jsan22
23 May 2017
Re: How proactive/reactive are the managers? it's a very good question , because it seems we are all expecting a crash sooner or later, simply cos there hasn't been one for getting on a decade - and US stocks in particular are pricey.But as a survivor of two major bear markets, I would say the only thing to do is have a chunk of your portfolio in what I call insurance funds - the likes of Ruffer/Trojan/Newton real return. These funds tend not to lose much and have even been known to rise in crashes. And don't sell your equity funds.I don't think it is the business of a good fund manager trying to be too reactive. After all, the success of people like LindsellTrain/Alex Darwall/Terry Smith is precisely to buy good stuff and keep it long term.Of course you can buy in and out of shares funds and any other funds, but then in effect you are trading which is a different kettle of fish, and most people fail at it.Having said that, I always check on trustnet for the performance of a manager in a down market but it is only one factor - I don't select a fund just on its resilience, I want to make money when markets rise too.As someone else pointed out you tend to only see 5 years performance tables, which tells you nothing because there haven'rt been any down years. Check out the 10 year performances on this site and trustnet under managers' profiles - you will then capture the 2008-7/08 financial crisis in the stats. cheersJ.
dazurtrader
23 May 2017
Re: SMT or MONKS SMT is one of my largest core holdings. Having, just now, compared performance charts over 5, 3, 1 year s and 6 months, MONKS have clearly done a catch up but now both seem to run hand in hand. I accept the positive points made about MONKS but feel that its 40% weighting in N. America may see it 'Trumped' in the next 12 months or so. Also note that MONKS pays a far smaller (and recently reduced) dividend compared to SMT.For me the case for MONKS has yet to be proved, although for new money it could be attractive but I won't be switching any SMT into MONKS. However, MONKS is now in my monitoring system and I'll review again at the end of this year.
Eadwig
22 May 2017
Re: How proactive/reactive are the manag... Windsor Buffet, "Also discretionary fund managers (like Brewin Dolphin, Hargreave Hale) don't really respond to short term movements in the markets. If you're looking for quick in and out of the market type investing strategy you'll have to do it yourself... "I found a site and article which I unfortunately didn't bookmark and cannot find again, that showed the 'churn' rate in actively managed funds, and it was very surprisingly high - to me at least. This wasn't special growth funds or anything like that. More your standard, large and 'safe', blue chip style investments with higher yields.Churn rate is the turnover or change in the fund make-up over a period. From memory, the average fund had a churn rate of 43% and many were well over 50%. In other words, by the end of the year they had sold half their holdings they had at the beginning of the year and replaced them with something else. Or at least that is how I took the figures.I'm not saying they were responding to short-term market movements, I wouldn't have thought so, but to be sure you have to watch out for interviews with fund mangers or yearly reports to get any form of explanation as to their tactics over the short term.I was surprised by the high churn rate - higher even than my own portfolio probably, if I measured it. Or possibly it had just been one of those years. It was perhaps 2 or 3 years ago I saw this list.Anyway, the point is that not all funds, by any means, are as stable as you seem to think when you say 95% don't respond to short term market movements. I'm not saying that statement is incorrect, by the way, but whatever they're responding to, the funds certainly do change. As you would hope and expect in an actively managed fund, of course, but the large, high yielding companies that tend to make up a good proportion of them I wouldn't expect to see a lot of change in.It may be that the some funds sell out of one of their favourite companies, buy into another favourite, collect dividends and then switch back at an appropriate time, and this exaggerated the figure. Also, thinking about it, this may have been including the year of the oil price crash, which might well have had funds selling holdings in companies they would otherwise have sat in happily for years without any change.Anyway - if anyone knows of a source of funds and their 'churn rate' (I'm pretty sure it was this article that taught me that term) it would be an interesting thing to compare. I think Morningstar has the churn rate of a fund, but I'm not sure you can get a list of funds by churn rate, if you see what I mean.Needless to say, tracker funds will have very high churn rates as they are obliged to keep moving to track the markets. They were excluded from the figures in this article, which was one of the very first I saw that was basically starting to question active funds and what you were paying for compared to trackers.Since then there has been a big move to cheaper trackers and more and more people saying they are the way to go (Warren Buffet for one). After the next big market crash, I wonder if the 'fashion' will remain. That would actually be the time to move back into tracker funds, in my opinion, not now as people appear to be doing in droves, when we are surely near the top of the latest bull run. I've always thought the best way to measure how good a fund manager is is to see how well his fund did compared to his peers during a big and protracted sell-off in the markets. Its been such a long time since we had one, its hard to find that kind of comparison at the moment, especially with funds that still have the same manager in place.
Windsor Buffet
22 May 2017
Re: How proactive/reactive are the manag... Funds like SMT don't react to short term market movements no matter how ferocious they are (and they can be pretty ferocious at times). And the same goes for 95% of the universe of investment funds out there. The managers view their responsibility as wisely investing the cash you've handed over to them. There are a few exceptions, on of my favourites is PNL, but they've been down in the region of 40 - 45% equity exposure for quite a few years now. Also discretionary fund managers (like Brewin Dolphin, Hargreave Hale) don't really respond to short term movements in the markets. If you're looking for quick in and out of the market type investing strategy you'll have to do it yourself...
