Jpmorgan Global Core Rea... Share Discussion Threads

[mwj1959] 09/12/2024 17:09

Red over camomile definitely!

[affemoose] 08/12/2024 20:10

lol, thank you mw :-)

There are certainly some chunky trades going through in the last few days, though hard to see details as they are off book.

I shall sip my camomile tea, pull a face as it tastes like lawn clippings, and reach for a bottle of red to calm my nerves !

[mwj1959] 06/12/2024 16:15

AM - don't get too grumpy!
I agree that the timescale is disappointing, but there was always the risk that this was going to be the case. But I also agree that they have been slow in getting to where we are now. I don't know whether they could have gone faster. There may have been regulatory constraints. Liquidity will undoubtedly deteriorate, but that is always the case in these sort of liquidations. And it may create opportunity if the discount were to widen materially. I can probably live with this, given that I will have most of the NAV returned by then. My bigger concern revolves around a material drop off in the NAV, which is an undoubted risk given the nature of the assets. As I've said in an earlier post there is a potential opportunity cost hanging around for the full return, which from an 80p share price is relatively modest. A source of cash undoubtedly if better opportunities materialise elsewhere.

[affemoose] 06/12/2024 15:14

It's been a few days since the circular and I must confess I am still annoyed about the timescale for asset sales. This is not what we understood in the initial information shared with us. I know there were caveats etc but I was rather expecting the delays to come later not before the resolution at the EGM has even been passed!!

If i'd known we'd have to wait up to 24 months, or longer, to see the asset value returned to us (with possible movement up and down of course) I may have voted differently in the discontinuation vote purely from a liquidy perspective.

As this sale process drags on - the liquidity will fall off a cliff, Spreads will become huge and the cost of exit at any stage will be correspondingly higher.

I am Grumpy from London.

[affemoose] 04/12/2024 15:54

Message from Company Secretary - you were, of course, correct mw - the estimated payout rates in the Circular did include the liquid assets in the first payments.
The remaining unpaid at end of CY 25 is indeed what will probably, maybe, be paid by end 2026.

I agree with you re: North of 80p SP

Good luck CWA1!

[cwa1] 03/12/2024 17:18

FWIW I've decided to duck out with a decent profit and hope I can spend the money wisely on any one of a myriad of other tantalsing investments. Risk and reward much more closely aligned now than they were and I HOPE to outperform the dollop I left on the table for the next man. Good fortune to those that stay

[mwj1959] 03/12/2024 17:11

Your 5% yielding share could go down as well as up and I suspect is almost certain to be more volatile than JARA's NAV, but ultimately its all about opportunity cost of remaining in JARA, particularly at the current discount. If it was at 30% it would be a much easier call!
There will still be some dividend income coming in, but not being paid out, and it would be interesting to know what the various private UCITs actually yield. So let's say a further 2-3p accrues over the remaining life of the trust. This would add a little bit more upside to the NAV, albeit some of it would be used to cover expenses etc. Flip side of that is that moves in the underlying assets/currency are ultimately going to be more important variables in determining the final return.
For now I'm probably going to hang on, but if the share price was to move north of 80p I'd definitely be tempted to unload some. Where to put the money is the next challenge. All my holdings are in SIPPs/ISAs, so there is no issue around holding higher yielding assets, whether they be equities, trusts/funds or FI. Depends how much risk one wants to take.

[affemoose] 03/12/2024 16:50

What my last post doesn’t factor in of course is the retained Dividends and any impact on NAV

[affemoose] 03/12/2024 15:21

I've just done some Excel modelling comparing selling all today vs. waiting 2 years

IF I sold all JARA today and bought a 5% yield share elsewhere I would end up after 2 years 3.225% down compared to if i'd waited for the JARA asset returns to finalise in Q4 2026. So Jara is offering a 3.225% premium to selling and buying elsewhere.

this is assuming JARA NAV's hold at 90pence per share. Obviously NAV of assets can go up and down etc etc - and nothing is guaranteed.

BUT... not exactly compelling is it??

IF we had all our cash back by Q4 2025 i'd be looking at a 7.84% premium by holding JARA.

Any suggestions?

[mwj1959] 03/12/2024 10:09

This, I'm afraid, is the problem of holding illiquid assets via open ended vehicles. We're not going to be the only one wanting to get out (we hold less than 5% in all these vehicles), so there is going to be a queue, a fairly long one in some cases. We've seen similar in all the open ended UK property unit trusts where its taken years to finally be able to get out.
Once the EGM has passed and all the redemption requests have been put in the Board should be in a position to provide much more granularity as to when and from which vehicles we should receive payouts. But, even then, it is still likely to be a bit of a moveable feast.
If you sold now at 78p you'd be doing so at a 14% discount. Tempting I guess, particularly given the higher yields and wider discounts available elsewhere.
As I've said before there remains plenty of NAV risk here too, both from an asset and currency perspective.

[mwj1959] 03/12/2024 09:43

I agree that it is not clear! My interpretation is that there will be a meaningful distribution after the third one, which will be the remaining 15%. But let's see what the Company Secretary says...

[affemoose] 03/12/2024 09:36

I am very tired of these ambiguous comms.

end of 2026 is, as you say, far far away. Far too long tbh. This blows all previous estimates cleanly out of the water (was assumed complete by Q4 2025 +/1 1Q). I am interested in exactly what the issue is, what they have found out/discovered etc - why the change now? What asset is proving tough to offload and why?

