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Temple Bar

Closed-end funds and OEICs
Arborbridge
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Re: Temple Bar

#346267

Postby Arborbridge » October 8th, 2020, 5:32 pm

ReallyVeryFoolish wrote:A HOLD given today by Questor in the Telegraph. Quite a positive note but stops short if rating it a buy.

RVF



I think buying an IT with a contrarian philosophy when that IT is well down and discounted, it doubly contrarian!

Arb.

Dod101
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Re: Temple Bar

#346275

Postby Dod101 » October 8th, 2020, 5:50 pm

The last time I looked it was at a good discount so that is one positive, but there are a number of ITs in that category. More important is whether you have faith in the new managers. I know nothing of them except what I have read in the excerpts further up this thread. Fundamentally though it depends whether you think that a 'value' approach is the way to go. It certainly has not been for a long while in the UK at any rate and I cannot see that changing very much. So I am out.

Dod

Arborbridge
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Re: Temple Bar

#346313

Postby Arborbridge » October 8th, 2020, 8:50 pm

This image will give you some idea of just how strange the current market is. Temple Bar to my mind, has historically been a good an safe performer - it would never shoot the lights out, but it was being conducted by a safe pair of hands.

How easily that has all been swept away! I don't know if there was something nefarious going on, but let's assume there wasn't, it's quite amazing how recent events have caused the share price to plummet.

The chart shows the XIRR of Temple Bar from my experience over the years from 0ctober 2015. The trust returned (for me) around 8% to 12%, a perfectly reasonable return and one which is far from making it a basket case. Then since the spring of this year and covid, the NAV has collapsed and the share price even further. How quick success can turn into disaster.

Image

I'm reluctant to sell at the moment, and indeed the adventurous would be buying. For the moment, I'm staying put as many companies are bog-standard holdings for HYPers which we know have suffered badly: Shell, BP, Rolls, Marks, HSBC, Land Securities plus unfortunates such as Easyjet. Pre-Covid, no one could have looked at the portfolio and said it was stupid - indeed many a HYP would have had many of TMPL's stocks. It was a fair cross section of the UK market - but like many HYPers, Alistair Mundy was caught holding stocks which were trounced. It will come back in time, and was beaten down too far. My only fear is that the new manager will be tempted to clear out some good stock at bargain basement prices and make matters worse.

Arb.

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Re: Temple Bar

#346317

Postby ADrunkenMarcus » October 8th, 2020, 9:01 pm

Arborbridge wrote:Alistair Mundy was caught holding stocks which were trounced. It will come back in time, and was beaten down too far. My only fear is that the new manager will be tempted to clear out some good stock at bargain basement prices and make matters worse.


I share that fear.

In fairness, Alistair Mundy's performance had been improving in 2019 and into 2020, but he was hit particularly hard by COVID-19 and the Board insisted on de-leveraging at what was basically the bottom of the market! The damage from early 2020 will take a lot to undo.

Best wishes

Mark.

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Re: Temple Bar

#346362

Postby Arborbridge » October 9th, 2020, 7:46 am

ADrunkenMarcus wrote:
Arborbridge wrote:Alistair Mundy was caught holding stocks which were trounced. It will come back in time, and was beaten down too far. My only fear is that the new manager will be tempted to clear out some good stock at bargain basement prices and make matters worse.


I share that fear.

In fairness, Alistair Mundy's performance had been improving in 2019 and into 2020, but he was hit particularly hard by COVID-19 and the Board insisted on de-leveraging at what was basically the bottom of the market! The damage from early 2020 will take a lot to undo.

Best wishes

Mark.


We will never know whether the directors were correct or not, unfortunately. They've caused a lot of damage with this decision, but from their POV they would say they are facing reality and planning for a better future. On the other hand, it could be like Luni used to say - people can't resist the temptation to fiddle. "Don't just stand there do something!"

