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Growth Focussed Investment Trusts & Funds

General discussions about growth strategies which focus primarily on investing for capital growth
scotia
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Re: Growth Focussed Investment Trusts & Funds

#305444

Postby scotia » May 3rd, 2020, 7:09 pm

Dod101 wrote:
scotia wrote:


I am surprised that you show Finsbury Growth and Income as -11.7% over the three months because I have recorded the share price as £7.76 at end January and the same at end April with a dip in between. I never really think of it as a UK trust because most of the investments are overseas traders and there are a number of overseas companies as well but I guess it is not a Global Trust, but it is very different from say City of London that is so often quoted.

Dod

I have had a look at a different graph (but still with Hargreaves Lansdown), where the January price seems to be 889p, and the 30th April price seems to be 778p. In between there was an 8p dividend so this gives a drop of 11.6% - in agreement with the total return figure. Are we looking at the same IT? I'm looking at FGT. I'll have a look later at a different source.

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Re: Growth Focussed Investment Trusts & Funds

#305456

Postby monabri » May 3rd, 2020, 8:03 pm

FGT total return , recent data. Dipped to -30%, mid-March , now at -11% (ish). Source Hargreaves Lansdown.

Image

Shareprice only from LSE.

Image

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Re: Growth Focussed Investment Trusts & Funds

#305469

Postby Dod101 » May 3rd, 2020, 8:49 pm

scotia

Looking again I think your numbers are correct. I keep weekly records of prices and it held quite firm at around £9 least until 22 February when it began to weaken a bit. At the end of April it was around £7.76 so it look as if I was rambling. Sorry. I think your numbers are about right. Still not a bad result though.

Dod

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Re: Growth Focussed Investment Trusts & Funds

#305479

Postby scotia » May 3rd, 2020, 10:35 pm

Dod101 wrote:
Still not a bad result though.

Dod

Agreed - I only wish I could find another manager of a UK based company portfolio with a similar performance. I'm currently (possibly too) heavily reliant on Finsbury/Lindsell Train UK in this sector.

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Re: Growth Focussed Investment Trusts & Funds

#305490

Postby ReallyVeryFoolish » May 4th, 2020, 1:30 am

jackdaww wrote:
ReallyVeryFoolish wrote:The high performing growth trusts/funds have done remarkably well. In the main, the formerly high risk tech stocks (Amazon, Microsoft, Facebook, Apple etc) seem to be morphing into the 21st century version of virtual monopoly utilities. Much to my frustration, I spent much of the last two years or so moving about half my money out of the growth/TR sectors into a small what I percieved to be, good quality income stocks. The result? I would have been much, much better off (I mean MUCH better off) if I hadn't bothered
and simply generated a pseudo income from a fully growth/TR portfolio
. A saultory lesson that means I have had to move beyond Plan B into Plan C for my upcoming retirement. Had I done nothing, I would still be on Plan A.

RVF.


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

agreed , simple and obvious to me ..

and such a portfolio might include some high yielding stocks - such as legal & general , glaxo etc ..

:)

jackdaww, that's exactly where I positioned my portfolio. Where would you have struck the balance? I went half and half income + growth/TR. During the"don't look" period I would have been showing a low six figure loss. I am now high five figure loss across the entire portfolio. The vast chunk of that loss is income shares. I didn't go for junk equity yield. I went for quality - DS Smith, Shell and a couple of others. I thought 50/50 was a sensible, pragmatic adjustment away from 100% growth/TR. How wrong can anyone be? Let my experience be a salutory lesson to anyone thinking of exposing their portfolio majorly to yield.

RVF

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Re: Growth Focussed Investment Trusts & Funds

#305501

Postby Dod101 » May 4th, 2020, 6:35 am

It depends of course what you are looking for. As this is the growth strategies Board, growth presumably. I cannot bring myself to sell growth in order to produce an income to live off so I use growth performers to top slice into income shares/ITs. I have done that with Scottish Mortgage twice this year already. I also hold Caledonia, Finsbury Growth and Income and RIT Capital Partners, all of which have held up quite well.

Dod

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Re: Growth Focussed Investment Trusts & Funds

#305503

Postby ReallyVeryFoolish » May 4th, 2020, 6:47 am

Dod, perhaps I am being more dim than usual. But if top slicing a growth stock isn't selling, what is it? It seems to me you are indeed selling growth stock to reinvest in income stock. I can't understand why you say you aren't selling growth stock to generate an income. It seems exactly what you are doing. Albeit not living off growth stock cash sale proceeds, but using an income stock as a device to then yield that cash. That has turned out to be a very bad strategy indeed for me.

