Kool Keith
25 Aug 2017
Re: Difficult to Rationalise Only to be expected games, if in a fullers pub doing 'research' at this time of the day
gamesinvestor
25 Aug 2017
Re: Difficult to Rationalise Oh Dear, haven't had my coffee yet."Unfirtunately" ----> Unfortunately"like" -----> line"post" -----> potsGames -- wake up man!!
gamesinvestor
25 Aug 2017
Re: Difficult to Rationalise " it would be interesting to know how those get valued on a monthly basis"Ocean, A friend and I, working hard in a Fullers Pub in London, at the time -- where much high handed investment thinking tends to take place - came up with an exact similar view.We think Woody is basing the ""growth"" in his funds valuation largely on the basis of these unquoted companies.We also concluded, correctly or otherwise" that as he's so utterly useless at identififyng good companies to invest in and when he invests in the useless ones, he does so at the top of their cyclical trends, he needs a mask.That mask is the jiggery pokery around the unquoted element, that the market can't decide for him.Unfirtunately for Woody, like Madoff, eventually you get found out.The investors in his 3 (in many ways similar) funds could be in for a very big shock a few years down the like when the proceeds of their ISA money or the regurgitated cash from their pension post starts to look a little green around the gills.Games
oceanfree
24 Aug 2017
Re: Difficult to Rationalise Commenting on Woodford - "45 of the list are unquoted companies in an equity income fund"Yes I saw that - it would be interesting to know how those get valued on a monthly basis. I would imagine good valuations are important at the moment.If Woodford invests more in secondary funding rounds, does his earlier stake get revalued to that level. What about at other times? How on earth do you value an early stage pharma company possibly with no income.I dont invest with Woodford, but if I did I would be reverse engineering his portfolio breakdown to see whats going on with the non-listed investments and see how significant they are.
gamesinvestor
24 Aug 2017
Re: A Woodford Fundholders Response "in some ways a 40% fall in prices would be a fantastic - especially for the next generation "nimbo - it would for sure, as the social divide from an economic perspective is soooo wide now it's gotten scary.I don't give a monkey's about my house being worth an eye watering amount - it's my kids and those little one's they have that the problem exists for.The pressure is immense because they both have to work, as a couple, to even consider a mortgage and even then I'll have to hand them a wad of cash to get going.Games -- I suppose it's never been that different except it's currently off the reality scale right now.With all the robots coming in what's the chance of the average salary becoming not £27K but actually start to go backwards -- something has to give!
nimbo1
24 Aug 2017
Re: A Woodford Fundholders Response Hi Games, sorry shouldn't have made a throw away comment like that without clarifying. Cleary a £300k house in suburbia isn't 20% down. Finance is available and affordable for some areas of the market. I am under offer on a place outside of london within an hour on the train for almost exactly 20% off the asking price from last year. Anything in the higher stamp duty tax bracket and all but the best properties have seen 10% falls and the extra stamp duty taken into account. My experiences of looking at the london market in the last couple of years suggest an even greater fall depending on the type of stock you own in particular from the 2014 highs. E.g. If you purchased one of the new 2 bed flats around battersea power station for 1 mil + good luck even shifting it yet alone worrying about the price. Ive sold 2 things in the last couple of years (not new build flats) and it was very hard going to say the least. Please don't misinterpret this as me complaining. Other than the pain it would bring to those who own their houses and the economy (and lloyds and woody!) in some ways a 40% fall in prices would be a fantastic - especially for the next generation - even the playing field and make them feel like they have a chance and all that imo.
