PIE Global Small Companies Fund.

[1leon]

The Investment Statement issued this week seems somewhat short on detail not helped by covering the 3 existing Funds as well. There seems to be no indication of the amount sought,the intended geographical allocation or identity of the other managers to be used.The managers are to be like minded operators and although the fees are reduced from the other Funds there will still be a double layer of magement/performancethis Fund will need to meet. Investors are encouraged to invest by the end of this month to buy in at par.Although presentations are apparently planned there isn't too much time before the launch 2 September. It all seems a bit rushed without some real detail.
PIE Funds was launced as a boutique limited Fund and has expannded considerably beyond its original modest expectations boosted by standout performance.The detail of actual investments seems to have diminished with a few investments now spotlighted rather than any overall investment detail (other than an investment pie chart) at any point. I appreciate the difficult of signalling moves but it would be nice to have the overall picture occasionally to see where the results are obtained.
I realise there is both an Auditor and a Trustee but am equally conscious that these have provided little protection to investors when things turned sour.
The Global Fund seems to me too much like inviting investors into a substantial unknown on the basis of high returns if the same results could be achieved by a range of managers (and more fees?) internationally. How do other investors feel on the information and ability to perform?
Discl: Hold existing 3 Funds.

[stoploss]

The Investment Statement issued this week seems somewhat short on detail not helped by covering the 3 existing Funds as well. There seems to be no indication of the amount sought,the intended geographical allocation or identity of the other managers to be used.The managers are to be like minded operators and although the fees are reduced from the other Funds there will still be a double layer of magement/performancethis Fund will need to meet. Investors are encouraged to invest by the end of this month to buy in at par.Although presentations are apparently planned there isn't too much time before the launch 2 September. It all seems a bit rushed without some real detail.
PIE Funds was launced as a boutique limited Fund and has expannded considerably beyond its original modest expectations boosted by standout performance.The detail of actual investments seems to have diminished with a few investments now spotlighted rather than any overall investment detail (other than an investment pie chart) at any point. I appreciate the difficult of signalling moves but it would be nice to have the overall picture occasionally to see where the results are obtained.
I realise there is both an Auditor and a Trustee but am equally conscious that these have provided little protection to investors when things turned sour.
The Global Fund seems to me too much like inviting investors into a substantial unknown on the basis of high returns if the same results could be achieved by a range of managers (and more fees?) internationally. How do other investors feel on the information and ability to perform?
Discl: Hold existing 3 Funds.
I think they tell you less as he is investing in some small companies and some are very illiquid.With his phenomenal success people are bound to get on the coat tails. I have been lucky enough to be in 2 stocks that he has subsequently got into, and I thought it was a great endorsement so I purchased more..... Your only way to keep in touch is to keep an eye on the ASX SSH notices.For me these have been unbelievable. However I do think that he has a real niche in Australasia and it is obviously working well. I won't be investing in the Global fund , I wish them and all investors the best of luck but I think they should stick to where they have a proven competitive advantage.
DISC:Holding 2 funds and very happy with them.

[1leon]

Perhaps you should take your own advice rather than asking me to tell you what I find out. My question was whether others thought the Investment Statement was any basis on which to invest and what means there was to be satisfied on claimed performance in existing Funds. In fact I referred to standout performance which includes last week. Stoploss reply following yours however is in line with my "feeling" on no proven competitive advantage on a global scene and I think additional costs is part of of that consideration.

[Jaa]

I agree with the comments here. Their results have been unbelievable so far, the small companies fund is up 26% in only 3 and a half months. With performance like this the coattails problem is likely to be very real. But that is a problem for the Aus/NZ funds not for this global fund.

The lack of information on who the global managers are in this new fund and their specialties is not acceptable and would be heavily critised from any other fund manager. I guess you could argue as a successful fund manager PIE Funds has some advantage in being able to pick overseas managers likely to be successful. But then again they might just be selecting their mates. I highly doubt that but my point is how can we know?

With their previous success they will no doubt easily fill this fund and it will probably go on to do very well. But the old adage of always understanding what you are investing in will keep me out.

[Lizard]

In my view, PIE are to be congratulated for once again trying to offer New Zealanders a unique investment product. To date, PIE have provided an excellent service for investors who believe that life is too busy to spend 20hrs per week optimising their investments, but also don’t feel they should be condemned to investment returns that are barely above term deposit or require a $1m+ portfolio to afford serious attention from an advisor. The Global Fund endeavours to continue in this vein, filling the global diversification gap identified by many of their investors.

