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Joe C
Posted: 08 February 2023 09:23:02(UTC)
#850

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There may be a few amongst us who delve into the details of specific holdings in order to form an opinion, but I would suggest that the majority don’t; nothing beyond a cursory look to get the general idea. You’re unlikely ever to attain the level of information gathered by the managers who picked the stuff.

Assuming you accept that the team is competent (and if you don't then this is all moot), then - is it more likely you know something they don’t, or they other way around?

I don’t see any issue here with making a long-term bet on a well-run trust with a fairly solid track record, currently available for double its average discount. Certainly 20% is punchy (too punchy for me, I have around 5%).

Unless I have missed the recent thread listing all the investment dead-cert recommendations for 2023 and beyond?
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Mr GL
Posted: 08 February 2023 09:33:06(UTC)
#848

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S Dobbo;256779 wrote:
I wonder how many here, are now 'long term holders' when they started off as traders seeking to profit from the discount?


I am most definitely not a long term buy and hold and never sell investor... I have been in and out of RIT many many times over the last probably 25 years... initially my PEPs and then TESSA type investments... then as part of a regular monthly drip feed ISAs... When my kids were born I had a direct monthly investment scheme set up directly with RIT (I think) for a while (but then they passed it over to someone else and I cashed in to manage it myself)...

I was not happy owning it at 10% premium in the 2018/19 period and since the covid crash have bought in large chunks when I felt the discount has widened too much and sold when I felt the shares had rallied too much...

At these prices and at what I would guess is an almost 20% ish discount I am a long term investor and holding 20% of AUM in it...

IF the price rallies too much then I would be forced to sell... IF from here its a slow grinder and returns to the slow and steady type performance then I could see myself owning it for a long time... all depends on the price action...

IF it gets to a 10% type discount I would probably want to have maybe 10% of AUM in it...
IF it gets to parity / premium I will sell it all - probably

The debate upthread - which I really do want to have - is helping me understand if I am crazy or not... I think I am on the right side of risk / reward and feel I am in an asymmetric trade... IF markets sell off from here RIT will do no worse than the market IF markets rally from here RIT will rally harder as investors look for underperformers and discount tightening...

Yes - the discount could blow out even wider but historically RIT have shown willingness to buy back shares in the 15-20% discount region - and I expect these will resume post results which are due in 3 weeks time... and before that we should get end of Jan NAV which should be a step higher to reflect general market rallies YTD and especially their China exposure which has been strong outperformer this year...
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Andy JR
Posted: 08 February 2023 10:00:48(UTC)
#833

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Mr GL;256754 wrote:
Logic Prophets;256622 wrote:
We can all try and second guess the true valuation on PE at this moment in time…. and I guess some of you probably know my thoughts by now…. but everyone should bear in mind that this preliminary NAV update is an “estimate” and no more than that.

“As normal at this stage of our year end, the preliminary NAV is an estimate and remains subject to adjustment and audit. Full details will be included in the 2022 Annual Report & Accounts, which is expected to be published at the end of February.”


OK.. lets try this...

I have clearly stated why I think Rit is a buy here ... based off discount, recent NAV announcement, using comparable index movements, It's own track history...

What do you think?

Is RIT is a Buy, Sell or Hold here? SP at close was 1986p


Even without the detailed analysis, In the present climate with higher interest rates for longer climate I just cannot see how any PE stock can flourish.
It does depend though upon an individual’s circumstances as to whether to buy, sell, hold or just watch.
if you think you can time the bottom and like a gamble why not buy!
However I would rather wait and see when the corner has been turned, miss a bit of upside possibly but save a lot on probable downside.
I bought a few only (0.4% of pf at 1952 ) as a pure in out gamble prior to release of latest NAV.
I should have sold them last week on the spike up caused by market miss interpretation of interest rate outlook.
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Mr GL on 08/02/2023(UTC)
bill xxxx
Posted: 08 February 2023 10:04:46(UTC)
#851

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We've got a lot of these, in long-term trusts, so expect to hold them for many years - as no doubt do the Rothschilds. Bought a few more recently at 1960. Have never sold a single share.

I like RCP's exposure to a wide range of assets, including ones that I probably wouldn't be able to access otherwise. We also hold a lot of PNL, CGT and Ruffer, each of which has a particular tilt, but all of which carry less risk than RCP. We also hold some VWRL, just in case equities do remain the only game in town.

I don't think that the Rothschilds have suddenly lost it in recent months, it's just been a year when the pluses didn't outweigh the minuses in their portfolio. I can remember this happening to Ruffer - their stated aim is to not lose money in a 12 month period, but they pretty much did that a few years ago, when their expensive derivatives protections didn't deliver. The Ruffer unit price was essentially flat between 2016 and 2020.

For RCP, it seems to me that a c.20% discount right now - if that's what it is - is very good value on any reasonable period. No idea where it's going in the short term of course

One thing that might tighten the discount a bit is a return of buying back - they last did in December, at around 2000, when I think the discount might have been c.15%-ish. At the same time, a couple of directors also bought.





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Robert D
Posted: 08 February 2023 10:31:26(UTC)
#852

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bill xxxx;256785 wrote:

One thing that might tighten the discount a bit is a return of buying back - they last did in December, at around 2000, when I think the discount might have been c.15%-ish. At the same time, a couple of directors also bought.




