I guess not as long as many HL customers are buying in he is getting a double hit on the fees.

MM

ReallyVeryFoolish wrote:

Reactive wrote:

ReallyVeryFoolish wrote:Interesting thoughts from the management of Blue Whale Growth Fund. I have high regard for Stephen Yiu, manager of the fund hand picked by Peter Hargreaves to run the fund seeded from his own wealth pile. Disclosure - Blue Whale Growth Fund is one of three investments that combines form well over half my total investments.

Three types of companies to avoid after Covid -

https://bluewhale.co.uk/blog/2020/06/02 ... iling-list

RVF

Hi, I'm just wondering if you bought directly with BW or with another platform? The reason I ask, is they state that they don't charge any platform fees if you buy directly with them.

Hi, all my investments are held in ISA or SIPP with Interactive Investor. Family portfolio holdings of Blue Whale are with AJ Bell. So I don't know about holding the fund directly with Blue Whale to be honest with you. Sorry I can't be of more help.

RVF

Thank you for your reply.

Blue Whale seems to be a UK based, GBP denominated global equity fund with mostly US, then European stock. It's performed much better than most such active funds over the last 3 years.
The SPIVA report indicates that all similar funds underperform their risk-comparable, passive index benchmark after 5 years in 85% of cases, after 10 year in 92% of cases. https://www.spglobal.com/spdji/en/spiva ... va-europe/
Blue Whale advises: 'Past performance is not a guide to future performance.'
If I'm to 'buy and hold' indefinitely, how do I determine whether Blue Whale will become one of the 92% after 10 years, or one of the 8%?
If I can't determine that, if I'm to buy Blue Whale how do I decide when to sell?

Well I hope both Blue Whale and Fundsmith and I’m quite happy with both for the time being.

I’ve held for the past 3 months and it’s done pretty much nothing. I tell a lie it’s about 1% down. Can’t say I’m massively impressed thus far, though I realise I am making judgment over a rather short time frame. I’ll give it another 3 then look elsewhere. It’s only about 2% of my total so I can afford to give it some slack.

Good luck with that level of patience. You'll probably need it.

You're not impressed with the share price? Or the type of investments they have or their investing style? I'd suggest the latter haven't changed much, but share prices are a different matter.

Humeau wrote:Good luck with that level of patience. You'll probably need it.

You're not impressed with the share price? Or the type of investments they have or their investing style? I'd suggest the latter haven't changed much, but share prices are a different matter.

I sensed your rebuke in the post and above and respected the point enough to keep silent but I am now under water with this after holding for 6 months. At what point am I allowed to be unimpressed?

That is indeed the problem. Terry Smith alluded to investor impatience as his biggest worry at the last AGM.

The tech stocks that BlueWhale is concentrated upon have been largely out of favour of late. Is that a longer term trend, or just a blip? If you didn't think the types of companies that BlueWhale invests in, had good, long term futures, you have to ask yourself why you invested in the fund.

My own view is that the fund has many fabulous companies in it. I don't own the fund but have several of its holdings in my portfolio. I want more but am waiting for a correction. I'll be buying MA and MSFT when the herd goes to sell mode.

Padders72 wrote:I sensed your rebuke in the post and above and respected the point enough to keep silent but I am now under water with this after holding for 6 months. At what point am I allowed to be unimpressed?

Terry Smith repeatedly makes the point that a year is an arbitrary and rather short period to assess performance over.

I buy active funds because I want the "slant" or characteristic that fund has - I wouldn't for example buy Fundsmith if I was interested in small cap value investing.

You presumably bought Blue Whale because you wanted something with a "tech" slant combined with emphasis on growth?

If you're unhappy that investing approaches can move from being a good to a bad fit for the market as a whole's behaviour, or that economic expectations can change (the concern about rising inflation leading to interest rate rise concerns leading to loss in perceived value in growth tech stocks), then you may spend less time unimpressed (and indeed save a bunch of time) by sticking to something like VWRP?

If you're going to invest in actively managed funds (especially ones that aren't closet index trackers), then it is inevitable that you'll see periods of over and under performance compared to the index.

