Discussion in 'Managed Funds & Index Funds' started by Here_To_Learn, 27th Mar, 2006.
Any early hints about how the Wholesale Fund March distribution is shaping up?
Steve was indicating at the recent shareholders meeting that they hope to distribute around 3%.
But the market has moved upwards a little since then. I still think somewhere around 3.8% (if the fund is around 15.5 to 16% ytd at that point - come this Friday). Time will tell....
I agree Perky. I would think that > 3.5% is quite possible now.
Being an interim Quarter, I guess it depends on how much they want to hold back and also what happens in the remaining days, but a healthy Distribution is certainly looking very achievable now . NB. By 'healthy' I mean > 2.5%.
OK ... any more updates before EOD ?
Definitely an exciting day for all Navrainvest investors !
I still think 3.8% IS possible - maybe even something around 4%. The fund (IMO) will be at around 16.2 or 16.3% YTD after today.
So far around 8% of ditributions, add say another 4% for this qtr - and this leaves another 4% "in the kitty" - perhaps 1.5 or maybe 2% of that is "left over" for next time , and maybe 2% more is left for capital growth.
As at close of business yesterday, the NavTrade Retail fund had returned 4.71% for the quarter with a closing retail application price of 1.1579 versus an opening price on Mon 3rd Jan 2006 of 1.1058.
Incidentally, over the same period the ASX200 returned 7.10% with a closing price of 5115.0 versus an opening price on Mon 3rd Jan 2006 of 4776.0.
I can see that the ASX200 closed today at 5129.7 so actually returned 7.41% for the full quarter but I can't see NavTrade's closing unit price today so can't confirm its total performance for the full quarter including today's trading.
I will be able to let you know by around lunch time on Monday though when they post their previous trading day results.
Perky - you make it sound as if NavraInvest gets to choose how much is left in the fund as "capital growth" and how much is distributed.
Only trading profits are distributed ... and ALL trading profits must be distributed by the end of the financial year.
Capital growth is NOT distributed, and is simply the unrealised profits from growth in the underlying stocks that they hold. If a stock is sold and they take a profit, THEN they get to distribute the profit (indeed they must distribute that profit at the end of the financial year if they haven't done so already).
Maybe it's just the words you use that's causing this feeling - but I thought I'd point it out in case there was any confusion.
So the question is: of the 4.71% NI returned this quarter, how much is realised capital gains (some of the return will be unrealised at this point) and of that how much will they choose to distribute? They may decide to hold back something for the last quarter just in case the next quarter isn't that great, so I'm thinking a distribution of around 3.5% is possible.
I do understand your point Simon.
I have noticed that generally the funds end up with around 2 or 3% cpaital growth each year - thats how I base my summations, as they seem to sell off stocks at the end of each quarter to "lock in" their profit.
Picking up on Sim's point (as an aside) I understand from Steve that one interesting aspect of the US fund is the proportion of return from REALISED gains is higher relative to the Australian funds. I.e. there's higher turnover in the portfolio. which should I guess mean higher proportion of return able to be distributed...potentially
I was wondering if the unit price is a reflection of capital growth in shares held only.. or both cap growth and trade profits?
I assume both if the unit price drops after a distribution.
Yes, the unit price would be calculated by adding the total value of the shares currently held by the fund, plus any other cash holdings (including trading profits so far for the quarter), and then dividing this total figure by the number of units on issue.
So if the unit price is, say, $1.10 at the beginning of the quarter, and at the end of that quarter the market has basically gone nowhere (no capital growth), the unit price will still increase as a result of accumulated trading profits during the quarter.
At the end of the quarter, assuming all those trading profits are distributed (and assuming nobody purchased or redeemed units), the unit price would drop back to $1.10
I haven't paid much attention to how the NAVTrade system works (and I won't as long as I keep getting acceptable distributions ), but from what I know I would disagree with you your last observation perky. I thought the buy/sell decisions were based on the output of the trading algorithm, which depends on the current stock prices, trading volumes, and some measure of the value of the stock currently held (which in turn depends on past buy/sell outcomes). I stand to be corrected, but I doubt there is anything in the algorithm that triggers a sell off as we approach the end of a quarter. This would impose an articifial constraint on the algorithm whoich would generally lead to a less than optimal result.
Does anyone know more about this sort of thing?
That was also my understanding John.
I think it's 3.25% for retail.
Any idea what that is in cents per litre?
Alan, if it was 3.25% then that would be about 3.8c per unit. I can't tell you precisely as they still haven't posted their closing unit prices as at Friday on the website yet so I'm running with the 1.1579 application price from Thursday.
It will all become clear soon no doubt...
31/3/06 Application price is $1.1574 retail.
It's not that I'm greedy or impatient, but just can't wait to know how much I get this quarter
Hmmm, Navra distributions are a bit like sex. Very exciting, lots of anticipation, but once you get it, it's all over for another 3 months.
I think someone was riding the "refresh" button in their browser! Just spotted that it had been posted myself...
That represents a total return for the quarter of 4.67% for NavTrade Retail versus 7.41% for the ASX200. So, yep, a decent distribution, but no management fee for Navra...
The pessimists amongst us might also lament the 2.74% of "opportunity cost" in under-performance. Sure the distribution is nice, but it could have been SOOOO much nicer!
Michael. (The glass is always half full guy)
PS. Attached is the specific performance of NavTrade Retail versus the ASX200 for this quarter in isolation.
Separate names with a comma.