Briggsysgonagetya
Well-known member
What percentage return are you/ would you be happy with over a year ?
All stock investors out there......
- Thread starter seasideone
- Start date
It is interesting - however you know they're just comparing apples and oranges to generate a clickbait headline right?
"Retail investors on the online platform Interactive Investor have bagged returns of 12.6 per cent on average over the past three years, compared with 10.7 per cent delivered by funds in the Investment Association’s 40-85% Shares sector, where managers invest across a mix of both stocks and bonds."
As mentioned earlier in the thread, the vast majority of retail clients on platforms like that are either 100% equities or a very high % of equities, especially the ones who are confident enough to setup their own brokerage accounts.
They compare their performance to the 40%-85% Shares sector - of course returns are lower in a bull market and during the Covid recovery if you have up to 60% of your allocation in assets other than shares! It goes without saying doesn't it? Bonds have been absolutely shocking over the last few years as well.
Complete non-story. And I say that as somebody who doesn't universally buy into the value of fund management generally. Stats vary, but in any given year only around half of fund managers beat their benchmark. Extend that to 3 years and it's closer to 30% - longer term will be less. Many of them are stealing a living. So, rather than picking individual holdings, you're faced with having to predict which fund manages are going to be the lucky few who outperform over your investment horizon - impossible unless you're Mystic Meg.
The finance industry is 99% bullshit, as is the newspaper industry.
Edit to add - just to blow my own trumpet here, I reviewed a balanced client earlier and our portfolio for him (bespoke as they all are) has returned over 16% in the last 6 months. That said, as I've mentioned, looking at returns on their own completely misses the point when it comes to the IFA value proposition.
"Retail investors on the online platform Interactive Investor have bagged returns of 12.6 per cent on average over the past three years, compared with 10.7 per cent delivered by funds in the Investment Association’s 40-85% Shares sector, where managers invest across a mix of both stocks and bonds."
As mentioned earlier in the thread, the vast majority of retail clients on platforms like that are either 100% equities or a very high % of equities, especially the ones who are confident enough to setup their own brokerage accounts.
They compare their performance to the 40%-85% Shares sector - of course returns are lower in a bull market and during the Covid recovery if you have up to 60% of your allocation in assets other than shares! It goes without saying doesn't it? Bonds have been absolutely shocking over the last few years as well.
Complete non-story. And I say that as somebody who doesn't universally buy into the value of fund management generally. Stats vary, but in any given year only around half of fund managers beat their benchmark. Extend that to 3 years and it's closer to 30% - longer term will be less. Many of them are stealing a living. So, rather than picking individual holdings, you're faced with having to predict which fund manages are going to be the lucky few who outperform over your investment horizon - impossible unless you're Mystic Meg.
The finance industry is 99% bullshit, as is the newspaper industry.
Edit to add - just to blow my own trumpet here, I reviewed a balanced client earlier and our portfolio for him (bespoke as they all are) has returned over 16% in the last 6 months. That said, as I've mentioned, looking at returns on their own completely misses the point when it comes to the IFA value proposition.
seasideone
Well-known member
Your last line is so true, the stock market is more irrational than most ex wives (or husbands) in the short term
and that is where/why you can make money in the long term.If you were ging to give advice on how to pick an IFA or Fund Manager - what criteria would you use?
seasideone
Well-known member
According to the rule of 72.....
If you take your annual return, lets say 10% and divide 72/10, it says it will take 7.2 years to double your money.
My goal is to double my money every 3 years which means I need a 24% annual return, therefore I target in the 26-28% range.
Last year I achieved 45.5% and so far this year I am up 16.83% as of close of the markets yesterday, granted it is currently un-crystalised.
I also do not play with penny shares, or companies that do not have a track record of constantly delivering excellent results.
I think I should also point out that I have had for a proper financial education off a US Hedge Fund and now pay for access to their research and trades. I do not do all their trades as I do not like some of them, but I do apply what I have learnt to my own choices.
The real problem I have isn't not knowing what to buy - it is when to sell, as I have sold multiple times to find the stock continues on a hugely massive trajectory which cost me a fortune in lost profits.
I also find it easier to pick winners in a bear market as the valuations are less, so I like to buy a depressed valuation of a great company and hold it to either the stock and/or the market recovers.
