James Anderson’s reflections.
As he prepares to stand down as joint manager of Scottish Mortgage Investment Trust, James Anderson reflects on the great minds that influenced his thinking
Thanks. That was a good read. I’ve been looking into the Santa Fe Institute and Long Now Foundation as Baillie Gifford draws on their research. This Peter Leyden talk was fascinating:
Long term investors: “Fascinating stuff.”
Traders: “Sponsored by Stripe. That’s bullish!”
My god SMT is taking a beating. I never thought we’d see sub 1000 again, let again sub 800. How low can it go!?
I’ve been aggressively DCA-ing from January and will keep doing it with in hope that in the next 10-15 years it will bring some nice returns.
SMT’s latest results here
Thanks, some nice light Sat’day morning reading!
I have got SMT in my shopping basket for now but its exposure to high euphoria over valued stocks like tesla and also exposure to high risky Chinese stocks is the reason am sitting on the side-lines.
If I’ve learnt any lesson from my Evraz is to be on the side of caution with some of these high risk countries - just my 2cents tho
I’m a DCA guy, so I personally don’t try to time the market, because if I’ve learned something in the last two years, is that the long time horizon is the way to go (the nerves are grateful).
We are currently in the bear market. Nasdaq composite was already in the bear market since March 2022 , S&P 500 was officially in the bear market last week.
In the bear market high growth stocks will be in the first line to face to swords. The S&P500 is mainly containing Blue Chips high quality stocks. If S&P500 already down 20%+, expect Fund/Trust containing high growth stocks such as SMT to fall much deeper. But When they recover they also recover faster and with multipliers.
There are research showing that during “the bear market” DCA will normally beat Lump-sum,. Selective DCA e.g buying high quality stocks, fund in the red days or using indicators to identify overbought/Oversold might produce a better result.
SMT is a good example to see why DCA is better during “the bear market”. Imagine those who threw lump-sum money into SMT in the start of downtrend e.g November 2021 or early 2022. They might already see their fund down 50%+.
Since the growth sector is the first to be shot down, it will be also the first to wake up. The key question is … when?
EDIT: and because we’re almost at the pre-covid levels, I’m confident to escalate my investment in SMT.
P.s. Risks are high but so are the rewards at Scottish Mortgage Investment Trust | Business | The Times
Frankly I would not be this optimistic about nasdaq(growth) , last time it went vertical (2000.) it took roughly 15 years for nasdaq to get to same levels.
We are not even near to 2018/2020 bottoms, so there is plenty of room to fall.
Not to mention, what if those levels don’t hold…
Also true for 2000. Nasdaq droped 30%, to rebound 25% before the grand collapse.
We are now reaching those same levels, so we cannot rule out one last hurrah by growth.
I partially agree, but it’s also true that nowadays the markets move a lot faster. Some changes/movements that in the past took more years, now happens in months/weeks/days. As long as one’s philosophy is oriented in the longer term (10+), I’d say DCA is the way to go.
I just listened to this and thought others might be interested, James Anderson of BG discussing fund management
Pleased to see SpaceX joining the TOP 10 SMT holdings.
Interesting insight: Valuing private companies – our robust approach (July, 2022)
I soo much like SMT management style and strategy but it’s Chinese exposure is a big massive concern for me personally hence i will remain on the side line. My Evraz & Polymetal (Russian stocks) has thought me a bitter lesson. Am not discouraging anybody because i can still invest in SMT but i will need a far bigger upside than 2022 prices so far. I reckon it will take a recession or preferably conflict between China & Taiwan to bring down the share price to what am looking for, touch wood it doesn’t happen.
If you want more exposure to SpaceX check out - BG’s Schiehallion Fund:
It doesn’t have good liquidity from what I’ve experienced before and can take a couple of days for orders to go through.
Baillie Gifford looses 104.7 billions GBP in 2022 (YTD, until end June 2022):