This changes the landscape somewhat doesn't it......

Sell now and get approx NAV minus 10%

Wait up to 2 years to get NAV, whatever that NAV may look like in 2 years.

I assume there will be heavy selling after capital return at end of Q1 2025 and final flurry of selling Q3 - nobody in their right mind wants to hold a dead asset paying management fees, listing fees etc until end of 2026.

[affemoose] 03/12/2024 09:28

Sorry MW - I should have been clearer in the post above, my values include assumed liquid assets.

But you are right of course - the Q1 values ARE the liquid assets

Original RNS values are below:

Return of capital to Shareholders

Approximate per cent. of NAV

Estimated payment date*

#1

15-20 per cent.

Q1 2025

#2

30-35 per cent.

Q3 2025

#3

25-30 per cent.

Q4 2025


As you can see - 30% + 35% + 20% = 85%. Not 100%! 15% left on the table

[mwj1959] 03/12/2024 09:22

I see what you mean. But if you read the text it says that these are the first three tranches and that any final distribution will be done by the final quarter 2026 (a long old wait!). It will be just the liquid assets that are distributed in Q1 25.

[affemoose] 03/12/2024 08:56

Shareholder Circular is out - check the RNSs.

EGM on 20th December to vote

Looking at the asset realisation and capital return dates and amounts...

Doesn't take a maths genius to add up the returns they list against timeframes and realise that MAXIMUM that they are listing for return is 85% - what happens to the remaining 15%+ ???

I can only assume that their insistence on treating the 15% liquid assets as separate to the illiquid assets will be returned on top of the 15-20% slated for Q1 2025. If this is the case they have failed to give a return date for this liquid portion.

Why they do not include these in the numbers is a mystery and, frankly, annoying.

Assuming that this is the case:

30-35% Returned Q1 2025 (incl assumed 15% Liquid Assets??) - (original value given in RNS is 15-20%)
30-35% Returned Q3 2025
25-30% Returned Q4 2025

I have emailed the company secretary to check.

[mwj1959] 02/12/2024 12:30

I've just got a response from the Company Secretary who confirms that the 15% in liquid assets is included in the 50-60% that should be realised by the end of Q2 25. She wasn't able to disclose what funds made up the rump of that number.

[affemoose] 29/11/2024 10:49

I have asked myself the same question re: the 15% listed real estate - their comms are not the clearest. I have a feeling that these 15% are part of the 'easily realisable' elements but.... why call them out?

Confusing

[mwj1959] 29/11/2024 09:22

It would be interesting to know what parts of the portfolio would make up the "approximately 50 - 60% of the Company's portfolio that could be liquidated by the end of Q2 2025". Does it include the "approximately 15% invested in listed real assets and other liquid securities that are easily realisable.", which we should get a large part returned to us in January at the latest. I presume it does, but I'll ask the Company Secretary to confirm.
We should also remember when looking at the NAV that 60% (21% Infra, 21% Tpt, 17% AP RE) of it has valuations as at 30 June, so not particularly timely.

[affemoose] 28/11/2024 16:27

While it drags on ..... fees are being earn't.

Asking them to speed this up is like asking a Turkey to vote for Christmas i'm afraid mw

Gobble Gobble Gobble

[mwj1959] 28/11/2024 11:02

I suspect this is going to trade around this level until we get nearer the first realisation date, unless there is a significant move in the NAV, either up or down. This the problem here...we're going to be exposed to NAV risk for a considerable period of time. This was always likely to be the case, but I do believe that this whole process could be progressing faster than it is.

[affemoose] 27/11/2024 10:13

On another note - CORD have had a very strong update if anyone is interested. You can do your own homework but one standout point that certainly gives me heart:

"Three million additional shares acquired by the Company Directors, the Investment Manager and staff, since 31 March 2024, including 2.6 million by Steven Marshall, Chairman of Cordiant Digital Infrastructure Management. Total ownership now at 1.8%."

Skin in the game is a vital indicator to make sure that management is aligned with us plebs. I like.

[affemoose] 27/11/2024 08:38

Circular regarding Wind Down Early Dec, Extraordinary General Meeting later in Dec.

50 - 60% of the Company's portfolio could be liquidated by the end of Q2 2025

Divi on 29th Nov will be the last Dividend. All following distributions done via Capital Return.

[mwj1959] 20/11/2024 13:52

August factsheet has 58% in US$, 22% in £ and a mish mash of other currencies.

[affemoose] 20/11/2024 11:06

Good points being made - many thanks.

The £:$ exchange rate was hedged to some degree so this may be the variance in pricing of NAV vs. Exchange changes?

This is a 'Tumbleweed Stock' now - we just wait as it rolls along, nothing much of any interest outside asset sales etc. - where things end up is of course at the mercy of global winds - primarily $:£, Inflation and Asset valuations.

The only major thing we really really need is information on wind down plan and for them to just get on with it.

[mwj1959] 18/11/2024 14:19

19% discount based on this NAV, which would have been boosted a bit by the further £ weakness (c.2%) vs US$ MTD. Interims later this month should hopefully put more meat on bones of winding up. Without that difficult to see share price moving much higher from here. Lot of other real asset vehicles struggling against backdrop of higher bond yields. A trend that I suspect will be with us for a while unfortunately.