Member Info for lordloadsoflolly

290754 - playing devil’s advocate, I suppose you could argue SMT’s managers might be persuaded to play things more cautiously with unlisteds in future, as these have been a drag on recent performance.

And that could lead to lost opportunities.

Or that they might be talked into part-selling some of their holdings with more racy current valuations (Nvidia springs to mind). Personally, I’d be quite happy with that anyway, but I guess it might mean missing out on the final? leg of their bull run.

I don’t really see much downside with Elliott myself, but am just trying to surmise the type of concerns others might have.

Oldnbald - not sure if this was addressed at me "Any chance you could post the content pls? Behind a paywall."

The content in that link's not behind a paywall for me. But if it still is for you, let me know and I'll post the most relevant bits (it's a lengthy article!)

Elrico - what the fundraise ACTUALLY indicates is that Opti has insufficient capital (due to slow sales) to grow the business & that it doesn't want to sell further SBTX stock at its current beaten up level.

#PlacingAsALastResort

I think we've established by now that some buybacks produce long term benefits, others don't.

What's perhaps more relevant here is Elliott's involvement (which probably kickstarted SMT's new buyback scheme in the first place).

As I've posted previously, it's worth reading up on Alliance Trust's "run in" with Elliott. In 2017, Elliott finally sold its holding in AT, saying:

"When Elliott became a shareholder over five years ago Alliance Trust had poor corporate governance and its shares traded at more than a 15% discount to net asset value. Since then, corporate governance has improved, an external asset manager has been proposed and the discount has narrowed to less than 5%."

You can read the full article via the link below. Whilst Elliott's relationship with AT was certainly fractious, the end result was largely positive:

www.citywire.com/new-model-adviser/news/elliott-ends-war-with-alliance-trust/a987878

Goldgirl's posts - laughable

IMM investor sentiment is improving.

I've not listened to the CEO where others report Tim "talking about shareholder value and to ride the share up".

Assuming he DID actually say that, it would a major red flag for me. Firstly, because Tim's projections have consistently been way out up until now. And secondly, because any CEO who tries to talk their own share price up normally knows the fundamentals don't support their argument - yet at least. Otherwise the market wouldn't really need any convincing.

DorestLSE - sure, not every buyback bolsters a share price in the longer term.

Just as not every buyback is done for the same reason initially.

Diageo has very little in common with SMT, so I don’t see how you can usefully extrapolate from one to t’other.

As for preferring a special dividend, in effect you’ve been given one right now - thanks to the near 13% share price uplift since 15 March.

If you think there are better opportunities out there, now might be a good time to take the money & run.

Personally, I don’t see it that way & will definitively be staying put.

DorsetLSE - there are probably two main schools of thought with buybacks.

Either: managers are running out of growth opportunities & see buybacks as a short term way to boost the share price.

Or: managers genuinely believe their shares are currently undervalued & use buybacks to signal this to the market.

Whichever people believe here, the short term impact is that with fewer shares in issue, the price rises. So SMT value creation, rather than destruction, for now.

Personally, I believe the size of the buyback programme is the gamechanger here, as it’s far greater than any previous scheme. And it’s not as if the shares are being bought back at a particularly high price for now. Which is probably why they’ve gone in hard early, whilst the price remains relatively subdued. They’ve already bought back over £40m worth in the first week.

Stocksr- I don’t think the managers will “have adjusted their investments to more profitable equities.”

That’s not their style.

What HAS changed (& is largely responsible for the recent SP re-rate) is the big boost in share buybacks. Plus news that an activist investor, renowned for improving performance at another trust, has acquired a 5% stake.

Thrfrogster - I guess we'll never know their precise motivation. But whatever - from where I'm standing, it's hard to read any negatives into it.

StrictlyZinc - whatever attracted Elliott Associates to SMT, given their history they presumably view it as a fund whose recent underperformance they can help reverse. Otherwise, why increase their holding to 5%?

Doesn't necessarily mean they're right of course, but at least they've succeeded with others in the past.

Laallee - thanks for this - an interesting development!

I see it as quite positive & it'll certainly keep SMT's managers on their toes.

Alliance Trust's SP has gone up from around 500p in 2015 to 1225p today. And it has way outperformed its benchmark over the last 5 years:

www.trustnet.com/factsheets/T/id56/alliance-trust-plc/

Contrast that with the 10 years prior to Elliott's 2015 intervention, when Alliance Trust rose less than 70%. Admittedly this earlier period includes the 2007/8 financial crisis, but even so.

CaptainPicard - I think your actions perfectly illustrate risk management.

Every investor's circumstances are different. And to some extent - along with your personality - they're likely to determine attitude to risk.

Life's too short to have sleepless nights worrying about the investments you manage. So by taking action to address this, you've done exactly the right thing. So what if you could have got a bit more? You'd have still had that worry in the meantime. And you broke even at the end of the day (probably better, once dividends are factored in).

Plus, valuable lesson learnt. Always ask yourself BEFORE investing how comfortable you'd be if you lost some/all of the money. If the answer's "not very", invest less. Or choose something altogether safer.

Lordmakealot - your best guide to Guident's current worth will be the latest US funding round.

My main concerns (apart from the Auve Tech partnership vehicles resembling Teletubbie milk floats) are that Guident remains a small cap minnow. And despite its patents, a much bigger concern could easily come along, throw money at the same problems & end up eating Guident's lunch.

Unlike your preference for Guident, a lot of posters on here said they were in for Microsalt only. And whilst their recent IPO went well (though there are signs the early launch froth is dissipating), Tek's own SP continues to drift ever lower.

So the question isn't so much whether some/all of Tek's holdings might eventually become more valuable. It's whether Tek can reward its shareholders by returning any of this value to them.

If, instead, Tek repeatedly chooses to plough any gains into its next buzzword venture, then over the years shareholders will simply be diluted to oblivion.

Yes, it IS all just hope until Tek shows how it can extract any shareholder value from any of its holdings.

At the moment, Tek's share price speaks volumes on this, regardless of how well - or badly - its holdings are growing.

Gotoutjustintime - I certainly see their buyback programme as a positive. And so does the market for now.

It's no coincidence SMT closed at 781p on 14 March and is currently hovering around 859p, following their buyback RNS on 15 March.

Shano1 - that’s certainly one way of looking at it.

But one look at SMT’s share price since the buyback programme was announced suggests a possible alternative take on things.

Personally I hope the comment referenced in my previous link about funding buybacks by "trimming positions based on their size" applies to Nvidia. No harm in top slicing, particulary when a holding has experienced a meteoric rise and is looking like it may now pause for breath:

www.hl.co.uk/shares/shares-search-results/n/nvidia-corp-usd0.001

Absolutely no need for anyone to apologise!

After all, there are no hard & fast rules on any BB - and I'm certainly not some kind of self-appointed moderator here.

Just better IMHO if we generally keep comments relevant to SMT. On which note, I found the following article on the recent buyback announcement interesting:

www.trustnet.com/news/13408629/how-scottish-mortgage-will-pay-for-its-1bn-buyback-scheme

We seem to have gone a bit off message.

Just a reminder this is an SMT board guys, not a pensions help line.