Managed funds

[Basil]

Smart Shares TWF total world fund 5 year performance is 11.48%. That's a PIE fund and that return is therefore after fees and tax. Different funds will have different returns but if we take their fund as a proxy then you're right, that's a decent return for a very broadly diversified fund with no work for investors.

Straight of Hormuz closed again. Took 5 years to get the nuclear deal with Iran last time.

Overseas markets trading on multiples that suggest the war is already over. That makes no common sense to me.

On a risk reward basis I'm not convinced that this is a good time to be putting cash to work overseas.

[Dolcile]

For me this period just reinforces that it's time in the market not timing the market.  Some would also say being long on a basket the greatest companies in human history is not such a bad thing. 

[winner (n)]

Share prices follow eps eh Basil

s&P at record levels ...overvalued?

I found this interesting

You cannot view this attachment.

[Basil]

For me this period just reinforces that it's time in the market not timing the market.  Some would also say being long on a basket the greatest companies in human history is not such a bad thing. 

That's the standard line that fund managers trot out.  Fact is, if you get the timing badly wrong it can take 15 years just to recover, (that's not getting a return in 15 years, just getting back to where the index was), i.e. probably 40%-50% loss in real terms after adjusting for inflation. https://news.crunchbase.com/venture/startup-valuations-bubble-downturn-stocks/

An oil supply shock if its extremely protracted, worst case could send the world economy into a global depression.  US and European equities are priced as though the geopolitical risk is completely gone.  That makes no sense to me.

[Shareguy]

I'm sceptical like Basil that this could go on for some time and agree the market seems to disagree given the pricing of equities.

There is risk with any investment and as long as you have a long term approach, history says that you will do ok in most cases. Now going forward no one knows what's going to happen.

With Covid both Discovery and Pie funds took an hammering but gosh when it turned the upside was huge. This time might be different and it might continue to get worse only time will tell.

Insert from Craig's.

When things are going well, you wonder if you've missed the boat.
When markets face challenges, it feels safer to wait for the outlook to improve.
One option is to simply close your eyes, grit your teeth and invest your money right now,
all at once.
While it sounds outlandish, most evidence proves this is a wise move.
A 2023 study by Vanguard (based on returns from 1976 to 2022) showed that lump sum
investing led to better returns 68 per cent of the time.
That's because sharemarkets are usually rising.
I looked at returns over the past 30 years for shares in New Zealand, Australia and the
United States.

None of us want to invest at the top of the market or when things are about to head south.
The price you pay has a significant influence on your future returns, so your entry point is crucial.
A few of the outcomes in Vanguard's other 32 per cent of occasions won't be pretty.
If you're unlucky enough to invest your lump sum immediately before a market downturn
or recession, it might take years to recover.
That suggests we should sit back and wait for a big fall, then take advantage of cheaper
prices.
A great idea in theory, but this requires a fairly accurate crystal ball.
Markets have a habit of proving us wrong.
A rosy outlook can turn on a dime, while the long-heralded slumps we patiently await sometimes never arrive.

PS My crystal ball is getting repaired.

[Basil]

My crystal ball is beyound repair. Anyone's guess where international events go from here but if we think about it logically, we've got two deranged power obsessed narcissists in power with Netanyahu and Chump, we've got a new supreme leader in charge of a country of religious extremists with the Houits and Hellbolla thrown into the mix as well not forgetting the other middle east countries heavily impacted as well.

How on earth does anyone get a widespread lasting peace in the middle east ?  It would take a miracle and yet the US market is trading at record levels ?

[BlackPeter]

My crystal ball is beyound repair. Anyone's guess where international events go from here but if we think about it logically, we've got two deranged power obsessed narcissists in power with Netanyahu and Chump, we've got a new supreme leader in charge of a country of religious extremists with the Houits and Hellbolla thrown into the mix as well not forgetting the other middle east countries heavily impacted as well.

How on earth does anyone get a widespread lasting peace in the middle east ?  It would take a miracle and yet the US market is trading at record levels ?

Interesting - apparantly there are hard line Shia muslims (including the new lineup of Iran) who think that creating a real war around Israel is the right method to get Muhammad al-Mahdi back to bring after a nice war everlastiing peasce (well, run by the Muslims), and it sounds as well as if hard wing US bible belt so called Christians think that for gods end game to begin Israel needs to get back into their old territory. Clearly - a nice war is part of this saga as well.

Sounds like a multi religeous crusade / hijad. Add the things you claimed above and we just watch an amazing war to start. How long does a normal crusade take? Couple of years at least ...

Not sure, though, what this means for the stockmarket. They didn't had stocks during the previous crusades .

