Lord Edgingtons "Get Rich Slowly" Stocks and shares bonanza

[LostinSpace]

Opposite for me. I’ve been buying individual shares all my life since Maggie gave me the bug and I put my first student grant in to BT shares. I rigorously benchmark myself against the FTSE 100 and the FTSE all share total return indices and comfortably beat them both. Though appreciate that there are other perhaps more relevant benchmarks.

The way I see it , you are paying a lot of expensive people to pick stocks for you when , by definition, they can only perform on average to the average before their costs. Exception for me is investing overseas. I have a few individual US and European holdings but for Asia and emerging markets I have investment trusts as I don’t have the confidence to do my own research in those markets.

You're right, you are paying other people to pick the stocks for you. Don't forget though that they are pros, and the charges include buying/selling stocks, and their costs for that are a lot less than yours. They are better at it that than you or me, and imo the charge is worth it.

I started in individual stocks and barely broke even, I've done nicely from IT's though and have made well over 10% pa over the last 5 years, that'll do me.

 

[chorleythehord]

You're right, you are paying other people to pick the stocks for you. Don't forget though that they are pros, and the charges include buying/selling stocks, and their costs for that are a lot less than yours. They are better at it that than you or me, and imo the charge is worth it.

I started in individual stocks and barely broke even, I've done nicely from IT's though and have made well over 10% pa over the last 5 years, that'll do me.

Yes, but you still have to correctly pick the guy who picks the stocks for you . There are any number of them all doing research. They can’t all be beating the market. Some lose some win. On average they do average. So you are paying for average. That’s my logic anyway.

i bought my godson some shares in Witan investment trust about 5 years ago as a christening Present. Had an Excellent track record of growing dividends and the share price. Since then it’s underperformed and now I’ve dug deeper i realised they did so well simply because they were overweight in tobacco which had a golden run and has since bombed.

Then there is the Woodford fiasco. I felt for many years that he did so well because he just happened to have a job in charge of a uk income based equities fund ( something I lean towards) and that sector overperformed for years. Some though thought he was a genius and followed him when he went solo ( and it’s hard t blame them) , and despite his army of expensive analysts he picked some terrible stocks And all his investors lost a fortune.

 

[LostinSpace]

Yes, but you still have to correctly pick the guy who picks the stocks for you . There are any number of them all doing research. They can’t all be beating the market. Some lose some win. On average they do average. So you are paying for average. That’s my logic anyway.

i bought my godson some shares in Witan investment trust about 5 years ago as a christening Present. Had an Excellent track record of growing dividends and the share price. Since then it’s underperformed and now I’ve dug deeper i realised they did so well simply because they were overweight in tobacco which had a golden run and has since bombed.

Then there is the Woodford fiasco. I felt for many years that he did so well because he just happened to have a job in charge of a uk income based equities fund ( something I lean towards) and that sector overperformed for years. Some though thought he was a genius and followed him when he went solo ( and it’s hard t blame them) , and despite his army of expensive analysts he picked some terrible stocks And all his investors lost a fortune.

You make some good points. As I said, I've done better with funds than I could with individual stocks. I try to avoid the in thing like Woodford, I did have money invested in his first fund which did far too well for an income fund after launch so I sold at a 10% profit. It'd been better if I'd sold earlier. Same with his patient capital trust, I made 20% from that. I think people were buying stocks because that's Woodford was buying at first, pushing prices up. There are some really good funds that've performed well year on year. I get the impression that you know your stuff, I'd be happy to discuss more by PM but if I carried on here, it'd bore most most posters to tears! Edgy was talking about a shares club, maybe set something up with a PM group? Not a share club, just a discussion group.

 

[We8PNE]

Not for widows & orphans, but if you like to take a risk, have a look at Versarien plc @ .3725p.

Graphene will be in everything in the future.

 

[Regardless]

Not for widows & orphans, but if you like to take a risk, have a look at Versarien plc @ .3725p.

Graphene will be in everything in the future.

Graphene will indeed be everywhere - so that's interesting. But go on We8... say a little more. Even 2 or 3 sentences to explain what sets them apart from other companies with respect to commercially exploiting graphene.

 

[LostinSpace]

Not for widows & orphans, but if you like to take a risk, have a look at Versarien plc @ .3725p.

Graphene will be in everything in the future.

Just stick to the Lasher thread eh.