RVF

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Re: Growth Focussed Investment Trusts & Funds

#305506

Postby Dod101 » May 4th, 2020, 7:13 am

ReallyVeryFoolish wrote:Dod, perhaps I am being more dim than usual. But if top slicing a growth stock isn't selling, what is it? It seems to me you are indeed selling growth stock to reinvest in income stock. I can't understand why you say you aren't selling growth stock to generate an income. It seems exactly what you are doing. Albeit not living off growth stock cash sale proceeds, but using an income stock as a device to then yield that cash. That has turned out to be a very bad strategy indeed for me.

RVF


I guess you are right! I am not generating an income directly though but I do take your point. This year with my two sales, I bought firstly Diageo and then 3i Infrastructure. I also sold half of my holding in Legal & General to buy 3i Infrastrusture which I see as a fairly secure dividend generator.

Diageo is certainly not an out and out income share but a steady share as and when things recover. As for selling L & G, I still hold a big slug but I was unconvinced by their rushing out their reassurance about their dividend and there is still about 6 weeks to go before the dividend payment so this was a sort of hedging my bets.

I hold very few out and out income shares.

I am trying to protect my dividend income albeit at a lower level at least initially and so far it has worked reasonably well.

Dod

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Re: Growth Focussed Investment Trusts & Funds

#305583

Postby richfool » May 4th, 2020, 1:34 pm

Although I have been investing (in IT's) predominantly for income, last year I decided that I ought to have some exposure to global growth and technology stocks as part of maintaining a broadly diversified portfolio. So I started positions in Bankers and Mid Wynd, as well as increasing my existing holdings of JGGI (JP Morgan Global Growth & Income) and JAGI (JP Morgan Asian Growth & income).

During the falls over the last couple of months, (as well as tinkering with and topping up some income producing IT's), I topped up BNKR, MWY and JGGI, and also started a small position in USA (Ballie Gifford US growth trust). Thus further increasing my exposure to US growth and technology stocks like Amazon, Alphabet, etc. I also had in my mind (rightly or wrongly) that if dividend income stocks were likely to suffer and cut their dividends (due to Covid-19 implications), that there might be better prospects for growth and technology stocks. I also added a position in WWH (Worldwide Health trust) which invests in pharma's, biotech and healthcare companies.

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Re: Growth Focussed Investment Trusts & Funds

#307185

Postby Aminatidi » May 10th, 2020, 11:21 am

I was debating replacing a small (10% or so) that I have in Bankers with a even split between:

* Baillie Gifford Global Alpha Growth B Acc
* Baillie Gifford Global Discovery B Acc
* Baillie Gifford Positive Change B Acc

I know BG have IT equivalents for many of their funds and I tend to use ITs to reduce fees but this would be a small sum and almost a bit of a "play" allocation.

Easy to turn into a collector of funds and other than Bankers the only 100% equity trusts I have money in are Mid Wynd and Saints.

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Re: Growth Focussed Investment Trusts & Funds

#309250

Postby 1nvest » May 16th, 2020, 10:22 pm

ReallyVeryFoolish wrote:if top slicing a growth stock isn't selling, what is it?

Reducing when growth has advanced at a above average rate. If something makes 20% in a year then its advanced at a relatively fast rate such that the rate might slow/reverse. Taking some off the table is wise/appropriate. That requires trading/decisions, but the easiest form of trading is to review once yearly and realign to target weightings (rebalance).

Many for instance hate gold, often saying that its a block of metal that just sits there, earns nothing, pays no dividends. However its purchase power of stock (or gold purchase power of stock) has varied considerably over time. At times accumulating more ounces of gold, at other times deploying ounces of gold to accumulate more shares - such that its not a case of what the individual assets are, but how they combine together.

In this image for instance
Image
the key take is the right most values for each decade, the average of the yearly best asset and worst asset, along with the average of those two values. If the average of the best is twice the average of the worst in real (after inflation) terms, then the combination will produce a net real gain. At times the losing asset will see some of the proceeds from the best asset being deployed to add more shares/ounces of gold and at other times vice-versa. In contrast buy and hold and just spending the dividends/whatever - constant shares (ounces of gold) just rides volatility both up and down without 'taking profits'.

Not so much selling - as in totally ejecting a stock/asset altogether, but rather adding or reducing, according to relative performance.

Conceptually gains from price appreciation, income (dividends) and volatility capture should all broadly compare over time. If there was one that solely was the consistent best then all investors would tend to converge on that alone. In practice each has its time both with and against the wind/tide. Diversifying across all three is reasonable - but requires reducing (adding) - trading.

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Re: Growth Focussed Investment Trusts & Funds

#309341

Postby tikunetih » May 17th, 2020, 12:14 pm

Aminatidi wrote:but this would be a small sum and almost a bit of a "play" allocation.



IMO not a good idea to allocate money to investments with such apparent weak conviction...


