Member Info for Mr.Flibbles

New coverage Berenberg Bank 680.00p. The 1-year target must look to add 20% to the NAV and the discount to close to zero would equal exactly the 50% upside I mentioned in my previous post, they must have used the same crude calculation!

I also added into 2 accounts during that dip at 441p today. having previously added ay 470p and 460p.

Lastly... the lack of investor interest you mentioned appears to be getting looked at in the result comments Karen wrote: "In parallel with our continued focussed portfolio approach and our vision to democratise venture capital we have also made some investments in our own business to build the infrastructure that will enable us to broaden our appeal to a wider pool of investors who would not usually have access to private high growth technology companies.".

Personally I feel like a seed investor here.

Thank you for updating here.

Hi Steph, HGT and MERI are just used as an example to show you that they have no discount and are comparable.

Results are out today showing a satisfactory 5.7% growth in NAV given some post C19 re-valuations. GROW aim for an annualised return of 20% so this time next year and the following year they will have to aim for more than 20%, not saying they will, but if they show signs the discount will close rapidly and you're looking at a staggering 50% return on the actual SP in just 1 year from. Would be a nice portfolio boost.

All we need to do is give it time.

Cya on the citywire fund forum.

Hi Steph, good to see you are close to EU high tech ecosystem. I don't think EU private sector growing tech companies are held back if you see the annualised performance of HGT they match the US software index returning 14-15% annualised and in most recent years closer to 20% annualised. If the sector GROW was in was undervalued I would not be investing here. I am here because I do see a disconnect between the sector and GROW's share price. I do believe the best UK/EU talent is in the non-listed sector and I believe GROW should be trading at 560p today and this gap will close quickly. I agree with your forecast of 640p perhaps this time next year, but we have to take into consideration the volatility of listed private equity could be a drag on this. You can see this volatility of listed private equity if you go back to studying the graph during the last financial crisis of HVPE and PIN vs say something sensible like a 60:40 portfolio or LSE:CGT.

Polar Technology type trusts have benefitted from technology but they have the edge because lots of the stay at home economy stocks are publically listed Zoom, Netflix, Amazon, Microsoft etc. and these are well known and retail investors are jumping in on them in unprecedented volume... I was lucky to buy some Ocado stock. But GROW do have companies like TransferWise and again this is a reason why we should be 560p today. I work closely with two other companies in GROW's portfolio daily and I can see first had they are in a good position. The portfolio companies I don't have feelings like Graphcore and Aircall look seriously good and I don't like to ramp anything up but I am very excited about all these companies doubling in price and would welcome them to only IPO much later in their development as is the new trend. I don't want to miss out on this growth.

PART 2:

8) no reason why GROW from this starting point can't double in SP every 4 to 6 years for the foreseeable future.
AMSWER: It will take just 4-5 years to double your money presuming 20% annualised return. Similar returns can be found with Ballie Gifford funds and tech funds like Polar and ATT. But a more realistic 15% annualised return is sensible. Do spread your risks.

What am I missing?
ANSWER:
Did you buy GROW based on low P/E? This is not the way to buy stocks. The way I buy stocks are qualitative. For example, I loaded up on Ocado because I use them and seen every other person post virus jump on them. I buy GROW cos I use their products. I no longer care too much about earings or profit numbers (like Ballie Gifford). If you want to use P/E's in your companies you buy stick to those with high P/E ratings not low ones so you don't get suckered into these value stocks that have never performed (See value factor ETF vs momentum factor ETF's!!!). With funds P/E can be ignored ,it is the NAV you are after.

See you in the fund forum where experts and experience can take your questions rather than me who knows very little really.

I am an amateur too. I have a day job!

PART1:

1) IN the long run (20 years) Grow SP will increase in line with the profits made by the underlying companies.
REPLY: The NAV of every company should be calculated ever 6 months or so by an independent source. A monthly NAV is provided by many private equity funds based on exchange rates and any recent deals.

2) This is because those profits will in time be embedded in dividends paid (almost zero) and increases in the valuations of the underlying assets (which will in time be proportional to profits made).
REPLY: A company does not have to pay a dividend especially through the growth phase. These days the dividend is put to better use by investing in growth.

