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Open Thread: What Are You Buying/Selling/Pondering
Sold some Blackstone (BX). Added to Oaktree (OAK), Energy Transfer Equity (ETE) and considerably to Ecolab (ECL). New position in Liberty Media (LMCA). Added Canadian Natural Resources (CNQ)
Pondering keeping ARTWX versus putting the money into the global stalwarts GGSOX when grandeur peak opens it. Otherwise doing nothing except monitoring for when it's time to exit ZIV.
pondering selling whitebox market neutral. not sucking as much as whitebox tactical opportunity, but something seems broken at whitebox. one hussman in my life to take chance on is enough, and then whitebox is referring to hussman in its quarterly report.
Thinking of selling all of PASAX (a fund held within my hybrid income sleeve) and replacing with JNBAX or BAICX. I was close to doing this about a year or so ago but held off because I felt it was ready to make an upward turn. In hindsight, I should have followed my constitution and let it go due to poor performance when compared to other members within its sleeve. It has now reached my "cut line" and close to getting stopped out (therein is probally my answer).
However, I'll give myslef another 72 hours, or so, to ponder my thoughts ... and, come Friday ... It will most likely will be cut it loose day for PASAX.
In the mean time, while I ponder this over, does anyone else hold PASAX; and, if so, what is your current thinking on PIMCO All Asset fund?
Thinking of selling all of PASAX (a fund held within my hybrid income sleeve) and replacing with JNBAX or BAICX. I was close to doing this about a year or so ago but held off because I felt it was ready to make an upward turn. In hindsight, I should have followed my constitution and let it go due to poor performance when compared to other members within its sleeve. It has now reached my "cut line" and close to getting stopped out (therein is probally my answer).
However, I'll give myslef another 72 hours, or so, to ponder my thoughts ... and, come Friday ... It will most likely will be cut it loose day for PASAX.
In the mean time, while I ponder this over, does anyone else hold PASAX; and, if so, what is your current thinking on PIMCO All Asset fund?
Thanks for stopping by.
Old_Skeet
I haven't owned it in a while but I do think Rob Arnott has been bearish and has been early.
It becomes a matter of whether or not you want to go along with that and hope that he's right that the turn is sooner than later.
--
Will probably sell FIS today, disappointed after they made a huge purchase that I really don't care for. Too bad as I wanted that to be a long-term holding.
Yesterday sold MPACX from my account and MAPIX from my mother's. Great funds, but I want to raise a little cash and I don't think either of us need an Asia focused fund when we already have broad based foreign ones.
Today I'm feeling smart that I got out of Asia yesterday, but it was a long-term asset allocation decision.
Switched from VSFVX to VINEX in my daughter's Edu. IRA. Reason is performance chasing and momentum. Since I have a short span for this account, I do some moves based on momentum unlike in my retirement account. She is about to go to college in 2 years.
Thinking about adding to my holdings in Artisan Global equity. Mark Yockey has been a very consistent performer. Any thoughts from the community on purchasing Baidu? The stock is down considerably with the China selloff and I see that Yockey is adding to his position. He said in his quarterly letter that valuation is attractive.
@Old_Skeet, I would pass on Rob Arnott funds. There is really nothing special about his approach. There are much better moderate allocation funds out there. Vanguard Wellington and Wellsleye, for example.
By coincidence, I recently sold PAIUX (similar fund as PASAX) and switched to Vanguard Wellesley. I actually do think Rob Arnott has some unique viewpoints and methods. However when I thought about what I actually want to achieve, it seemed that a moderate/conservative allocation fund could have the same role in my portfolio with lower expenses and fewer surprises.
Thinking about adding to my holdings in Artisan Global equity. Mark Yockey has been a very consistent performer. Any thoughts from the community on purchasing Baidu? The stock is down considerably with the China selloff and I see that Yockey is adding to his position. He said in his quarterly letter that valuation is attractive.
I tend to like Naspers, where you get a huge stake in Tencent, plus a sort of IACInteractive/Liberty Interactive-style portfolio of a lot of other emerging market e-commerce businesses, plus the cable/media side of the company. Baidu seems like a reasonable value at this point, but I just wouldn't go anywhere near Chinese tech plays at this point with the way that I feel things are going - if anything, I'm looking at this point more at things like Walgreens and Ecolab. I may be wrong, but I think if you're looking at things like Baidu you will get better opportunities.
