Murray International (divi)

[Itsallaguess]

I am not aware of any successful investor who got rich through only investing in high yield equities.

But that's because your self-imposing a 'rich' stipulation in the above 'successful investor' statement Si, and imposing it onto a group of income-investors who, in the main, don't see it as a primary driver to deliver their own definition of the word 'successful' in relation to their particular investment-strategy...

Surely you can see that by doing so, you'll never lose your argument because you're setting your own strict terms, and they are sometimes ones that other investors don't necessarily need to cover-off with regards to their own strategies before they are happy to use the word 'successful' against their own approach...

Your metric above would be like someone coming up to me at work and telling me that I've had an 'unsuccessful career' because there are two rungs above me on the managerial ladder that I never attained, which would clearly be nonsense in terms of me not being able to think of the career that I did have as being 'successful', and I think taking a comparative approach like that, on such terms, is the unfortunate basis of much of the hot-air around this particular debate...

Cheers,

Itsallaguess

[simoan]

" If it's paid as a dividend, it's a dividend." says our friend

ABSOLUTELY WRONG IN THE CASE OF A SPECIAL DIVI ATTACHED TO A CONSOLIDATION.

Any investor who takes such as income, which of course they are free to do, is JUST KIDDING HIMSELF.


Such a special is basically a sale of part of your holding for which you get some cash, a neutral type of portfolio event by design at the outset.

Plodder

PS This was drilled into us on a unitisation course I attended decades ago, because counting such an event as a divi in unitisation terms would grossly distort the process.

You can take whatever approach you want. No need to be so condescending either. A dividend is a dividend to me and counts as income. How do you account for it when a company is selling assets to pay the dividend rather than from cashflow as Shell and BP did for years and other high yield shares still do? Other companies weaken their balance sheet by paying the dividend using debt e.g. Morrisons did for several years because there was not enough cashflow. Where do you stop with such nonsense? And this whole idea of "unitisation" is just monkey science.

Moderator Message:
Unitisation is a well established method for monitoring investment returns, especially useful when the invested sum is being adjusted from time to time or shared amongst different parties. It has nothing to do with monkeys, which could easily be interpreted as an insult by those employing unitisation. Please employ more tact. Thanks. - Chris

[simoan]

" If it's paid as a dividend, it's a dividend." says our friend

ABSOLUTELY WRONG IN THE CASE OF A SPECIAL DIVI ATTACHED TO A CONSOLIDATION.

Any investor who takes such as income, which of course they are free to do, is JUST KIDDING HIMSELF.


Such a special is basically a sale of part of your holding for which you get some cash, a neutral type of portfolio event by design at the outset.

Plodder

PS This was drilled into us on a unitisation course I attended decades ago, because counting such an event as a divi in unitisation terms would grossly distort the process.

You can take whatever approach you want. No need to be so condescending either. A dividend is a dividend to me and counts as income. How do you account for it when a company is selling assets to pay the dividend rather than from cashflow as Shell and BP did for years and other high yield shares still do? Other companies weaken their balance sheet by paying the dividend using debt e.g. Morrisons did for several years because there was not enough cashflow. Where do you stop with such nonsense? And this whole idea of "unitisation" is just monkey science.

Moderator Message:
Unitisation is a well established method for monitoring investment returns, especially useful when the invested sum is being adjusted from time to time or shared amongst different parties. It has nothing to do with monkeys, which could easily be interpreted as an insult by those employing unitisation. Please employ more tact. Thanks. - Chris

Sorry. I apologise for my dislike of unitisation but can see that if you want to pretend you're a fund manager it's a good way to compare your performance with Terry Smith. Good luck with that. Anyway, there are better ways to calculate Total Return, and that is what we were discussing before "the ATTACK OF THE BLOCK CAPITALS" declaring I am absolutely wrong from someone that probably doesn't know a balance sheet from a bed sheet, or the number of ways a company can, partially or wholly, pay dividends from capital. Let's just agree unitisation has nothing whatsoever to do with the ongoing discussion and our friend should not be getting their knickers in such a twist in their need to unitise the world. If you have to declare dividend payments received in the income section of a tax return, that's what it is.

