Managed Funds what if navrainvest went bust?

GTP

GTP is an ASX/S&P200 company- in line with the NI strategy, and is seemingly volatile which should suit the specific algorithm Steve develops for each company.

I'm personally rather fond of the company which has returned in the order of 500% realised gain in the past 3 years, with still a substantial holding to boot.

It's a low PE/ high dividend/ high growth compant that has a very healthy NTA backing (one of the larger land holders in the contry) and endowment income from the management of the MIS.

I'm convinced.

Patchy

 

Checking the SMH funds tables this morning noticed Navra has a "NAv" against its Retail Fund indicating figures not available for 1, 3 years, entry and exit prices. Surely if you want people to invest in your fund you would ensure these figures are made available - they have appeared in the past, but obviously have not been updated!! Maybe because of low performance, but some figures are better than none, it is not a new fund with nothing to quote.

 

Once again a point that would probably best be made direct to NI Investor Services ?????

NavraInvest Investor services
[email protected]
Phone 1 300 656 131

Might be a big assumption to think no figures in the SMH is due to a lack of action on the part of Navra Invest ? I doubt it would be due to low performance - I assume there are plenty of other 'low-performing' funds, and surely some not returning as high as NI , still listed ?? I did say assume, as I don't have a copy of the SMH

 

A Possible alternative: writing covered calls or even protected covered calls. I'm not saying that a covered call strategy would outperform NI, but it's a suggestion. I wouldn't take Peter Spann's simplistic view of the strategy either, I believe you need to select companies based on fundamentals first, then think about the income strategy. Of course in a sustained bear market you can lose out if capital losses outweigh income, but I'm sure NI would have greater issues in the same market.

It sounds like (and I could be totally wrong) that for this LOE strategy you really need an absolute income stream. I don't understand how this can actually be achieved without a mandate allowing the use of shorting or derivatives.

Someone also mentioned index fund managers: you're essentially paying them to give you an index-weighted exposure while leveraging scale economies associated with operating a large fund. It would be a time consuming and costly job to do this yourself, so I think there's still value. Also the fact that the average index fund outperforms the average active fund should appeal to some, especially since they charge lower fees. The one problem though, is that index weightings don't represent value. When Cisco was worth 1/2 a trillion in the tech-boom, you're index fund would have had a huge share, not because of value, but simply because of weighting. It's seems counter-intuitive to move money into a security because it has become more expensive. I think index managers are realising this and starting to talk about value indices.

Anyway, it would be good to hear from anyone with an opinion on covered calls. It's still speculation in a large way because you are looking for a security to not move in a certain direction over a very short time. I think it's much less speculative than a lot of activities, but it's the timeframe and downside exposure that I worry about.

 

Yeah, most people probably are. For those who already invest in direct equities though, it's almost passive to move additional funds into the same securities (if they're suitable) and write calls against them; it may take 10 minutes per month. But if you don't already invest in direct equities, it would take a substantial amount of time to find good stocks to write against. So yeah, not for everyone.

Anyway, just a thought.

As an aside, the ASX buy write index has outperformed the ASX200 with less volatility over the past 20 years. Since most active funds won't even beat the ASX200, maybe it's worth looking at. I don't know if NI has beaten the index since inception, but volatility comes into it too.

 

Tryhard,

As a customer of Navrainvest I'm not sure if I agree with you - I don't think it's the customer's job to be telling Navrainvest their figures aren't being reported at various outlets. It's Navrainvest's job to monitor their marketing.

However if I was a shareholder I'd be pretty annoyed about the lack of figures. I still don't understand why NI don't monitor these forums but that's their choice. Talk about looking a gift horse in the mouth though.

 

Hi -T-,

Got any links to talk about value indices? I haven't heard of that before. Thanks.

 

Sim, to say that Navra are too small to look after what amounts to their own interests in reporting their figures in a five minute phone call to Morningstar or SMH once a year (or even once a month) is ridiculuous. It is in their own interest to make sure these figures are reported (they do want more investment dont they) and it is not an onerous job.

I think you do a sterling job defending Navra on this forum however I think for a lot of people it is wearing a bit thin that there is no input from Navra themselves. Five minutes once a month is not too much to ask of anyone to put a post or two and update figures and it hardly warrants employing an additional person.

If this is Navra's continuing attitude of avoidance to shareholders and unitholders which I think largely comprise this forum then I think it is a sad state of affairs and only erodes confidence in the organisation going forward. After all it is our investments that keep paying their salaries!?!?!? Take us away to invest elsewhere and what are they left with!

 

Hey Glebe

I had a quick look, but I can't remember where I saw the info. It may have even been in a magazine. If I recall correctly, it was about a group of fund managers that were in the process of creating an index based on intrinsic economic value.

There are other more simplified value indices, based on PB, PE or similar ratios. But of course it's flawed to think that a cheap stock is a valuable stock. Also with a lot of our mining stocks, their PEs can be lowest when they're the most expensive due to the influence of commodity prices.

There's a small blub about the simple ones at:
Index Styles

 

I agree with both Sim and RedRover, or at least have an attitude somewhere between the two It would be nice for a one-off (or more frequent) post from Steve to address some of the questions raised, considering there is such attention to the NI fund on here.

But then I do agree, if no one has actually asked the questions of Steve or NI Investor Services, it seems a little bit ridiculous to continue to try to tease out an 'answer' on this forum when no one here is authorised by the Company, or probably qualified, to make any comment.

 

Although newly joining this forum, & not knowing Navra from Adam, I've been a financial planner & at a property investment coy long enough to know that all that you read in the newspaper ain't always true! The SMH tables use the nearest last working day unit price: your 52 week return might have an extra 6 days [Say there was 1% unit price movement last Friday, and the same almost a year ago, when it was Easter - depending on which date was actually used, there could be a couple of % + or - difference]. It seems the fund gets blamed for SMH's problems, when they don't even report prices to them!

The coy. that I was with had $6bn+, and decided it wan't worth being in SMH for all the confused calls that they caused, so withdrew from the tables. So I can understand why Navra might chose not to be involved. I'm betting that they DO love you, and know that you pay their bills etc, but can't justify seeing SMH spoil any good news with bad methodology!
cheers
Mat

 

GTP

Agreed,when GTP hit $2.56 today I hooked in and bought some. This companies vital signs are impressive.

Redrover,
What were you talking about when you said, 'to include GTP in the portfolio breaks the rules of the <Navra Fund's> investment criteria'?
WHY? It's an ASX200 bluechip stock with all of the attributes quoted above.
Mark Leo.

 

Mark Leo
I think if you look at the heavy weights in the fund already, then GTP does not stack up re market capitalisation etc. along with the likes of the banks, CCL etc. There are probably a dozen other companies like LLC, LEI which were in the fund at one stage that have more "right" to be in there. I believe the only reason GTP is included is because of the marketing Navra did of their tax scheme re trees! However if it is there and since it has dropped quite a bit in price perhaps it will now show some gain. Certainly a stock for a private portfolio and I am a "woodlot" holder for the last 7 years.

 

Mark Leo

GTP you bought at $2.56 - why ??- all the indicators were heading south.
Opened today at $1.91 with a brief recovery to $2.09'ish. See ASX 22 page report on government announcement.