I decided to start to average out of PASAX and average into JNBAX. I stayed with PASAX for more than a year after first thinking I should move on as it would soon position to catch more of the faster market currents; but, it looks as though it has failed to do this. It has such a large asset base that by my thinking makes it harder to effectively tactically position in this rapidly changing market environment. I felt this way with Marketfield after Main Stay grew the fund to such a size that put it beyond its ability to reposition in short order to catch the faster moving market currents and to take advantage of special opportunity. I moved away from Ivy Asset Strategy fund, a few years ago, for the same concerns.
I am moving on ... and, into JNBAX which is considered a conserative allocation fund.
Scott and John. Thanks very much for the feedback on Baidu. I appreciate it. I'm curious are you sitting tight on your emerging market holdings? I've held Matthews Asia Small company fund for about 6 years now and its getting nailed with everything else in emerging markets now. I'm probably going to stay in but was curious what you're doing?
Scott and John. Thanks very much for the feedback on Baidu. I appreciate it. I'm curious are you sitting tight on your emerging market holdings? I've held Matthews Asia Small company fund for about 6 years now and its getting nailed with everything else in emerging markets now. I'm probably going to stay in but was curious what you're doing?
I still hold Jardine Matheson (JMHLY) although somewhat less than I did. Still hold CK Hutchison (CKHUY). The latter threw off an enormous special dividend a month or two ago because it spun off the real estate holdings into another company which apparently is not going to be offered in the US (those shares were sold by the ADR sponsor, then the funds were distributed to CK Hutchison shareholders.)
The restructuring of Hutchison Whampoa and the resulting CK Hutchison is interesting - CK Hutchison is volatile but offers an array of compelling assets, including the infrastructure assets and AS Watson. It is also about $9 lower than it was, largely due to the dividend.
Still hold Abbott (which, despite being a US company, has very significant EM exposure.) I've said it before: Abbott (ABT) is a very boring way to get EM exposure.
Still own V and MA, which will eventually move into China.
I do like Ecolab (ECL), which is a water play among other things. Does have a moderate amount of EM exposure. Boring, consistent business. I think water will continue to be a big theme in coming years and also hold Danaher (DHR), which has exposure to water, as well.
Still hold small positions in a couple different funds, including T Rowe Asia Opportunities.
Still hold Brookfield Infrastructure (BIP), which does have a lot of Australian exposure and have actually added to that after there were discussions for it to purchase (in cooperation with its parent co) Australian logistics company Asciano (which I'm a little surprised was approved, but it was the other day.) BIP may also potentially look at the the Australian Rail Track Corporation, which may be put up for sale by the government. (http://www.smh.com.au/business/brookfields-asciano-takeover-sets-up-a-fight-for-australian-rail-track-corp-20150819-gj2s6o.html)
Speaking of Brookfield, also continue to think that Brookfield Property Partners (BPY) remains significantly undervalued. Book value is listed at $28, but, "And lastly, IFRS value per unit increase to $30 per unit up from $28 at the end of the year as a result of the contribution from FFO and value appreciation in excess of distributions to unitholders and the impact of our unhedged equity invested in foreign currencies." (http://seekingalpha.com/article/3399755-brookfield-property-partners-bpy-ceo-ric-clark-on-q2-2015-results-earnings-call-transcript) So, that trades at around $22 and is worth at least in the upper $20's.
Still like Oaktree (OAK), which hasn't done much of anything, but if things turn South in considerable fashion, I think the world's largest distressed debt investor may have a ton of opportunities in the US and abroad.
Note: OAK, BPY and BIP are MLPs, so they do throw off K-1s.
I will not be going back into Brazil into names like Cielo (CIOXY) and Ambev (ABEV), at all. I hope Brazil will turn things around, but the situation there looks as if it is getting worse. I mean, the situation with water and the Olympics next year is horrendous.
I don't own it anymore, but Singtel (SGAPY) is a boring EM yield play that owns stakes in other Asian regional telcos, as well as investments in tech companies (including wholly owned digital advertising company Amobee and cyber security company Trustwave, as well as a venture capital arm.)