There is absolutely no difference between BHP selling its oil assets to Woodside and paying a special dividend, to what BP did between 2013 and 2020 in selling off oil fields to fund a dividend payment that was not covered by free cashflow. Unitisation has nothing to do with it.

All the best, Si

[MDW1954]

Moderator Message:
This thread has drifted somewhat! Useful discussion, though. On the subject of unitisation, I shall shortly be posting some definitive information that Lemon Fool has been offered. It just needs editing and tidying up. When posted, I'll post on this board to say so. --MDW1954

[simoan]

Moderator Message:
This thread has drifted somewhat! Useful discussion, though. On the subject of unitisation, I shall shortly be posting some definitive information that Lemon Fool has been offered. It just needs editing and tidying up. When posted, I'll post on this board to say so. --MDW1954

I apologise if it drifted because of me but I was being attacked by all comers. I don't believe unitisation has anything to do with the discussion on dividend payments we were having with respect to MYI. The point I was basically making (clearly not very well!) is that if you start off with a high yield by investing in companies that are not growing and pay all their cashflow (and more) out as dividends, it's hardly surprising that dividends generated will not keep up with inflation much higher than a few percent. If instead you'd invested in companies which offer a lower starting yield because they re-invest cashflow to grow the business and pay out a smaller dividend, then you might find that such a portfolio would still be able to grow its dividend income closer to a much higher rate of inflation. That is what I am seeing this year so far.

All the best, Si

[Bagger46]

‘declaring I am absolutely wrong from someone that probably doesn't know a balance sheet from a bed sheet’

Well you need to apologise to OldPlodder imho, because you are massively wrong on the above, at the very least.

For a start he has vast expertise in all manners of business( he owned three companies before he retired, one quite big), every aspect of finance and is successful as an investor. Not the kind of chap to get any of this stuff wrong, and I have known him for quite a few years.

Secondly if you has taken care to actually read and ponder on what he posted, instead of getting on you high horse all over the place, you will have realised that he is 100% correct in what he says. A special attached to a consolidation is not a divi. By any stretch of the imagination. He clearly said that investors of course are free to treat it as such, and many do, they are, as he says kidding themselves in doing so, but it is a free country. If I was to ask my many very experienced investor friends that question, every one of them would agree( and many of them are highly qualified to make that judgement, coming from all walks of business, professional and research life mostly and having massive skin in that game, with very different portfolio approaches too.

So just don’t answer, give it some thought is all I ask.


You clearly despise unitisation, fine, but myriad of investors, highly experienced and massively qualified investors use the method and have done for decades, so no need to thrash this useful process.

Plodder can’t post at the moment because I would guess his boat is in full sail past Ushant at the moment( a spot where any mariner takes serious care), and will be gone for weeks I understand.

Regards

Bagger

[MDW1954]

Moderator Message:
Just to say: I am coming to this thread late, but keen to see a resolution here. --MDW1954

[simoan]

Moderator Message:
Just to say: I am coming to this thread late, but keen to see a resolution here. --MDW1954

Thanks but no need from my point of view. Why on earth should a total return investor care about the difference between capital and income? They don’t. Even allowing for special dividends with share consolidations my “income” is up 20% YTD. However, this thread should return to discussing MYI as intended by monabri in the OP.

Besides, I don’t have a boat so am clearly not worthy of those that do and enjoy using BLOCK CAPITALS TO MAKE A POINT and feel without doubt they are 100% correct. I was always taught shouting unnecessarily was bad form on the internet and just makes you look like a 10 year old…

[Dod101]

Well, I do not know who comes out of this worst. I have a lot of sympathy for simoan's views but at times his style and language is probably not appropriate for this Board. Anyway if he does not like/believe in ITs I am not sure why he so confidently bothers to post here. It is a bit like me arguing against HYP investors. I do not agree with it in its style or strict rules but let them get on with it if they want.