 

[Regardless]

To be clear @We8PNE - I'm not asking a facetious question. Genuinely interested why you picked out this company. The graph I posted wasn't supposed to be pooh-poohing your recommendation... I just happened to look it up and thought it interesting enough to post, but past performance isn't an accurate guide for future performance! If you know why they've got into a few exciting bubbles in the past, that would be interesting. Of course, I could go and research but your 2 minute guide might help put people on the right track a lot quicker.

 

[jakehake]

You make some good points. As I said, I've done better with funds than I could with individual stocks. I try to avoid the in thing like Woodford, I did have money invested in his first fund which did far too well for an income fund after launch so I sold at a 10% profit. It'd been better if I'd sold earlier. Same with his patient capital trust, I made 20% from that. I think people were buying stocks because that's Woodford was buying at first, pushing prices up. There are some really good funds that've performed well year on year. I get the impression that you know your stuff, I'd be happy to discuss more by PM but if I carried on here, it'd bore most most posters to tears! Edgy was talking about a shares club, maybe set something up with a PM group? Not a share club, just a discussion group.

yoi can’t go all secret squirrel on us….if people want to discuss stuff on here we’re not forcing users to read it if they aren’t interested hence why I’d took those posts out of the Corona thread so it didn’t get lost or upset the natives

question for you and @chorleythehord about Woodford as seems you paid more attention regards what happened, I know it went pop but my scheme never allowed us to invest in his funds as it was all trustee chosen funds that we can then choose from and neither Invesco or Woodford were ever selected by them.

Was his undoing that in the Woodford venture he had switched away from the rules of his Invesco funds so he could invest in more unlisted/private ventures/startups? And it was a number of failures or write down in these ventures that collapsed the house of cards? Or was it other holdings that caused it to suffer? I vaguely recall that the point about unlisted stocks was one of the main problems in the end as when investors started to withdraw because those sort of holdings aren’t on markets you can’t just liquidised to get the cash back for people?

 

[jakehake]

To be clear @We8PNE - I'm not asking a facetious question. Genuinely interested why you picked out this company. The graph I posted wasn't supposed to be pooh-poohing your recommendation... I just happened to look it up and thought it interesting enough to post, but past performance isn't an accurate guide for future performance! If you know why they've got into a few exciting bubbles in the past, that would be interesting. Of course, I could go and research but your 2 minute guide might help put people on the right track a lot quicker.

the one bit that stands out for me on a quick scour of their details is the latest Director/PDMR report was the CEO dumping £900k of their holdings at 53p. Know everyone has their own personal financial goals and needs but Directors/Insiders with large or increasing holdings is a confidence booster normally.

But like yourself interested what the future holds that they suggested it

 

[Regardless]

What exactly ARE the laws on a CEO selling shares. By its very definition, surely it would technically be insider trading- so there must be special rules/ exemptions, unless I am misunderstanding something.

 

[jakehake]

What exactly ARE the laws on a CEO selling shares. By its very definition, surely it would technically be insider trading- so there must be special rules/ exemptions, unless I am misunderstanding something.

Think they normally have certain windows that they are permitted to do it in. Also will try and find it but some also set a forward looking set of rules that their broker/agent is then obliged to follow I.e they could say “on the 1st of each month if the price is >x then sell x% of holding” so technically isn’t insider trading as such. Also more basic stuff like they can’t trade within 30 days of financial reports being released I think

 

[LostinSpace]

yoi can’t go all secret squirrel on us….if people want to discuss stuff on here we’re not forcing users to read it if they aren’t interested hence why I’d took those posts out of the Corona thread so it didn’t get lost or upset the natives

question for you and @chorleythehord about Woodford as seems you paid more attention regards what happened, I know it went pop but my scheme never allowed us to invest in his funds as it was all trustee chosen funds that we can then choose from and neither Invesco or Woodford were ever selected by them.

Was his undoing that in the Woodford venture he had switched away from the rules of his Invesco funds so he could invest in more unlisted/private ventures/startups? And it was a number of failures or write down in these ventures that collapsed the house of cards? Or was it other holdings that caused it to suffer? I vaguely recall that the point about unlisted stocks was one of the main problems in the end as when investors started to withdraw because those sort of holdings aren’t on markets you can’t just liquidised to get the cash back for people?