People often say that there is no point in having a number of different UK income ITs because they are all fishing in the same pond. That has always been incorrect, in my view, and this is an extreme example which demonstrates it.

On a more personal note, if you lay my HYP chart on top of the TMPL bar chart from 2010, I am only just ahead on capital - it's just that my poor performance has been less dramatically concentrated than that of TMPL.

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Re: Temple Bar

#346365

Postby Wizard » October 9th, 2020, 8:06 am

I am not close to this but it sounds like a lot of losses were crystallised at the worst possible time. What worries me more (and what convinced me that Temple is not for me) is the selection of new managers with such a poor record / reputation.

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Re: Temple Bar

#346367

Postby Dod101 » October 9th, 2020, 8:31 am

Wizard wrote:I am not close to this but it sounds like a lot of losses were crystallised at the worst possible time. What worries me more (and what convinced me that Temple is not for me) is the selection of new managers with such a poor record / reputation.


That is the case with me but then who is going to sell at the best possible time (when everything is going along swimmingly? MIght top slice but few would sell. For my part I was quite deliberately waiting to see who might be appointed as managers. It had anyway become an insignificant holding so I sold. I do not know whether I made a gain or a loss overall and do not care; I just decided to sell it.

Dod

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Re: Temple Bar

#355349

Postby ADrunkenMarcus » November 10th, 2020, 8:09 pm

TMPL is up 15% this week, which is better than it had been doing. But then it needs to double even from here to claw back its losses and get us back to early 2020!

Best wishes

Mark.

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Re: Temple Bar

#355483

Postby Largsviking » November 11th, 2020, 11:24 am

Yes I note and welcome the recent increase, I have retained my holding but still nursing a very large loss even with this recent increase.

That said, lets see what comes but it has a long way to go as DOD mentions before this recovers to some modicum of respectability.

What I do wonder does this begin to signal a post vaccine switch to Value instead of the intensive market obsession/interest in Tech, which I would add has stood me in good stead. Eventually the tech train will de-rail.........

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Re: Temple Bar

#355534

Postby Dod101 » November 11th, 2020, 1:58 pm

For value to come good (in the UK anyway) it would need a sea change and I see no evidence of that. Many of the FTSE100 shares are bombed out and show no signs of recovery. Temple Bar is still at about a 14% discount to NAV and NAV in this case is the value of the shares of its holdings. Many of the underlying companies are probably themselves selling at well below their enterprise value. Even after the rises in the last two days or so most shares are well below where they are at the beginning of March I think. Before anyone challenges that I have only tested a few!

Contrast that with Baillie Gifford China which is standing at a premium to NAV of around 20% to NAV and they are selling shares in to the market from treasury every day.

Dod

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Re: Temple Bar

#355539

Postby Arborbridge » November 11th, 2020, 2:12 pm

This is one of those cases where a failure of courage meant I didn't buy when I should have done, recently.

OTOH, I can hardly be blamed for backing away in view of the background. Over the years, I've never learnt the lesson - when you see a bombed out collective, it is probably worth buying.

14% discount and a possible 6% yield is still worth having as it is invested in mostly solid companies. It does add up to the UK market being cheap.

Arb.

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Re: Temple Bar

#355570

Postby monabri » November 11th, 2020, 3:08 pm

Share price change in the last week for some ITs.


Image

Arborbridge
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Re: Temple Bar

#355584

Postby Arborbridge » November 11th, 2020, 3:55 pm

Well here's the long view on most of those ITs

Image


What interests me is that although they fish mainly in the same pond, the results are radically different. Don't believe anyone who says they're all the same so you only need one or two.
Finsbury is way ahead, then comes Law Debenture. Somehow Schroder Oriental slipped in next (I had meant to include only UK ITs) . Next the run of the mill duffers with Murray Income the best duffer and Temple Bar with the wooden spoon.

