I don't think I'm the only one who has been disappointed with one's NZX portfolio performance this year. It's been hard to shelter and protect capital let alone make decent returns.
While I love the NZ market as it feels safe dealing with companies that you know well. I'm coming to the conclusion that there are few NZ companies these days that you can buy and hold for long periods (stick in the bottom draw and forget).
I think the NZ market is just too small and more suited for traders. Only have 12 NZX stocks now. Out of all retail and property trusts. Still in all the main four retirement stocks which have done ok (except for OCA) The others because I lucked in buying at the lows and participating in Rymans CR. Still think the future is bright for the retirement sector with huge ageing population.
Fletchers what a disappointment and I should have known "leopards don't change their spots." There is a nest of cockroaches at that place. I'm thinking we at close to bottom of the cycle so will continue to hold both FBU and STU. Looking for exit of FBU. Still a believer in Stu and confident that healthy dividends will continue for this undervalued stock, which will eventually re rate or be taken over.
The last few years I made the decision for diversification and a pivot in direction to move money from the NZ market into overseas markets. The FIF tax initially put me off investing in other markets but I'm glad I did. My US shares have done very well plus the exchange gain has worked in my favour. The size of some of these US companies is staggering.
While I love investing directly I have come to the realisation that there are others out there that are much smarter and more focused than I am. The decision to invest with Discovery funds who specialises in small Australian caps has been outstanding. Up 48 percent since Sep 22. Pie funds has started to improve but a long way to go and is on constant review.
I'm going to further reduce my exposure to the NZ market and look at index funds and other fund managers for further diversification.
That's my current thinking. What's yours?
I feel much the same way Shareguy.
The NZX has been incredibly hard and frustrating work these last three years. I recently calculated the NZX50 (which includes all dividends paid) is down a whopping 25% in real inflation adjusted terms since January 2021, just after Labour got in for its second term. Its declined slightly more since that calculation a little while ago. "Swimming" against that sort of outgoing tide and making any meaningful progress is an exceptionally difficult task and extremely tiresome. The plethora of companies trying to hide their woeful performance behind dizzying amounts of ESG nonsense is nauseating to say the least.
There are a couple of GARP (growth at a reasonable price) stocks that I have respect for and frankly anything that can grow eps in this dreadful economy commands respect including TRA and HGH. GNE appears recession proof but Kupe output is in steep decline. Depreciation on property stocks are a sacrificial lamb with the country's book's obviously in poor shape. I expect returns in the RV sector to remain weak in the near term.
One investment class often overlooked is corporate bonds which I expect to perform well from here with some good quality 4 year bonds like ARV010 and ARG030 trading in the mid to late 7% range and I have sizeable positions in each but care is necessary with corporate bonds, make sure they have good cash flow and modest debt like those two have.
Like you I have decided I don't have the mortgage on all good idea's, the N.Z. market is very small and illiquid, life is to be enjoyed and therefore choosing a good fund manager or managers to invest overseas with a significant part of one's portfolio makes profound common sense as frankly this achieves a number of things, including diversification and more time to enjoy my hobbies and walk my dog.
I choose Barramundi based on its unique structure including being a PIE and paying out 2% NTA per quarter which when I retire will be most beneficial in terms of funding travel and hobbies. I like their multi year track record of on average soundly beating the ASX indices over the last 5 years so I have parked significant funds there and happy to leave them to do their thing.
Marlin may get a look into in due course but at this stage I am content to own their warrants and see how the fund goes over the next 2 months.
Frankly, I also like cash at the moment. Nothing wrong with cash and short term deposits earning a predictable 5-6%. Its a good place to hide in a recession.
Quote from: Shareguy on Sep 08, 2023, 10:20 AMI don't think I'm the only one who has been disappointed with one's NZX portfolio performance this year. It's been hard to shelter and protect capital let alone make decent returns.
While I love the NZ market as it feels safe dealing with companies that you know well. I'm coming to the conclusion that there are few NZ companies these days that you can buy and hold for long periods (stick in the bottom draw and forget).
I think the NZ market is just too small and more suited for traders. Only have 12 NZX stocks now. Out of all retail and property trusts. Still in all the main four retirement stocks which have done ok (except for OCA) The others because I lucked in buying at the lows and participating in Rymans CR. Still think the future is bright for the retirement sector with huge ageing population.
Fletchers what a disappointment and I should have known "leopards don't change their spots." There is a nest of cockroaches at that place. I'm thinking we at close to bottom of the cycle so will continue to hold both FBU and STU. Looking for exit of FBU. Still a believer in Stu and confident that healthy dividends will continue for this undervalued stock, which will eventually re rate or be taken over.
