2023 Returns

[Snoopy]

Snoopy wrote:
"As for judging NZ based investments against an American sharemarket index, that is just inappropriate in my view. Generally you are looking at entirely different kinds of businesses both in scale, industry classification and yield 'over there' compared to 'here'."

This is the entire point. If you are a 50 year old prostitute in Hamilton, you may well see fit to judge yourself against other similar ladies however perhaps you should be comparing yourself to 20 year old Auckland ones.

Well if you live in Hamilton, and don't have personal transport links to Auckland, you may well find a 50 year old prostitute in Hamilton that scrubs up well and satisfies your needs? The grass isn't always greener.....

SNOOPY

[mike2020]

Snoops. Do you have to pay more to drive a classic? Asking for a friend.
I do think he would prefer to put more money into oca. Long term the results could even out. Keep your cash and meet said hooker in the village. Some folk prefer aged cheeses.

[SailorRob]

Well if you live in Hamilton, and don't have personal transport links to Auckland, you may well find a 50 year old prostitute in Hamilton that scrubs up well and satisfies your needs? The grass isn't always greener.....

SNOOPY

Believe me between America and its thousands of companies and free market system, powerful military and liquid capital markets and NZ with our currency supported by two crops and a penchant for socialism that looks an awful lot like communism - as well as the relative value between decent companies - the grass sure is Greener, though here we have better Dak, well maybe.

We all have the personal transport links, we can easily and very cheaply access global markets as easily as we can our own.

But nothing stopping you focusing on the Hamilton darling, could be a dude though? Guess today that's a bonus though.

[mike2020]

My point was Mike, Buy Berkshire instead of passive funds (but offer also genuine)

I thought you meant you would now for the next 3 years, offer stands from now due to massive differences in valuations between passive products and Berkshire.

Who knows what price Berkshire will be in 3 years, could be an awful offer by then!

Well, I will extend the offer. No matter what you decide to do over the next 3 years - Berkshire beats you silly or you get the Rum.

I can't resist a good bet. I took a look at BRK over 10 and 40 years. The last 10 are outstanding. In relation to property I think you have mentioned a couple of times past returns can't be repeated and I am inclined to agree, do you think BRK can repeat the last ten years> Its something over 300% in a decade, possibly closer to 400%, I don't know it well in regards to currency movement or any sort of div reinvestment. I do sense there is huge opportunity in the global market. Is there an NZ listed fund that has large exposure to BRK?

I then looked at two funds, KFL and IFT, over 10 years. That was worth the exercise as I already felt positive about IFT long term but now view KFL as clearly cyclical and barely an active fund, not entirely their fault they have very limited choices in NZ. I expect both to perform very well over 12 to 36 months. It is hard to bet against BRK though.

[SailorRob]

I can't resist a good bet. I took a look at BRK over 10 and 40 years. The last 10 are outstanding. In relation to property I think you have mentioned a couple of times past returns can't be repeated and I am inclined to agree, do you think BRK can repeat the last ten years> Its something over 300% in a decade, possibly closer to 400%, I don't know it well in regards to currency movement or any sort of div reinvestment. I do sense there is huge opportunity in the global market. Is there an NZ listed fund that has large exposure to BRK?

I then looked at two funds, KFL and IFT, over 10 years. That was worth the exercise as I already felt positive about IFT long term but now view KFL as clearly cyclical and barely an active fund, not entirely their fault they have very limited choices in NZ. I expect both to perform very well over 12 to 36 months. It is hard to bet against BRK though.

No the last 10 have been very average indeed as BRK hasn't had any multiple expansion while the market has. But therefore when you buy now you're only paying 13 x earnings, far lower than the market.

Berkshire is the furthest thing from a good bet that you could imagine, it is probably the most sound investment you could make.

In USD it's around 225% over the last decade and I estimate around the same going forward or a 12% return. This will be higher if you get any significant multiple expansion and buybacks below intrinsic, then there is currency which nobody knows what will happen.

I have zero clue how Berkshire or anything else will perform over 12 to 36 Months.

[kiora]

I can't resist a good bet. I took a look at BRK over 10 and 40 years. The last 10 are outstanding. In relation to property I think you have mentioned a couple of times past returns can't be repeated and I am inclined to agree, do you think BRK can repeat the last ten years> Its something over 300% in a decade, possibly closer to 400%, I don't know it well in regards to currency movement or any sort of div reinvestment. I do sense there is huge opportunity in the global market. Is there an NZ listed fund that has large exposure to BRK?

I then looked at two funds, KFL and IFT, over 10 years. That was worth the exercise as I already felt positive about IFT long term but now view KFL as clearly cyclical and barely an active fund, not entirely their fault they have very limited choices in NZ. I expect both to perform very well over 12 to 36 months. It is hard to bet against BRK though.

Size matters
"To investigate fund size and performance, the authors use regression analysis and cross-sectional analysis and find that the common notions of declining expenses and returns are mostly true. Their analysis shows that a change in the size of a fund equal to a two-standard-deviation shock in the log of a fund's total assets yields a decline of 5.4 to 7.7 bps in monthly performance. This impact is approximately 65–96 bps annually before fees"
https://rpc.cfainstitute.org/en/rese...%2Dcap%20funds.

Picking leaders matters as does time frame

https://www.sharetrader.co.nz/showth...t=#post1025271