Comments on: Q3 2020: Just In The Red

By: Charlie Johnson

Charlie Johnson — Sun, 04 Oct 2020 15:37:01 +0000

Thanks for the great reply and link.
No, not following too closely, but its a great focused starting point for research amongst all the white noise and marketing out there.

By: Nick

Nick — Sat, 03 Oct 2020 23:37:33 +0000

Thanks for the reply. You are definitely more into UK companies than I am! I did have some Mercantile and a FTSE 250 ETF looking for a Brexit bounce and they did okay for a bit but then covid knocked the stuffing out of them so I sold. I did also at one point have some RIT and Caledonia, but got a bit bored of them. Watching from the side-lines, neither really seemed to live up to their defensive sticker in the Q1 crash. Maybe it’s a grass is greener thing, but I fear that the UK is stuck in high tax, high regulation, currency depreciation, and will be there for some time. Better opportunities elsewhere, I think.

By: ITinvestor

ITinvestor — Sat, 03 Oct 2020 11:51:35 +0000

In reply to Nick.

Hey Nick,

The lack of BG funds and trusts is definitely something I have been lamenting this year!

I did own Pacific Horizon back in the 1990s but most of my current holdings were chosen a few/several years ago when the BG trusts didn’t stand out so much. I’ve been adding to UK smaller companies and renewables/infrastructure recently and BG aren’t really in that space although I was considering Edinburgh Worldwide for a while.

I suspect one or two of their trusts will find their way into my portfolio at some point – but I tend to move rather slowly 🙂

By: Nick

Nick — Sat, 03 Oct 2020 11:21:45 +0000

Interesting reading as ever, thank you. I notice that you do not have any Baillie Gifford investments and was curious as to why that was. I have 40% in various BG funds, and another 10% in Polar Capital Tech. Somewhat risky, I know, being so heavy on growth and tech but even though I am only 75% equities I am up 40% over 12 months to date. I have 14 equity funds/ITs, 2 in high yield bonds, and 1 equity (Rio Tinto). Although individually these are almost all high risk investments, my FE risk score across the board is only 89 (FTSE 100 risk being 100). I also have a very low allocation to the UK in funds (5%) but have 9% in Rio Tinto, which I do not really think of as a UK company even if it is listed here. Rio has actually done far better than most funds, e.g. miles better than a global ETF, and I cannot foresee a world that does not need steel and copper.

By: ITinvestor

ITinvestor — Fri, 02 Oct 2020 13:37:06 +0000

In reply to diy investor (uk). Thanks DIY! Hard to argue with that dual focus - it's certainly worked superbly this year. @Charlie - Glad you've found the blog useful and nice timing with SMT. I hope you're not following me too closely, though, as everyone needs to make their own decisions when buying trusts and funds :-) I'm not sure exactly what you are looking for regarding more info on premiums and discounts. I did a more general piece on this topic last year which might help though: https://www.itinvestor.co.uk/2019/04/should-you-avoid-investment-trusts-with-premiums/

By: Charlie Johnson

Charlie Johnson — Fri, 02 Oct 2020 10:33:05 +0000

I started reading your blog at the start of this year and it has been a great source for me to crystallise my personal investment management amongst the white noise of information on the internet and the financial media. I acted on much of the information and apart from a big dip with the UK Black Rock and Henderson ( both sold off at 10% losses and switched to SMT to recover) I am up this year a little more than you, so very pleased. Now moving more funds into China after your summary of those ITs.

It would be good to have a deeper dive into the fuller implications of NAV to share price and it’s importance, particularly as ITs are bought and sold on share price. Premiums and discounts to NAV are easy, but the practical relevance is not so much. And trawling for information I am not sure many others actually do either.

By: diy investor (uk)

diy investor (uk) — Thu, 01 Oct 2020 09:43:02 +0000

Nice summary IT. Yes, the UK FTSE has been a serial underperformer for several years so I suspect the move into more global trusts will be rewarding.

I have been thinking about the big picture this year and with Covid-19 (fwiw). My conclusion is that a twin focus of climate change and technology will be the global drivers for the coming decade and beyond and I have been aligning my portfolio with this in mind.

I was particularly interested to hear the announcement from China’s Xi on climate this week and the goal of neutrality by 2060. Combined with the EU drive for zero emissions by 2050, I suspect this will have a big impact on the global economies and there is now evidence that some of the big fossil fuel players are scrambling to go ‘green’ and regain some credibility.

Finally, thanks for buying my ‘Climate Emergency’ book! Let me know what you think in due course and any thoughts on ways to improve it for the next edition.