I concur that Justin's book is an excellent read and I joined SharePickers as a result. He updates a Microcap league on a daily basis and has an excellent website containing up to date analysis across a range of Microcap s. He also runs a weekly webinar each Wednesday to share his knowledge and his own picks and watchlists. Highly recommended.
It seems to me that you've identified severe undervaluations in UK stocks but unfortunately they can only be addressed by takeovers and winding down the companies. As long as all the big money goes into US stocks there will never be a recovery in the UK.
I think the issue mostly is people have seen good returns from investing in index funds that follow all world(mostly us weighted), and say S&P500. As long as investors keep doing that, the market truly won’t be representative of the underlying stocks. The top 10 of the S&P500 list are what 35% mcap if the index?
I don't disagree that passive investment is happening - a lot.
But an index will always be weighted and always only cover part of the market even if it's a "world index". Therefore vast demand for passive, indexed stocks could lead to overvaluation while non-indexed stocks grow progressively undervalued in relative terms.
Ultimately if you can buy a larger stream of future cash flows then through buy backs, dividends and M&A the lack of investor interest doesn't necessary doom the contrarian to a worse outcome - even if the market is disinterested in those shares.
Some of my ideas in 2025 do reflect the ongoing reality that wealth management is a passive affair... hence the 6X lean into XLPE for example. If you can't beat 'em then at least profit from 'em.
What could be interesting is to produce a list of all the stocks you wrote about, where you didn’t say you were not investing.
Then track the prices post event, see if there was a ‘better’ entry point, and identify exit point(s), vs buying on first reading of your posts.
Then are there any indicators to ‘wait’ in said purchase, set limits on portfolio weightings, and have spare chase held in VWRP. Would that still give 46% total returns / what would the average annual rate be?
I’ve bought said book, not quite read through it yet. Not sure I will follow the strategy as I have a 2 month window if I buy a stock, I can’t sell and vice versa.
There have been some micro caps I have annoyingly identified and sat in the fence as I could not make a sense of their valuation. One such went from 8p to 290p on momentum. It taught me to stand by my convictions. I now track my returns vs a global equity tracker, and I’m happy to say that I am ahead.
I concur that Justin's book is an excellent read and I joined SharePickers as a result. He updates a Microcap league on a daily basis and has an excellent website containing up to date analysis across a range of Microcap s. He also runs a weekly webinar each Wednesday to share his knowledge and his own picks and watchlists. Highly recommended.
It seems to me that you've identified severe undervaluations in UK stocks but unfortunately they can only be addressed by takeovers and winding down the companies. As long as all the big money goes into US stocks there will never be a recovery in the UK.
I think the issue mostly is people have seen good returns from investing in index funds that follow all world(mostly us weighted), and say S&P500. As long as investors keep doing that, the market truly won’t be representative of the underlying stocks. The top 10 of the S&P500 list are what 35% mcap if the index?
I don't disagree that passive investment is happening - a lot.
But an index will always be weighted and always only cover part of the market even if it's a "world index". Therefore vast demand for passive, indexed stocks could lead to overvaluation while non-indexed stocks grow progressively undervalued in relative terms.
Ultimately if you can buy a larger stream of future cash flows then through buy backs, dividends and M&A the lack of investor interest doesn't necessary doom the contrarian to a worse outcome - even if the market is disinterested in those shares.
Some of my ideas in 2025 do reflect the ongoing reality that wealth management is a passive affair... hence the 6X lean into XLPE for example. If you can't beat 'em then at least profit from 'em.
OB
I suspect one of your must successful tips to date may be PSH, because it does fulfil the criteria of holding large popular stocks.
PSH is the 4th highest so far; the #1 and #2 are off the radar minnows.
The 3rd is FTSE250 so "large popular stocks" are doing well I'd agree.
What could be interesting is to produce a list of all the stocks you wrote about, where you didn’t say you were not investing.
Then track the prices post event, see if there was a ‘better’ entry point, and identify exit point(s), vs buying on first reading of your posts.
Then are there any indicators to ‘wait’ in said purchase, set limits on portfolio weightings, and have spare chase held in VWRP. Would that still give 46% total returns / what would the average annual rate be?
I’ve bought said book, not quite read through it yet. Not sure I will follow the strategy as I have a 2 month window if I buy a stock, I can’t sell and vice versa.
There have been some micro caps I have annoyingly identified and sat in the fence as I could not make a sense of their valuation. One such went from 8p to 290p on momentum. It taught me to stand by my convictions. I now track my returns vs a global equity tracker, and I’m happy to say that I am ahead.