For the diversified investor, Global Equities provide a core part of a portfolio but the choices are often limited to overly-diversified mediocre performing funds or require the investor to rotate between funds in order to optimise for economies and currencies. The beauty of the global fund will be that it will enable investors to access boutique small-cap, active funds that would normally be very difficult or expensive for small New Zealand investors to access. They will also then use their proven skills of active management to both time the market and rotate between preferred economies/currencies in a way that would be too time consuming for individuals. The flexibility of this mandate is something that most larger funds would be afraid to swallow because of the extent they would be required to back their own decisions. While Pie Funds success in doing so with funds rather than individual stocks is yet to be proven, they have proved to be canny operators to date, so certainly deserve a fair chance.

In view of concerns expressed, I am guessing the reason individual fund managers are not identified is in order to preserve maximum flexibility - none of their funds were launched saying what shares they were going to be buying and this is no different. As for fees – the double layer deserves acknowledgement, but the point is to have an active fund that outperforms. Pie have not been greedy to date – in fact I often wondered how they were going to survive with the low level of fees from their early capped funds that are structured more towards investor return (with associated performance fees for Pie). A more “normal” fund manager would have opened up the funds, taken the Morningstar “top fund” ratings they would then be entitled to and have grown FUM and management fees as far as they could! If their work is able to achieve the returns they are aiming for, then an extra 1% fees will not offend me – and in fact I will feel pleased that their improved revenue position helps guarantee their longevity.

[1leon]

[QUOTE=Lizard;422594][SIZE=2][FONT=arial] "The Global Fund endeavours to continue in this vein, filling the global diversification gap identified by many of their investors. "

I agree on global diversification. We are however talking of a small cap fund which even on PIEs reccomendation would be a small part of a (global) investment

" While Pie Funds success in doing so with funds rather than individual stocks is yet to be proven, they have proved to be canny operators to date, so certainly deserve a fair chance."

The beauty of PIE has been an apparent readiness to exit/enter quickly. If they invest in Funds that report monthly (like themselves)or less it is difficult to see an ability to move quickly.It can take 21 days to exit PIE itself and like provision in the Funds it invests in would be a whole new ball game.

"none of their funds were launched saying what shares they were going to be buying and this is no different."
All the funds were launched for investment in Australian and NZ small caps and with indicated Fund sizes (although these have been substantially exceeded). So we did at least know how much and where it would be invested. There was actually also quite full reporting on the companies purchased when there was only one Fund. That seems a wildly different proposition from investing in a Fund of unknown size and unknown geographical spread.To be truely global might seem to require considerable size.

"If their work is able to achieve the returns they are aiming for, then an extra 1% fees will not offend me – and in fact I will feel pleased that their improved revenue position helps guarantee their longevity."
It isn't simply an extra 1% they also have a 10% performance fee. Presumably the Funds they invest in will have performance fees more like their normal 15% so we could be talking of a performance fee of at least 25%.

It's interesting to note the current 3 funds totalling $m111+ each hold around 40% in cash. The Global is to include an Austr and NZ portion. Given current cash holdings PIE hardly needs any more money to invest in this area. Whilst I note your view on improved revenue by virtue of the Global Fund my greater concern would be that it distracts them from their knitting in OZ and NZ.

[Joshuatree]

All good points but to keep it simple ;Outstanding track record speaks for itself ; Great management .i will be applying for my third PIE Fund.

[Lizard]

I emailed asking for Pie's comments and received the following back from Mike:


We think the “all-in” fees won’t be too dissimilar from the existing funds as we have good negotiating power with managers. In addition, at least half don’t charge a performance fee.

[karen1]

I emailed asking for Pie's comments and received the following back from Mike:

Thank you Lizard, often pays to go to the top!

And thanks to others in this thread for their varying views.

[Lizard]

Looks like the Global Fund is off to a good start - my account already showing 0.5% gain this week - and actually, looking at the date, that was just the first two days. :)

I think they can take this fund a bit larger than the others, due to format, so should be open for a while - unlike the micro-cap one which was closed-off in days (and seems to be doing pretty spectacularly!).

[baller18]

is this under nzx or asx? Can't find it under the code PIE. Cheers!
Or is this a PIE fund we invest in with our banks?

[CJ]

is this under nzx or asx? Can't find it under the code PIE. Cheers!
Or is this a PIE fund we invest in with our banks?http://www.piefunds.co.nz/

Fund not listed, not kiwisaver. Very good track record with their earlier funds.

[baller18]

http://www.piefunds.co.nz/

Fund not listed, not kiwisaver. Very good track record with their earlier funds.
Thanks CJ!!

[Joshuatree]

3rd time lucky but i can't be bothered posting figs again except to say have alook; 3 funds re in the 40% return for 1 year or less plus new global small companies fund still open. OUTSTANDING Mike and team!

[percy]

I went to Pie Funds presentation this afternoon.
Very interesting with each fund manager talking about their 'good' buy and their 'bad' buy.
They certainly have a very disciplined buying criteria model, and review their thesis regularly to see if it holds.
Lighten their holdings on any earnings downgrade.
Most impressed.
Thank you Pie for letting me attend, as I am not invested with them.