1. We know for certain that volatility will occur. For positions that are not held with utmost conviction, periodic volatility and market stress will in all probability simply act as triggers to invite meddling - satisfying the investor's desire to "just do something" - causing deviation from the long term plan and very likely negatively impacting long term returns. Essentially some variation of buy higher, sell lower.

Far better to hold investment positions in which you have conviction, thus making it psychologically easier to "hold fast" during the stressful times.

For many investors, much of the path to decent long term returns comes from simply avoiding doing the damaging stuff vs. a focus on knocking it out of the park.


2. I'll return to an analogy I used a few weeks ago on another thread: imagine if you were invested in a fund and received a monthly factsheet where the manager disclosed that they had "almost a bit of a "play" allocation" to some positions in the portfolio. How impressed would you be with that and the lack of seriousness that such a turn of phrase signals? Not very!

So, conduct yourself with your investment decisions as you would expect a professional investment manager to behave if they were managing your entire portfolio for you. Thoughtful, serious business only. No f@#!&5$ around. Don't lower your expectations and standards just because it's you in the hot-seat instead of some professional you've outsourced it to.

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Re: Growth Focussed Investment Trusts & Funds

#309346

Postby Aminatidi » May 17th, 2020, 12:24 pm

tikunetih wrote:
Aminatidi wrote:but this would be a small sum and almost a bit of a "play" allocation.



IMO not a good idea to allocate money to investments with such apparent weak conviction...


1. We know for certain that volatility will occur. For positions that are not held with utmost conviction, periodic volatility and market stress will in all probability simply act as triggers to invite meddling - satisfying the investor's desire to "just do something" - causing deviation from the long term plan and very likely negatively impacting long term returns. Essentially some variation of buy higher, sell lower.

Far better to hold investment positions in which you have conviction, thus making it psychologically easier to "hold fast" during the stressful times.

For many investors, much of the path to decent long term returns comes from simply avoiding doing the damaging stuff vs. a focus on knocking it out of the park.


2. I'll return to an analogy I used a few weeks ago on another thread: imagine if you were invested in a fund and received a monthly factsheet where the manager disclosed that they had "almost a bit of a "play" allocation" to some positions in the portfolio. How impressed would you be with that and the lack of seriousness that such a turn of phrase signals? Not very!

So, conduct yourself with your investment decisions as you would expect a professional investment manager to behave if they were managing your entire portfolio for you. Thoughtful, serious business only. No f@#!&5$ around. Don't lower your expectations and standards just because it's you in the hot-seat instead of some professional you've outsourced it to.


Fair but I also think that using 5% or so as a "play" pot can sometimes help drifting too much with larger positions which are the big picture.

Trust me out of £175K (ish) 95% of it is very safe and exactly where I have conviction it should be.

I know several people who do something similar i.e. main portfolio which is deliberated and held long term and a small allocation or even a separate account sometimes to have some fun with to satisfy the "bit of a gamble" instinct some of us have (though I don't consider investments a gamble in same way I would the bookies).

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Re: Growth Focussed Investment Trusts & Funds

#309349

Postby Dod101 » May 17th, 2020, 12:47 pm

Aminatidi wrote: I know several people who do something similar i.e. main portfolio which is deliberated and held long term and a small allocation or even a separate account sometimes to have some fun with to satisfy the "bit of a gamble" instinct some of us have (though I don't consider investments a gamble in same way I would the bookies).


It is your money and the benefit of running it yourself is that you can do exactly what you like with it. If you want to use some as a ' bit of fun' money, why not? Obviously if you are paying someone else good money to look after your funds that is different.

Dod

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Re: Growth Focussed Investment Trusts & Funds

#309420

Postby tikunetih » May 17th, 2020, 3:56 pm

Dod101 wrote:It is your money and the benefit of running it yourself is that you can do exactly what you like with it. If you want to use some as a ' bit of fun' money, why not? Obviously if you are paying someone else good money to look after your funds that is different.


For many PIs, running their own money and doing exactly what they like with it often isn't a benefit but a disbenefit, because their meddling actions interrupt or interfere with the compounding process that delivers good long term returns.

I'm referring here in particular to the behaviours we commonly see with PIs of chasing performance in some manner or other...

For example, I've no doubt there were very many people who were content to be buying risk assets (inc. equities) throughout 2019 only to ditch them in late March 2020 and switch to safer assets. And once the market has recovered a lot, then commence switching back again, selling the safer stuff and buying the riskier stuff again that's now much pricier than when they sold it. Buy higher, sell lower, and the reason most PIs under-perform the funds they're actually invested in.


But clearly, as you state, people can do with their money as they choose. If someone was to prioritise indulging a gambling whim, or to minimise their own feelings of discomfort during periods of market stress, then that is entirely within their gift to do so. However, they should be clear that doing so will almost certainly impair their returns, and significantly so over time, unless they possess very unusual levels of skill/luck.

