The Lemon Fool

seagles wrote:

Bouleversee wrote:

seagles wrote:Now that was strange?

Just brought my first slice of SMT. I have been following/looking at SMT, MNKS, MWY and FCIT for a growth share (my first foray in my own portfolio). Today could not decide between the 2 Baillie Gifford Trusts. Tried to deal on MNKS in Hargreaves and it would not let me, suggested I put a stop/loss on buying? So SMT it is then.

Do you mean a limit order?

Sorry, must have been miles away, yes a "limit" order.

Why did you consider that having to do a limit order is a reason to not proceed with the trade?

I usually do limit orders even when I do not have to, as with more liquid securities. You can always use a limit that is way in the money, so that it will execute immediately anyway just as if it were a market order.

Lootman wrote:

seagles wrote:

Bouleversee wrote:Do you mean a limit order?

Sorry, must have been miles away, yes a "limit" order.

Why did you consider that having to do a limit order is a reason to not proceed with the trade?

I usually do limit orders even when I do not have to, as with more liquid securities. You can always use a limit that is way in the money, so that it will execute immediately anyway just as if it were a market order.

Would totally agree with a limit if it was just the 1 IT, but as I was caught between the two I thought it "karma" to go for SMT.

I have just received my Interim Dividend for SMT and, together with the Final for last year, it seems that the trailing yield for this calendar year is 0.003% and that is after paying about half of it from capital gains. Is this a record?

It is scarcely worth their while going to the trouble. There ought to be a waiver of the need to distribute revenue for ITs for amounts of say less than 0.5%. Despite the Chairman's comments in the Annual Report, the dividend paid is of no significance whatever to me nor I imagine to many, even in these difficult times.

Dod

I am wrong, not for the first time. The actual yield on Scottish Mortgage is more like 0.3% as has been kindly pointed out to me.

If anyone has read my post, I am sorry to have got it wrong.

Dod

Dod101 wrote:I am wrong, not for the first time. The actual yield on Scottish Mortgage is more like 0.3% as has been kindly pointed out to me.

If anyone has read my post, I am sorry to have got it wrong.

Dod

If you can get the moderator to remove the % from the 0.003 - then the number is OK
However even if the yield had been 0%, I expect that most of us would not be concerned, since the total return over the past year has been 115%

scotia wrote:

Dod101 wrote:I am wrong, not for the first time. The actual yield on Scottish Mortgage is more like 0.3% as has been kindly pointed out to me.

If anyone has read my post, I am sorry to have got it wrong.

Dod

If you can get the moderator to remove the % from the 0.003 - then the number is OK
However even if the yield had been 0%, I expect that most of us would not be concerned, since the total return over the past year has been 115%

Thanks you are absolutely right. Quite an amazing return especially for an investment trust. It sounds more like a share like Poseidon, the Western Australian miner of about 50 years ago. Anyone remember that?

Dod

Dod101 wrote:

scotia wrote:

Dod101 wrote:I am wrong, not for the first time. The actual yield on Scottish Mortgage is more like 0.3% as has been kindly pointed out to me.

If anyone has read my post, I am sorry to have got it wrong.

If you can get the moderator to remove the % from the 0.003 - then the number is OK. However even if the yield had been 0%, I expect that most of us would not be concerned, since the total return over the past year has been 115%

Thanks you are absolutely right. Quite an amazing return especially for an investment trust. It sounds more like a share like Poseidon, the Western Australian miner of about 50 years ago. Anyone remember that?

For a longer term perspective, my SMT holding is up about 680% in a decade or so. The only other IT that comes close is Linsdell Train, at about 640%. Biotech Growth IT is up a great deal too, although I have held that for longer.

Sadly they are all in my taxable account, which make me reluctant to sell because of the CGT hit.

Though CGT could well be increased from 6 April? Most is in my taxable a/cs too but I may take it on the chin before 6 April

Dod101 wrote:

scotia wrote:

Dod101 wrote:I am wrong, not for the first time. The actual yield on Scottish Mortgage is more like 0.3% as has been kindly pointed out to me.

If anyone has read my post, I am sorry to have got it wrong.

Dod

If you can get the moderator to remove the % from the 0.003 - then the number is OK
However even if the yield had been 0%, I expect that most of us would not be concerned, since the total return over the past year has been 115%

Thanks you are absolutely right. Quite an amazing return especially for an investment trust. It sounds more like a share like Poseidon, the Western Australian miner of about 50 years ago. Anyone remember that?

Dod

Yes that was when I was a very junior academic, with no money to spare, so I didn't get involved in the Poseidon bubble, but 30 years later I had some modestly burnt fingers in the dot com bubble.

Dod101 wrote:It sounds more like a share like Poseidon, the Western Australian miner of about 50 years ago. Anyone remember that?

