Time to dump previous high flyers?

[Jon46]

One year does not matter at all in investing. There are quite a few very good funds in the list. I would suggest ignoring the short term, staying put, and letting them do their job for many years to come in the SIPP.

Jon

PS My wife(who mostly invests in collectives, more ITs than Funds) holds a four of these in various portfolios, she in fact topped up the MFM Multi Cap inc. last week as it yields well and, in her opinion, these divis are a lot safer looking forward than some elephant's she can think of.

[scotia]

Its not been a great year for UK Equity Income and Mid-Cap funds - so any combinations of these have performed poorly. I would suggest that most of your bad boys have fallen into this category - i.e. it is a Style problem rather than incompetent management. If I had known about these market conditions beforehand, then I would have ditched your bad boys, but my crystal ball doesn't seem to work. So what will happen next year? More of the same? Or a reversal of interest in UK Equity Income and/or Mid Cap shares? I don't know - so I expect I'm staying put with most of your bad boy list. Oh for a more efficient crystal ball!

[ermintrade]

My own view is that the BREXIT negotiations will be long drawn out and uncertain for years. So I think that many domestically-focussed UK companies are a risky proposition. My actions have been to switch out of UK small and mid cap funds and move to global, US, Japan and emerging market funds. I will maintain that stance for the forseeable future.
Regards
ermintrade

[richfool]

I don't know the funds mentioned by the OP, as I mainy invest in IT's., but I would endorse the "investing is for the long haul" viewpoint, and I like being well diversified, so I would normally keep the sectors that are currently out of fashion, on the basis that their day will come (again). Unless you feel that some profit taking or re-balancing is in order.

I have in fact used the recent weakness of the sectors to gain exposure to smaller companies & mid caps at a relative discount, so to speak.

[ADrunkenMarcus]

...Marlborough Multi Cap Income

All these have been awful this last year or so and are losing me money...

Fred,

I wouldn't worry about this in the slightest. A year is nothing: even five years is a bit short. Judge after ten. If you do anything, I'd argue adding to these 'awful' holdings.

I don't like unit trusts particularly and I only hold two. I have held Marlborough Multi Cap UK Income since 30 November 2011, so almost five years. For the P Class Income units, the unit price has risen from about 91p to 149p (a gain of almost 63%). The dividend has increased from about 5.4p in the 2012-13 financial year to 7.4p in the 2015-16 financial year, growing at a compound annual growth rate of 11.2% and giving me a nominal dividend yield on cost of 8.1%. I have received about 30p per unit in dividends, or almost a third of the original investment. All told, it has given me a total return compound annual growth rate of 14.4%.

On last year's dividend, you're getting a starting dividend yield of 5% or so. In simplistic terms, that sort of starting yield combined with future dividend growth of 7% or more should get you to a total return of over 12% a year and very healthy dividend income as well.

Including the most recent dividend payment and the closing unit price on Friday, it has given me a total return of almost 96%, which compares to almost 57% for the FTSE All Share Total Return Index and 95.5% for the FTSE 250 TR. It has almost doubled the total return in the FTSE 100 in the same period.

Best wishes


Mark.

[ADrunkenMarcus]

My own view is that the BREXIT negotiations will be long drawn out and uncertain for years. So I think that many domestically-focussed UK companies are a risky proposition.

Fair point about Brexit uncertainty, but in the long term I expect the UK to remain one of the richest countries in the developed world. And temporary price weakness does throw up some bargains. For example, Patisserie Holdings PLC. Sound management and a compelling roll out plan from a business with good store margins and cash generation. At 269p, you can buy for a decent forward price to earnings ratio (forecast under 18) a business that has been growing profits and revenues in the double digits.

Best wishes


Mark.

[scotia]

At the moment I am holding fire but I have more or less decided to dump my Majedie Income holdings as it has been particularly disappointing, having lost money virtually since the day I bought it, despite having a solid record prior to that.
And therein lies the problem. I too bought into Majedie Income on the basis of its past performance, only to be disappointed. So should I jump into another fund that is currently prospering - possibly only to be disappointed again?
But yes - I was moving some investments into cash for other purposes, so a chunk of Majedie was dumped today.

[ADrunkenMarcus]

I am very tempted to buy into Evenlode Income despite the fact it has had a really good year and is much more expensive now than it was.

Evenlode is a good fund, but I don't know that it is necessarily more expensive. As I recall, it holds a number of American shares whose earnings will be more valuable in Sterling terms when converted into the lower rate post-Brexit. The unit price of Evenlode may have increased, but you may be getting more earnings per unit. The problem is I don't think funds tend to publish their price to earnings or free cash flow ratios, although Fundsmith is an exception.

Best wishes

Mark.

[ADrunkenMarcus]

I too bought into Majedie Income on the basis of its past performance, only to be disappointed. So should I jump into another fund that is currently prospering - possibly only to be disappointed again?

If you are judging its performance after less than five years - don't. Judge it in the long run, not short term.

On the question of jumping into another fund, what odds would you give that the one you have jumped out of will suddenly start prospering again as soon as you've done so? Sometimes leaving your portfolio alone is the best option.

Best wishes


Mark.

[pje16]

Evenlode is a good fund, but I don't know that it is necessarily more expensive. As I recall, it holds a number of American shares whose earnings will be more valuable in Sterling terms when converted into the lower rate post-Brexit. The unit price of Evenlode may have increased, but you may be getting more earnings per unit. The problem is I don't think funds tend to publish their price to earnings or free cash flow ratios, although Fundsmith is an exception.
Best wishes
Mark.

I'm about to buy TB Evenlode Global Equity GB00BMFX2893 as it had a good writeup in the April issue of AJ Bells Shares magazine
It's going to be this years ISA for me as Ifeel a bit uncertian about individual equity purchases at the moment

[Mike88]

I am very tempted to buy into Evenlode Income despite the fact it has had a really good year and is much more expensive now than it was.

Evenlode is a good fund, but I don't know that it is necessarily more expensive. As I recall, it holds a number of American shares whose earnings will be more valuable in Sterling terms when converted into the lower rate post-Brexit. The unit price of Evenlode may have increased, but you may be getting more earnings per unit. The problem is I don't think funds tend to publish their price to earnings or free cash flow ratios, although Fundsmith is an exception.

Best wishes

Mark.

I bought Evenlode income last year. The fund is down 2.7%.