@Just_a_guy
That’s a balanced assessment, thank you.
You’re right, if and when earnings stabilise (and a future improvement in NOM, quite possibly achievable via the realisation of synergies, may well play a role in that), then there will be no reason for the business to be valued at a discount to market, provided that market share does not deteriorate.
For, as you say, the underlying growth in superannuation savings does represent a strong tailwind.
The questions for me right now are a) how far we still are from that stabilisation, and in that respect I would want to see some evidence of the extent to which the new structure of fees for advice is reflected into current earnings, and b) to what extent the current market share (of IOOF+ANZWM) can actually be maintained.
In the latter regard, I do personally see the advance of Independent Financial Advisers and competing platform providers as a significant threat.
And then, of course, there is the outstanding risk of under provisioning for remediation payments.
I can see why some long-term holders (including yourself) would want to hold on for a little longer, and give the business a chance to deserve a further re-rating (and/or give the shorts a chance to get squeezed out).
For me, today’s decision to exit was simply a result of sell discipline. Namely, especially for those holdings where my initial investment thesis has been proved wrong, I have to ask myself the question of whether I would want to buy any amount of it, at today’s price, if I didn’t own any. And for me the answer to that question is no, because IFL's risk/reward as of now does not look superior to the one of a simple ASX200 index tracker.
My two cents as usual.
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