Henderson Far East Income Share Discussion Threads

[kiwi2007] 17/8/2023 23:52

Sorry - double post..

[superiorshares] 17/8/2023 23:31

Anyone wants to start scoffing?
Might be wise to check out my past prediction on this Advfn

[superiorshares] 17/8/2023 23:29

I remember putting money into this about a year after the Asian currency crisis . I did very well out of that.

OK. I'm one for big predictions. How about .
£1.10 £1.30 area ?

[scruff1] 17/8/2023 20:19

shalder - not sure HFEL is one to trade - I cant see it. It only bloody moves one way- slowly
Masurenguy get the 14yr low but not sure how a 2022 chart helps. Skinny's -2023 more relevant perhaps. Since Q1 they have sold Industrial Bank (China) and bought ASE (Taiwan). They have no exposure to the residential stuff - or at least no more than the rest of the planet.

[aleman] 17/8/2023 19:40

Don't forget that China was nearly twice the proportion of income in the 2022 results - something like 33% income versus 17% assets. If much is dividend scalping to switch capital into income, though, that could readily change. Despite that, I'd run with the assumption that 40% of income might come from China in FY 2023 results, or run at that rate into next year's numbers - until there's evidence otherwise.

[skinny] 17/8/2023 18:13

FWIW - an update on post 1526 :-

[shalder] 17/8/2023 17:50

Yes, I have had that view put to me by a friend who follows PRC developments more than I do, so probably no need to rush in just yet. For the same reason I am a bit wary of the miners too.

[kiwi2007] 17/8/2023 17:40

Shalder - I don't think China's slowdown has yet been fully reflected in the local markets and certainly not in the ASX and NZX.

At the moment it seems to be felt in this part of the world that Xi is too proud to have to admit that things aren't going well but that in six months time or so he will be left with no option but to jump all in and turn things around. Until then it's a bit of a rocky road.

[shalder] 17/8/2023 17:09

Some useful posts above, thnx. My view is that this is one to trade (if anything), not buy & hold for yield. So, interesting right now if you think the PRC and related Asian markets are oversold on China worries.

[masurenguy] 17/8/2023 16:46

HFEL shareprice hit a 14 year low today !
No position

[2sporrans] 17/8/2023 11:00

HFEL still trades at an unwavering premium of ~3% to NAV; its dire underperformance merits a discount in excess of 20%.
Peers typically have discounts of over 10% while their total returns have suffered considerably less than HFEL.

This bizarre premium was largely what finally prompted me to reduce my holding, by about 1/4, back end of April, just before the XD date; about 260p/share.

Though i wish i'd sold the lot, i can't see anything fundamentally that wrong with the holdings, although i have a suspicion too much turnover has been happening, timing to maximise on underlying dividend payouts.
Obviously, this will exacerbate the poor capital performance.
As others have noted, it is as if any paring of the dividend is being averted at all costs.
Could it be that the underlying holdings are being churned to keep the dividend COVER in tact? i.e. the underlying divi payout being maxed by buying shortly pre XD and selling soon after XD?
That, plus the very significant contribution to HFEL's income derived from its options writing which likewise must involve some capital gain sacrifice, if only on the upside.

Seems to me these practices have been lent upon increasingly over recent years; beyond the long observed bias to holding companies that pay high but stagnant divis, rather than those offering divi growth.
Then again i've been goaded into closer scrutiny since the first stark underperformance v peers during the rebound from the [COvid] lows of March 2020 though into early 2021.
2021 was the first year HFEL did not cover its divi payout; possibly a greater recourse to ensure cover thereafter has been consequential.

[panshanger1] 16/8/2023 13:21

No end to the pain here But as they say everything has a price

[tim 3] 14/8/2023 14:44

I think they will do almost anything to avoid a dividend cut .. and there lies the problem.

