Forum Archive Index - December 1999

[Phil Williams <philw@hyperactive.co.nz>]

Thank you Mark, for taking the middle ground standpoint...

This is really what I was driving at yesterday... Techs are a huge part of the 
market at present, and informed plays in the sector can give the kind of gains 
you've just experienced. It's lunacy to ignore them.

Congratulations on your success with Finsbury.

Further on this debate, you won't see those of us who invest in tech "bagging" 
good regular shares like RestBrands, Warehouse, or AMP Office... it seems 
however that to some "traditional" investors, a gain through price increase is 
somehow inferior
to one paid as a dividend...??
Here's a bit of self evident logic...
If you sell a tech and lock it in - it's still a gain! Often a very good one. :)
Just a thought ;)

Happy Holidays, everyone

Phil Williams

Animation/Media Design
Hyperactive New Media
Wellington, NZ
+64 8019550


Mark Hubbard wrote:

> I haven't got a lot of time to wade into this very interesting debate, but
> here's my pennys worth.
>
> I too consider myself to be a value investor - my main NZ shareholdings
> currently are: Warehouse, Ryman, Restaurant Brands, Fernz (well, sort of NZ)
> + AMP Office Trust and Kiwi Income Property Fund form the property portion
> of my NZ portfolio (if there is an undervalued stock on the NZSE based on
> likely future earnings, it must be AMP Office Trust). Up until about a month
> ago, I had always kept away from techs, as I thought, and still do, that
> many are way overvalued. I use a discounted earnings approach to share
> valuation (in combination with an eye to p/e's - thus you can imagine the
> obvious problems when trying to value a tech.
>
> However, the tech gains have just been too attractive, and I have decided
> that a small, note I said small, portion of my portfolio should be in techs.
> Because I have problems with valuations, however, I have decided to leave
> this portion of my portfolio to the experts and so have invested in techs
> through the UK Investment Trust, Finsbury Technology (I would also prefer my
> tech investment overseas, rather than in NZ). I have been in Finsbury for
> three weeks, and this morning my returns in this fund have just hit 30% (in
> three weeks). For the last three years this fund has consistently returned
> over 100%. At this rate, one could logically say who cares if the Nasdaq
> falls 50% (which certainly would be a crash), after these returns, I'll
> still probably be up.
>
> Finally, I took another punt and managed to get a minimum allocation in
> Chrome Global, half of which I sold down yesterday morning for .63c (a 106%
> return).
>
> I guess my point for value investors is, yes, tech stocks are 'generally'
> overvalued and therefore should only be a small part of your overall
> investments - however, they should still be in there somewhere surely.
> Buffet is very good, and basically wise - but God he is not.
>
> Regards
>
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