No secrecy intended, I meant an open forum. With hindsight though, as this is now a separate thread there's no need to worry about boring other forum members.
I'm surprised your broker wouldn't allow investments in Woodford, who do you use? If it's a work pension you may have no choice, but if you do then have you considered an investment platform like Hargreaves Lansdown or AJ Bell? They're both excellent imo, and very cheap compared to most brokers.
Woodford's undoing was due to several factors imo. His traditional strengths were in income funds and he had a passionate belief that Brexit wouldn't affect UK share prices, he was wrong of course. Also, he hadn't really changed his style since the 90's and to be top of your game you need to change with the times, Woodford didn't. His earlier success with Invesco Perpetual was largely down to luck imo, he became famous for not investing in tech stocks during the .com bubble. His reasoning wasn't that it was a bubble about to burst, more that he didn't invest in things he didn't understand. He sold out of BP just before the disaster in the Gulf of Mexico and he sold out of banks just before the global financial crash in 2009. His ardent supporters put this down to foresight, personally I think it was luck.
In his latest venture with Woodford Capital, you've already alluded to his investments in unlisted stocks. At first, it wasn't so much that, more that he started to dabble in areas outside his areas of "expertise", his downfall came down to the fact that many of his pharma/bio investments were unlisted. It wasn't these investments per se, but the disastrous fall in the value of his traditional stocks meant that the % portion of unlisted stocks in is portfolio grew to the point that they were outside of the allowable limit for open ended funds. He then started to play not so clever tricks to manage this, clever tricks that were dodgy in themselves. Basically he was switching investments (on paper) between the Woodford Income funds and his patient capital trust. By this time he'd got into an unstoppable spiral. The final nail in the coffin was when Kent County council tried to pull their entire £250 million investment from the fund in one go without warning. This in itself was an amateurish thing to do, showing up yet again the incompetence of councillors given responsibility way beyond their ability. Link Solutions, the administrators of the fund were also to blame for not seeing the problem developing (part of their responsibility) getting involved and acting sooner. They are the one's who forced Woodford to close the fund, arguably this was an ill timed and poor decision.

 

[jakehake]

No secrecy intended, I meant an open forum. With hindsight though, as this is now a separate thread there's no need to worry about boring other forum members.

I dunno I reckon between the few of us on here we could put a glass eye to sleep

I'm surprised your broker wouldn't allow investments in Woodford, who do you use? If it's a work pension you may have no choice, but if you do then have you considered an investment platform like Hargreaves Lansdown or AJ Bell?

Sorry probably didn't explain well, I have a long running ex-employer pension where the fund range is chosen by the Trustees and you either can use default "lifestyle" plans or choose your own from their limited (say about 30 funds) range. Whilst it was limiting in some ways due to the size of the employer, it is very cheap and they chose reasonable funds that we could use if we wanted so I still use it despite it not being whole of market. Still have the bulk of mine in it for those reasons

I have a second works one now through HL and again, whilst it has it's faults and the fees aren't the cheapest at least it gives most of the market and the interface and app are OK to use. Probably could engineer a way to transfer it onwards again to other cheaper platforms i.e. Vanguard periodically too but a hassle I can live without for the time being

Woodford's undoing was due to several factors imo. His traditional strengths were in income funds and he had a passionate belief that Brexit wouldn't affect UK share prices, he was wrong of course. Also, he hadn't really changed his style since the 90's and to be top of your game you need to change with the times, Woodford didn't. His earlier success with Invesco Perpetual was largely down to luck imo, he became famous for not investing in tech stocks during the .com bubble. His reasoning wasn't that it was a bubble about to burst, more that he didn't invest in things he didn't understand. He sold out of BP just before the disaster in the Gulf of Mexico and he sold out of banks just before the global financial crash in 2009. His ardent supporters put this down to foresight, personally I think it was luck.
In his latest venture with Woodford Capital, you've already alluded to his investments in unlisted stocks. At first, it wasn't so much that, more that he started to dabble in areas outside his areas of "expertise", his downfall came down to the fact that many of his pharma/bio investments were unlisted. It wasn't these investments per se, but the disastrous fall in the value of his traditional stocks meant that the % portion of unlisted stocks in is portfolio grew to the point that they were outside of the allowable limit for open ended funds. He then started to play not so clever tricks to manage this, clever tricks that were dodgy in themselves. Basically he was switching investments (on paper) between the Woodford Income funds and his patient capital trust. By this time he'd got into an unstoppable spiral. The final nail in the coffin was when Kent County council tried to pull their entire £250 million investment from the fund in one go without warning. This in itself was an amateurish thing to do, showing up yet again the incompetence of councillors given responsibility way beyond their ability. Link Solutions, the administrators of the fund were also to blame for not seeing the problem developing (part of their responsibility) getting involved and acting sooner. They are the one's who forced Woodford to close the fund, arguably this was an ill timed and poor decision.