If you invest for any significant length of time, you'll most probably see periods longer than 6 months over which you're down on an investment. I believe there's something in the small print to that effect.

xeny wrote:

Padders72 wrote:I sensed your rebuke in the post and above and respected the point enough to keep silent but I am now under water with this after holding for 6 months. At what point am I allowed to be unimpressed?

Terry Smith repeatedly makes the point that a year is an arbitrary and rather short period to assess performance over.

I buy active funds because I want the "slant" or characteristic that fund has - I wouldn't for example buy Fundsmith if I was interested in small cap value investing.

You presumably bought Blue Whale because you wanted something with a "tech" slant combined with emphasis on growth?

If you're unhappy that investing approaches can move from being a good to a bad fit for the market as a whole's behaviour, or that economic expectations can change (the concern about rising inflation leading to interest rate rise concerns leading to loss in perceived value in growth tech stocks), then you may spend less time unimpressed (and indeed save a bunch of time) by sticking to something like VWRP?

If you're going to invest in actively managed funds (especially ones that aren't closet index trackers), then it is inevitable that you'll see periods of over and under performance compared to the index.

If you invest for any significant length of time, you'll most probably see periods longer than 6 months over which you're down on an investment. I believe there's something in the small print to that effect.

All good advice in the last few posts and in hindsight I missed the bus with regards to US focussed tech growth here. You are right in identifying my original goal. I have now sold up and recycled the funds into an existing EDIN holding, something which has done a good job recently in capturing the UK market rebound and hopefully has further to run. I do have other holdings with some BW overlap, such as of SMT and Monks so I haven't totally abandoned the sector. Those do seem to have done better over the same timeframe than BW though not by much it is true since tech looks very toppy. Another factor is that I have become tired with Open ended stuff and now much prefer the IT (or individual holding) approach so was perhaps prejudiced against BW all along. I do wish continuing holders well though!

ps funny that T Smith should come up, I also sold down my Smithson holding a few weeks ago since I see the wind coming out of the sails there too.

I would say that you haven't missed the bus. It got stuck in traffic.

If you can jump in and out of funds and time that well, you are a lot more skilled than me.

I would say that you haven't missed the bus. It got stuck in traffic. I think the bus is on a long journey to a profitable destination. This paper explains the basics of how these buses should be built very well.

https://taovalue.files.wordpress.com/20 ... chdeck.pdf

Dorsey is an interesting guy and his fund is now at about a billion and like Terry Smith, he eats his own cooking.

I would judge that most of BlueWhale's companies have the required characteristics.

If you can jump in and out of funds and time that well, you are a lot more skilled than me.

Worth a listen this morning to a podcast by Steven Yiu. Discussing his selling of Facebook/Meta and PayPal before the recent large falls in their respective share prices. Sound quality is poor but it's still worth a listen if you have any interest in Blue Whale growth fund.

https://citywire.com/wealth-manager/new ... test1-list

Vanguard ongoing charge is 0.07% (" VUSA"...S&P500). Over a reasonable timeframe of 5 years, where is the "extra" return resulting from the managers skill?

Smith had a go at Unilever and producing a "post mortem " report. I think he would have been wiser to spend time concentrating on his own fund and might have avoided the hits to PayPal and META. Meanwhile, a 1% charge goes down very nicely.

ETF's like: VUSA, VEVE, etc will of course also be tracking Meta and the US tech stocks downwards.

richfool wrote:ETF's like: VUSA, VEVE, etc will of course also be tracking Meta and the US tech stocks downwards.

"To beat the market, you have to do something different to the market"
Given all these growth style outfits all tend to hold big weightings in American tech, it's no shock they have turned into expensive S&P 500 trackers.

absolutezero wrote:

richfool wrote:ETF's like: VUSA, VEVE, etc will of course also be tracking Meta and the US tech stocks downwards.

"To beat the market, you have to do something different to the market"
Given all these growth style outfits all tend to hold big weightings in American tech, it's no shock they have turned into expensive S&P 500 trackers.

Hence the graphs above (sourced from hargreaves Lansdown). At least when the market tracks down the fund charge is 1/14th of Mr Smith's.