gamesinvestor
23 Aug 2017
Re: A Woodford Fundholders Response "House prices are now 20% off"Nimbo -- that's stretching the paranoi a bit m8.House price stalling or potentially falling has nothing to do with the Brexit vote or anybody else's vote for that matter.It does, however, have everything to do with very simple economics and I'll list them for you below:-1. Interest rates have been held below inflation for 10 years -- something that has NEVER happened in 300 years of the BOE's history -- due to global events.2. The UK housing market has been pump primed by both previous and current governments by the use of "Funding for Lending", "Help to Buy" -- track the share prices of Taylor Woodrow, Barrat Developments -- these two companies shares were flat for many years and then rose inexorably when HTB was introduced and their house buying trick was effectively derisked by the tax payer to the tune of 20%.3. Quantitive easing -- has fed into asset prices pump priming them to a point of almost stagnation in that they have nowhere to go.4. The recent changes in stamp duty introduced by George Osborne has had the following three effects :-a) The second home has been discouraged for new buyersb) The Buy to Let wannabies have suddenly started to get cold feet.c) The Foreign buyer has had his company based purchased penalised with an equivalent or a 15% tax on his purchase of property through a company.5. The government has announced (and wil introduce in 2019) a policy that will not allow a shell company, or more importantly an offshore shell company to buy a property in London or any part of the UK without disclosing who the beneficiary will be -- so money laundering and secrecy has just got 10 times more difficult.6. the government has introduced stricter rules on BTL property owners in it's tax declarations making it more difficult for property owners to add in offsets against their income :-namely :-a) Wear and tear at 10% is no longer allowedb) Interest on loans are now to be tapered down to the point that marginal profits on leveraged house rents is going to all but drain away.c) The government is reducing the allowance to credit against renters that can't pay themselves - housing benefit cap.7. House prices have risen so much in the last 10 years than they represent a very high risk to the renter, the buyer and the want to be property owner -- In 100 years the average property price has been 3.5 to 5X the value of the average single main salary.Right now it's standing at 8.5X -- almost twice the 100 years average, mainly due to falsely low interest rates - duping the public into thinking loans are cheap -- when in reality borrowing at low interest rates and at a time of low inflation is actually very expensive because your loans never get inflated away as they have historically.8. Salaries over the last 10 years have not kept pace with inflation so disposable incomes have declined every single year for the last 10.9. Living costs have outstripped salaries making it harder to fund mortgages -- utilities have risen above inflation, council tax, VAT, Road tax, Insurance Tax, as have rail fares, running a car etc.I can stop there m8 -- because the ludicrous situations we are in have nothing to do with Brexit and everything to do with the fact that the UK is in a world situation that is not unique to the UK but is ever present in the EU -- look at Spain, Italy, Portugal, Greece who's youth unemployment averages 25%+, killing the future of their countries becasue they are trapped in an unrealistic and unsustainable currency.The protectionism of the EU has caused it to decline on a world scale econonically every single year for the 44 years of it's existence and until it is disbanded it will continue to do so as it's a protectiist and expensive failed experiment.Even the founder admits that a common currency was a mistake when you don't have commeon fiscal policy and debt sharing --- something the Germans will NEVER agr
nimbo1
23 Aug 2017
Re: A Woodford Fundholders Response we are in agreement on all of that : )
Bill1703
23 Aug 2017
Re: A Woodford Fundholders Response "... I believe many companies which now look like value plays will not be here in 10 years + time.."Fair points, nimbo. I think some won't be here... though whether they actually go to the wall, or get bought up by buyers perhaps better placed overall across their business, is one key consideration - certain brands and assets will always be attractive, and may still prosper in a bigger, or better portfolio. And plenty WILL still be here, I'm pretty sure... corporate history is one of constant change and evolution, adapt or die, it is merely that some do it better, and faster. But as to which ones are still here and which don't make it, that is the harder question... and it is both the 'value' investor's challenge, but also his/her opportunity!In a similar vein... I don't see the currency reversing either, not any time soon - but how much of that is already in the price? Or at least, some prices... the market often moves quickly to discount, if not necessarily the worst case, then a pretty severe one, which may not come to pass. I understand Woodford's move on 'value' UK stocks, and indeed I have been doing much the same, in a moderate way... perhaps his (and my) timing will prove erroneous, but maybe not. I am right with you, both DGE and ULVR will still be here... unless someone takes them out (still unlikely for me). BUT... they won't necessarily be trading at 24x FX-inflated earnings then, just as they only rarely have in the past. As per previous posts, I think there is perfectly good reason for existing DGE holders, who are sitting on big paper gains, to hold on... your downside is both finite and relatively quantifiable, and your overall returns will still probably be pretty decent. But committing new funds at this price is a different equation IMHO, and not one which I think will be particularly well rewarded, over the medium and longer terms.
