Record Share Discussion Threads

[robsy2] 23/2/2016 13:40

ticking up nicely.

[trident5] 10/2/2016 20:49

Thanks for the really helpful comments guys, especially TMFM - I somehow contrived to miss that when looking at the accounts.

[dangersimpson2] 10/2/2016 13:16

I'm not sure how much that would work. It does with insurers since the law of large numbers says that if you increase the number of policies the mean outcome remains the same but he standard deviation reduces hence the variability of the final outcome is lower and you have to hold less capital per policy. Would that work with REC's currency hedging strategies? It would be a good question to ask management.

[boonkoh] 10/2/2016 13:04

This pro ably makes REC an interesting acquisition for a strategic investor in the same sector. Absorb REC's regulatory capital requirements into their own, and free up this cash. Pays for a big chunk of the acquisition.

[tmfmayn] 10/2/2016 08:26

Note 25 in the 2015 annual report says regulatory capital is £8.8m and other operating capital is £20.5m, giving operating capital of £29.3m.

The same note describes operating capital as "intended to cover the regulatory capital requirement plus capital required for day to day operational purposes. The Directors consider that the other operating capital significantly exceeds the actual day to day operational requirements."

Also, page 26 of the report says:

"The Board’s policy is to retain capital (being equivalent to shareholders’ funds) within the business sufficient to meet continuing obligations, to meet regulatory capital requirements, to sustain future growth and to provide a buffer against adverse market conditions. To this end, the Group maintains a financial model to assist it in forecasting future capital requirements over a three year cycle under various scenarios and monitors the capital and liquidity positions of the Group on an ongoing and frequent basis. The Group has no debt."

[dangersimpson2] 09/2/2016 22:55

Most of it is regulatory capital.

[trident5] 09/2/2016 22:24

Does anyone know why they're holding on to so much cash on the balance sheet. Thanks.

[topvest] 07/2/2016 09:09

Had a quick look at these...

hxxp://www.wisdomtree.eu/article/1049/wisdomtree-launches-flagship-currency-hedged-etfs-on-the

They certainly look an interesting opportunity. About US¢200M under these two ETFs from what I can see.

[topvest] 22/1/2016 07:56

What about this....
"At the end of the quarter, Record entered into a licensing agreement with WisdomTree Investments, Inc. to provide currency signals that will be used to dynamically hedge currency exposures within WisdomTree's rules-based index family. WisdomTree Investments, Inc., through its subsidiaries in the U.S. and Europe (collectively, "WisdomTree"), is an exchange-traded fund and exchange-traded product sponsor and asset manager headquartered in New York. Record is optimistic that this development will allow dynamic hedging strategies to be accessible to a wider range of investors than has been the case thus far."

[topvest] 22/1/2016 07:52

Pretty good I would say. Due a large rebound today. Particularly like the increase in the return assets and positive news on that front. That's the area that makes all the difference if they can widen the appeal of this asset class particularly with the divergent monetary policies now in place.

Also with the $ at 1.40 the £ numbers will be looking much better and offset some of the recent weakness. Cracking buy opportunity at this price.

[wjccghcc] 22/1/2016 07:44

Those figures don't include the dynamic hedging mandate suspension of $500mm. Otherwise, not too bad.

[robsy2] 22/1/2016 07:33

I have had a quick look and I can't see anything bad there, fund performance postive , aum static , margins static ....?

R2

[robsy2] 15/1/2016 19:46

hmmh a bad day , off the bottom though ....

hxxp://ir.recordcm.com/share-price-information/share-price-chart

R2

[bdroop] 15/1/2016 19:25

I'd buy more but I've already got loads!

[topvest] 15/1/2016 19:12

Great top up opportunity- this pull back is well over the top. Tempted but have quite a few.

[muji1983] 15/1/2016 14:57

Does anyone know why is that happened?

[142minty] 15/1/2016 13:52

This is bad - down 17%.Is this seller done yet?

eek

[topvest] 07/1/2016 20:39

Yes, agree - total over-reaction to the couple of mandate changes in the last quarter or so. Would top-up myself but I have enough already. One big contract win would certainly help. I do wonder whether at some point the currency for return product will also come back into vogue. That is the product that will really make these shares motor but it just hasn't done very well since the global financial crash.

[142minty] 07/1/2016 09:06

certainly a buying opportunity. A 10 - 12% drop in share price given the value of that mandate to the business is completely over done and its not like it has been cancelled completely anyway. Yield still good and macro backdrop with more divergence in rates is increasingly creating an opportunity for carry trade which we haven't seen in a number years.

[robsy2] 07/1/2016 08:42

I've bought back in at 25.35, the yield is now nearly 7%. There is plenty of cash.
Reorganising a 500m mandate doesn't sound that catastrophic/material...
so a 12% discount on yesterdays price looks like a buying opportunity.
They are punished for being too transparent.

[topvest] 07/1/2016 07:49

Another bit of bad news for Record, albeit it's just another bit of short term business coming in and then going out again. That's two short term mandates that came in last year and went out again. Hopefully, they will secure some longer term business soon now that the US have raised interest rates. There is also a chance these mandates may come back at some point. Forex and interest rate management is a real issue for businesses and so the background environment is better than it has been for 4/5 years. They obviously need to win some more mandates to keep the business growing. I will keep patient with this one as they are a good business and well run.

[felix99] 08/12/2015 12:39

Shareholders will always earn second here from what I have seen - and despite favourable environment to pick up mandates they seem to lose as many as they win , net result not a lot of progress for shareholders, whilst the salaries keep being drawn regardless.

[chrisdgb] 08/12/2015 12:11

Just going through the report and accounts, some tasty salaries on offer..!!

[topvest] 01/10/2015 14:57

That's a disappointing client loss but at least it won't take effect for a few months. Trouble is this is higher margin business and c10% of their dynamic hedging book. Need some contract wins I guess. Still think this is a good business and these wins will no doubt come sooner or later. Happy to hold.

[robsy2] 01/10/2015 08:56

I have sold down my holdings.I'll stay on the sidelines for now. There has been much talk of engaging with prospects and clients but the clients seem to be leaving.... so I am as well for the time being.
R2