[Basil]

Sorry for a post a long way off topic.  Not sure how others are coping with the ebbs and flows of this but to be honest, and I am hoping this is a fairly safe space to share, its starting to affect my mental health a bit.  We've had nearly two months of this war now and I found myself really feeling quite good on Saturday with the Iranian announcement that the straight of Hormuz would be totally open again.  I thought we were finally getting somewhere...only to see on Sunday that its all turned to custard again.

Its almost too much, like a rollercoaster I can't get off.  I seriously felt the presence of the big black depression dog approaching my door yesterday...haven't felt him getting that close for many, many years.

I need to find a way to distance myself from what feels like the almost endless macerations of how is playing out and how this is affecting our economy, our market, global markets and the outlook going forward but its fills every news channel and is hard to avoid.

The black depression dog is a bit further away from my door today but he's still on my property waiting to get in.  Best remedy is to take my own tan coloured dog for long walks in the sun, hopefully Tony will fend off the black dog...that would be a good plan if there was any sun.  Anyway...hope you folks don't mind me getting this rant off my shoulders.  I'm pretty sure I'm not the only one that's having their head done in a bit by all this endless drama.

I used to have a client who's a counselor and she once told me the best way to cope with awful stuff is to think of five things each day you are grateful for.  They call this gratitude therapy.  I've always thought that's a load of mumbo jumbo but maybe there's something in that ?  Might try that tomorrow and see if I can put some more distance between me and the black dog.

[Stoploss]

Sorry for a post a long way off topic.  Not sure how others are coping with the ebbs and flows of this but to be honest, and I am hoping this is a fairly safe space to share, its starting to affect my mental health a bit.  We've had nearly two months of this war now and I found myself really feeling quite good on Saturday with the Iranian announcement that the straight of Hormuz would be totally open again.  I thought we were finally getting somewhere...only to see on Sunday that its all turned to custard again.

Its almost too much, like a rollercoaster I can't get off.  I seriously felt the presence of the big black depression dog approaching my door yesterday...haven't felt him getting that close for many, many years.

I need to find a way to distance myself from what feels like the almost endless macerations of how is playing out and how this is affecting our economy, our market, global markets and the outlook going forward but its fills every news channel and is hard to avoid.

The black depression dog is a bit further away from my door today but he's still on my property waiting to get in.  Best remedy is to take my own tan coloured dog for long walks in the sun, hopefully Tony will fend off the black dog...that would be a good plan if there was any sun.  Anyway...hope you folks don't mind me getting this rant off my shoulders.  I'm pretty sure I'm not the only one that's having their head done in a bit by all this endless drama.

I used to have a client who's a counselor and she once told me the best way to cope with awful stuff is to think of five things each day you are grateful for.  They call this gratitude therapy.  I've always thought that's a load of mumbo jumbo but maybe there's something in that ?  Might try that tomorrow and see if I can put some more distance between me and the black dog.

That will be easy for you Basil .
Turners
Tina
HLG
MFB
MCK
😂

[Plata]

I started to notice I was thinking about the war and how over-valued all the main indices seem to be, especially at night. I rotated into value and into areas I thought would be resistant to the war dragging on, and bumped up my cash position. I found that helped for me. In a way having some cash spare provides some joy to balance the misery duirng a big crash since you can score some bargains. Us younger folk have a meme about how "nothing ever happens". I think it has an element of truth to it in the sense that the media profit model encourages dramatism and fearmongering, things are rarely as they seem. Be glad we live on a net food exporting island in the middle of nowhere with plenty of water.... could be worse.

[Raven]

Gratitude journal has actual hard scientific research behind it. The study of the "pursuit of happiness" has genuine reliable research. You just need to ignore the influencers etc and go to the source of studies at the Ivy League colleges and other reputable institutions. All of my friends and acquaintances are surprised to learn I have a "happy book" (gratitude journal) as I'm not one for all that sort of mumbo jumbo but I reply that "I'm totally serious about being happy"

Hope your tan dog can keep the other dog away.

[Dolcile]

Basil — I'm really sorry you're feeling the black dog circling. I don't know if this is helpful or not, but a few things that genuinely help me when the world starts to feel overwhelming:

I avoid almost all media - News is massively skewed toward the negative and the dramatic — especially when conflict and markets are involved. Staying constantly plugged in can make it feel like the world is permanently on the brink, even when most of life is still quietly carrying on. Stepping back doesn't mean not caring; it just means protecting your headspace.

I try to focus on physical pursuits rather than mental ones - Anything that gets me away from screens and out of my head helps — walking, exercise, being outside, spending time with my kids, doing something practical. It creates distance from the constant stream of information and from things we ultimately have no control over. You've already got the right instinct there with Tony.