[scruff1] 14/8/2023 13:38

The chart is really one Kerly and Duhra should be ashamed of and the boasts and claims on their official site have long since begun to sound hollow.
You are right Tim and the way this is continuing to go its going to take a fair bounce to get back to where we are today let alone back to the £3 days.
Another point in the article I read over the weekend was that companies (including Apple as I remember)have started to cut investment in China - I think they called it China plus, meaning that they were maintaining their plants in China but new investments were in Taiwan, Korea and other Asian countries. One of the main problems that they were having is Xi's increasing insistence on the Communist Party's inclusion and increasing interference in the boardrooms. There certainly isnt a lot to breed encouragement that there is going to be a bounce anytime soon.
My main thoughts I suppose are yes 24p is a good dividend - a 10%+ yield. We commented on the buyers earlier but as InvestingDad says retail investors have completely lost faith. If the buyers whoever they are also decide against and go into reverse we could be in trouble and especially if there is even a sliver off the dividend.

[skinny] 14/8/2023 13:23

I think I've said before, I bought in 2014 @318.59 and sold @323.09 in 2021 - it was a pretty 'sleep easy' income investment.

Unfortunately, I bought back last year @298, 288 & 270 and am now sitting on @20% loss - ho hum!

[investingdad] 14/8/2023 13:10

That is a problem. I think everyone here believes in a dividend and everyone likes a growing dividend, but it has to be sustainable for the long term.I know what you are saying - 5yr chart is horrific. To put it one way, we are closer to the 2008 price than the ATH.I think I would like the managers to be a bit more present like those in CTY and MRCH are. Hiding away based on their performance no doubt.

[tim 3] 14/8/2023 12:50

Am sure there will be some sort of bounce at some point but looking at the chart will take a considerable bounce to reverse that multi year down trend.I think the final straw for me is how poorly it has performed compared with others in the area and the arrogance of the managers who seem unconcerned about its dismal performance.It's almost as if all they care about is making the dividend attractive regardless of the consequences on capital.

[investingdad] 14/8/2023 12:42

Worrying to see how many retail investors are abandoning this. I hold concerns too - China exposure being one. You look at the top ten and they aren't poor companies, but that 21% exposure to China is a worry. Particularly now that sentiment of the Chinese Market is clear. There is a dwindling appetite in retail investors and hedge funds are moving out following the the China ramp late 22. China have manipulated this market. They have broken it themselves but their fix is yet to materialise. Lowering loans and interest rates doesn't seem to be giving the confidence the population needs. It will be interesting to monitor the next steps.24.4p per share (whilst it lasts), I think I will stick it out for a little longer. There will be some upside, China's economy is likely to grow more than ours for example but not as much as they have targeted.

[tim 3] 14/8/2023 11:38

Morning.

Sold all my shares in these this morning.

Similar reasons to Lord Gnome.

I basically no longer have faith in them and think its quite likely they will fall further.

Wish every one well who is still in.

[scruff1] 14/8/2023 08:11

kiwi
That last paragraph is interesting as I was reading something similar yesterday, cant remember where I'm afraid but the gist was that Xi doesnt understand economics and his wrong decisions and the declining economic conditions are affecting his popularity amongst the population. HFEL however according to their latest factsheet seem fairly satisfied that they are not exposed to the main Chinese black spots such as real estate and I think their most recent asset additions were in Taiwan. Why in 6 months?

[kiwi2007] 14/8/2023 01:57

Interesting to compare it to iShares MSCI AC Far East ex-Japan UCITS ETF (IFFF).
Given that IFFF only pays a 2% dividend I'd imagine that, over many time periods, HFEL outperforms it overall.

As for these large blocks that HFEL regularly sells. I wonder whether some are going to UK councils who borrow large amounts from the government, invest said cash into high dividend stocks, spend the divi but don't have to account for the decrease in capital (lack of auditing)? Any thoughts?

Thirdly, and last. It is thought by those that think they know here in NZ that Xi will be forced to reboot or kickstart the Chinese economy in around 6 months time.

[scruff1] 13/8/2023 17:35

One thing for sure is whoever is buying and however they are buying - they aint buying enough.
Interesting post by 'johnjunior' on LSE (at least I thought so - though I think the monthly factsheets supply some of the answers)

[fabius1] 13/8/2023 13:41

I think the simple trick is to monitor the latest recorded trades (not large worked trades) when the market is open, get a quote from a couple of brokers and factor in the spread and price discount/premium.

[panshanger1] 13/8/2023 12:38

Don't think you can take the ADVFN trading figures at face value Most of the time they get mine wrong!! with buys often listed as sales and vice versa