I will not be adding to EM holdings any further. I know the philosophy is if you wait for clarity on something you're probably going to be too late when you get clarity. I'm still willing to wait on EM.
But you know what, I'm really not interested in adding to much of anything right now, EM or otherwise. Sort of interested in the Madison Square Garden REIT spin-off later this year, but we'll see.
I'm not against some Asian tech (Tencent, Baidu), but you really have to have tolerance for what may be considerable downside if things turn further South. I like Naspers in terms of the diversification, but even that I really have no interest in it at this point. I looked at Liberty Ventures in the US, but went with Liberty Media (LMCA), which I think is undervalued.
In 401 reducing allocation to ODMAX and CHTTX. Proceeds to cash. New contributions to OAKBX. Adding to VVPSX, ARTGX AND MAPTX. Would add to GPROX... Looking for a place(fund) for 5% of portfolio in Roth.
Man this incredibly helpful Scott. thanks for sharing this. I am down 60% on my holdings in Copa holdings -- a Panamanian airline that serves Latin America. They have gotten crushed by the downturn. I will probably keep holding at this point. Have you ever looked at Copa?
Man this incredibly helpful Scott. thanks for sharing this. I am down 60% on my holdings in Copa holdings -- a Panamanian airline that serves Latin America. They have gotten crushed by the downturn. I will probably keep holding at this point. Have you ever looked at Copa?
Happy to help.
Copa has come up when I've looked for dividend names, but I've never really looked into it in detail, unfortunately. The names that I've looked at in Mexico/Brazil have largely been the "familiar" (Femsa, which owns Coca-Cola Femsa; Ambev, which is essentially LatAm Budweiser; Cielo, which is essentially Visa Brazil and to some degree WalMart De Mexico), but I have absolutely no plan to return to any of these names for a long while.
Bank of Nova Scotia (BNS) also has a fair amount of LatAm exposure. You know, "Canada's Most International Bank" is cheap and pays a significant dividend, but I'm becoming more and more concerned about the international exposure that previously felt like an interesting diversifier. I took small profits on BNS after the oil bounce not that long ago but am glad I sold it. I keep thinking about going back to it but I just fear that it may prove to be a value trap or at the very least it may essentially do nothing for a longer period than I'd like.
Look at Arcos Dorados (Latin American McDonalds), which has basically gone straight down since it was IPOd a few years back. It's gone from like 30 to 3.
I'm down enormously on Glencore due to worries over Chinese commodity demand, but it's not a large position (even smaller at this point lol) but I wasn't planning on selling it. I have sold some commodity exposure and moved more into Intercontinental Exchange (ICE) which is a volatile name and not for conservative investors, but has held up quite well during the move lower in oil.
Basically, I'm at the point where I'm holding things that are need-based (a lot of healthcare, Ecolab, Walgreens), a play on a theme, are an unusual value or are volatile names that I am okay with holding for a long period or some combination of the above. In terms of volatile names, I've cut back on some (Blackstone) but have no plans to sell any further.
I will say that I've recently emphasized things like Ecolab (ECL), which has become a very large holding. I've also added to Oaktree (OAK) with the view that they are something that can potentially benefit if things head South.
About to bail on heavily discounted but quickly falling CAF, China A shares CEF. Paying heed to @JohnChisum, who says China ain't no place to be. The worst neighborhood is between my ears, but China and its intractable pollution come close behind. This appears to be yet another year that pundits were wrong about the recovery of EMs.
looks like ECL will break through its $118.46 all-time high one of these days and once it does, maybe it'll be off to the moon. i don't own any but i could see how that might happen. good luck to you!
looks like ECL will break through its $118.46 all-time high one of these days and once it does, maybe it'll be off to the moon. i don't own any but i could see how that might happen. good luck to you!
Thanks!
In terms of ECL, it's certainly not something that I expect a home run from. To me, it really falls under the definition of "boring and consistent." It's the largest hygiene and sanitation company. The water aspect is particularly compelling, but basically it's a company that provides a need in good times and bad. Retail and hospitality companies need to have proper sanitation and hygiene - for example, if a hotel has bed bugs, they will probably call ECL.