Eadwig
22 May 2017
Re: How proactive/reactive are the managers? stenic,I'm pretty new to SMT myself, but some general answers from past experience:If the US market crashes, ours will too, along with Europe and Japan.I don't know of any fund or site that keeps a record of the historic constituents, even though they do publish the current holdings every so often, so it would be easy for a third party to collect that data and build an archive. Useful it would be too, to answer your question, but I'm not aware of one.One way to check, is to look at fund performances over the very long term, and see which performed better in the bad times. Its such a long time since we've had any, its difficult to do that now too, but that is how I always used to evaluate funds I bought for a longer term hold. I.e. how well do thy handle my money when the market is in bear mode, compared to other funds. Don't forget to check the management, it may well have changed if you are looking back a long way, and the manager(s) are usually the important part of the fund.Good luck.
Stenic
21 May 2017
How proactive/reactive are the managers? Hi guysMy first question on II.If we assume a crash in the US market, then I would expect the well-paid managers to react pdq to minimise the effect, hopefully beating me to taking action and taking better actions than I would.From you guys' experience of this and I suppose other funds, how proactive and reactive are they?I don't seem to be able to find a history of the fund's constituents to see how they've reacted in the past - does anyone know if that is available, and if not, why not?I've probably showed my ignorance now...Cheers!S
jsan22
19 May 2017
Re: SMT or MONKS thanks for all your replies to this. My conclusion is to buy Monks with a bit of SMT on the side. But like others here, I don't feel comfortable buying anything at this moment in time (shares or bonds) , so for me it's going to be a long-term drip-feed.cheers allJ
Windsor Buffet
18 May 2017
Re: SMT or MONKS If you're interested in following the highly successful Baillie Gifford global investing model then why go for the more diversified Monks. Scottish Mortgage has a fantastic track record and the manager (Anderson) is one of the very few in UK fund management with excellent access to and relationships with the likes of Bezos and Musk. Yes it will underperform for periods of time (although it hasn't for many years now) but as the old saying goes 'run the winners'...
dontlikenicknames
18 May 2017
Re: SMT or MONKS SMT tipped recently in the Times.I!ve held both for the length of the recent bull run and done very well. now taking profits as markets are at a high.
holland44
12 May 2017
Re: SMT or MONKS Monks have outperformed because of the recent closure of its discount, and SMT is currently on a premium. I've seen an interview with Charles Plowden where he explained Monks' new approach to asset selection, which is part-geographic, part-risk-based and seemed really well thought-through. SMT is a different beast because it acts like a large high-conviction private equity fund - emphasising disruptive technology, selecting a good number of the largest consumer-tech companies like Amazon and Alphabet, but also investing in early-stage privately-listed companies that may become the big companies of the future or be taken over at a premium price. From a geographic perspective SMT is focused on the US, China and Europe ex-UK, whereas Monks is more spread out, with allocations close to the broad sizes of local stock markets (it's hard to tell, as it has 18.3% in a sector that Trustnet calls Global Emerging Market; this could mean anything but is probably dominated by Asia-Pacific countries).So since they have such distinctive approaches and both appear to be making a success of things, I'd say invest in both!
Windlesham Don
11 May 2017
Re: SMT or MONKS SMT have been a fantastic investment for me over a number of years, but wouldn't argue with a decision to Monks instead. If you have enough cash then I'd recommend buying a chunk of both to hedge your bets!
jsan22
11 May 2017
SMT or MONKS Had a plan to buy into STM, but wondering now if its stablemate MONKS is a better option?They have some overlap, but Monks is less concentrated, has a team with a strong record, and has actually out-performed SMT since they took over.On the other hand, I like SMT's conviction.Now that SMT is a FTSE 100 company, I realise that forces some buyers in, but might it force some selling too?Not decided yet, just appreciate any opinions either way.j
II Editor
08 May 2017
NEW ARTICLE: Most popular investment trusts - April 2017 "Two new entries - both global trusts - made their appearance this month in the table of investment trusts bought most by clients of our sister company, broker Interactive Investor.LSE:BNKR:Bankers investment trust, from the Henderson stable, has ..."[link]
investorprotestor
28 Apr 2017
Re: This is ridiculous ........ Good Luck - hopefully the good years are not behind us. Doubt it looking at past perf - 
Eadwig
28 Apr 2017
Re: This is ridiculous ........ sage, "....... how does it make any sense that a wrapper containing USA and Chinese stocks ......... forms a major playing place in our UK FTSE100 ??? ....."The way you talk anyone would think the stock market is supposed to be a place for entrepreneurs to find backers and raise funds in order to build and expand new wealth-creating enterprises.It's only chance that it is still 'our' FTSE 100, and not owned by Germany, by the way.In case anyone hadn't guessed, I just bought in, having exited Woodford's main fund. Don't say you haven't been warned.
