Smaller Companies Value Trust Share Discussion Threads

[bunz3] 14/9/2020 14:37

shorting some times risky ,each to their own decisions

[supernumerary] 15/10/2008 19:05

Technicals mean nothing for cra - if dgc works, there's no limit to the upside, if it doesn't it's just another interesting engineering company with a niche market. I am confident dgc works. But of course could be wrong, lol.

In the medium term (

[praipus] 15/10/2008 18:31

CRA looks interesting, I like the IP asset view. Engineering is not an industry I'm close to and in recession I could imagine it getting hit.

Market to book ratio: 6.5 is high, it is best to look for less than 1.
Current ratio: 16 anything above 2.5 is good.
Market cap: £35.8 mill, too low for some institutional investment they prefer >£50m
Dividend: None
Profit history: None

If we are heading in to depression/recession apart from speculation it may be better to look at companies that offer dividend's and a profit i.e.Utilities not that they are without risk i.e. Enron etc.

NWG, DVW, UU., PNN, SVT, NG.,IPR, SSE and for renewables RWE and REH.

That said I have no holdings showing a profit so what do I know. Good luck.

Edit: second thoughts re:CRA are you long or short?

[supernumerary] 15/10/2008 17:37

I've got no knowledge about nor interest in the trusts themselves - it's all a bit lacking in transparency for my taste. Just hit on this one trawling around top winners and losers our of curiosity, then it occurred to me there might be some useful hints on the underlying stocks.

Not a trader at all, but have come to the conclusion that buy and hold doesn't work on aim. Everybody trades on sbs or cfds so they all have stop losses in place; if you don't you're left without a chair when the music stops. Didn't want to spend my days in front of a screen, but seem to be doing that anyway, beginning to wonder if I shouldn't take advantage of it.

csd was obvious even then - they never had a market that would generate the sales to justify the market cap. I swapped a few posts with tradx666 at the time on that board - he took the short, I didn't, but I was as certain as you can be that it was going down, although I never anticipated 10p. Now it looks like a straight punt whether Farleigh takes them over, but there won't be much in it I don't suppose even if he does.

Have a look at cra if you haven't done so. I'm confident there'll be good returns over the next year or two - most of my spare cash is already in there...

[praipus] 15/10/2008 16:52

Very interesting. I've had some luck buying split capital investment trusts with less than a year to run and showing a minimum share price discount to NAV of 20%. Some over 100% profit (not without an emotional roller coaster) some losses some breakeven. However the plan goes out the window when the whole market shifts down 40% in less than a year!

Though if you are short already in the way you describe no problem.

I've been shorting with CFD's but without much success mainly due to my own falability, still learning.

Risks:
1. The trust winding up may roll into a new vehicle.
2. The trust may be taken over by another.
3. Trust shares holders accept underlying stock in leu of cash (I have never seen this but you never know.

Positives:
1. If one of the shorted stocks falls a lot then it may fall out of the index the fund tracks.
2. If the market move up a lot any loss on your short position is partially covered by the holding in the trust.

See what you mean about CSD you imagine with hindsight it was obvious. Do you think they are a good company still and just misundertood or are there issues there?

[supernumerary] 15/10/2008 15:13

Sorry - didn't see your charts, our posts must have crossed. Scary isn't it? I wouldn't like to be sitting there facing that lot, knowing that I've got to cash in half my portfolio. Not his money of course, which eases the pain a bit, lol.

Never shorted myself, but am very occasionally tempted. I still regret not shorting csd - nominated about two years ago as my short of the year at over 200p and fallen in a nearly straight line ever since, now around 10p.

It's the safety aspect that bothers me more than anything, but I've noticed in the past that forced sales by institutions have resulted in the biggest and most predictable falls I've seen. So when someone is obliged by their rules to create such a position, it's worth looking at more closely. Just musing really...

[praipus] 15/10/2008 14:15

Post 6 shows the top ten as at June 2008. None look worth going long of thats for sure.

The only thing with shorting is in such a volatile market you could get it horribly wrong and lose everything but that is some times a very exciting way to trade...lol

[supernumerary] 15/10/2008 13:47

Praipus - not got anything like that far yet, just interested in whether anybody else had gone down that route.

They list their top ten holdings in the pdf, which is about 30% of the portfolio, so I guess one or two of those would be worth a glance. I'm not sure if there's any more information about the fund holdings, but I'll be keeping an eye on the situation and may do some research early next year.

[praipus] 15/10/2008 13:42

Top ten as per 30 June 2008

[praipus] 15/10/2008 13:28

Thanks supernumeracy. Interesting idea. Which stocks did you have in mind for the short list?

[supernumerary] 15/10/2008 12:10

'Is the NAV statement showing NAV with the income shares fully paid?' It appears to show nav separately for income and capital? It's a decent discount to capital nav, but whether that nav is actually realisable in the current market is another question.

Given that they're committed to repaying the income shares in April, I've been wondering whether there isn't a shorting strategy against the least liquid companies in their portfolio? Naughty but I expect the hedge funds are already on the case...

[praipus] 15/10/2008 10:06

Is the NAV statement showing NAV with the income shares fully paid? And has the spread always been so wide?

[washbrook] 10/10/2008 10:01

Now 43p bid-50p offer