An informed PI would therefore make their choice with eyes wide open:
(a) pursue better returns by operating in as thoughtful, professional and disciplined manner as they can achieve; or:
(b) operate in a more indulgent manner, taking fun gambles from time to time, acting on their gut feel and doing what feels psychologically easier.


I'm simply telling people their future self will thank them for choosing (a), even if in the shorter term that path is a more difficult one to stay on, but it's not my decision. ;)

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Re: Growth Focussed Investment Trusts & Funds

#309452

Postby Itsallaguess » May 17th, 2020, 6:05 pm

tikunetih wrote:
If someone was to prioritise indulging a gambling whim, or to minimise their own feelings of discomfort during periods of market stress, then that is entirely within their gift to do so. However, they should be clear that doing so will almost certainly impair their returns, and significantly so over time, unless they possess very unusual levels of skill/luck.

An informed PI would therefore make their choice with eyes wide open:

(a) pursue better returns by operating in as thoughtful, professional and disciplined manner as they can achieve; or:

(b) operate in a more indulgent manner, taking fun gambles from time to time, acting on their gut feel and doing what feels psychologically easier.

I'm simply telling people their future self will thank them for choosing (a), even if in the shorter term that path is a more difficult one to stay on, but it's not my decision.


I'm not sure there's much disagreement that option (a) would perhaps deliver 'optimum returns', but isn't it just the case that some investors hold their hands up and admit that they haven't got the self-control or stamina to spend all day and every day (read months/years/decades...) in the Green Room without knowing that they've got £50 in their back pocket for a quick mooch in the Red Room now and again?...

If by taking this approach, the bulk of 'optimum Green Room returns' can carry on ticking away and 'doing their thing', and the process which allows for the long-term 'distraction' necessary for that to happen is some relatively low-level Red Room excitement, then doesn't that just fall into the important 'know thyself' aspect of personal investment?

Of course, it's 'self-diversion', but it's actually being done with clarity and purpose, and is based distinctly on an investor knowing themselves well enough to allow themselves to do it - for 'the greater (Green Room) good'...

'There's a saint in every sinner, and a sinner in every saint...'

Cheers,

Itsallaguess (relatively small-time Red Room moocher...)

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Re: Growth Focussed Investment Trusts & Funds

#309507

Postby tikunetih » May 17th, 2020, 11:39 pm

Itsallaguess wrote:If by taking this approach, the bulk of 'optimum Green Room returns' can carry on ticking away and 'doing their thing', and the process which allows for the long-term 'distraction' necessary for that to happen is some relatively low-level Red Room excitement, then doesn't that just fall into the important 'know thyself' aspect of personal investment?

Of course, it's 'self-diversion', but it's actually being done with clarity and purpose, and is based distinctly on an investor knowing themselves well enough to allow themselves to do it - for 'the greater (Green Room) good'...


I'd caution against seeking too much (or much at all) in the way of entertainment from your investing and try to keep the focus on the primary objective, which would be to maximise risk adjusted returns (whatever that translates to for you) in order to meet your financial goals. There's every chance that dull will eventually beat thrilling. Buy a lottery ticket if you want a low cost gamble or do a sport or activity for the excitement, would be my recommendation.

Per Dod's earlier post, though, it's your own money you're running so clearly you can do as you see fit. It's for you to weigh the pros and cons: finding what works for you in practice vs. in theory is key to longer term success, even if that practice might appear imperfect to an onlooker... ;)

Still, by posting about these things on public forums we invite feedback from others, and my opinion is that self-control and investment discipline are fairly low-hanging fruit, with material benefits if you can raise your game:

- It's usually about doing less, exercising patience and retaining a focus on your intended goal and time horizon. When stuff happens in markets, as it does, investors can feel compelled to react somehow as if this improve things, but very often the best reaction is to do nothing. The Jesse Livermore quote is somewhat relevant: "The big money is made by the sitting - the waitin' - not the thinking". The over-thinking, driven by emotions, is what can readily unseat people from their previously sound plans.

- Akin to reducing investment costs, the benefits of improved self-control and discipline will compound over time: while In the near term the advantage may be slight, these slight advantages accumulating and compounding over an investment lifetime can(/will) lead to substantial benefits eventually.

- Furthermore - and perhaps the money-shot - self-control is a skill that transfers readily and beneficially to other aspects of life where compounding also applies: think good dietary habits, beneficial exercise regimes, avoiding reacting emotionally to "events" that occur or idiots you come across, etc. Practice this stuff across different aspects of your life and it all gets easier and the outcomes usually better. What's not to like?

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Re: Growth Focussed Investment Trusts & Funds

#309614

Postby Wuffle » May 18th, 2020, 12:06 pm

Presumably the professionals are at the arbitrage all the time but just leave the IT ticking away at it?

w.


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