GoSeigen million challenge!

[GoSeigen]

I definitely recognise his bravery. it takes a lot of courage to believe that the UK stock market will suddenly become a global leader, after decades in the doldrums. A fortiori for UK banks.

I assumed he was waiting for value to be outed on certain UK stocks rather than taking a long term position on the UK.

Lootman has posted some 20,000 time on TLF, at that rate I doubt he has a clue what he's talking about in 75% of those posts. This one is typical, it contains on of his childish little straw-man comments, implying that I "believe that the UK stock market will suddenly become a global leader", the product of a fecund and foolish imagination. One doesn't have to believe that to make it worth investing in the UK.

For the record here are some of the reasons I am happy to invest in the UK:

1. Most of my economic activity and liabilities are based in the UK.
2. I don't invest indiscriminately: for share purchases I am looking for value, mainly in the FTSE 100, plenty can be found if one looks.
3. A return in investing comes from two sources, not just one as Lootman patently believes**. One I agree is performance of the issuer, but the other is the purchase price/valuation. I can get an awesome return from UK shares even if the UK is only a top-ten performing country as I think it may be. Conversely investing in a world leader doesn't make getting a return any easier if the valuation is crap.
4. When investing in UK shares I don't have to worry about currency effects, tax issues and custodianship or any of a number of more minor issues. Some of which could be eliminated by following the herd and buying a tracker. But the point is I like not having to bother with ANY of that.
5. I invest on a forward-looking view -- the fact that the UK market has been in the doldrums is only really relevant from the perspective of investor psychology (and therefore valuation).


There's probably more but that will do for starters. Oh and I'm quite happy to take long term positions if that means more than five years: I'm already there for many of my stocks. Followers of this thread will know that I've held UK banks for that long having bought them a little bit early but that they are performing well.

GS

(**)Lootman thinks it comes solely from performance of the underlying, in particular he thinks "global leadership" is a key factor. This is rubbish, because the second factor, which arguably is more important than the first is valuation. A world leader over valued can be a poor investment. A lowly company struggling and close to death can be an extraordinarily successful investment if it is undervalued. A prime example from my own portfolio is Manchester Building Society, a company as far from global dominance as you could imagine, written off by everyone, a dog in all but name, but absolutely extraordinary value when I was first buying it, most of my holding purchased at almost 50% (yes, fifty percent) yield and almost a ten bagger.

[Lootman]

I assumed he was waiting for value to be outed on certain UK stocks rather than taking a long term position on the UK.

A return in investing comes from two sources, not just one as Lootman patently believes**. One I agree is performance of the issuer, but the other is the purchase price/valuation. I can get an awesome return from UK shares even if the UK is only a top-ten performing country as I think it may be. Conversely investing in a world leader doesn't make getting a return any easier if the valuation is crap.

Yes of course you'd want to buy a share cheaply if you can. Just like you'd prefer to sell expensively. But your "buy low; sell high" advice is glib and trite. And you have not demonstrated how you know when a share price is low.

You may get lucky with your choice of UK shares but if the UK is the worst performing major stock market in 2025 then you are swimming against the tide. I prefer swimming with the tide.

So your bet on the UK could come off. It is just that there is no reason to believe that it will or that anything has materially changed to make that happen. And you certainly haven't explained why.

But yes, if you invest in the UK because it is simpler for you to understand and/or that FX issues are too confusing and complicated for you, then do that. But based on prior numbers you have given, I have obtained a significantly higher return this year than your "awesome" return. And I took less risk - something that interestingly you never talk about.

[MrFoolish]

A prime example from my own portfolio is Manchester Building Society, a company as far from global dominance as you could imagine, written off by everyone, a dog in all but name, but absolutely extraordinary value when I was first buying it, most of my holding purchased at almost 50% (yes, fifty percent) yield and almost a ten bagger.

I would dare to say you were taking a huge risk - unless you knew something the rest of the market didn't.

[Lootman]

A prime example from my own portfolio is Manchester Building Society, a company as far from global dominance as you could imagine, written off by everyone, a dog in all but name, but absolutely extraordinary value when I was first buying it, most of my holding purchased at almost 50% (yes, fifty percent) yield and almost a ten bagger.