A good summary: "The Business: From Anti-Microbial Fruit & Vegetable Treatments, to Bed Bug Extermination, to Fracking
Ecolab develops new products to do everything from dealing with deadly microbes in hospitals, killing bed bugs in hotels, keeping sheets clean and soft, and chemically treating water to improve quality. In Q2, Ecolab introduced a new anti-microbial fruit & vegetable treatment that was very well received. Ecolab even treats water and wastewater from oil & gas extraction." (http://seekingalpha.com/article/1749482-ecolab-why-bill-gates-owns-10-percent-of-the-company)
From the comments section in that article: "Michael, a couple of points. You might view them as nitpicking, but they actually are significant. Ecolab is not a specialty chemicals company - far from it. They did make a few proprietary specialty chemicals for their own consumption until about 20 years ago when regulatory and liability issues became so large that they decided to depend entirely on others for their raw materials. They consume both commodity and specialty chemicals in formulating the chemical specialty products that their customers need. Most who are not involved in one or the other of the industries may not "get" the distinction between specialty chemicals and chemical specialties, but it is real and substantial.
But Ecolab really isn't a chemical specialties company either. It is a services company that helps its customers solve a variety of their often mundane and recurring needs through efficient application and control of products (often chemical specialties), typically using a systems approach.
At one time, Ecolab was also a consumer products company, but exited that business about 25 years ago. It doesn't really fit neatly into any of the typical industry/sector classifications. It has thousands of competitors, but no real peers. Most of Ecolab's revenue does derive from "product" sales, but much of the value its customers receive derives from the application, dispensing and control know-how and service Ecolab provides to its customers as part of the total "package" it delivers.
Ecolab is certainly the kind of company Warren Buffet wishes he owned, but it has never been the kind of company he would be likely to buy. Otherwise he would have bought it long ago. Ecolab does have the "wide moat" that Buffet desires, but it is not the kind of business he understands well, and it rarely has ever been what he would consider to be undervalued (and then only for very short periods of time).
Over the past 30 years, Ecolab has rewarded its shareholders with 17+% compound annual total return. It is not immune to the market's ups and downs, but its performance has been consistently better than the market and the occasional company specific hiccup gets corrected promptly. Only a handful of companies have performed so well so consistently over such a long period of time.
Warren Buffet might look at Ecolab's trailing PE over 30 and think it was grossly overvalued. Even though he's Buffet's friend and bridge partner, perhaps Gates looks at the forward PEG around 1.5 and realizes it is about as cheap as it has ever been. And that there are very few places he can put $3 billion and get that kind of return.
Full disclosure - an noted in my bio, I retired from Ecolab many years ago. For more than 30 years it has been the biggest holding in my portfolio, and I see no reason to expect it will be not still be so when they carry me out of here."
Bill Gates continues to own a bit over 10%.
It's not exciting, but I sleep well at night with ECL as a large position.
Comments
GE, DIS, DOW, EPD, SEP are existing positions that I may be adding to soon.
Just bought back into DEO the other day on that drop, too.
Also bought some AAPL when it went to 14. Hoping China doesn't pull it down more but who knows.
EDIT : Oh yes, 114. I wish I had bought at 14
However, I'll give myslef another 72 hours, or so, to ponder my thoughts ... and, come Friday ... It will most likely will be cut it loose day for PASAX.
In the mean time, while I ponder this over, does anyone else hold PASAX; and, if so, what is your current thinking on PIMCO All Asset fund?
Thanks for stopping by.
Old_Skeet
It becomes a matter of whether or not you want to go along with that and hope that he's right that the turn is sooner than later.
--
Will probably sell FIS today, disappointed after they made a huge purchase that I really don't care for. Too bad as I wanted that to be a long-term holding.
Today I'm feeling smart that I got out of Asia yesterday, but it was a long-term asset allocation decision.
Thanks for your comments on Pimco All Asset.
I decided to start to average out of PASAX and average into JNBAX. I stayed with PASAX for more than a year after first thinking I should move on as it would soon position to catch more of the faster market currents; but, it looks as though it has failed to do this. It has such a large asset base that by my thinking makes it harder to effectively tactically position in this rapidly changing market environment. I felt this way with Marketfield after Main Stay grew the fund to such a size that put it beyond its ability to reposition in short order to catch the faster moving market currents and to take advantage of special opportunity. I moved away from Ivy Asset Strategy fund, a few years ago, for the same concerns.