Dod

[CryptoPlankton]

Moderator Message:
This thread has drifted somewhat! Useful discussion, though. On the subject of unitisation, I shall shortly be posting some definitive information that Lemon Fool has been offered. It just needs editing and tidying up. When posted, I'll post on this board to say so. --MDW1954

I apologise if it drifted because of me but I was being attacked by all comers. I don't believe unitisation has anything to do with the discussion on dividend payments we were having with respect to MYI. The point I was basically making (clearly not very well!) is that if you start off with a high yield by investing in companies that are not growing and pay all their cashflow (and more) out as dividends, it's hardly surprising that dividends generated will not keep up with inflation much higher than a few percent. If instead you'd invested in companies which offer a lower starting yield because they re-invest cashflow to grow the business and pay out a smaller dividend, then you might find that such a portfolio would still be able to grow its dividend income closer to a much higher rate of inflation. That is what I am seeing this year so far.

All the best, Si

I think you may have run into difficulties on this thread because the 'point' you were making seemed a little misdirected. Earlier in the thread, you also talked about "investing based on high yield only". The thing is, yielding an average of around 4.5% over the years, MYI has never had what most people would describe as an exceptionally high yield. Its attraction, to me at least, was its global diversification and steady inflation beating dividend growth (driven by the dividend growth of its investments) over many years (15 year CAGR is still about 7%), which only came to a halt with the pandemic.

Granted, since then the investment case has certainly become less attractive, particularly with the recent surge in inflation. However, I am sure this is true of many investments and, as a LTBH investor, I am disinclined to have major sell-offs every time the market gets a bit bumpy.

As I am sure is the case with others here, MYI makes up a relatively small percentage of my portfolio and, though I am obviously interested in how things develop, its fortunes won't make or break me. And, as I am also sure is the case with others, I certainly don't base my investing on chasing after high yields without any consideration of their sustainability or growth. So, may I humbly suggest that your implication that MYI investors do this, probably coupled with apparently gleefully announcing your superior recent investment performance, may together have just got one or two people's backs up.

(Meant with the best of intentions.)

CP

[simoan]

So, may I humbly suggest that your implication that MYI investors do this, probably coupled with apparently gleefully announcing your superior recent investment performance, may together have just got one or two people's backs up.

(Meant with the best of intentions.)

CP

You may, but there has been nothing gleeful from my side so that is just an assumption you have made yourself. Where were all the smiley faces if that’s how I felt? You need to look at yourself for the reason for such misinterpretation when I made no such declaration. There’s not much to feel gleeful about currently and I don’t.

And I have no idea where the whole unitisation thing came from? A complete irrelevance to the original discussion, do you not agree? Frankly, I give up but I think you’ll find without groupthink being challenged no -one will ever learn very much. Socrates would be proud of me

There’s a reason why I was successful in business, and you can probably guess what it is… I just question everything and poke sticks at lazy orthodoxies, it’s where innovation starts. Others should welcome opposing views rather than reccing posts against because they want “the nasty person” to go away. I won’t because I don’t care about recs/thanks. If you want to reinforce your confirmation bias, just keep hitting that thank button! BTW I would highly recommend anyone who feels like that read the book “How To Disagree” by Ian Leslie.

Please can this thread now return to the original subject? I won’t be responding any further, which should help.

All the best, Si

[CryptoPlankton]

So, may I humbly suggest that your implication that MYI investors do this, probably coupled with apparently gleefully announcing your superior recent investment performance, may together have just got one or two people's backs up.

(Meant with the best of intentions.)

CP

You may, but there has been nothing gleeful from my side so that is just an assumption you have made yourself. Where were all the smiley faces if that’s how I felt? You need to look at yourself for the reason for such misinterpretation when I made no such declaration. There’s not much to feel gleeful about currently and I don’t.