The last few years I made the decision for diversification and a pivot in direction to move money from the NZ market into overseas markets. The FIF tax initially put me off investing in other markets but I'm glad I did. My US shares have done very well plus the exchange gain has worked in my favour. The size of some of these US companies is staggering.
While I love investing directly I have come to the realisation that there are others out there that are much smarter and more focused than I am. The decision to invest with Discovery funds who specialises in small Australian caps has been outstanding. Up 48 percent since Sep 22. Pie funds has started to improve but a long way to go and is on constant review.
I'm going to further reduce my exposure to the NZ market and look at index funds and other fund managers for further diversification.
That's my current thinking. What's yours?
Mark Devcich of Discovery Funds seemed to be the smartest guy in the room when he was at PIE and ran the best performing fund by a country mile.
I quite liked this from Discovery August fund update -
We had over 110 company meetings in August. We've spent this week on the road doing further work on the best of them. One great idea per trip equals success. We believe two in one trip and you're making money. We've come back with the latter. We look forward to keeping you updated on our performance.
I've got some long term holds on the NZX but like the Oz market much more for growth and opportunities - the non imputation / lack of recognition of franking credits in NZ does annoy me though ☹️
Quote from: Crackity on Sep 08, 2023, 02:57 PMMark Devcich of Discovery Funds seemed to be the smartest guy in the room when he was at PIE and ran the best performing fund by a country mile.
I quite liked this from Discovery August fund update -
We had over 110 company meetings in August. We've spent this week on the road doing further work on the best of them. One great idea per trip equals success. We believe two in one trip and you're making money. We've come back with the latter. We look forward to keeping you updated on our performance.
I've got some long term holds on the NZX but like the Oz market much more for growth and opportunities - the non imputation / lack of recognition of franking credits in NZ does annoy me though ☹️
Discovery update was very good. Pie funds used to enjoy very high returns some years but not these days. Is it because these guys have left. Certainly the return Discovery is making is going to get noticed. Agree with you on the franking credits, it needs to be sorted.
Quote from: Shareguy on Sep 08, 2023, 10:20 AMI don't think I'm the only one who has been disappointed with one's NZX portfolio performance this year. It's been hard to shelter and protect capital let alone make decent returns.
While I love the NZ market as it feels safe dealing with companies that you know well. I'm coming to the conclusion that there are few NZ companies these days that you can buy and hold for long periods (stick in the bottom draw and forget).
I think the NZ market is just too small and more suited for traders. Only have 12 NZX stocks now. Out of all retail and property trusts. Still in all the main four retirement stocks which have done ok (except for OCA) The others because I lucked in buying at the lows and participating in Rymans CR. Still think the future is bright for the retirement sector with huge ageing population.
Fletchers what a disappointment and I should have known "leopards don't change their spots." There is a nest of cockroaches at that place. I'm thinking we at close to bottom of the cycle so will continue to hold both FBU and STU. Looking for exit of FBU. Still a believer in Stu and confident that healthy dividends will continue for this undervalued stock, which will eventually re rate or be taken over.
The last few years I made the decision for diversification and a pivot in direction to move money from the NZ market into overseas markets. The FIF tax initially put me off investing in other markets but I'm glad I did. My US shares have done very well plus the exchange gain has worked in my favour. The size of some of these US companies is staggering.
While I love investing directly I have come to the realisation that there are others out there that are much smarter and more focused than I am. The decision to invest with Discovery funds who specialises in small Australian caps has been outstanding. Up 48 percent since Sep 22. Pie funds has started to improve but a long way to go and is on constant review.
I'm going to further reduce my exposure to the NZ market and look at index funds and other fund managers for further diversification.
That's my current thinking. What's yours?
I guess everybody likes consistent high returns. Problem is just - they exist only in fairyland. The real world moves in cycles ... and the NZX is currently in the "take a breather" phase.
If you take a long term (say 3 to 5 decades) comparison of NZ shares vs overseas shares, than there is not too much difference.
Strongly disagree with the statement that NZ market is better for traders. Anybody who bought e.g. FPH or MFT or EBO for a handful dollars per share would be laughing at your statement. Obviously - like with trading - you need to buy the right shares at the right time.
And of course, anybody picking the cycles correctly and just investing in markets while they go up has an advantage. It's just - I didn't met so far anybody who is able to do that in a reproducible and sustainable manner. Met however a number of people who told me that they believe they will be able to do that, but they are now probably all on their superjacht in the Mediterranean.