Dod

Oh yes, I remember that. I can recall hearing about it on the radio whilst eating breakfast, it must have been quite newsworthy back then. Funny what sticks in your mind

RC

ReformedCharacter wrote:

Dod101 wrote:It sounds more like a share like Poseidon, the Western Australian miner of about 50 years ago. Anyone remember that?

Dod

Oh yes, I remember that. I can recall hearing about it on the radio whilst eating breakfast, it must have been quite newsworthy back then. Funny what sticks in your mind

RC

Like Scotia I was a young guy trying to make his way and had no money but I know of at least one (then) young chap who bet everything on it and made a life changing amount of money. That is when to do it of course, and get out in time!

Actually of course Scottish Mortgage is nothing like Poseidon and it does not even seem to be a bubble. It is still trading at par or a little below I think.

Dod

The managers at BG, I believe, buy company shares, and review whether to continue to hold them, based on their view of their long term prospects as disruptors of the status quo. they don't buy what is fashionable or follow 'momentum'. So they clearly think that the current values of highly rated companies, like Tesla, are supported by their long term prospects and are not simply an inflated bubble.

I am happy to carry on leaving the judgements to them. No doubt many investors thought Amazon was well into bubble territory when the price went from $5 to $100.

ReallyVeryFoolish wrote:But the million dollar question is, are the underlying assets in SMT in bubble territory? More importantly perhaps then the discount/premium of the SMT share price?

RVF

You have raised this very valid question before and of course I do not know the answer. I am comforted by the fact that Scottish Mortgage is not run by a young whizz kid but by a mature hard headed investment manager who has seen it all before I am sure. I will stick with it.

Dod

I see the Sunday Telegraph today reports that Graphcore, a UK chip designer started in 2016, is exploring floating on the Nasdaq at a valuation of up to £7.5 billion.

Guess who one of the early backers is - yes Baillie Gifford

Another example of the advantages of their investing in unquoted companies

The managers of BG certainly seem to have the midas touch (at least for 2020). How long this will last who can say. Amazon fwd pe 97, Netflix pe 79, Teslas pe 1202. We'll never know if we're in a second dotcom bubble until it bursts. I think a correction is imminent cause valuations are detached from fundamentals but thought that all year and been wrong. Guess the market figures these companies really are the future and that profits will catch up.

my baillie gifford holdings are ---

BGEU

BGUK

BGFD

USA

PHI

MONKS

SMT.

more than half of my IT's.

their performance seems good , and i like the concept of good managers talking to each other and sharing research.

scrumpyjack wrote:I see the Sunday Telegraph today reports that Graphcore, a UK chip designer started in 2016, is exploring floating on the Nasdaq at a valuation of up to £7.5 billion.

Guess who one of the early backers is - yes Baillie Gifford

Another example of the advantages of their investing in unquoted companies

I must say that I have great faith in Baillie Gifford and I do not think their success is an accident. BG is the only trading partnership I think in the UK which has unlimited liability, no LLP for them. For a start, that must make the partners very careful about what they are doing. The second point is that being a privately owned partnership they really have no conflict of interest with their clients, no half yearly results which they have to publish for the world to see, unlike say HL, AJ Bell and others who need to look at their bottom line at the same time as trying to look after their clients' interests. Of course, BG is not a charity and from what I know of their partners, none are on the breadline. They appear to retire as wealthy men and women. Good for them I'd say.

Dod

Certainly wealthy. James Anderson revealed in an interview a while ago that he held over 1% of SMT personally. That alone is over £100 million
Well earned!

Adamski wrote:The managers of BG certainly seem to have the midas touch (at least for 2020). How long this will last who can say. Amazon fwd pe 97, Netflix pe 79, Teslas pe 1202. We'll never know if we're in a second dotcom bubble until it bursts. I think a correction is imminent cause valuations are detached from fundamentals but thought that all year and been wrong. Guess the market figures these companies really are the future and that profits will catch up.

Those very high P/E ratios can be justified if the company concerned comes to dominate its sector and space. There is a reasonable argument that Amazon, Tesla and Netflix already do, which gives them protection from rivals and the ability to grow earnings at very high annual rates.

They also have artificially depressed earnings because they reinvest so much back into their business, feeding that growth, but inflating the P/E ratio.

Some companies with nosebleed P/E ratios do fall to earth, as we saw in the dot.com rise and fall. But others return to more reasonable P/E ratios as their earnings grow, without the share price suffering. Former high flyers like Apple, Google, Facebook and Microsoft now trade at a P/E ratio of 30 or, so, give or take, and they proved to be very successful investments back when they were much more highly rated.

Now of course if you are more comfortable buying shares with a P/E ratio of less than 10, you can find them. But not many of them have dazzled with their returns. If returns were inversely proportional to P/E ratio, we would all invest that way, but they are not.

scrumpyjack wrote:Certainly wealthy. James Anderson revealed in an interview a while ago that he held over 1% of SMT personally. That alone is over £100 million
Well earned!

That is serious 'skin in the game' ......