Scottish Mortgage Invest... Share Discussion Threads

[pockstones] 12/8/2018 09:06

Whoops absolutely right the performance stats are from 1995 to present so 23 years and over that time Scottish Mortgage has underperformed Herald which is long enough to form a judgement.
By all means invest in large cap highly rated American loss making businesses (Tesla being a particular favourite of Scottish Mortgage ) in a vehicle trading at a premium to net asset value but do not be surprised if it ends badly investing to misquote Buffet markets start off as popularity contests and end up on the weighing scales SMG depends on easy money valuations on a few mega cap stocks which they have ridden well leaving a rational investor with the question “And for my next trick?
You do not have that problem with Herald which is why it is the better investment prospect looking forward - and has been looking back to 1995

[quepassa] 11/8/2018 18:33

excellent post rrr.

both HRI and SMT are exceptional funds. Each in their own way is different and each has outstanding merits.

ALL IMO. DYOR.
QP

[rrr] 11/8/2018 17:12

But according to Trustnet:

In terms of both cumulative and annualised performance Scottish Mortgage (SM) has risen more over 1, 3, 5 and 10 year periods than Herald (H).

For example, in the case of cumulative performance, SM has risen by 465.8% in 10 years, H by 362.9%. For 5 years the figures are SM 224.5, H 128.1%. For 3 years SM 108.1, H 81.0%; for 1 year SM 31.6, H 23.4%.

Thus over all these periods SM does better.
The same is true for annualised performance.

Finally, Herald was launched on 16/02/1994. It is not possible to have a 25 year number for Herald yet therefore.

rrr

[pockstones] 11/8/2018 16:26

Quepassa both trusts invest in technology funds one has outperformed the other over one ten and twenty five years if investment is rational rather than emotional and funds are invested rationally you are getting more from Herald than you are from Scottish Mortgage. Furthermore as you point out the better performer comes with a greater margin of safety as it trades at a discount to asset value. Scottish Mortgage at six billion suffers from being too large to invest in small growth companies as Herald does. Buffet is right to point out that size becomes a handicap to investment success but the manager of Scottish Mortgage collects a fee based on the size of the fund managed. His incentives are not in your interests as an investor whereas Herald’s manager buys stock back when the discount widens despite this reducing her total fee but to the benefit of her remaining shareholders to my mind better performance and better values demonstrated. Anderson on the other hand markets heavily issues stock and increasingly invests in unquoted all possibly questionable. DYOR

[wetdream] 10/8/2018 16:51

Resistance at £5.60.
One more go next week perhaps?

[quepassa] 10/8/2018 07:41

Looks like Tesla's Board are taking Musk's proposals seriously and the Board will meet with Musk's financiers next week according to special report on CNBC:

hXXps://www.cnbc.com/2018/08/09/tesla-board-tells-elon-musk-to-recuse-himself-prepares-to-review-take.html


Tesla closed up in late trading yesterday.


ALL IMO. DYOR.
QP

[quepassa] 09/8/2018 20:44

I hear what you say but both funds are great in their own way. I was never suggesting that HRI was better than ScoMo as they are very different indeed. Nor was I ever comparing the two.

I simply suggested that HRI is a great fund too and somewhat over-looked with an undesevredly large discount in my opinion. HRI is smallcap media-tech UK and Europe. ScoMo is USA weighted.

Sorry to disagree but I think the outstanding thing with ScoMo is quite opposite to what you suggest. ScoMo did and does invests in companies which are juvenile and/or not yet in fashion such as Amazon when it was an unknown minnow, other companies when they are not even listed, Chinese companies like Baba when China was off-limits to most international funds, Tesla which was shunned by most investors in its early days.

The investing genius at ScoMo is that they correctly picked so many now dominant names when they were very small but which have grown to gigantic size. ScoMo had the conviction, foresight and risk-appetite to back them at an early stage.

It cannot be just luck that they backed so many early-stage companies which have become world-beaters.

And I don't think anyone would, could or should agree that Anderson is a momentum investor as you suggest. He is in fact quite the opposite.

Both are truly great funds in my opinion, run by exceptional fund managers in my opinion. I am hoping that HRI can tread in the footsteps of ScoMo and they seem to be doing a great job in the last few years.

ScoMo's performance continues to astonish.


Amazon is on the verge of joining Apple as the next trillion-dollar company but I fear that Baba will trounce the market caps of Apple and Amazon within just a few years.

It is not just by chance that ScoMo invested so heavily in these two companies.

Good Luck.

ALL IMO. DYOR.
QP

[pockstones] 09/8/2018 20:16

Quepassa could not agree more over one ten and twenty five Herald stuffs Scottish Mortgage the difference between the discounts reflects the Scottish love of blather Herald invests in small growth Anderson in high fashion momentum largely out of the states

[lollipop1] 09/8/2018 19:46

Amazon climbing

[wetdream] 09/8/2018 19:38

Just needs to clear £5.60.

[wetdream] 09/8/2018 12:20

Amazing-hardly a buy in sight.SP very solid.

[quepassa] 08/8/2018 18:37

I just can't figure out the discount-to-NAV on HRI when so many other smallcap funds are near par. The discount to NAV represents a real bargain in my view and ripe for compression.

