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Great content, as always! Just a quick off-topic question: I have a SafePal wallet with USDT, and I have the seed phrase. (air carpet target dish off jeans toilet sweet piano spoil fruit essay). What's the best way to send them to Binance?
Thank you for the correct explanation of the forecast increase in the state pension. I must have watched 3 or 4 other videos that have incorrectly explained it. Nice succinct assessment of major events and your take on it.
Hi Alec, we have added some timestamps in the description of this episode (and will do so for future episodes) so I hope this helps to navigate through the discussions.
I know is an old video but why the EV/EBIT is 10x of the 2nd company? I thought it was EV: Mkt Cap + Debt so : 100 + 90 + 190. Divided by EBIT will be a total of 19x
Hi Steven, yes ‘supportive realisation’ perhaps more appropriate phrasing. With Molten Ventures shares trading at a significant discount (>35% currently), the market is implying scepticism in the published NAV. Therefore, sales at holding values are helpful in supporting the valuation methodology deriving the NAV (i.e. the fair value at the last valuation point, the price that is assumed could be achieved in an orderly transaction for these core holdings). Endomag, the largest realisation of the three mentioned in this interview, was a successful investment for Molten Ventures - earning a 3.7x multiple on invested capital having first invested in the company in 2018 (the sale, at slightly above the holding value which had been marked up incrementally, realising that gain). Perkbox (1.3x) and Graphcore (0.9x), when combined, clearly made a far more modest return for the company but their sales nonetheless supported the carrying values.
Let's say that I want to live my life using euros, in a non-euro country. My employeer can pay me in euros, but the salary is still set in pounds or something. How can immunize myself from my local currency? It's ok if the euro looses value, because I choose to use it.
I forgot about Tim. I used to watch him when I was in University. I don't know how RU-vid Algorigthm did recommend him over So many years!! Miss the whiteboard in the background though!!
If you were investing from the UK, would you choose the S&P 500 or the FTSE? Also, thank you for all the videos-they are extremely informative. What platform would you suggest for investing in index funds with the lowest fees?
I'd long wondered what a "bear squeeze" is, and now I understand. Very well delivered presentation - concepts explained clearly, concisely and in a straight forward way. I agree it's good to ignore the news. Thank you!
Is it always the case that buybacks are the best capital allocation policy or it should be compared to what potential returns you would get from new investments or adding to existing ones? if the portfolio is at a discount at 12% and a new investment is at a 30 % discount to intrinsic value why would buybacks be the automatic capital allocation choice?
Thank you, a really important question. In my view, it actually isn’t a case of ‘one or the other’ in this instance. Decisions should be made with the aim of maximising net asset value (NAV) per share returns. There is a level of certainty of return which can be achieved from share buybacks by many Investment Trusts (ITs). If you consider an IT which invests in a large, liquid, market traded, traditional portfolio (such as one invested in a portfolio of quoted equities, as was the example of Smithson given in this episode), the investment manager/board can have strong confidence in the daily published NAV being a good representation of ‘realisable’ value of the underlying portfolio on that day (+/- trading costs and market timing). If the IT share price currently reflects a discount to this NAV per share (using 12% as an example), there is an option to sell pro-rata a portion of the underlying portfolio and use the proceeds to buy back the IT shares. This process is instantly accretive to NAV (i.e. buying something for 88p which is realisable at 100p today). It is maximising NAV per share returns which should be the key consideration, even if this means the overall size of the IT (number of shares in issue) shrinks during a period of weaker sentiment. In contrast, when assessing a new investment for the underlying portfolio, using the example of one which currently trades at a 30% discount to ‘intrinsic’ value, there is less certainty as to whether the discount on this specific investment can or will be realised and how long that might take (this will be dependent on the market changing its current view). The investment may well be attractive and if the investment manager assesses it to be more compelling than something already in the existing portfolio, the investment should still be made but this should be at the expense of a less attractive existing constituent (i.e. an assessment of competition for capital within the portfolio). Crucially, this decision is separate to the buying back of the company’s own shares. These decisions clearly become more complicated when less liquid/unquoted investments and fixed borrowing is a feature. I hope that helps. Feel free to get in touch via the podcast email address if you would like to discuss further.
