RYM - Ryman Healthcare

[In4a$]

Also, I chose to post my exit because I know others have been thinking along similar lines, and I think its useful to share information with like-minded people. Looks like I'll just leave that to PM from here.

Good luck to all!

Nah, keep sharing Oldguy. It's good to hear what others are doing, I don't always follow suit but helps me rationalise my own decisions. I am holding out for next update in hope we will see $9, if so I'll sell a 1000 or 2 and wait for the next dip and buy again. I float about a 1/3 of my holding, selling at a high and buying when price dips again. Don't always get it right but more interesting than just buying and holding. keeping a base holding means if price soars at anytime, I'll own some. Cant live of dividends with this stock. !!

[Vaygor1]

Anyone investing in this company is doing so for capital gains. It simply is not worth holding just for dividends.

And, to realise those capital gains, you actually have to sell the shares at some stage, right? Thanks.

I do not agree with you in this case OG as I am not into RYM for capital gains at all.

My average hold period is 4.3 years and I have never sold a share.

The dividend might appear small to begin with but it goes up by 15%/annum minimum every year as regular as clockwork.

Assuming I retain my current holding, my pre-tax return on investment in the next 12 months by way of dividend alone will be over 6.7% of my average weighted investment$/share.

Next year it will be over 7.7%, and the year after it will be 9%…. these numbers are divorced from the SP and market sentiment. As such I am not the slightest bit concerned about a global stock market crash.

Capital gains I guess are the cherry on the cake if for some inexplicable reason I am forced to sell. Currently sitting at 240% increase in capital worth from my weighted average investment over an average holding period of 4 years … and not a single 'trading' buy/sell cent to the brokers, and as I am not trading, entirely tax free.

[kura]

Anyone investing in this company is doing so for capital gains. It simply is not worth holding just for dividends.

And, to realise those capital gains, you actually have to sell the shares at some stage, right? Thanks.

Name of this forum is "sharetrader" maybe it is time it was renamed ?

[OldGuy]

I do not agree with you in this case OG as I am not into RYM for capital gains at all.

My average hold period is 4.3 years and I have never sold a share.

The dividend might appear small to begin with but it goes up by 15%/annum minimum every year as regular as clockwork.

Assuming I retain my current holding, my pre-tax return on investment in the next 12 months by way of dividend alone will be over 6.7% of my average weighted investment$/share.

Next year it will be over 7.7%, and the year after it will be 9%…. these numbers are divorced from the SP and market sentiment. As such I am not the slightest bit concerned about a global stock market crash.

Capital gains I guess are the cherry on the cake if for some inexplicable reason I am forced to sell. Currently sitting at 240% increase in capital worth from my weighted average investment over an average holding period of 4 years … and not a single 'trading' buy/sell cent to the brokers, and as I am not trading, entirely tax free.

You're using the wrong denominator. This is a common problem. The opportunity cost of holding is determined by current market value, not purchase price. I am surprised that you'd made this mistake, as your posts are normally pretty good.

[Bjauck]

I do not agree with you in this case OG as I am not into RYM for capital gains at all.....

I agree. I have held Ryman for years and intend to hold for as long as possible. It has been able consistently to exceed the dividend growth of many other companies. http://www.rymanhealthcare.co.nz/inv...re-performance . However I understand this type of investing may not be possible or suit everyone.

[Bjauck]

You're using the wrong denominator. This is a common problem. The opportunity cost of holding is determined by current market value, not purchase price. I am surprised that you'd made this mistake, as your posts are normally pretty good.

Wouldn't there be a risk that an alternative investment to Ryman would deliver a worse result over the long term?

[percy]

You're using the wrong denominator. This is a common problem. The opportunity cost of holding is determined by current market value, not purchase price. I am surprised that you'd made this mistake, as your posts are normally pretty good.

Maybe wrong,but the most fantastic way to look at it.!!!

[Vaygor1]

You're using the wrong denominator. This is a common problem. The opportunity cost of holding is determined by current market value, not purchase price. I am surprised that you'd made this mistake, as your posts are normally pretty good.

Utilising opportunity cost is one method that has a place among all the methods. None totally right, none totally wrong. The basis behind my figures is transparent. Readers are able to take from it what they may.

[BIRMANBOY]

"Opportunity cost" is a vague and shifting sand concept. Why? it depends on who is given the "opportunity", and what the opportunity is and of course how you handle that particular opportunity. So a more measurable and meaningful system is how much money do you have tied up in the situation.

You're using the wrong denominator. This is a common problem. The opportunity cost of holding is determined by current market value, not purchase price. I am surprised that you'd made this mistake, as your posts are normally pretty good.

[Vaygor1]

"Opportunity cost" is a vague and shifting sand concept. Why? it depends on who is given the "opportunity", and what the opportunity is and of course how you handle that particular opportunity. So a more measurable and meaningful system is how much money do you have tied up in the situation.

I agree BB.

My opinion as to what an opportunity cost constitutes is:

Interest forgone to the extent that your are using free funds.
Interest accrued as a result of borrowing to buy
Brokerage/legal/valuers fees.
Holding costs over time can be looked at as either opportunity costs or sometimes not.
Buying another share instead of say RYM can be an opportunity cost but at the time it relates to an uncertain and as yet unknown real return.

In certain circumstance it is appropriate to subtract opportunity costs from the overall gain before arriving at ones final gain, or loss.

The schoolbook definition of opportunity cost may have altered over the years but the application of including opportunity costs solves some problems but raises others.