A bit of long‑term perspective - As awful as things feel in the moment, I remind myself that the last 100 years have been full of wars, crises, depressions and shocks that I'm sure also felt existential at the time. Somehow the world — and markets — keep finding a way to move forward. That doesn't minimise what's happening now, but it can help counter the feeling that this time it's different and permanent.

And for what it's worth, I'm a advocate for incorporating some form of intentional gratitude each date  — even if it just creates a small daily pause away from the crazy world.

You're definitely not alone in having your head done in by all this. Glad you shared it, and always happy to chat.

[Shareguy]

Sorry for a post a long way off topic.  Not sure how others are coping with the ebbs and flows of this but to be honest, and I am hoping this is a fairly safe space to share, its starting to affect my mental health a bit.  We've had nearly two months of this war now and I found myself really feeling quite good on Saturday with the Iranian announcement that the straight of Hormuz would be totally open again.  I thought we were finally getting somewhere...only to see on Sunday that its all turned to custard again.

Its almost too much, like a rollercoaster I can't get off.  I seriously felt the presence of the big black depression dog approaching my door yesterday...haven't felt him getting that close for many, many years.

I need to find a way to distance myself from what feels like the almost endless macerations of how is playing out and how this is affecting our economy, our market, global markets and the outlook going forward but its fills every news channel and is hard to avoid.

The black depression dog is a bit further away from my door today but he's still on my property waiting to get in.  Best remedy is to take my own tan coloured dog for long walks in the sun, hopefully Tony will fend off the black dog...that would be a good plan if there was any sun.  Anyway...hope you folks don't mind me getting this rant off my shoulders.  I'm pretty sure I'm not the only one that's having their head done in a bit by all this endless drama.

I used to have a client who's a counselor and she once told me the best way to cope with awful stuff is to think of five things each day you are grateful for.  They call this gratitude therapy.  I've always thought that's a load of mumbo jumbo but maybe there's something in that ?  Might try that tomorrow and see if I can put some more distance between me and the black dog.

Great post Basil, Your not alone. I'm sure that there is a lot of us that are feeling the effects of the doom and gloom that seems to be out there.

I think though that generally anyone on here that can invest in shares is very fortunate when there are so many people struggling to even feed themselves. Starting the day with 5 things you are grateful for seems like a good plan to me.

Dolciles great post is "bang on"sometimes nothing beats switching off and enjoying the little things like going for a walk or doing some gardening.

[entrep]

I am starting to come to similar conclusions. The New Zealand share market simply isn't liquid enough and doesn't have enough interest to justify any large positioning. And any positioning you do take must be extremely discounted. Buying something for "fair value" on the NZX is likely to achieve far worse returns than simply buying an international index. There is no point. Of course, this will also create opportunities on the NZX as more people ignore it. However, just from my own position, I can understand the underlying businesses and trends, AI, tech, etc. etc., far more in international markets than I can locally. This was also underlined to me recently when I was talking to a broker about the extremely poor performance of SUM, notwithstanding that it's such a well-run business. They were saying that one of the set reasons is that Australian institutions have absolutely no faith in the New Zealand economy at the moment and have pulled bids. Again, this creates an opportunity potentially, but not much fun if you are already in the stock!

Not really sure what I'm trying to say, but my own NZX single stock picking is by far the worst returning asset class for me personally versus any and all others (forex, crypto, commodities, US stocks, anything).

More than happy to be corrected.

US and International markets are now at all time highs.

For convenience it is hard to I don't beat a global index fund and chill approach.   The hassle to return ratio is outstanding. 

I am sitting 74% global shares, 20% nz shares and reits, and the rest (6%) in cash.

[Basil]

Many thanks guys. I really appreciate your support and encouragement. Some great posts.

Being semi retired I think I have slipped into a pattern of being too connected to the news flow. I have Sky which has multiple news channels covering the geopolitical mess as well as the world's leading business channel CNBC channel 91.

Its on 24/7 and it's easy to develop an unhealthy addiction to wanting to keep up with the very latest events on a near constant basis. Its not healthy, I know that and I think that's what I need to really reflect on. In a sense I know I am probably subconsciously trying to see what's next that's coming around the corner, what geopolitical turn of events will affect the market next in some vain attempt to control the uncontrollable. Its not logical and not healthy.

 I think maybe 20 minutes of the international markets and latest news in the morning and the same around dinner time is a much healthier approach than watching it for hours on end.

Anyway the sun is shining a bit and Tony wants his walk.
 Thanks again guys.