The Lemon Fool

Hi All,

Could you please comment on this portfolio construct in terms of diversification, replication, risk and possible improvements? I have included salient points from the x-ray (this does not constitute the whole of our holdings, but is one distinct part). The objective of the portfolio is growth over the next five to ten years.

Trust - Weight
Scottish Mortgage - 20.0%
Witan - 20.0%
Foreign & Colonial Investment Trust - 20.0%
Fidelity Special Values - 15.0%
Edinburgh Worldwide - 15.0%
Allianz Technology Trust - 10.0%

Geographic Spread
America - 44%
UK - 24%
Europe - 15%
China - 7%
Japan - 4%
Asia - 6%

Stock Sector
Cyclical - 39.5%
Sensitive - 42.1%
Defensive - 18.4%

Investment Style
Large Growth 30%
Medium Growth 14%
Small Growth 8%
Style Total 52%
Large Blend 10%
Medium Blend 4%
Small Blend 4%
Style Total 18%
Large Value 15%
Medium Value 3%
Small Value 4%
Style Total 22%

Largest Overlap (shows total percentage of investment held in the company)
Amazon (four trusts) 3.15%
Alibaba (four trusts) 1.62%
Tesla (four trusts) 1.60%
Tencent (three trusts) 1.48%

Just my passing 2c, simply that.
Nice you've considered overlap, and are attuned to it.
6 funds is better than the 20+ we see some people post!

I'd be interested if/when you have time to hear how you settled on this choice/focus.

Oh, and good luck!

DiamondEcho wrote:Just my passing 2c, simply that.
Nice you've considered overlap, and are attuned to it.
6 funds is better than the 20+ we see some people post!

I'd be interested if/when you have time to hear how you settled on this choice/focus.

Oh, and good luck!

First thing on selection is that all of these funds are well regarded in this and other forums and all have solid performance over all time periods. I was trying to get a relative balance between stock sectors (Cyclical/Sensitive/Defensive) and not worry so much about geographic spread (but the spread turned out fine I think).

I had to do a lot of work on Excel to see which trusts worked with each other especially in terms of holding overlap as I was concerned that I would ending up with a large exposure to (say) Amazon or Tesla etc. I could have left Allianz Tech out as SMT, EWI and Witan all have high Tech exposure but for now I will most probably leave as is.

It was a really time consuming exercise to copy/paste/format the top 10 by holding/sector/country to Excel for each trust and then manipulate it to see these overlaps but I hope it was worth it.

I like it, mainly because it is very similar to mine!

I went for Fundsmith & Monks rather than Fidelity and Allianz. For tech I have gone all in with an individual holding in Amazon (up 100%), because I have a lot of confidence in the company in the long term (and short for that matter).

I have had my portfolio in place for just over a year and despite being in drawdown is up over 18%.

Good luck with it

MM

EssDeeAitch wrote:Hi All,

Could you please comment on this portfolio construct in terms of diversification, replication, risk and possible improvements? I have included salient points from the x-ray (this does not constitute the whole of our holdings, but is one distinct part). The objective of the portfolio is growth over the next five to ten years.

Trust - Weight
Scottish Mortgage - 20.0%
Witan - 20.0%
Foreign & Colonial Investment Trust - 20.0%
Fidelity Special Values - 15.0%
Edinburgh Worldwide - 15.0%
Allianz Technology Trust - 10.0%
....

Hi EssDeeAitch,

Sorry to be really slow here. We are still pretty new to this. Are those products you mentioned "Investment Trusts", as opposed to "Funds" (i.e. OEICs)?

Matt

TheMotorcycleBoy wrote:

EssDeeAitch wrote:Hi All,

Could you please comment on this portfolio construct in terms of diversification, replication, risk and possible improvements? I have included salient points from the x-ray (this does not constitute the whole of our holdings, but is one distinct part). The objective of the portfolio is growth over the next five to ten years.

Trust - Weight
Scottish Mortgage - 20.0%
Witan - 20.0%
Foreign & Colonial Investment Trust - 20.0%
Fidelity Special Values - 15.0%
Edinburgh Worldwide - 15.0%
Allianz Technology Trust - 10.0%
....

Hi EssDeeAitch,

Sorry to be really slow here. We are still pretty new to this. Are those products you mentioned "Investment Trusts", as opposed to "Funds" (i.e. OEICs)?

Matt

Hi TMB, yes, they are all Investment Trusts

SDH, Yes, my thoughts are that you are a bit too technology heavy. FRCL includes technology as well as the more specialist (investment) trusts like SMT, Edinburgh Worldwide and Allianz Tech.

richfool wrote:SDH, Yes, my thoughts are that you are a bit too technology heavy. FRCL includes technology as well as the more specialist (investment) trusts like SMT, Edinburgh Worldwide and Allianz Tech.

In an earlier post I said I think I may be a bit heavy on tech, and could have left Allianz Technology out. But I will probably not change right now. Other than that, there is very little overlap between holdings, see earlier post for details, cheers

EssDeeAitch wrote:

richfool wrote:SDH, Yes, my thoughts are that you are a bit too technology heavy. FRCL includes technology as well as the more specialist (investment) trusts like SMT, Edinburgh Worldwide and Allianz Tech.

In an earlier post I said I think I may be a bit heavy on tech, and could have left Allianz Technology out. But I will probably not change right now. Other than that, there is very little overlap between holdings, see earlier post for details, cheers

SDH, Noted that you have diversity of holdings, but my concern would be the sector concentration. You would be making yourself very vulnerable to a technology sell-off. You can still target growth without so much technology exposure.

richfool wrote:

EssDeeAitch wrote:

richfool wrote:SDH, Yes, my thoughts are that you are a bit too technology heavy. FRCL includes technology as well as the more specialist (investment) trusts like SMT, Edinburgh Worldwide and Allianz Tech.

In an earlier post I said I think I may be a bit heavy on tech, and could have left Allianz Technology out. But I will probably not change right now. Other than that, there is very little overlap between holdings, see earlier post for details, cheers

SDH, Noted that you have diversity of holdings, but my concern would be the sector concentration. You would be making yourself very vulnerable to a technology sell-off. You can still target growth without so much technology exposure.

Got it, I think I shall look again at Allianz, although it has been a good performer and I have bought for a reason, I do like to diversity of the other trusts.