nimbo1
23 Aug 2017
Re: A Woodford Fundholders Response Worth just mentioning IMO Companies like Unilever and Diageo will benefit hugely from technology as they rip out vast swathes of their cost base. I was a holder in a share called Blue Prism and have now sold because I need more evidence of income given the valuation. I did a lot of work on what they are doing and went to their global event etc. To cut a long story short their software robots can replace any repetitive back office function. 30% of the world is employed in some sort of administration role according to one statistic I read - thats not to say they are all secretaries but their jobs require high levels of repetitive tasks, which can now all be replaced by software robots which work 24/7 and cost a fraction of a human. To offer just one example NPower used to have a team of c.300 people doing something dull. They've been replaced by a bunch of software robots and 2 people overseeing it resulting in a huge boost to productivity and a lowering of the cost base - transformation is the word all the consultants implementing these bots use to describe it.
nimbo1
23 Aug 2017
Re: A Woodford Fundholders Response good point on the currency and one i realise - but thats the world we now live live in. Little old UK going it alone and therefore no one wants to be holding our pennies! I know now currency is depressed there is a risk it can reverse and the boost on paper is a one off. I don't see currency reversing - thats why I thought Woodford was mad to suddenly back the UK so strongly before we see the true impact of Brexit feeding through. I have many friends working across a range of the professional service industries - all report stodgy and slowing growth. House prices are now 20% off and any one with anything over 1.25 is struggling to sell unless it is well priced. That will feed into psyche of the masses soon enough and the slower slow down will have arrived. The problem with technological disruption is I believe many companies which now look like value plays will not be here in 10 years + time. They are simply not innovating fast enough. I think quite a few won't be around in 10-20 years. (My view only and I may of course be wrong - so I choose not to hold things I believe are being impacted). IMO Diageo and Unilever will be here still - unless humans go off food and drink. Even if I am wrong for the moment the dividends from Diageo cover all my drinking requirements so I get to 'live a little', 'for free' : )
Bill1703
23 Aug 2017
Re: A Woodford Fundholders Response "IC update for what it's worth..."Thanks nimbo... but as too often with the IC, it's worth next to nothing. Terrible, vacuous reportage IMHO.Maybe they genuinely haven't noticed that North American sales were boosted, not so much by the "growing popularity of whiskey and scotch in the US" (have they only just discovered it? Uncle Jack D will be burling in his grave), but almost entirely by FX - as with those in various other non-UK regions? But it's not as if DGE have tried to disguise this.And quite how they think a few bottles of Casamigos is going to make any noticeable impact on the multi-billions of N American sales, I really don't know. And have they thought about the billion or so they spent on it... so whither ROI, pray? Chronic Investors indeed!
LK Hyman
23 Aug 2017
Re: A Woodford Fundholders Response Nimbo,"The growing popularity of whiskey and scotch in the US provided a boost to sales in North America"The boost mainly came from the decline in the value of sterling versus the dollar.So there.LKH on the flybridge miiiaaaaoooowww
nimbo1
23 Aug 2017
Re: A Woodford Fundholders Response IC update for what its worth Shares in Diageo (DGE) hit an all-time intraday high earlier this month of 2,604p, and it’s easy to see why. In the full-year results announced at the end of July pre-tax profit was up by a quarter to £3.6bn, while revenue increased 16 per cent to £18.1bn. The growing popularity of whiskey and scotch in the US provided a boost to sales in North America as a whole, where the business had previously experienced a slowdown in turnover. This improvement looks set to continue with Diageo's recent acquisition of Casamigos, the 'house of friends' tequila brand co-founded by George Clooney.DGE:LSEDiageo PLC1mthToday change0.17% Price (GBP)2,584.50Diageo’s cost-saving goal was increased by £200m to £700m, and a £1.5bn share buyback programme was also announced, which indicates that management is confident in the company’s future. This confident tone was echoed last week when Diageo chairman Javier Ferrán purchased 65,000 shares at 2,503p each, for a total of £1.63m.
forddrive
23 Aug 2017
Re: A Woodford Fundholders Response Stick with Diageo.