RSE has been buying back shares for the past 12 months and the discount has continued to widen (now around 50%) so I'm not sure buybacks do much for the SP

Looking at the charts the RCP share price is well below the 200-day moving average - not usually a good sign
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You have to change your life
Posted: 08 February 2023 14:47:18(UTC)
#853

Joined: 17/11/2021(UTC)
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The 2,000 mark is psychologically important - especially as RIT have been dancing around it for several years.

I'm sure the company will support it via share buybacks or increased dividend ( I gather the company can "smooth" payments).

So 2000 is probably the floor. The upside more difficult to assess, but isn't it always?
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npf
Posted: 08 February 2023 18:47:05(UTC)
#849

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Mr GL;256782 wrote:
helping me understand if I am crazy or not... I think I am on the right side of risk / reward and feel I am in an asymmetric trade.


Not crazy and I concur it seems a reasonable punt for both a trade or a longer term hold. However, I guess I would say that, as I've also punted a 10% slug of my portfolio into it recently.

But, not sure I'd describe it as asymetric though, as it's hardly a 'your money back at the very least' situation. I view it as a potential 10-15% upside this year if markets are steadily "up and to the right" but with a decent downside risk if markets puke.

As already discussed, Jan's NAV should be a step up, not just from Chinese and US equities, but also from fixed income, with a bit of headwind from GBP-USD's 3% appreciation. Feb's NAV might also be heading for another step up as the currency appreciation has, so far, largely unwound and Chinese equities are still gaining.

There's nothing yet on the horizon that might repair the discount. Needs a few months of decent NAV growth for that, even better if they can deliver it when markets aren't, and try to regain some defensive credibility.

Oh, and IIRC, the share price has tended to do OK around new ISA season, so Apr might see a little improvement on the discount front.
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Mr GL
Posted: 09 February 2023 09:46:10(UTC)
#846

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mdss68;256777 wrote:
Can I find a link now, naturally not......but I'm about 90% certain I read something about RIT reducing their Coupang stake, maybe 6 months or more back now.


here...

Numis said –

RIT Capital Partners – Value in defensive exposure

Numis views: The December NAV wraps up a challenging year for RIT Capital which saw the NAV total return down 13.3% versus -12.9% for the MSCI AC World index (50% sterling), or -8.1% in Sterling. On the face of it, returns in-line or below weak equity markets will be disappointing for investors seeking defensive exposure from RIT Capital. However, the NAV’s insulation from falling markets in December, was reflective of performance over the year. We believe that RIT Capital continues to demonstrate the type of risk/return profile investors generally expect from RIT, with more resilient NAV performance in falling equity markets, but lagging in rising markets; the lag in rising markets was significant in 2022 markets, which left the fund broadly in line with its equity market benchmark over the whole year. RIT Capital takes an active approach to managing risk, meaning it is not always clear exactly what the underlying exposure is, but this led to it hedging some of its growth exposure during the year and has historically seen it hedge its market exposure to specific holdings, such as Coupang, which was invested as a private and held through IPO.
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Strangways
Posted: 09 February 2023 10:57:08(UTC)
#828

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Mr GL;256667 wrote:


its not a meltdown - but I need more than just insinuation to work out if I am wrong here... I have over 500k invested in RIT... this is the biggest position I hold... and I want you or anyone to question and challenge each and every decision I make - no issue with that - but we have to deal with facts and logic - and not get sucked into postulating fraud / dishonesty etc...

So - sorry I questioned your intentions earlier... BUT please try to use the facts at hand when framing a debate... we'll all go crazy if we lose trust ... panics occur because investors lose trust... and from your response just now I can see that was not your intention... but from my response you can see how I am a little anxious...


You're not alone Mr GL. I have about 300K in RIT. Most of it is a long term holding, but I've been adding recently. I'm pretty relaxed about it. The attraction of RIT as a trade, is that if it all goes wrong, you're still left with a holding in large, diversified and liquid IT. There are much worse places to be.
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Mr GL
Posted: 09 February 2023 11:36:27(UTC)
#854

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I know this is abhorrent to many - comparing RIT with CGT/RICA/PNL.... but I'm going to anyway...
3 years from Dec 19 before COVID to Dec 22

NAV/sh Dec-19 .. Dec-22 .. change

CGT. 4274 …. 4832 …. 13.1%
PNL. 419 ….. 470 ….. 12.2%
RICA 231 …... 308 …... 33.3%
RCP. 2004 … 2388 … 19.2%

VWRL 70.56 … 82.8 …... 17.3%

mandates
CGT
Capital Gearing Trust's objective is to preserve and over time grow shareholders' real wealth.

PNL
Our policy is to protect and increase (in that order) the value of shareholders’ funds per share over the long term.

RICA
It has a simple aim – consistent positive returns, regardless of how the financial markets perform.
We try not to lose money in any 12 month period, and to grow the value of our investors’ wealth over the long haul.
If we can do this, we should outpace inflation, protecting and increasing the real value of our investors’ income and capital.

RIT
Free from the constraints of a formal benchmark, RIT has a remit to invest globally in any asset class.
Our corporate objective is to deliver long-term capital growth, while preserving shareholders’ capital; to invest without the constraints of a formal benchmark, but to deliver for shareholders increases in capital value in excess of the relevant indices over time.
Therefore we aim to deliver healthy participation in up markets with reasonable protection in down markets. Over time this should allow us to compound ahead of markets through the cycles.

VWRL
The Fund seeks to track the performance of the FTSE All-World Index.


I have
8.7% Capital Gearing CGT
8.8% Personal Assets PNL
9.7% Ruffer RICA
20.2% RIT Capital RCP
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