3) IN the short run GROW's Earnings (E) based as it is on SP valuations of its assets will be very volatile and dependent on market sentiment for the sector -as that affects the benchmark valuations even if disconnected from profits actually earned by the underlying companies in any year.
REPLY: Yes the share price is based on market sentiment relative to the NAV valuations + cash. The sentiment these days is not quantitative (earning etc... that can be found by any tom and harry) but qualitative, earnings are irrelevant and low P/E's are generally a bad thing (get your head around that by joining a proper forum!)

4) Because GROW E will be very volatile the P/E is lower than the sector. Basic price to be paid for volatility
ANSWER: Yes the discount to NAV because it is volatile, but I believe it should be higher because of qualitative factors, not quants. Always use NAV in a fund not P/E. Funds will take a percentage cut of NAV every year for themselves.

5) For my money, the discount is exaggerated. I intend to hold long term and am happy for the short term depression of SP to occur due to market sentiment rather than due to any real profit performance of GROW's underlying companies (who are overall doing well in the COVID world we are in).
ANSWER: I agree.

6) curious why corporates who can also hold long term are not more into GROW resulting in a higher short term SP smoothing the upwards curve a bit by having a higher starting point. 3.9 P/E is a silly starting point. The companies GROW owns are still earning money.
ANSWER: I am not sure how P/E is calculated on a fund nor do I see its relevance. I tend to ignore P/E or EV or even EBITDA these days and certainly for funds. What makes share prices go up and down are called factors. Please research "ETF Factors" that aim to simulate these factors.

7) I think in the long run when the market gets used to GROW (a newby) the discount to the sector technology trust p/E (benchmarked by say Polar) will slowly disappear. Results speak louder than plans.
ANSWER: This is tricky. Polar's assets will remain close to NAV. Private Equity often has a natural discount in most cases.

Hi steph, probably the same as what you think. The discount to NAV is cr18% so when we compare it is compared to MERI at no discount it is better valued, but MERI appeared to have cherry-picked the best, an exclusive in Starling Bank and higher percentages of Transferwise and Graphcore (that you know all about, interestingly Baillie Gifford own some).

I increased my position after Baillie Gifford bought in. They way Baillie Gifford value investments (they own Tesla and SpaceX) is not based on quantitive factors like cash, P/E, debt levels that anyone can have access via technology, but instead, they ask for qualitative factors like can you take customers into space. This aligns to GROW. What's been hit hard from this pandemic and for years is value stocks, GROW and Baillie Gifford do not own these so I beleive GROW should have traded higher but often private equity does trade at a discount (I hold HVPE and PIN too and a discount is expected).

I recommend joining Citywire fund insider forum (I post as Johan...), you will get some great advice on asset allocation and how funds work.

Damit no edit function on LSE. I should have srote: " Today we see 25,000K sell, do not worry at this level Baillie Gifford is probably buying at a few pence higher."

A couple of other points after digging deeper into the posts, where you see just 1 or two trades these are NOT some secret code. This is simply a fund with GROW inside it or a private equity tracker buying them as part of customers request to buy and sell it.

Today we see 25,000K sell, do not worry at this level Baillie Gifford most likely but an institution is probably buying at a few pence higher.

This is most likely my last post as I only invest in funds, where I am an active poster in a fund orientated forum. Do try and avoid individual stocks especially as here in the UK we don't really have access to the good markets like the US full of talent. The best UK talent is in private equity-like GROW and MERI. Unilever, Warhammer and Ocado are possibly some of the very few exceptions.

Hi everyone. For years I have avoided posting on forums like this after posting many years ago. There is a lot of false information on LSE like forums. P/E is largely irrelevant in a fund and do not reflect the valuations of the underlining companies. These conservative valuations are based in part on valuations of similar companies in the public sector. The other which is very similar to GROW is MERI. In the bigger cap space, you have HGT with a track record of 12-15% growth of NAV per annum. All these funds are highly volatile.

Nobody has picked up on the significance of Baillie Gifford buying in who have a track record of 20% per annum growth with SMT, though they are probably buying Draper for their EWI.

Companies in the private sector are no longer IPO'ing quickly and instead of staying private for longer capturing allot of the upside (please watch the video on MERI website).

I use some of the companies in GROW for work and yes they are very good while some are not the class leader. I have every confidence. But I do recommend not using these types of forums and instead move to asset allocation including funds and trackers for equities, bonds and gold. There are forums for them.