Manchester & London Inve... Share Discussion Threads

[thruxie] 29/3/2021 18:00

Twitter @MLCapMan

[jfinvestments] 29/3/2021 16:26

What is there @ on twitter?

[thruxie] 29/3/2021 11:51

@JF I agree. From reading through their past reports I'd surmise they are betting on a strengthening of the China/Yuan over time so yes.

They are active on Twitter with a few posts about the recent drop and calls, worth following.

[jfinvestments] 28/3/2021 15:58

I still think this will be worth more money in ten years time. China's growth isn't stopping anytime soon so I presume he is backing their currency to strengthen? Seems a safe enough bet over the longer term?

[thruxie] 28/3/2021 14:34

Well, time will tell. Rising interest predictions and a general rotation into cheaper value. It's possibly going to be an interesting 12 months ahead.

[riskvsreward] 28/3/2021 12:50

I would not like to see the manager speculating on forex. It has already exposure to yuan with holdings in Tencent and Alibaba. So the risk is on the yuan depreciating not appreciating. Betting one way only is gambling. This is a high growth tech trust so the focus should be to select best companies in the tech sector.

[riskvsreward] 27/3/2021 06:51

Its Feb./21 portfolio shows about 3% from derivatives which I take to be covered call options sold. It has about 8.5% gearing.

It is weird that the manager borrows 8.5% to have a 8.5% bond holdings of iShares China CNY Bond ETF in a growth focused technology investment portfolio.

Looking at the ytd, 1yr and 5 yr performance of this bond etf, its return is negative or less than 10% over 5 years.

[riskvsreward] 26/3/2021 14:49

I think the manager takes a longer term bullish view but also a view of possible short term correction and volatility, as well as the differentiation from other tech trusts of it paying a dividend.

Therefore it may under-perform a fast moving bull market of last year but it will outperform in the current tech. market of a correction.

[fez77] 26/3/2021 11:45

Thanks all. I'll pop some cash in once I've got some free.

[thruxie] 26/3/2021 10:56

@vacendak agreed!

OK so I've been scouring the accounts and reading up to try and get my head around this negative press about calls. Questor touches on it but doesn't really explain.

The way I understand it is that, they had a view say that the market was going to drop. They sold calls 20% higher than their then current positions. However the market continued to rise so they had to buy back at a higher rate and made a loss on that trade. Conversely if the market had fell they would have protected their previous gains and made a profit? So basically they hedged their portfolio and if right they'd be praised as geniuses ;)

A little bit unusual as they're perhaps acting more like a hedge fund than a trust hence perhaps the volatility. But feel free to correct me if I'm wrong about this or you have other information.

[vacendak] 26/3/2021 09:19

Tech and China have been hammered lately, look at BGCG which is pure China for an example, so no real surprise that MNL's boat is being rocked a bit.

[thruxie] 25/3/2021 21:01

@Fez a lot of the time the director buys are because the fund is smallish so the manager buys (and sells) to increase liquidity. However not to say the manager hasn't got skin in the game - he owns about 51% of the trust.

Some of the recent underperformance has been attributed by the manager to not holding Tesla and smaller tech stocks.

Personally I hold for their high concentrated exposure to FAANG stocks plus Alibaba and Tencent.

Highly recommend their website.

[jfinvestments] 25/3/2021 21:00

From what I can see it has out performed BUT on the 3 and 5 yr. 39.42% compared to 31.45 and 197% to 103%.I liked their top 10 and holdings in general. I still do. I liked they didn't have Tesla. Though that view hasn't quite helped me yet.

[thruxie] 25/3/2021 20:47

I took it for granted they were selling capital to pay the dividend as the underlying holdings are more growth orientated low dividend payers. I believe JP Morgan do similar in both their global and Asian income and growth trusts.

However best to keep and eye on it. Looking at the markets today, it looks like everything was selling off!

[fez77] 25/3/2021 20:45

New to here. Spark of interest from Director buys.

Can anyone advise why they have made a loss over past 3 years?

Also why would you buy them in preference to - BUT (Brunner Investment Trust) who have made a profit over past 3 years and actually trade at a larger discount to NAV?

[jfinvestments] 25/3/2021 19:14

I think it is less of a worry if you think 5/10 years time. Those companies will continue to grow. The market is just in panic mode about most things. I'm holding for the time being, but if there's a full correction and the board are transparent about options trading then I will add to this. It'll be cheap and has good companies.

[pugugly] 25/3/2021 17:38

Auffering - If pundits right that USA is flipping away from tech to Value possible will continue to fall and siscount widen - but what do I know!!

However watching in case flipping pundits wrong.

[jfinvestments] 25/3/2021 17:22

The problem they explained was that they are selling the shares for call options for short term cash (use for dividend). Then getting them back , but possibly paying for the call option too.Essentially saying it is over complicating. Without it there would have been solid growth and with it, less.I think I will see how far this goes and how the board respond before buying more.

[thruxie] 25/3/2021 11:56

A lot of the criticism I've read elsewhere compares this trust to Scottish Mortgage. However the fact MNL avoids the Tesla and unlisted tech bubble is precisely why I prefer this. However I'll see how this plays out over the coming months but happy to add more on weakness.

[digitaria] 25/3/2021 11:50

Thanks, yes I make it about 12%. Which is historically an unusually wide discount.

[digitaria] 25/3/2021 11:27

Telegraph piece is here



worrying comments from Alan Brierley at Investec, suggesting that investors are not seeing the gains they should be.

M&L issues NAV updates weekly on Wednesday, but the link on the LSE site for yesterday doesn't work. Does anyone have the NAV issued on Wed? The trust is probably on a sizeable discount at this point.

[thruxie] 25/3/2021 11:26

It'd certainly be an interesting read but behind a pay-wall. However looking at some of the big underlying holdings eg: Amazon, Microsoft, Baba and Alphabet. All forecasting double digit growth and available here for a discount.

So I'd beg to disagree with Questor on this one :)