Why hasn't any other asset manager copied Scottish Mortgage?

jamesanderson
scottishmortgage

#1

usually when a fund is really successful someone tries to replicate it, but this doesn’t seem to have happened with Scottish Mortgage.

I wonder if it’s because it’s really difficult to copy - is it really that hard being a fortune teller (Ha!).

I can see some managers doing some of what James Anderson and Tom Slater do, I’m thinking of people like Woodford with his long term investment strategy, but not in the same way as Scottish Mortgage.

I’m hard pressed to think of anyone or anything else like Scottish Mortgage?


#2

No I can’t think of anyone else or any trust/fund that is quite like this, so I come around to the conclusion that this is actually very difficult to replicate.

He is obviously uber intelligent, I watched a video interview on the Scottish Mortgage micro-site link in the article and I’m no dumbo, but I needed to consult my dictionary to fully understand what he was saying.

They’re just a really good management team,a nd I like the fact that they buy and sell shares constantly to get the discount to zero, it makes it easier to trade.


#3

http://whichinvestmenttrust.com/what-is-scottish-mortgage-investment-trust/I haven’t watched the video yet @andreacz but I just read through the annual report and I needed my dictionary out for that one too.

This is from the Interim report:
“There is a strong structural asymmetry in equity market returns, given the potential for a successful company to grow to many times its size.”

What the heck does that mean? Even with my trusty dictionary I can’t get my head around that one.
if you wanna have a butchers at the reports they’re here.


#4

James Anderson is English, or at least he sounds English in the videos. Maybe he’s a posh jock, you get them sometimes if they went to public school.

I’ve no idea what that statement means @arsenalplayer but I know this is a terrific fund.


#5

Maybe SM are just lucky. Value has been out of fashion for some time and it looks as if anyone who has bet heavily on big tech has done fairly well.

I think that their point is that if you have a company worth £1m and it doubles in value you have made £1m, but if its value halves you have only lost £0.5m


#6

I think it is more than just luck @mickbeaman, though it undoubtedly played a part. I read somewhere, cant remember if it was in one of the annual reports that 80% the investment ideas the SM pair generate don’t contribute to the performance to any great extent.

Though I think you have a point about value being out of fashion for so long. I’ve also read some value managers think their time in the sun is about to begin.


#7

I’ve been notified that this is an old conversation, but think it is still relevant.
SMT and MNL have been mentioned together, not that they are in any way similar. However, MNL bought some large and some small tech type stocks, ( See top ten) people noticed that NAV was higher than the MNL price, and started buying. This year. When, because of its consistent performance, SMT was on a premium to NAV. There are few people who could run an IT the size of SMT - a small and nimble Trust can nip in and have an exceptional year.
The "Why can’t they be copied ? " see above. Remember the Best Ideas Funds ? of a few years ago. “We’ve put 4 of our best ideas people together to come up with a fund that combines all the good investments we can think of.” Where are they now.? Not easy to do.


#8

Yeah i remember those ‘best idea funds’ from Skandia, now Old Mutual @Kuhncha, they tanked!

City of London or CTY is another one of those trusts where the manager supposedly does something simple, investing mainly in FTSE 100 companies but he has been beating peers and the market for over 25 years now, and it’s cheap as chips. I think of CTY as being what investors in Tracker/ETFs should be investing in. It’s not a shoot the lights out fund but its got a fantastic long term performance record with a 50 year rising dividend.