Hello you wonderful and intelligent individuals that make up this forum. I sincerely hope everything is going well for you.
I kindly wondered for investment ideas has anyone thought of looking up the holdings of for instance BlackRock UK Smaller Companies Fund. They would have a team of researchers, who would audit their investments more thoroughly and you would hope they would have closer relationships with these company’s. I kindly wondered please for investment ideas would this be a good option looking through the company’s in this fund please? If anyone kindly had any thoughts on this i would be forever grateful and it would be highly appreciated.
Sending you lots of good wishes and hope you generate massive wealth for yourself in the stock market. Very best wishes and hope you have a wonderful life.
I can’t comment on that specific fund but in general, yes I look at the list of holdings in funds to see what they are holding. However, there are many issues so it isn’t automatically a question of “fund X has company Y so company Y will perform well and I should hold it” - I wasn’t interpreting your question as suggesting this anyway.
For small company funds you can get some companies that aren’t listed so it is then impossible to invest in them except through funds. Also you don’t know whether some positions are to balance risk or hedge (ie they already can several companies that they really like and need to balance against those). You also don’t know their hedging or trading strategies. Also I wonder whether some funds do/can acquire shares through fund raising or swaps or off-market so you aren’t exactly in the same position as the fund in terms of investing as a retail investor.
Just like analysts sometimes get their forecasts and analysis hopelessly wrong, so funds aren’t perfect and I’ve often seen a fund holding a company that I don’t think will perform very well (but their timescales and criteria my be entirely different to mine)
So, it is definitely worth looking at what companies are held by funds. You’d hope that it at least gives small cap companies and endorsement that they aren’t basket cases. Thus it gives me a confidence to look at them in more detail or keep them on a watchlist.
Thank you very much for your very helpful response WakeMeUp that is very kind of you. I am very grateful for your support with this.
You kindly gave me a few ideas for thought which i had not thought about which i am very thankful for. Regarding not knowing whether some positions are to balance risk or hedge and not knowing their hedging or trading strategies. I also think thats very important what you said about whether some funds do/can acquire shares through fund raising or swaps, so you would have to determine if when you are buying, it is the correct time to buy and the small cap business still has good growth potential. I really like your comments here, thank you very much for leaving these.
On an initial overview it seems a few company’s i have reviewed from BlackRock UK Smaller Companies Fund have good growth potential and some not so good, so this may be hedging risk like you kindly mentioned.
Thanks for being an amazing member of these forums WakeMeUp, hope your investing / trading continues to do well for you. Have a fantastic week and look after yourself. Take care.
Disclaimer first: I don’t have a lot of experience nor knowledge. I think the UK is unfortunately not the best market to invest (index wise) at the moment. 2024 doesn’t look great, as interests will be kept high and this usually hurts small companies.
A couple of alternative ideas: check the Japan ETFs and India ETFs, they’ve been doing quite well and are forecasted to keep going up. As always do your own research, there are many people like myself out there blabbing their opinions.
I’ve always had a contrarian view and it usually comes back to bite me by not following through with it more.
My biggest investment fail has been Argo Blockchain when it rocketed a few years back. It wasn’t worth its all time high(282p), but it wasn’t worth 5p back then either. I just thought I was missing something, and ended up missing out.
Similarly a group of us figured inflation would be rife post Covid, and growth would be hit as a result. Inflation being the simplest way for governments to reduce the value of the debt paid out to keep economies going. As a result exit growth, go into core industries such as energy and finance (banks). Right now, private finance is struggling and so are sectors of the U.K. More and more US companies are investing in the U.K. You can have 5 IT workers in the UK for every one in Silicon Valley. Ok this might help US companies reduce costs, but it brings money into the U.K. I’m not saying growth is out but private finance is probably where growth is right now, similarly UK dividend heroes. I don’t mean Vodaphone but MNG/LGEN.
Similarly the EU is dragging behind the US, and is slowly waking up, and Chinese investment is struggling at the moment.
Who knows if these views will also be correct in the short to medium term. Time will tell as always.