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Fela69, I'm afraid your perspective does not compute with my assessment of SMT. It is what it is, has some fab companies which it historically acquired just at the right time and has done very well for me thank you very much.
Admittedly it has underperformed in recent times but how much of this (beyond the given global economics) is actually down to proven mismanagement or poor company selection and purchasing?
Who has the authority or credentials on here to say anything that SMT have done recently is a mistake or ill advised?
Despite everyone having their own opinions I personally believe smt to still have a sound management style and structure and do not believe the disfavour they are clearly considered in at the moment to be justified (again, over and above the given economic malaise bought about by inflation).
In short the sp and current opinion are fixed in this present time, but in 2 years time it could well be a wildly different situation with the media lauding SMT management as being as good as ever and all the forecasting brokers having returned it to firmly "strong buy" status.
In short one man's "disappointment" is potentially another man's future opportunity.
Fela, please don't be sad. I'm far more of the opinion that SMT will (from their current standing) outperform just about anything before too long.
I look at it that way having had half a lifetime of the shocks and fears inherent in investing.
I used to think it was complicated, but it doesn't have to be really.
Sure SMT have lost biggest of all (probably rightly down to the fears discussed peculiar to smt), but similar trusts have lost quite big in the exact same pattern too.
The truth is in the pattern of loss which can only be underlined across all of these investments as high inflation.
It's like looking out if the window and seeing day yet doubting the evidence of your own eyes and wondering if it's night down to analytics and statistics.. Ok .. that's a crap and extreme analogy but I'm sure you get my jist.
The argument that the 20% discount sp isn't real down to the unproven nature if a similar % of unlisted inclusions in SMT is a reasonable one, until you might also consider that they were companies chosen by a team of experts who assume at least one or two to take off big . This is indeed a wild card that makes any a riskier yet potentially profitable purchase, or is it??
Given your opinion that the market probably completely discounts the worth of these unlisteds based upon their unproven worth you might consider them a tombola bonus (to some degree at least)..
Stay invested and sleep well...
I'm interested Fela96, what's your background?
You do strike me in all that you write here (very strongly) as a youngster trying to utilise investment theory pretty much in isolation to all else.
Can I just ask that if at the time you purchased your SMT you had done the homework and assessed it as a good investment?
If so, just stick with that.
The theory isn't going to help because we are passing through one mother of a flux at the mo and no one (that's no one) can foresee anything beyond the fact that these type of investments always do better in low interest economics.
That's all you need to know, so either grit your teeth and hold (recommended by me rather a lot) or sell and sleep better.
Well call me revolutionary, but I like closed ended investment trusts exactly because they are run by a team of investment experts whose own reputations and livelihood relies on them being profitable.
You also get the safety of dozens of individual investments all rolled up in one.
Theory is all very well, Fela96, but it has to add up convincingly for it to stand as an argument and even then is liable to fall on its ass..
Believe you me, you are over complicating things. Perhaps you should forward your protestations that SMT are failing for the reasons of x, y and z to the SMT management team? As those investment experts are liable to be out of a job if they don't succeed, I'm sure they'll snap to it.
I recently sold a small holding of Worldwide Health Care that had underperformed prior to high inflation and bought a few more SMT in their place.
Should have done so sooner.
I'm reasonably sure they'll do better in the longer term in SMT than where they were .
It has just also occurred to me... If the market is always right, why was SMT valued at 1550pps in Nov 21?
The simple answer is that the market wasn't right, rather SMT was simply the market leader investment trust safe haven bet in a difficult marketplace and everyone got on the bus.
I wish I'd got off the bus with them later but don't play that game and have collectively done ok...
The lesson is that it's all fluid, nothing is fixed and that indices and calculator's will never replace a crystal ball or anticipate human sentiment or emotion.
Before having to also apologise out of insensitivity for those who have invested and lost, can I also point out that I have "lost" around £140k staying invested in SMT since the absurdly frothy heights of Nov 21.