I also do not believe in the "diversified" portfolio that many push, I prefer to buy a select few stocks that have been fully researched and am happy to hold whatever happens to them, in fact the more they go down the more I buy as I am certain they will recover over time.
Well, for an IFA I'd recommend selecting me if you're outside the UK, or if you're in the UK somebody I refer clients to there (there are 2 or 3 I pass business to). I don't trust anybody else because I've seen how the average IFA operates and I generally hate the profession, I reckon less than 10% are good, the rest are just glorified salesmen. One criteria would be the question - how many potential clients have you advised to do nothing, despite you earning no fees from that advice? For the vast majority, it will be 0 (if they're honest of course, which isn't a given).Your last line is so true, the stock market is more irrational than most ex wives (or husbands) in the short term
If you were ging to give advice on how to pick an IFA or Fund Manager - what criteria would you use?
Fund managers are harder, definitely look at performance over 5 years +, preferably 10 years if they have the history. If not in that fund, check their previous funds too. You want to see how they perform in all market conditions, you can only really do that over 10 years. That said, I don't use that much active management specifically because it's so hard to find value. I'd also check how their fund constrains itself to it's mission statement and holdings rules - a lot of them creep away from what made them successful previously, sometimes it's even quicker, like for instance Neil Woodford - his risk management dropped off a cliff, and you don't want to be stuck with a fund manager like that. In fact, the "personality" fund managers rarely maintain performance over longer timeframes, if ever. In his case if rumours are to be believed, some events in his personal life may have influenced his decision-making, so you never know where the risk is really.
It's definitely not easy, as you can tell I don't have a lot of faith in the industry on the whole. I set my firm up specifically to combat all the bullshit in the overseas markets, but standards in the UK are poor too, albeit in different ways. It's been a battle all through my career to be honest.
Lot of truth here - selling is the hardest part for sure.
On diversification - I currently only hold 2 shares in my SIPP, it's only play money really but I hold over 80% in cash right now as I thought this year could get tricky as the market unwound the priced in rate cuts. I still think we'll see cuts this year, but probably 1 or 2 rather than the 4 or 5 some were talking about. That's the only pot of money I "trade" with as it doesn't really matter what happens to it and I can't access it yet anyway.
seasideone
Well-known member
What two stocks do you hold?
Briggsysgonagetya
Well-known member
Yes, anything under 20% and you may as well just buy an ETF. I rebalanced my portfolio at the end of January and (as of right now) im up 34% in the last 3 months
seasideone
Well-known member
Excellent - what do you own?
Briggsysgonagetya
Well-known member
Palantir
TransMedics
Hims and Hers health
Are my main positions at the moment,i sold my Nvidia a few weeks ago after a 200%ish gain to concentrate into Transmedics and H&H, Palantir is my main high conviction longterm holding over the next decade, i bought between $6- $11, current price is around $22
TransMedics
Hims and Hers health
Are my main positions at the moment,i sold my Nvidia a few weeks ago after a 200%ish gain to concentrate into Transmedics and H&H, Palantir is my main high conviction longterm holding over the next decade, i bought between $6- $11, current price is around $22
MicroStrategy and Tesla!
Briggsysgonagetya
Well-known member
If
if/when Tesla solve FSD and license it to other OEM’s they will be the most valuable company in the world, also Optimus and robotaxi. I can see Tesla 10-15 Xing from here, i love the company but i dont like the stock at the moment, i do hold a few shares right now but it will need to drop to around $100 for me to want to load up
seasideone
Well-known member
Very Cathie Wood!
Briggsysgonagetya
Well-known member
She does get it right sometimes
seasideone
Well-known member
I did very well with ARKK initially, bought at 50, went to 140 and got out at about 95.
It’s currently 45; she is a gambler to me, but I am thinking of having a few quid of my play fund back on her.
Briggsysgonagetya
Well-known member
The thing i dont like about ARKK is they dont let the winners run, if a stock goes up to a certain percentage of the total she dumps it, theyre only up 23% in the last year
seasideone
Well-known member
That goes back to the point about knowing when to sell
Briggsysgonagetya
Well-known member
Thats the hard partThat goes back to the point about knowing when to sell
Yes that's my long term play with them - their AI potential alone could be very interesting but I can't touch that money anyway for 15 years so it's very much a playing pot.