MFG in the BUY zone, page-179

Hi Corncrop, Clueso and others. Your comments are interesting.
I hold Magellan High Conviction Trust (MHHT) as a core holding. I also hold MFG, until now smallish %
How do these two holdings sit together?
At a Magellan conference last year I asked HD if investing in MFG could be likened to a leveraged investment in his various trusts. He didnt like the analogy, giving the example that if he got hit by a bus, MFG would dive whereas the Funds would be safe.
Even so I think its worth discussing, and would welcome your input to my idea below.

So the situation right now is that the Magellan funds have been performing well over the last 6 months and the lacklustre year before will soon fade from memory. Of course they are down in Sept with the general market. Although the instos move slowly, if they havent bailed out by now they will likely stay imo. Note MFG was weak today in a strong market. That's a very weak signal - I think the fund managers are expecting a bad FUM report next week. Add to that the risk that fund managers are rebalancing portfolios for fear of an inflation surge. Bonds in, equities out.

So to my idea - to arbitrage between my fund holdings (MHHT) and MFG depending on relative strength. I have sold a portion of my MHHT to free up some cash. I am reinvesting most or all of that into MFG at reduced prices. My thinking is that if the funds continue to perform, the MFG shares will indeed become a leveraged reflection of that. At some point I will cycle back into MHHT. I also like the MFG yield (my SMSF loves it). Of course the dividend is under threat if FUM and performance fees drop off.

My investment into the Magellan philosophy remains intact, but the parts move around.

Thoughts?