These are only shares prices, unfortunately. My data does not have NAV or TR which would have been more interesting - but I thought I chuck this together for stimulation purposes ;)

PS - I can do this later with TR using trustnet, but a bit short of time at the mo.

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Re: Temple Bar

#355595

Postby monabri » November 11th, 2020, 4:31 pm

Total Returns over the last 5 years

A comparison of "apples" ... with Vanguard's VUKE as a reference. EDIN being under recent new management..one can see why.

:- CTY's returns are approx the same as VUKE's over the last 5 years.

:- TMPL and EDIN are pretty similar. TMPL was doing "ok" (comparatively) until the start of this year.

Image

Image

Arborbridge
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Re: Temple Bar

#355610

Postby Arborbridge » November 11th, 2020, 5:16 pm

Thanks Monabri.

We often get interested when something is either doing very well or very badly!
Neither are the best times make decisions, so I usually put it off until later. That's not always a goof thing either, but I've been caught so often over the past 35 years of playing around.


Arb.

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Re: Temple Bar

#355619

Postby Dod101 » November 11th, 2020, 5:31 pm

Interesting about Murray Income because after absorbing the assets of Perpetual their costs will drop a bit which may help their performance again.

You could say that Edinburgh and Temple bar have been nearly as bad as each other over the longer term. I held both but now hold neither which probably means that they will now take off. They both have scope for that, trading at well under NAV.

Dod

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Re: Temple Bar

#355631

Postby ReallyVeryFoolish » November 11th, 2020, 5:57 pm

Thanks for taking the trouble to put the stats together. Having bought a chunk of Merchants trust at exactly the worst moment possible, I am heartened by it's recent bounce. Long may it continue.

RVF

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Re: Temple Bar

#355678

Postby ADrunkenMarcus » November 11th, 2020, 8:52 pm

The long term stats are interesting and do show TMPL's poor performance. The welcome recovery in the last week needs to go much further indeed to change that. TMPL was starting to show signs of life at the end of 2019 but that was utterly wiped out early in 2020.

On the capital front, I've posted before that the shares in TMPL I bought in December 2001 have compounded at 2 percent to date which compares to 2.1 percent Consumer Price Inflation. :(

On the dividend front, however, I've received more than the book cost in dividends so the total return is ahead of inflation (above the FTSE 100 TR and below the FTSE All Share TR).

Best wishes


Mark.

Arborbridge
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Re: Temple Bar

#355723

Postby Arborbridge » November 12th, 2020, 7:16 am

Dod101 wrote:For value to come good (in the UK anyway) it would need a sea change and I see no evidence of that. Many of the FTSE100 shares are bombed out and show no signs of recovery. Temple Bar is still at about a 14% discount to NAV and NAV in this case is the value of the shares of its holdings. Many of the underlying companies are probably themselves selling at well below their enterprise value. Even after the rises in the last two days or so most shares are well below where they are at the beginning of March I think. Before anyone challenges that I have only tested a few!

Contrast that with Baillie Gifford China which is standing at a premium to NAV of around 20% to NAV and they are selling shares in to the market from treasury every day.

Dod


Seems like you've made a good case for buying more TMPL ;)

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Re: Temple Bar

#355725

Postby Arborbridge » November 12th, 2020, 7:22 am

Dod101 wrote:Interesting about Murray Income because after absorbing the assets of Perpetual their costs will drop a bit which may help their performance again.

You could say that Edinburgh and Temple bar have been nearly as bad as each other over the longer term. I held both but now hold neither which probably means that they will now take off. They both have scope for that, trading at well under NAV.

Dod


I would have thought they have both been disastrous in the relatively short term, and that makes the long term look bad. TMPL had a really bad 2020.

I'm not arguing either way, but I've been fooled so often by comparisons before now, that I'm just urging caution. You might remember my cautionary tale of selling MUT because it had been one of my laggards (along with DIG the dog) but now it's floated to near the top of the losing bunch :roll:

Arb.


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