I would dare to say you were taking a huge risk - unless you knew something the rest of the market didn't.

GS has a penchant for UK financials. Now the idea of focusing on a very narrow range or sector and trying to gain an information advantage is a reasonable strategy. There are folks here like simoan who appear to do well with that approach. Although his focus is more on small and under-researched UK companies and that can make sense, if you have the energy and aptitude for it.

A blind devotion to UK financials because that is the only thing you understand is dangerous however, and you are correct that GS appears to discount risk.

Now of course he trumpets his one big winner. I am guilty of that too, having eleven-bagged on Nvidia in just 2 years and have not been shy about saying so. But I do not see a coherent approach to risk in his speculations. And that may be fine for him but is probably not prudent for most investors.

[GoSeigen]

A prime example from my own portfolio is Manchester Building Society, a company as far from global dominance as you could imagine, written off by everyone, a dog in all but name, but absolutely extraordinary value when I was first buying it, most of my holding purchased at almost 50% (yes, fifty percent) yield and almost a ten bagger.

I would dare to say you were taking a huge risk - unless you knew something the rest of the market didn't.

Sure, but isn't that what successful investing is all about? It's the old Buffett "buy when others are fearful" philosophy. I'm pleased to see people Like Looty pissing on UK stocks. And many others selling out of boredom ("Look: world trackers have done so well with better diversification, it's obviously the place to be"). I want to take on risk when others would rather offload it.

Besides, the market doesn't just price stocks on what it knows, it prices them on what it feels and on what it thinks everyone else feels. The other way to express this is to say that market prices often aren't set by the smartest investors but by the dumbest or most greedy or most terrified. So how good is the pricing likely to be in those circumstances??


GS

[77ss]

....
Lootman has posted some 20,000 time on TLF, at that rate I doubt he has a clue what he's talking about in 75% of those posts......

Well said!

In my opinion loghorrea is a serious problem on LF. Seven posts a day, year in, year out is surely excessive. Lootman is by no means the only overposter either.

The may well be pearls of wisdom there, but how on earth can one separate the wheat from the chaff? Some self restraint would be welcome.

[swill453]

The may well be pearls of wisdom there, but how on earth can one separate the wheat from the chaff? Some self restraint would be welcome.

Yeah, repeat after me "I don't have to have the last word on everything.".

Scott.

[Lootman]

In my opinion loghorrea is a serious problem on LF. Seven posts a day, year in, year out is surely excessive. Lootman is by no means the only overposter either.

This is a strange place indeed if the most active and enthusiastic members are criticised for being so. And a lot of my posts are short and to the point. I doubt that I have written the most words.

Anyway I can agree with GS that deviating from benchmarks can lead to a wider array of outcomes. But I am baffled why he cannot explain his bets other than by telling us that he think his picks are "cheap". And by the fact that he apparently cannot quantify or measure risk.

[SalvorHardin]

This is a strange place indeed if the most active and enthusiastic members are criticised for being so. And a lot of my posts are short and to the point. I doubt that I have written the most words.

With TLF increasingly resembling the comments sections under opinion pieces in The Guardian, it is no surprise to me that posters like yourself who regularly post about politics, investment, personal finance and economics from a free-market and right wing viewpoint, are coming under attack.

Just like we saw on TMF, a fair few posters on TLF are quite hostile towards success, self reliance and free markets.

[swill453]

With TLF increasingly resembling the comments sections under opinion pieces in The Guardian, it is no surprise to me that posters like yourself who regularly post about politics, investment, personal finance and economics from a free-market and right wing viewpoint, are coming under attack.

We all see bias, I think. My impression of TLF is that it is that the majority of the opinionated posts are from the right wing.

Scott.

[Lootman]

This is a strange place indeed if the most active and enthusiastic members are criticised for being so. And a lot of my posts are short and to the point. I doubt that I have written the most words.

With TLF increasingly resembling the comments sections under opinion pieces in The Guardian, it is no surprise to me that posters like yourself who regularly post about politics, investment, personal finance and economics from a free-market and right wing viewpoint, are coming under attack.

Just like we saw on TMF, a fair few posters on TLF are quite hostile towards success, self reliance and free markets.