If you take a long term investors perspective ... you know that there always will be some good years, and some not so good years. If you invest on the stockmarket its something like 7 good and 3 not so good years in a decade ... but obviously, these are average numbers.
Currently we are in the "not so good" phase. It will pass ... and than you might be annoyed to have missed the next upturn in NZ if you shifted your money somewhere else always chasing the highest return.
Actually - I think the odds are not bad for things to turn in NZ pretty soon. We might have in 6 weeks a different government, Interest peak is either here or close, the Russian economy might crumble (and with that Putins resolve to regather the Russian empire), our industry might be able to diversify from selling too much stuff into just one really big autocracy, next government might be smart enough to bank onthe worlds misery (just following the amazing Swiss example) - who knows.
One thing I often observed is that when people start to whinge too much, things tend to get better - though its not because of the whinging.
Anyway - while portfolio reviews are always a good idea, I am optimistic for the NZ market. Does not mean I have all money in NZ, but I am currently more likely to shift money closer to our shores than into the other direction (and yes, it makes the tax declaration a bit easier) - but obviously, I haven't got a working crystal ball either.
Quote from: BlackPeter on Sep 10, 2023, 12:25 PMI guess everybody likes consistent high returns. Problem is just - they exist only in fairyland. The real world moves in cycles ... and the NZX is currently in the "take a breather" phase.
If you take a long term (say 3 to 5 decades) comparison of NZ shares vs overseas shares, than there is not too much difference.
Strongly disagree with the statement that NZ market is better for traders. Anybody who bought e.g. FPH or MFT or EBO for a handful dollars per share would be laughing at your statement. Obviously - like with trading - you need to buy the right shares at the right time.
And of course, anybody picking the cycles correctly and just investing in markets while they go up has an advantage. It's just - I didn't met so far anybody who is able to do that in a reproducible and sustainable manner. Met however a number of people who told me that they believe they will be able to do that, but they are now probably all on their superjacht in the Mediterranean.
If you take a long term investors perspective ... you know that there always will be some good years, and some not so good years. If you invest on the stockmarket its something like 7 good and 3 not so good years in a decade ... but obviously, these are average numbers.
Currently we are in the "not so good" phase. It will pass ... and than you might be annoyed to have missed the next upturn in NZ if you shifted your money somewhere else always chasing the highest return.
Actually - I think the odds are not bad for things to turn in NZ pretty soon. We might have in 6 weeks a different government, Interest peak is either here or close, the Russian economy might crumble (and with that Putins resolve to regather the Russian empire), our industry might be able to diversify from selling too much stuff into just one really big autocracy, next government might be smart enough to bank onthe worlds misery (just following the amazing Swiss example) - who knows.
One thing I often observed is that when people start to whinge too much, things tend to get better - though its not because of the whinging.
Anyway - while portfolio reviews are always a good idea, I am optimistic for the NZ market. Does not mean I have all money in NZ, but I am currently more likely to shift money closer to our shores than into the other direction (and yes, it makes the tax declaration a bit easier) - but obviously, I haven't got a working crystal ball either.
Thanks for posting. Great to get a range of views.
Yes I'm probably being a bit harsh. I hold all three of those stocks you mention and have done very well. However where I'm coming from is that we have very few of the quality of those three. There is a lot more opportunities offshore in my opinion for quality companies, as the market is just so much bigger.
I note Craigs current equity weighting is
NZ shares 19 percent
Australian shares 15 percent
International shares 21 percent
Bonds 37 percent
Property 3 percent
Cash 5 percent
I agree re your catalysts for change and already seeing positive shoots in the housing/rental market. However there are lots of clouds out there. The last few years has shown us that the so called experts and even our reserve bank got a lot wrong forecasting. In NZ we have a probable change of government and summer coming up, so a lot to be positive about.
I'm not talking about leaving the NZX it's more about diversification and sleeping well with a more balanced portfolio. You could well be right with your optimism regarding the NZX, I hope so.
My move to offshore continues to be a good move. Discovery funds was up in May in which was a very tough market. My US stocks continue to shine. In NZ have sold down both FPH and Sum that had been long term free carry positions. Still have a small holding of each. I may be wrong but I have concerns regarding Sums share price to NTA. All the other operators have taken the medicine and I worry that Sum is still in the past as far as cash flow and reporting metrics goes. I have also taken a large position in Ryman. I like the new chair and have listened to the results call and read all I can find. I'm sure others will think I'm mad, time will tell. I am also watching Turners that I have never owned but agree that it's a great company. I'm thinking the share is great buying but will wait and see given the downtrend and state of the economy.