I am moving on ... and, into JNBAX which is considered a conserative allocation fund.
Old_Skeet
The restructuring of Hutchison Whampoa and the resulting CK Hutchison is interesting - CK Hutchison is volatile but offers an array of compelling assets, including the infrastructure assets and AS Watson. It is also about $9 lower than it was, largely due to the dividend.
Still hold Abbott (which, despite being a US company, has very significant EM exposure.) I've said it before: Abbott (ABT) is a very boring way to get EM exposure.
Still own V and MA, which will eventually move into China.
I do like Ecolab (ECL), which is a water play among other things. Does have a moderate amount of EM exposure. Boring, consistent business. I think water will continue to be a big theme in coming years and also hold Danaher (DHR), which has exposure to water, as well.
Still hold small positions in a couple different funds, including T Rowe Asia Opportunities.
Still hold Brookfield Infrastructure (BIP), which does have a lot of Australian exposure and have actually added to that after there were discussions for it to purchase (in cooperation with its parent co) Australian logistics company Asciano (which I'm a little surprised was approved, but it was the other day.) BIP may also potentially look at the the Australian Rail Track Corporation, which may be put up for sale by the government. (http://www.smh.com.au/business/brookfields-asciano-takeover-sets-up-a-fight-for-australian-rail-track-corp-20150819-gj2s6o.html)
Speaking of Brookfield, also continue to think that Brookfield Property Partners (BPY) remains significantly undervalued. Book value is listed at $28, but, "And lastly, IFRS value per unit increase to $30 per unit up from $28 at the end of the year as a result of the contribution from FFO and value appreciation in excess of distributions to unitholders and the impact of our unhedged equity invested in foreign currencies." (http://seekingalpha.com/article/3399755-brookfield-property-partners-bpy-ceo-ric-clark-on-q2-2015-results-earnings-call-transcript) So, that trades at around $22 and is worth at least in the upper $20's.
Still like Oaktree (OAK), which hasn't done much of anything, but if things turn South in considerable fashion, I think the world's largest distressed debt investor may have a ton of opportunities in the US and abroad.
Note: OAK, BPY and BIP are MLPs, so they do throw off K-1s.
I will not be going back into Brazil into names like Cielo (CIOXY) and Ambev (ABEV), at all. I hope Brazil will turn things around, but the situation there looks as if it is getting worse. I mean, the situation with water and the Olympics next year is horrendous.
I don't own it anymore, but Singtel (SGAPY) is a boring EM yield play that owns stakes in other Asian regional telcos, as well as investments in tech companies (including wholly owned digital advertising company Amobee and cyber security company Trustwave, as well as a venture capital arm.)
I will not be adding to EM holdings any further. I know the philosophy is if you wait for clarity on something you're probably going to be too late when you get clarity. I'm still willing to wait on EM.
But you know what, I'm really not interested in adding to much of anything right now, EM or otherwise. Sort of interested in the Madison Square Garden REIT spin-off later this year, but we'll see.
I'm not against some Asian tech (Tencent, Baidu), but you really have to have tolerance for what may be considerable downside if things turn further South. I like Naspers in terms of the diversification, but even that I really have no interest in it at this point. I looked at Liberty Ventures in the US, but went with Liberty Media (LMCA), which I think is undervalued.
Copa has come up when I've looked for dividend names, but I've never really looked into it in detail, unfortunately. The names that I've looked at in Mexico/Brazil have largely been the "familiar" (Femsa, which owns Coca-Cola Femsa; Ambev, which is essentially LatAm Budweiser; Cielo, which is essentially Visa Brazil and to some degree WalMart De Mexico), but I have absolutely no plan to return to any of these names for a long while.
Bank of Nova Scotia (BNS) also has a fair amount of LatAm exposure. You know, "Canada's Most International Bank" is cheap and pays a significant dividend, but I'm becoming more and more concerned about the international exposure that previously felt like an interesting diversifier. I took small profits on BNS after the oil bounce not that long ago but am glad I sold it. I keep thinking about going back to it but I just fear that it may prove to be a value trap or at the very least it may essentially do nothing for a longer period than I'd like.