I stayed put throughout the froth knowing that the gains I made would likely be lost in future adjustments.
I'm currently (today) slightly above where I was before the initial loss of the COVID realisation panic of Feb 20.
Easy come, easy go.
Sure, SMT is less popular than comparisons but is really not that complex or different.
Sure the 20% nav discount has been consistently analysed on here as between making SMT anything between a giveaway and deeply suspicion laden.
Can I be revolutionary here and just say that it is what it is and that the collective SMT concerns are and will be worth a great deal more once things get better.
Just because the market say x=y now doesn't mean it's fixed, because of course markets aren't fixed or they wouldn't exist.
At heart a product promised tomorrow by a collection of great companies is deemed worth eff all when world inflation runs hot. This is the problem.
We know this.
Sentiment isn't there for SMT right now, and given the media slant upon it is utterly surprising (I know... Blah, blah, yawn... Etc)...?
I'll ditch my input again for a while as it seems deep analytics and pessimism rule the current mood.
Moderna have their foundation in mRNA science. They will make money with this as it's a biggie with multiple future opportunities and they know what they are doing.
Perhaps SMT know this also?
SMT is an investment that will be screwed in sentiment down to the fact that future ideas aren't deemed as profitable when the jackpots come in at some non definable future point, but every human endeavour wishes the wheel to turn.
It's all about sentiment and although I completely agree the market is "always right", investment wouldn't exist if it was fixed.
SMT isn't a bloody lemon, but is full of profitable companies
Who cares what people think of it now, and maybe what they think of it now is a nod to future profitability?
We aren't investing in it for an immediate return, or are we?
Past performance cannot be utilised as an indicator to future performance.
Perhaps a chill pill and stowing the calculators may be a worthy tactic right now?
General inflationary fears at a renewed peak have knocked off the recovery, Dontshootme, your investment will be worth more than it is right now but you may have to wait.
I'm not going to repeat the media smt downcry argument any more, because clearly it's only me who believes in it (recommendations given then withdrawn accounted for).
You live a long life and invest for many years and things can seem simpler somehow.
The only absolute we can take away from this is the effect of inflation on sentiment and current value.
It's not a general rule (but far from coincidental) that I often see negativity during LSE opening turning into opposite positivity during NYSE opening for SMT. On that basis I do think there is a (baffling) association between mentality linked to our more knackered outlook than that in trading in it from other less afflicted countries.
I've tried to ascertain the numbers investing in SMT and where they reside (which might account to a slant towards pessimism for those who inevitably and wrongly associate SMT with the UK), but this info isn't obvious.
Whatever, you would expect investment from all corners would come out balanced in the wash.
Whatever, Id say SMT is definitely over inflicted with negative sentiment at the moment and repeat my rather simplistic view that this has largely been created and driven by media sentiment.
In psychology there is proven humanistic theory called "primacy versus recency". This dictates that initial impressions of something or something new to the conceiver are accepted in face value, and only multiple successive more positive re introductions to that something will erode the primary assessment.
I think we can all agree and connect with this, and given the poop SMT has found itself badmouthed into (whereas other investment trusts have received zero issues, suffered no changes or criticism), then I feel less surprised at the current unpopularity.
As for algorithms and theories?
My impression is whilst all that stuff can potentially be useful for concreting ideas of worth and future worth, I have found my gut offers 75% surety over my many years of investment.
It remains all of our greatest asset, and on that basis I can see only strong reason for holding.
As for fears as concerns moderna, although not performing and largely static at the moment (indeed over the last few years post predictable losses re inflation), I'm not particularly worried in the same way as I'm not particularly excited.
So I am overcomplicating it and missing the simple basics am I F96?
Funny...
Saying SMT is a fail and offering statistical argument to back it up that (shall we say) fails isn't complicating things?
With all the respect, time for me to press the eject button on this.
So ATT fails on a shorter term perspective of around 3 years and so does PCT? Of course SMT fails on a shorter term perspective as a great many other have given the spectre of high inflation.
