HGH - Heartland Group Holdings

[mouse]

A lot of us who were investing back then lost heaps. On paper I lost ~$10k, but that was'nt a true reflection as shortly before the crash I pulled ~$20k and bought a new car. Most of us were expecting a correction, it was just the sheer size that caught most by suprise. Those who had investments in companies that were actually producing (Fletchers, Forest Products, Waitaki NZR etc) still came through the far side with some assets. Those who invested mainly in financials and investment companies are the ones who lost the most.

I believe that the same would happen again in the event of another major crash. Those companies that actually produce goods and/or services would survive, while those that rely on simply moving money would be the ones most affected.

Words of Wisdom. Yet Heartland is doing well and, providing it is not your complete investment, should be OK. I remember the 1987 crash. I used to wander over to the Christchurch stock exchange in my lunch break. The latest prices were written up on the white board. One chap turned to me, 'prices can't go any lower, can they?' I was at the HK stock market crash a few years previously and knew THEY CAN. But I kept quiet. Investing is dangerous, so is getting married or eating. A bit of care is needed.

[Bjauck]

In any global market correction, I think NZ would always be more volatile. There is a higher degree of ownership of NZ stocks by overseas funds than in 1987. In addition the currency risk would exacerbate asset risk. International fund managers would need to draw down investments at a faster rate than "the market" as their clients would take fright and cash up. In addition there would be a flight to safe haven currencies, and NZ's being a commodity currency would be dumped.

I am not sure what the overseas ownership percent is for HNZ. My guess is that it is less than average for a listed NZ company.

I have several term PIE funds with Heartland and several with a big Aussie (in which I also have a shareholding). Dealing with Heartland is so much smoother and easier and the interest rate is fractionally higher too. My "personal" banker with the big Aussie can be difficult to locate with relocation, shifting days off and answerphones.

[percy]

As far as I know there are no overseas funds holding Heartland shares.
Heartland have no overseas funding.
You must be aware Australian Banks have European wholesale funding,large exposure to both Australian and NZ housing markets,have lower equity ratio than Heartland, and would put Australian interests before New Zealand's.
The out look for NZ is a lot more stable than overseas.In particular Australia has rising unemployment,poor performing manufacturing,mining ,and retail is facing huge challenges.The Australian government also faces the prospects of Tony Abbott being rolled.

[Bjauck]

As far as I know there are no overseas funds holding Heartland shares.

That sounds positive for SP appreciation in the future if o/s funds decide to buy into what proving to be a solid and successful company. Although greater volatility could result.

Heartland have no overseas funding.

One of the reasons for the higher interest rates offered on my Heartland term pies I guess.

You must be aware Australian Banks have European wholesale funding,large exposure to both Australian and NZ housing markets,have lower equity ratio than Heartland, and would put Australian interests before New Zealand's.

Yes...I am a long term holder of shares in an Aussie Bank as well. If the local subsidiaries relied on NZ funding for NZ mortgages... rates would be higher and the Auckland housing bubble would be smaller and would make less mess when/if it is burst.

The out look for NZ is a lot more stable than overseas.In particular Australia has rising unemployment,poor performing manufacturing,mining ,and retail is facing huge challenges.The Australian government also faces the prospects of Tony Abbott being rolled.

Presuming NZ's current outlook holds if there is another 1987 type scenario, do you think we could become a safe haven? My feeling is that sentiment would quickly reverse. NZ would not be a Switzerland.