Today Herald closed again near its recent June all time high at 1340p against a NAV of 1529p, being a gaping and generous discount to NAV of 12.5%. HRI is up more than 100% since early 2016 and going strong with a £billion in its portfolio. Compare that great performance to dismal Woodford funds.

Good luck on HRI - over time smallcap funds outperform and sometimes there are multi-baggers in the portfolio in the making - hopefully just like ScoMo's success with Amazon and others!

ALL IMO. DYOR.
QP

[spangle93] 08/8/2018 18:13

Steeplejack - a third observation ref Tesla

Most private companies held by SMT are surely because they can realise gains once the company lists, or if/when it is bought by a larger competitor.

If a company the size of Tesla went private, it becomes a harder route for ScoMo to liquidate value from its investment. It couldn't trade or sell the private shares (easily), it's hard to value its stake, no-one would take on buying it, and Tesla doesn't look like it will pay divvies for a while.


QP - thanks for the HRI pointer. I dipped a toe in recently after reading up. That track record is lovely if you own them, though a bit scary to buy in (!), but there's still a good discount as it's a growth share.

[wetdream] 08/8/2018 11:45

A close of day finish above 560p would be excellent imho.

[quepassa] 08/8/2018 10:35

Away from Tesla for the moment...


A recent July quote from perhaps the highest profile, most successful and revered fund manager in the UK, namely James Anderson of ScoMo fame:-


"To me XXXX may be the most important company in the world."


Try to guess to yourself before you read this article which the company is that James Anderson wrote this about:


hXXps://resoluteoptimism.bailliegifford.com/moores-law/


ALL IMO. DYOR.
QP

[quepassa] 08/8/2018 10:00

"If Tesla goes private,it’s more than likely that SMT continues to hold its interest"


two observations:

1. ScoMo's private/unlisted individual holdings are without exception all much less than 1%

2. ScoMo's investment criteria/guidelines/limits for investing in private companies would make it almost impossible for ScoMo to continue holding the same quantum/monetary value in Tesla.

all imo.dyor.
qp

[steeplejack] 08/8/2018 09:51

Over the last ten years,the number of LSE listings have halved.They have fallen by a third on Wall Street.Managements are fed up with ever burdensome government regulations and the short termism of fund managers albeit its difficult to parley with algorithmic trading.If Tesla goes private,it's more than likely that SMT continues to hold its interest.Musk might be crying wolf to shake the sceptic shorters but his possible privatisations plans are in vogue.

[quepassa] 08/8/2018 09:50

uapatel. thanks. good post. good food for thought.

for sure, you are right that the Chinese have immensely deep pockets and desperately want to go green and be technology leaders on all fronts.

an unfolding story.

all imo. dyor.
qp

[wetdream] 08/8/2018 09:39

Nothing wrong with the scrutiny of being a public company.
Yes, the City's short-termism can be a nuisance, but imho it's Musk's failure to understand the switch from niche to mass production and consistent failure to deliver on quoted targets, that's caused him some embarrassment.
If done correctly, the City will give a co. plenty of rope. Just look at Fevertree!

[uapatel] 08/8/2018 09:19

Just thinking aloud, but may be the opening up of a new plant and the Chinese need for a clean environment means that some Far East investors may be keen on getting onboard. Being a private company would offer less scrutiny on whom the investors are. Especially in an America First environment.

Could be barking up the wrong tree, but is interesting that if true how the US banks haven't a clue on the money side?

[quepassa] 08/8/2018 09:13

please elaborate as to how. thanks

[uapatel] 08/8/2018 09:11

I wonder if the Chinese deal may have more to it?

[quepassa] 08/8/2018 09:02

well, Musk said he had the funding in place.

who could do the funding? who knows. a major global US bank may be able to pull off a syndicated LBO of that magnitude. or a consortium of sovereign wealth funds. even perhaps a consortium of private equity investors.

Musk is a serious guy. the question for me is whether Musk would really tweet that out if there wasn't some substance to it.

reminiscent of Branson and Dell who didn't like the scrutiny of a being a quoted company who took their businesses private.

fascinating. shorters scorched for sure.


all imo. dyor.
qp

[quepassa] 07/8/2018 21:27

Big question how Musk would come up with the mega $66billion to pull off the take-it-private buy-out at a suggested $420 per share.

Some are saying a less than one in three chance.

However, Musk is a man capable of shooting for the stars in my opinion - and likely getting there.

A moving and evolving story but the latest from trusted Bloomberg:


hXXps://www.bloomberg.com/news/articles/2018-08-07/tesla-jumps-on-report-of-saudis-building-about-2-billion-stake


ALL IMO. DYOR.
QP

[wetdream] 07/8/2018 21:18

Tesla shares suspended.
Comment from BBC website:


Analysis by Kim Gittleson in New York
Elon Musk has had a difficult relationship with stock market investors - and been particularly angered by so-called short sellers, who have made record bets on the ultimate collapse of Tesla.
On Tuesday, those same short sellers were threatened with big losses after he tweeted that he was considering taking the electric car maker off the market and back into private ownership.
The messages sent the share price surging before trading was halted. But it bears noting that Mr Musk is known both for his erratic outbursts and for his quirky sense of humour.
Both have been frequently on display as Tesla has struggled to hit production targets. That's briefly left some wondering if this is all just another way of turning attention away from the fact that Tesla has yet to turn a profit.