Thanks. i am no expert on social media but generally one performance metric that is cherished by providers is engagement. I imagine that the TLF sponsors like to see commitment and engagement by members, so I was surprised to see quibbles. Maybe as you say it is a proxy for some other issue.

But anyone who does not enjoy my incisive commentary is of course welcome to ignore my posts. I promise I won't mind.

[88V8]

A prime example from my own portfolio is Manchester Building Society, a company as far from global dominance as you could imagine, written off by everyone, a dog in all but name, but absolutely extraordinary value when I was first buying it, most of my holding purchased at almost 50% (yes, fifty percent) yield and almost a ten bagger.

I would dare to say you were taking a huge risk - unless you knew something the rest of the market didn't.

Perhaps.
But GS took the trouble to post extensively on TMF about opportunity and rationale, and those of us who rode on his coat-tails did very nicely, thankyou.

V8

[LooseCannon101]

This challenge shows the folly of investing long-term in cash and cash equivalents (bonds).

Starting in June 2016 at about £17k the portfolio has grown at about 5% per year to just over £30k. At this rate it will take another 10 years to reach £50k.

I think we should thank GoSeigen for his efforts as it proves this strategy has no chance of achieving it's aims.

[GoSeigen]

This challenge shows the folly of investing long-term in cash and cash equivalents (bonds).

Starting in June 2016 at about £17k the portfolio has grown at about 5% per year to just over £30k. At this rate it will take another 10 years to reach £50k.

I think we should thank GoSeigen for his efforts as it proves this strategy has no chance of achieving it's aims.

Thanks for the comments.

It's very strange though. I was intrigued by @LooseCannon101's reference to long-term investment in bonds and cash because this portfolio has had a minimal allocation to bonds and cash for years.

So I went back to look at my posts and weirdly my impression is that a bunch of posts have disappeared into thin air! I can find only two updates showing the account allocation and I'm pretty certain that although I may have missed the odd year I have regularly updated with an account breakdown. The 2024 update refers specifically to the prior year's post which now seems to be gone, so what has happened? Have a load of posts randomly been deleted? (Perhaps one of the contributors to this thread asked for all references to them to be removed and that affected a bunch of my posts too???) Anyway, given all the missing posts it's not surprising that someone would get the wrong impression of the allocation.

If anyone could explain what's happened to the posts I'd be grateful.


Getting to the substance, I agree, the performance has been far below what is required to achieve UKPoker's aim. In the period since 2016 that is not the fault of bonds and cash however. I took a big punt on bank stocks from 2016ish and they really didn't start to perform until after COVID. The portfolio has grown from about £8,000 value at the COVID bottom in Mar/Apr 2020 to the current approx £32000 -- clearly in hindsight the bank call was too early. Note to self: upgrade the crystal ball.

Having said that, I also noted right at the beginning of the challenge (and regularly since then) that this is a live-money portfolio consisting of my daughter's savings and would be invested in a conservative way (though not low-risk necessarily, just not doing stupid stuff, like putting 100% on an AIM stock in the hope of an imminent contract win). Nevertheless I've run it with the intention of getting close to ukpoker's goal. I never truly believed 30%pa is consistently achievable though, as such I think the results tend to cast doubt on the idea you can trade your way to a million in 20 years, which probably is a Good Thing.

But no. It hasn't been all cash and bonds for a looong time.


GS

EDIT:
1. Looking back I made a trade in early 2020 which I almost certainly would have reported at the time but that post is gone.
2. To be fair, one bond position survived until 2023, this was my comment about it in 2021: "I have been very lazy about reporting this portfolio. Last year of course was the COVID crash and I surpassed myself in masterly inactivity. I was desperate to add some nice cheap shares to the portfolio but unfortunately it was 100% invested and the only position I wished to sell -- the Liverpool bonds -- was so illiquid that despite searching high and low I couldn't find a single bid. [Maybe should have sold it to myself in another portfolio LOL.] So sadly I have to keep collecting the interest at 5%pa on the purchase price, which is not a terrible loss but spoils the dash to one million. "
3. From 2018: "Added to the LLOY position today. This is now a farm bet on UK bank equity with roughly 60% exposure divided equally among BARC, RBS and LLOY:"

[Gerry557]

I like to read real investing updates, good and bad. When you find that better crystal ball let me know cos I want one.