I'm still buying the 5 year argument as a very good one (although one that will likely be tested somewhat from Nov 26)...
We shall see ...
Your argument is; "SMT is a failing trust.. Correct?"...
That says to me either to encourage discussion for someone holding who is trying to better visualise the future profitability (all good stuff for discussion and very natural), or someone who is convinced it is a loser.
However the 5 year loss argument is presented, simply looking at the graph doesn't actually show a single period in which a 5 year loss has actually yet occurred. It may well do so in a couple of years comparitive to the ridiculous froth at the height of Nov 2021, but that might be seen as reasonable..
We all knew these trusts were getting frothy in 2021, and none more than SMT being the obvious best choice for the more casual investor to chuck into given (I did the maths at the time) it offered the best returns over the previous 18 months...
Cue the rush for the door for those treating it as a buck generating safe haven.
I'm not bitter now as the hyperinflation was temporary and didn't view it as the true worth of what I was already invested in.
That's another perspective into the magnified extent of losses right there.
Fela96, you say "SMT fails on the 5 year time scale"?? How? Today it's 796 and 5 years ago to the day it was 535? In November 2026 you may be proven correct given the slide from Nov 21, but down to universal factors others may well be in the same boat ..
Having said that, I wouldn't be surprised if you are proven wrong there also...
Whatever.. I'll probably still own them at that time and be happy to do so.
Ok Fela96.. Fair enough.
I was convinced by your arguments that you were sold out. I take it therefore you are seeking reassurance that it isn't a turkey and to continue irrevocably on its recent path...?
Completely understandable and it has been a fantastically rough 2 years for holders...
It isn't my largest holding but I still have £100k plus and this current moment I actually see as the possibly most insane point to sell in the trust's history.
I am probably the weakest analyst on this discussion forum but sometimes just the basics are enough.
We know the presiding reasons for the exceptional losses above other investment trusts such as pct/att (Bilde, media, unlisted/doubt etc). You now have to ask yourself as the light at the end of fhe hyperinflationary tunnel increases whether the great many excellent companies within the trust are liable to continue losing?
The wheel will not stop turning and man will not stop wanting the best in any world situation and so these companies will profit.
I am more concerned as goes China and Putin right at the moment, but it is difficult to extricate yourself from those crystal ball pitfalls in any investment scenario.
Simplistic and obvious stuff granted, but sometimes I believe things can be overthought.
..as in my mind you have conveniently left out other periods in which SMT has successfully made a great deal for it's investors.
SMT simply does not at this moment represent a 5 year loss and is also in very good company indeed as goes other losers who bought into around a year following November 21.
It doesn't.
Your arguments remind me to the commercial effectiveness of research bias. Concentrate on the aspects of "fact" that lend themselves to your particular argument and you can "prove" just about anything...
Yes Fela96, SMT must therefore be a failing investment.
Correct.
Let me to be the first to congratulate you and censure your fine judgement.
You win the cuddly toy.
Might we just see if SMT is a failing investment and for the time being accept that the trust has not recently performed well?
I have found human beings and their actions to be somewhat complex, and despite respecting maths, graphs statistics not all mysteries can be solved by it.
I was hoping thinking LLL's "lies, damn lies and statistics" might have tempered the abject pessimism to some degree as in my mind...
You are talking of an extraordinary period in our history there Fela96. I offer a differing perspective in that I have never sold any of my SMT holdings in the last 25 years + but was still up over 100% (not sure how much) at their recent lowest point.
I sleep well at night yet have my retirement on a plate along with the belief that SMT stand to gain now and for the next many years to a far greater likelihood than to lose.
Its a matter of perspective and so I do appreciate yours.
That's a fair enough comment, Fela96. But your comment underlines you as a slightly differing fish to many remaining invested in SMT and disregards the entire strategy and discipline that has always underlined smt.
Buy well and hold through thin in order to reward through thick.