Peter Thornhill 2019

Great post!

Having been in communications with PT over the past year or so he really discourages people heading down the direct share route. He has over the years picked a few duds which went to zero whilst also getting a few diamonds in the rough from those in the know such as Angus Gluskie, Frank Gooch etc etc.

 

When I met him unexpectedly at an unrelated event he was volunteering at, he was generous with his time talking to me, happy to talk about this stuff in his free time for no fee and as stated by others, didn't argue over minor points just focus on: get into it, make it simple and also (for me) focus on building your career that you enjoy (will get you further than fussing over asset classes).

 

How true is this. Have 'wasted' a lifetime climbing a corporate ladder that I do not enjoy, so can relate. Now trying to carefully build a new career on the side that I can 'retire' into.
Whilst I do not subscribe to all his assumptions, PT's book, columns and videos certainly straightened a lot of my thinking out to be less reactive and more considered - for that I am thankful.

 

Thornhill in Brisbane on 15 Sept:

Motivated Money - Peter Thornhill Wealth Inspiration Event - Sun 15th September

 

Most investors are wrong on dividend yield as income

 

Hmm, synopsis. Buy more of the bloody things.

 

In keeping with @dunno ‘s magnificent post the other day on hoarding cash vs investing immediately then your post about reducing the size of one’s personal cash buffer I’ve done exactly what you suggested above. At least fully with the personal portfolio. Personal cash buffer drastically reduced. If in the unlikely event some short term cash is required then we’ll draw against cash fully offset against our home loan then pay back ASAP when next dividends are received. That’s our Emergency Fund.

The SMSF despite deploying a sizable amount of cash into the market recently is still quite cashed up but it will be undertaking a more gradual approach.

I have to admit that not having cash sitting idle on the sidelines is somewhat like having a weight lifted off one’s shoulders, so liberating. You literally can put the market completely out of your mind until the next round of dividends / distributions is received. And importantly because ongoing new cash amounts are relatively small it’s easy to invest straight away regardless of whether the market is perceived as high, low or whatever given the immediate impact on the portfolio is minor. Yes good old fashioned Dollar Cost Averaging at work. Little effect in the short term regardless of what the market does but massive over the long term.

As for not having dry powder set aside for the unknown impending Elliot Tsunami well not worried at all. If the event is serious enough the resultant Bear market could range from many months to years in duration. We’re fortunate in that our portfolios generate way more income than needed so there will still be ample opportunity to keep accumulating if such an event arises.

One’s never too old to keep learning.

Thank’s to all who contribute here in helping this sometimes stubborn old investor continue to improve and overcome his behavioural weaknesses. It’s not always easy opening up about one’s weaknesses on a public forum but perhaps others might benefit from it.

 

Great post @Nodrog . I feel like I am following your chain of thought but just slightly behind you in action. I am a little slow sometimes.

 

It is likely harder for you too given the amount of cash you’re wanting to invest.

My decision has been made even easier in that some “active” listed funds I like appear to be offering good value at present but one never can be really sure. Indexing however remains a very important component of our portfolios and won’t be neglected.

I’m also paying more attention to asset allocation parameters than in the past.

In regard to my choice to continue to invest part of the portfolio with active listed Mgrs, albeit I’m investing indirectly through these I take heart from a video @dunno posted yesterday and this point in particular:



@SatayKing would likely smile and say this translates to his famous expression: “it’s all about me”.

PS: poor @dunno after reading my interpretation of the video is probably wishing he never posted it. Sorry @dunno if that’s the case.

 

Unfortunately I am not as disciplined as you.

So I've slightly modified the dart board theory I mentioned in the LIC thread, arrange the holdings by ASX code and then one by one until it's all in.

 

Actually I see my attempt at fund selection still as a weakness rather than disciplined. Damn contrarianism is so embedded in my psychy I have trouble resisting perceived value opportunities. It does throw set asset allocation percentages out at times but I’m improving. It generally evens itself out overtime I’ve found so not too concerned.

 

I think it’s an awesome video. Especially the last minute or so, like I said it encompasses why I still have active and direct components in my portfolio. Enjoyment and acceptance of outcome.

Its not a video I would ever regret putting up. As far as interpretation – that’s where our freedoms come into play.

Like for example, the link above to the Thornhill article, I just interrupt that as acknowledgement of total return investing but coached in his own income perspective.

 

Yes, I’ve watched a number of his videos since you first made me aware of him quite some time ago. Most enjoyable to watch. Incredibly skilled but honest and humble.

Active investing with direct shares is in the way too hard basket for me nowadays. But LICs cater to that active need in me although it’s still a long term focus. Pretty simple things but the opportunity to take advantage of NTA discounts satisfies my contrarian nature with minimal effort and skill involved. Going 100% indexing would take away the immense pleasure I get from investing in LICs.

The important thing is that if circumstances changed where by I could no longer spend any time on this or it was left to my wife the portfolios would basically run themselves. Even LIC SPPs / Rights Issues could be binned without too much impact on the portfolio especially at this stage of our life.

As you say “enjoyment and acceptance of outcome”.

 

Feel like I'm searching for the Holy Grail, cant find the video

 

Vanguard Global Value Equity Active ETF (VVLU) [ETF]

 

Probably a distraction which will either confirm your bias or your bias will reject it.

Anyways, it'll only be a flesh wound and Athur couldn't find it either.

 

Anyhow @SatayKing discovered the secret in the video long ago. But because it’s a secret I can’t tell anyone. But a tip, it has to do with “location”.

 

Most certainly about location being at Bateman's Bay about to tuck into a Chorizo and Field Mushroom Risotto.

 

@Nodrog

With such a large portfolio and dividends taken as cash to deploy where your preference lies, the next headache is the additional cash injection as dividends pour in

There's that Tsunami you wanted

 

@dunno does

@SatayKing The Holy Grail?