And I have no idea where the whole unitisation thing came from? A complete irrelevance to the original discussion, do you not agree? Frankly, I give up but I think you’ll find without groupthink being challenged no -one will ever learn very much. Socrates would be proud of me

There’s a reason why I was successful in business, and you can probably guess what it is… I just question everything and poke sticks at lazy orthodoxies, it’s where innovation starts. Others should welcome opposing views rather than reccing posts against because they want “the nasty person” to go away. I won’t because I don’t care about recs/thanks. If you want to reinforce your confirmation bias, just keep hitting that thank button! BTW I would highly recommend anyone who feels like that read the book “How To Disagree” by Ian Leslie.

Please can this thread now return to the original subject? I won’t be responding any further, which should help.

All the best, Si

No assumption on my part, I was only explaining how it appeared to come across as I thought it might help. I was also just trying to point out that your dismissal of people investing "based on high yield only" really had no relevance to this thread. However, as you say you were actually looking to provoke then it seems I misunderstood your motives.

I'm sure people will be grateful to be allowed to return to the original subject, which was simply a discussion on the pattern of MYI dividend distributions - not really the right time or place at all for "opposing views" to high yield investing. (Certainly, discussion about groupthink, recs and confirmation bias is way off topic.) If it is something you wish to pursue then perhaps the "High Yield Shares and Strategies - General" board would be more appropriate? I'd suggest it would be more likely to be seen by your perceived target audience there.

All the best to you too.

CP

P.S. Yes, I agree on the unitisation thing.

[Itsallaguess]

I just question everything and poke sticks at lazy orthodoxies

I was also just trying to point out that your dismissal of people investing "based on high yield only" really had no relevance to this thread.

It was no mistake that I made sure it was the top-ranked 'anti-income-investment MacGuffin' CP -

• You're an income-investor, so you *must* be a high-yield income investor...

https://www.lemonfool.co.uk/posting.php?mode=quote&f=56&p=434576

'Lazy orthodoxies' indeed...

Cheers,

Itsallaguess

[simoan]

Sorry I can’t see how to write private replies. Has this been disabled?

1. It was never my intention to provoke but that’s how it ended up after iaag’s post which created a totally false narrative. That got my back up. I wouldn’t touch SMG with a barge pole. Please read my first two contributions dispassionately again.

2. A yield of 4.5% is a high yield by most definitions, especially when the risk free rate until very recently was less than 1%. This include PYADs HYP rules as I understand them.

3. It’s nice to be told my posting style is rubbish by Dod. I’ll be the kettle, he can be the pot

That’s it from me.

[nmdhqbc]

I wouldn’t touch SMG with a barge pole.

Buffy the Vampire Slayer is a great show.

[richfool]

I previously held and then sold MYI because of an extended period of poor capital growth performance. Nevertheless, I was aware of and valued manager, Bruce Stout's opinion of markets being driven up too much by QE and that "the chicken's would have to come home to roost" at some point, and his resultant defensive stance; and earlier this year I bought back into MYI, as part of a move away from growth and technology back towards value (and income).

I appreciate the diversity of the holdings of the trust, the fact that it some exposure to emerging markets and even fixed interest, and of course the dividend, which is not to be sneered at. I hold MYI as one of a number of globally focussed IT's, with differing mandates.

[jackdaww]

puzzled . what is SMG ?

[scrumpyjack]

puzzled . what is SMG ?

Sarah Michelle Gellar, I think. Yes Buffy the Vampire Slayer was excellent!

[Dod101]

puzzled . what is SMG ?

If you look back to when si first used the expression, I think he intended to refer to Scottish Mortgage. Its ticker is of course SMT. If you look it up, SMG is actually some obscure ETF.

Dod

[scrumpyjack]

Clearly, but we are just having some fun