I remember adding to Lloyds around covid. They had just announced a change to quarterly dividends. Then along came the PRA.

Although things have improved a bit since on the bank front, those quarterlies are long gone.

[Lootman]

This challenge shows the folly of investing long-term in cash and cash equivalents (bonds).

I went back to look at my posts and weirdly my impression is that a bunch of posts have disappeared into thin air! I can find only two updates showing the account allocation and I'm pretty certain that although I may have missed the odd year I have regularly updated with an account breakdown. The 2024 update refers specifically to the prior year's post which now seems to be gone, so what has happened? Have a load of posts randomly been deleted? (Perhaps one of the contributors to this thread asked for all references to them to be removed and that affected a bunch of my posts too???) Anyway, given all the missing posts it's not surprising that someone would get the wrong impression of the allocation.

If anyone could explain what's happened to the posts I'd be grateful.

I recall some time ago Stooz said that TLF was running short of data storage space. Or that TLF has to pay for the data storage it uses.

And so there would be periodic purges of old posts that had not been accessed or read in the last N months or years.

For the most part that makes sense, although obviously it makes less sense for anyone trying to build a long-term record of their portfolio.

Starting in June 2016 at about £17k the portfolio has grown at about 5% per year to just over £30k. At this rate it will take another 10 years to reach £50k.

The S&P 500 has about tripled since June 2016, so with a S&P 500 tracker that 50K target would have been reached recently. But even if that lofty rate of return continues it will take another 22 years, i.e. until 2047, to reach a million.

[88V8]

.....2. To be fair, one bond position survived until 2023, this was my comment about it in 2021: "I have been very lazy about reporting this portfolio. Last year of course was the COVID crash and I surpassed myself in masterly inactivity. I was desperate to add some nice cheap shares to the portfolio but unfortunately it was 100% invested and the only position I wished to sell -- the Liverpool bonds -- was so illiquid that despite searching high and low I couldn't find a single bid. [Maybe should have sold it to myself in another portfolio LOL.] So sadly I have to keep collecting the interest at 5%pa on the purchase price, which is not a terrible loss but spoils the dash to one million. "...

I remember that post.... wonder where it went.

V8

[GoSeigen]

.....2. To be fair, one bond position survived until 2023, this was my comment about it in 2021: "I have been very lazy about reporting this portfolio. Last year of course was the COVID crash and I surpassed myself in masterly inactivity. I was desperate to add some nice cheap shares to the portfolio but unfortunately it was 100% invested and the only position I wished to sell -- the Liverpool bonds -- was so illiquid that despite searching high and low I couldn't find a single bid. [Maybe should have sold it to myself in another portfolio LOL.] So sadly I have to keep collecting the interest at 5%pa on the purchase price, which is not a terrible loss but spoils the dash to one million. "...

I remember that post.... wonder where it went.

That comment is still around, it's here.

I've had a more careful look back and all the trade reports are still there. So I'm thinking the explanation is I've been rather lazy about annual updates as hinted in the above quote. Perhaps I missed a few completely (e.g. in years with no trades) and in other cases just reported the total portfolio value. Also the first few years' updates were on Motley Fool. At some point I'll do a post with a few links back to key posts, just to help me find them in future if nothing else.

EDIT: Current value £36172

GS

[GoSeigen]

Confession time! Double-confession time!

1. I made a trade a month ago and didn't report it immediately.
2. I sneakily borrowed some cash to part-fund the trade


With the price of INVR in backwardation I decided to take advantage and Bed-and-ISA the holding, while simultaneously buying a few extra shares.

Great idea and timing because I had cash ready in the target ISA account -- but I forgot to check the cash position of the actual challenge portfolio. Turns out there was no spare cash, so I've effectively borrowed about £350 to pay for the 80 extra shares. This borrowing will be paid back as dividends arrive or if I make a sale; it amounts to less than 1% of the portfolio value so should be immaterial to the final outcome.


Here are the trades:

Trade   Symbol   Unit Price   Quantity   Fees     Value    
SELL    INVR         600.25        320   £11.95    1,908.85
BUY     INVR            600        400   £22.99   -2,422.99

The cash balance was £-£354.98 and the latest total account value £36,789.82.


GS