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No argument from me re the international fund; it's not just a...

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920 Posts.

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20/07/22

15:19

Post #: 62632401
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Originally posted by Fundidetective: ↑

I think it’s way too convenient and simple for FOR to put down a part of its atrocious performance not just in the last year, but over the years, to mistakes made. This was the explanation offered in their report.

I ask when is a said mistake not actually a mistake? FOR’s performance IMHO is simply explained by an actively chosen course. It took the tide to go the other way to expose their shortcomings (the irony of using a Buffett quote here is too much!).

What do I mean?

That course of action was set years ago when there was already evidence of drift and an overly opportunistic investing strategy. Don't just blame the CIO as the retail investors who bought into 'something different' likely stroked and reinforced that ego and vulnerability.

The second chapter is when FOR then scaled up its unpredictability by bringing on a hedge fund momentum analyst. Sure it led to huge outperformance in one year. Question is was that performance ever going to be sustainable? SPACs drove a huge part of their FY2021 performance. There were 6 of them in a concentrated fund of 35-45 stocks. That's b_lls deep in a highly speculative part of the market. Even in their June 2021 report, there were waxing of a new idea pipeline in IPOs and SPACS! That is the definition of blinded ego. We now know how that turned out.

In short, I think you can only put the woeful FY2022 blame on mistakes, only if you call FY2021 a mistake (that worked). FY2022 was an extension of opportunistic and loose cannon investing seen in FY2021; only this time round, the music stopped. The tide turned. Either way, the strategy lacks rigour, process and cohesion.

I have pointed out the META and TWTR shockers in previous posts. They have no reason to be in any of these and many more. To cry about TWTR as Musk pulls out after they had the opportunity to sell with only 10% to the takeover price on an investment that had struggled for years is plain dumb. We should not be surprised to now see little to no real rationale or articulation. There isn't much more conviction to offer I don't think.

A mistake here is not when FOR built half an ark that did not float. The mistake was feeling confident they could cross an ocean with inferior navigation, conflicting captains, 2nd grade materials and yes risk systems, having successfully crossed a pond.

It is not all mistakes of course. What has worked is its marketing which has found a vulnerable client niche. Unfortunately, 'farm boy', opportunistic investing, style drift are not tick boxes in the institutional playing field which explains why FOR will be where it is.

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No argument from me re the international fund; it's not just a dog with fleas, it's all fleas!

The FASF isn't anywhere near as bad, Steve has the talent to deliver far better returns in the FASF than he does; but as long as he stays plugged in to what sell-side analysts, company managements and mainstream media are telling him, that talent is going to be completely blunted.

The big weakness that most farm boys have is naivete, and Steve is getting himself (and us) rinsed at least once or twice per year, because he can't seem to see when someone is spinning a yarn.

I think that if he fired his analysts, moved back to Orange, and stuck exclusively to analysing publicly available information, we'd all make sh1tloads more money.

FOR Price at posting: $1.26 Sentiment: Hold Disclosure: Held
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