Look at Arcos Dorados (Latin American McDonalds), which has basically gone straight down since it was IPOd a few years back. It's gone from like 30 to 3.
I'm down enormously on Glencore due to worries over Chinese commodity demand, but it's not a large position (even smaller at this point lol) but I wasn't planning on selling it. I have sold some commodity exposure and moved more into Intercontinental Exchange (ICE) which is a volatile name and not for conservative investors, but has held up quite well during the move lower in oil.
Basically, I'm at the point where I'm holding things that are need-based (a lot of healthcare, Ecolab, Walgreens), a play on a theme, are an unusual value or are volatile names that I am okay with holding for a long period or some combination of the above. In terms of volatile names, I've cut back on some (Blackstone) but have no plans to sell any further.
I will say that I've recently emphasized things like Ecolab (ECL), which has become a very large holding. I've also added to Oaktree (OAK) with the view that they are something that can potentially benefit if things head South.
In terms of ECL, it's certainly not something that I expect a home run from. To me, it really falls under the definition of "boring and consistent." It's the largest hygiene and sanitation company. The water aspect is particularly compelling, but basically it's a company that provides a need in good times and bad. Retail and hospitality companies need to have proper sanitation and hygiene - for example, if a hotel has bed bugs, they will probably call ECL.
A good summary: "The Business: From Anti-Microbial Fruit & Vegetable Treatments, to Bed Bug Extermination, to Fracking
Ecolab develops new products to do everything from dealing with deadly microbes in hospitals, killing bed bugs in hotels, keeping sheets clean and soft, and chemically treating water to improve quality. In Q2, Ecolab introduced a new anti-microbial fruit & vegetable treatment that was very well received. Ecolab even treats water and wastewater from oil & gas extraction." (http://seekingalpha.com/article/1749482-ecolab-why-bill-gates-owns-10-percent-of-the-company)
From the comments section in that article: "Michael, a couple of points. You might view them as nitpicking, but they actually are significant. Ecolab is not a specialty chemicals company - far from it. They did make a few proprietary specialty chemicals for their own consumption until about 20 years ago when regulatory and liability issues became so large that they decided to depend entirely on others for their raw materials. They consume both commodity and specialty chemicals in formulating the chemical specialty products that their customers need. Most who are not involved in one or the other of the industries may not "get" the distinction between specialty chemicals and chemical specialties, but it is real and substantial.
But Ecolab really isn't a chemical specialties company either. It is a services company that helps its customers solve a variety of their often mundane and recurring needs through efficient application and control of products (often chemical specialties), typically using a systems approach.
At one time, Ecolab was also a consumer products company, but exited that business about 25 years ago. It doesn't really fit neatly into any of the typical industry/sector classifications. It has thousands of competitors, but no real peers. Most of Ecolab's revenue does derive from "product" sales, but much of the value its customers receive derives from the application, dispensing and control know-how and service Ecolab provides to its customers as part of the total "package" it delivers.
Ecolab is certainly the kind of company Warren Buffet wishes he owned, but it has never been the kind of company he would be likely to buy. Otherwise he would have bought it long ago. Ecolab does have the "wide moat" that Buffet desires, but it is not the kind of business he understands well, and it rarely has ever been what he would consider to be undervalued (and then only for very short periods of time).
Over the past 30 years, Ecolab has rewarded its shareholders with 17+% compound annual total return. It is not immune to the market's ups and downs, but its performance has been consistently better than the market and the occasional company specific hiccup gets corrected promptly. Only a handful of companies have performed so well so consistently over such a long period of time.
Warren Buffet might look at Ecolab's trailing PE over 30 and think it was grossly overvalued. Even though he's Buffet's friend and bridge partner, perhaps Gates looks at the forward PEG around 1.5 and realizes it is about as cheap as it has ever been. And that there are very few places he can put $3 billion and get that kind of return.
Full disclosure - an noted in my bio, I retired from Ecolab many years ago. For more than 30 years it has been the biggest holding in my portfolio, and I see no reason to expect it will be not still be so when they carry me out of here."
Bill Gates continues to own a bit over 10%.
It's not exciting, but I sleep well at night with ECL as a large position.
http://www.morningstar.com/stocks/XNYS/PNM/quote.html