Forum Archive Index - February 2000

["Mark Hubbard" <mhubbard@es.co.nz>]

> That's a very interesting site - thanks Mark. Any secret as to how you
chose
> the particular investments you did - there's a mind - boggling range of
> options (and as we know history doesn't help with future returns). Perhaps
> if the dollar does rise it could be better to wait 'till later in the year
> before investing too much overseas? Regards Graeme


In choosing the individual funds, I started by ignoring the individual
funds, and concentrating instead on the areas that I wanted to be invested
in. The bulk of my money I wanted invested in straight global funds on the
principle that the professional fund managers know better what areas of the
world to be invested in. Regarding the global funds I also wanted a small
company component. Aside from this though, I wanted my own weighting away
from US (which I believe to be overvalued) toward Asia and Europe. Leaving
aside geograpy, I also decided that I wanted money invested in technology
shares. All of these different areas could then be looked up on Trustnet,
and then I chose the individual funds based on a mixture of past performance
(I know this is not indicative of future performance, but it certainly is a
good starting point), the narrative descriptitions of the objectives of each
fund (I wanted mainly capital gains), and then also finally with an eye to
how much each fund was trading at a discount/premium to its asset backing.
Thus, if you search by the different areas you will note that all the funds
I am in are in the top 5 or 6 funds of their type by performance, and all
trading at a discount (although Finsbury in currently trading at a premium).
This then gives my selection criteria:

1) Henderson Electric & General: global fund (highest weighting in UK)
2) Fleming Overseas: global fund (highest weighting in US).
3) Charter European: the European component
4) Fleming Asia: the Asian component.
5) Finsbury Technology: the technology component.

The sixth fund, Jardine Fleming Fledgling Japan is a throw-away money punt.
Its had the best historical performance over the last year of all the UK
Investment funds (over 600%), so thought it would be a bit of fun (might
lose it all - but can afford to! - and then again, it might be highly
profitable).

You will note that the global small company element is still missing. I've
had the money I want invested in this area (which will be through Henderson
Strata Fund) sitting in term deposit for a while as I'm waiting for the $NZ
to appreciate a bit, as currently its very low - although I may change my
mind here and simply invest it as I can't see $ appreciating all that much
(see my earlier post). (Although the Dow/Nasdaq still worry me also, now the
Fed seems on a sustained program of interest rate increases).

There is also a global venture capital fund ( Thompson Clive) which is high
risk, obviously, but also performing well, and I think would round out my
portfolio well, so may look to investing in over coming year - might be the
best place for my nz FEG and NUH money!!.


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