Ok that is a bit clearer then, I hadn't realised it was issues with the listed/unlisted weightings too, just remember reading it was a cashflow thing that brought it crumbling eventually. Cheers for the insight, I know his name and the history but hadn't realised just how many had been affected by it until recently. Also seems strange that in places like HL in the performance charts the funds still show up the rear even now. Are people still trapped in it due to legal proceedings or just that they can't ever get the money back till all remaining investments are liquidised?

 

[LostinSpace]

I dunno I reckon between the few of us on here we could put a glass eye to sleep



Sorry probably didn't explain well, I have a long running ex-employer pension where the fund range is chosen by the Trustees and you either can use default "lifestyle" plans or choose your own from their limited (say about 30 funds) range. Whilst it was limiting in some ways due to the size of the employer, it is very cheap and they chose reasonable funds that we could use if we wanted so I still use it despite it not being whole of market. Still have the bulk of mine in it for those reasons

I have a second works one now through HL and again, whilst it has it's faults and the fees aren't the cheapest at least it gives most of the market and the interface and app are OK to use. Probably could engineer a way to transfer it onwards again to other cheaper platforms i.e. Vanguard periodically too but a hassle I can live without for the time being




Ok that is a bit clearer then, I hadn't realised it was issues with the listed/unlisted weightings too, just remember reading it was a cashflow thing that brought it crumbling eventually. Cheers for the insight, I know his name and the history but hadn't realised just how many had been affected by it until recently. Also seems strange that in places like HL in the performance charts the funds still show up the rear even now. Are people still trapped in it due to legal proceedings or just that they can't ever get the money back till all remaining investments are liquidised?

On the last bit, I haven’t kept up with the detail over the last 6 months or so but my understanding is that investors have got some money back and will get more when the final (illiquid) holdings are sold. They’ll never it all back though, partly because of losses incurred before the fund was closed, partly because of winding up costs and partly because holdings have been sold at bargain basement prices. In the end, those who invested right at the beginning will be lucky if they get half their money back. The biggest lesson for me is never put all your investments in a single fund.
HL aren’t as expensive as people make out imo. First you can buy and sell open ended funds for free. Secondly, platform fee apart, a lot of their other costs are the cheapest in the business, particularly when it comes to taking money out after retirement. Also, some of the fund manager fees are cheaper with HL than other providers.
If you want to switch to another provider, it’s quite straight forward these days.

 

[jakehake]

On the last bit, I haven’t kept up with the detail over the last 6 months or so but my understanding is that investors have got some money back and will get more when the final (illiquid) holdings are sold. They’ll never it all back though, partly because of losses incurred before the fund was closed, partly because of winding up costs and partly because holdings have been sold at bargain basement prices. In the end, those who invested right at the beginning will be lucky if they get half their money back. The biggest lesson for me is never put all your investments in a single fund.
HL aren’t as expensive as people make out imo. First you can buy and sell open ended funds for free. Secondly, platform fee apart, a lot of their other costs are the cheapest in the business, particularly when it comes to taking money out after retirement. Also, some of the fund manager fees are cheaper with HL than other providers.
If you want to switch to another provider, it’s quite straight forward these days.

I'm fortunate we have no platform or transaction fees and the ongoing fund charges are normally 0.1-0.2% below the norm so apart from not having a full set of funds to choose from it saves a fair bit for me so I'm leaving that there until I have to move it when I want to go into drawdown as they don't let us do that within the scheme(though given it's over a decade away may well be able to by then.

Because I've used HL for shares/Investment trusts mostly the £12 a time charge isn't the be all and end all due to what I normally can trade but can see for small investors in can eat into their stuff if they were only buying small amounts each time. But it is what it is and free money from work for now so worth it

 

[LostinSpace]

I'm fortunate we have no platform or transaction fees and the ongoing fund charges are normally 0.1-0.2% below the norm so apart from not having a full set of funds to choose from it saves a fair bit for me so I'm leaving that there until I have to move it when I want to go into drawdown as they don't let us do that within the scheme(though given it's over a decade away may well be able to by then.