[percy]

Unfortunately for us there is only one Switzerland and we would not become a second one,although some overseas people have brought land in NZ as a safe 'bolt hole.'
That said I think NZ is a lot safer country to invest in compared to most countries,ie Japan,Europa,etc.
NZ companies have very strong balance sheets and low gearing when compared to 1987.
On a personnel level, I sold most of my Australian small caps,just over a year ago, and invested the funds in more EBO,HNZ,PGW and took up IPOs MELCA,GNE and ZEL.All of these companies were on more modest ratios than the Australian companies I sold.I have also benefited from higher yields that carry full imputation credits.{And the share price growth has been huge.}

[Bobdn]

It's nice to hear stories of the 1987 crash, helps keep everything real and reinforce a sense that the good times can stop at any old time. I remember switching on Teletext on Tuesday 20 October 1987 (I had to check that date) unaware of "Black Monday" in the US. I thought that the service must have been malfunctioning because all the prices seemed wonky. This is a vivid memory.

http://www.tepapa.govt.nz/WhatsOn/ex....aspx?irn=2592

On a brighter note, I'm in for the long haul with HNZ and have enrolled in the DRP.

[percy]

Most people I know lost their shirt in 1987.Those who did not, had taken out money a few weeks earlier, to either buy a house ,a car or business.I was one who thought the market would come back a little,but completely miss judged it!!!
A share club I was in, had a bank overdraft.That was all we had left!! Negative funds.We reduced the size of the club from 10 to 5,as some wanted to walk away.We increased our contributions from $50 a month to $100.It was slow going to start with,but did not take many years before we had to distribute the shares to each member as the size of our portfolio had grown to over $120,000. That meant we would have had to form a company,or some formal structure that would have involved accountants and lawyers.Would have meant every meeting would have been about structure,rather than stock picking.
There have been some great opportunities,AIA,EBO,FPH,IFT, MFT,POT,RYM,WBC to name a few.
We are now benefiting from HNZ being added to the list.

[Baa_Baa]

HNZ on an intra-day basis has exceeded the TA breakout target of $1.38 ... [snip]

A quick update on HNZ chart, showing here the monthly price, a very positive picture indeed @ $1.41 close and money flow breaking up. Now that the TA target has been exceeded, $1.38 becomes short term price support. So looking ahead with the FA target at $1.66, it suddenly seems a lot closer than when the projection was appreciatively volunteered. The parabolic curve however suggests caution for traders, though long termers won't be concerned, with monthly price support at $1.30 and solid support at $1.12 and $0.95. Must be divvi time soon.

Attachment 6753

[winner69]

BaaBaa - parabolic curves as you call them often happen when dormant undervalued stocks see the light of day and get rerated

Should never has spent as much time under a $1 as it did. Now the market has woken up to what HNZ is really worth it is not surprising to see the action over the last month or so.

The half year will be good. When the detail comes up and people do their sums it will be really hard for Jeff to keep a straight face and say guidance is $46m to $48m. Full year $50m plus.

I don't know why he they are trying to keep expectations down ..... must be an ulterior motive or something but Roger will say they are just bankers and bankers are always conservative .... yeah right

Look forward to your chart in a few months baabaa

[mouse]

Most people I know lost their shirt in 1987.Those who did not, had taken out money a few weeks earlier, to either buy a house ,a car or business.I was one who thought the market would come back a little,but completely miss judged it!!!
A share club I was in, had a bank overdraft.That was all we had left!! Negative funds.We reduced the size of the club from 10 to 5,as some wanted to walk away.We increased our contributions from $50 a month to $100.It was slow going to start with,but did not take many years before we had to distribute the shares to each member as the size of our portfolio had grown to over $120,000. That meant we would have had to form a company,or some formal structure that would have involved accountants and lawyers.Would have meant every meeting would have been about structure,rather than stock picking.
There have been some great opportunities,AIA,EBO,FPH,IFT, MFT,POT,RYM,WBC to name a few.
We are now benefiting from HNZ being added to the list.

1987 was a great opportunity. To lose. Yet there were some useful ideas that came out of it. The point being, the collapse of the finance companies a few years ago, I cannot even remember the date it must have been after Lehman Brothers, was almost a re-run of 1987. Today I was at the Christchurch Cathedral. After the service I saw in Latimer Square a line of people in a queue for a free lunch. Europe is printing money, as has America and Britain? The situation is difficult but has opportunity. To win. HNZ has been fantastic as far as I am concerned.