Forum Archive Index - December 2003

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi Soarer2,
 
>
> so what does your investment in RBD make you Snoopy, 
>a below average Cantab ?
>

Yes it does Soarer ;-(.

Of course how you see the performance of RBD,  depends how you 
manage your risk.  I run an 'income portfolio' as part of my total 
portfolio.     I see RBD as simply one of the cylinders in my five cylinder 
motor.   Effectively I am running on four at the moment, but that is OK.  
Investment is risky and I expect about one of my five income 
investments to start running roughly at any time.  It is not the ideal 
situation but I would argue that if I was so risk averse that I couldn't 
stand to see a share going backwards, then I probably wouldn't be 
taking enough risk.   As it is I am sitting on an after tax return in 2003 
of some 10.5% (after tax) for my total income portfolio.  That is about 
twice what the bank would give me if I had the same money in term 
deposits, which is what I destined the income portfolio to do.    So I'm 
happy.  Well, not totally happy as I would have liked to have done 
better.   It certainly has done over the last two years.    But since the 
income portfolio is returning exactly what I expected of it, I can't really 
complain!

Specifically on RBD...

As long as the ROE remains high, the market position remains strong, 
the yield remains good and the debt remains low, I will continue to hold 
RBD.     The fact that it has been going backwards is annoying but I 
don't think it is a terminal condition.   We aren't looking at a GDC 
communications where 60% of their business is knocked out by the 
stroke of a pen.  So I'll simply be patient and wait for the turnaround at 
RBD.   I don't try to time the market, because I don't know when the 
turnaround will come.    Yet I do know that I will be there when the time 
comes if I continue to hold.

SNOOPY

discl:  Below average investor for 2003 ;-(





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