Because I've used HL for shares/Investment trusts mostly the £12 a time charge isn't the be all and end all due to what I normally can trade but can see for small investors in can eat into their stuff if they were only buying small amounts each time. But it is what it is and free money from work for now so worth it

Because of the charges, I only buy Investment trusts if I have at least £1K to invest, otherwise i'd stick to open ended funds. Also, some IT's have open ended equivalents, so I slowly build up to £1,000 and then switch to the IT equivalent.

I agree though, for small investors, it's best to sick with funds.

 

[We8PNE]

To be clear @We8PNE - I'm not asking a facetious question. Genuinely interested why you picked out this company. The graph I posted wasn't supposed to be pooh-poohing your recommendation... I just happened to look it up and thought it interesting enough to post, but past performance isn't an accurate guide for future performance! If you know why they've got into a few exciting bubbles in the past, that would be interesting. Of course, I could go and research but your 2 minute guide might help put people on the right track a lot quicker.

Like all shares, it's best if you do your own research. This company is the only verified graphene producer in the world. It's collaborating with some huge companies, from Rolls Royce to Aecom. However, after water, the second most consumed material on earth is concrete. Google 'concretene' and take it from there.

Btw. The share sale by the CEO was to facilitate his divorce.

 

[chorleythehord]

You're right, you are paying other people to pick the stocks for you. Don't forget though that they are pros, and the charges include buying/selling stocks, and their costs for that are a lot less than yours. They are better at it that than you or me, and imo the charge is worth it.

I started in individual stocks and barely broke even, I've done nicely from IT's though and have made well over 10% pa over the last 5 years, that'll do me.

I think the key is to have a widely diversified portfolio. I have 50 plus individual stocks. Even if you think Oil has no future have some oil stocks, technology is overpriced , still hold some, banks are on course for catastrophe , still have exposure to the sector etc Etc.

It’s then about weighting and you back your own judgement by reducing ( but not eliminating) exposure in areas you don’t fancy and , if like me, you think we are at the start of a bull run on mining stocks , or smaller UK companies still have ( a bit) further to go, you can go overweight there With a few picks. This allows you have to have little punts on individual stocks that are maybe too risky for a portfolio of just a dozen or so stocks. Thus when you are playing with your life savings, the opportunity for disaster by stock picking is massively mitigated.

That in truth is all a lot of the fund managers are doing and it’s pointless in my mind paying them to do something you can easily do yourself.

 

[chorleythehord]

You make some good points. As I said, I've done better with funds than I could with individual stocks. I try to avoid the in thing like Woodford, I did have money invested in his first fund which did far too well for an income fund after launch so I sold at a 10% profit. It'd been better if I'd sold earlier. Same with his patient capital trust, I made 20% from that. I think people were buying stocks because that's Woodford was buying at first, pushing prices up. There are some really good funds that've performed well year on year. I get the impression that you know your stuff, I'd be happy to discuss more by PM but if I carried on here, it'd bore most most posters to tears! Edgy was talking about a shares club, maybe set something up with a PM group? Not a share club, just a discussion group.

yep, if you want to PM me I’d be happy to exchange ideas.

 

[chorleythehord]

yoi can’t go all secret squirrel on us….if people want to discuss stuff on here we’re not forcing users to read it if they aren’t interested hence why I’d took those posts out of the Corona thread so it didn’t get lost or upset the natives

question for you and @chorleythehord about Woodford as seems you paid more attention regards what happened, I know it went pop but my scheme never allowed us to invest in his funds as it was all trustee chosen funds that we can then choose from and neither Invesco or Woodford were ever selected by them.

Was his undoing that in the Woodford venture he had switched away from the rules of his Invesco funds so he could invest in more unlisted/private ventures/startups? And it was a number of failures or write down in these ventures that collapsed the house of cards? Or was it other holdings that caused it to suffer? I vaguely recall that the point about unlisted stocks was one of the main problems in the end as when investors started to withdraw because those sort of holdings aren’t on markets you can’t just liquidised to get the cash back for people?

yes, I think he just got too cocky and some of his investments in illiquid assets were downright irresponsible For the sort of people who were trusting him with their life savings. He even broke his own rules i believe, not that I know too much about it , because I don’t really put my money with fund managers , certainly not UK ones, unless I see an unjustifiable discount in an IT.