Advice on equity fund management

Long story short, stock have always been my thing, quit job after 5 years to start a very small scale hedge fund-ish investment vehicle.

Long equity only, have been a devotee of Lynch and Fisher.

Currently having record of 29.49% CAGR since inception 4 years ago.

But due to the trade-war talks and whatnot currently 20% down for overall portfolio this yr, part of it also due to my mistake of switching strategy too often.

So valuation and stock quality remains unchanged, but the short term volatility started to eat into my confidence, plan to seek advice to go through this rough patch:

1) is it normal for stock to go so low that they will be traded at the same price 4 years ago despite the earnings have 5x as of now?

2) Will long term value focus strategy always prevail at the end of the day?

3) the operator are always so cunning on pressing down the prices, dun want to buy high and sell low back to them, have any1 face this before?

4) I've generally go over many diff type of industry and made the most out of oil, but for consistent record purpose, should I specialize in a certain industry I am good at? or just continue with the general value oriented approach. which would yield more in the long term?

5) Generally any other suggestion or experience sharing is welcome, or other problem and you've overcome in managing fund or related activities.

This is not a post/thread to advertise, nor to solicit any fund from anyone. Purely discussion and info sharing. And no troll pls thanks.Oh and English is not my first language.

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im sorry but you have to be kidding me right?
You started a hedge fund and you dont have an idea of why the value of stocks decrease during times of trouble?

haven't you seen wolf of wall street?
selling securities is like selling cars, it's all about charisma. you don't actually need to know anything about finance.

yeah but hes not saying he's a broker, hes saying hes a hedgefund i think, which means investing in stocks with other peoples money

I am still learning during the 1st 3 years and just had my big break last year, but somewhat I started to lose a bit of confidence over myself with such a sharp drop during the span of 1 week. Guess emotion gets the better of me. Anyway good reply there, really appreciate it.

so youre in the US?

You are right

Nope, SEA country, or as they call it emerging market.

Personally i dont think youve got anything to worry about if youre in SEA because the USA cant win a tradewar vs china.
If youre worried, start hedging and buy gold stocks

US non farm payrolls and unemployment rate coming out in the us in about 8 hours from now and if theyre good then your stocks may take a bit more of a hit.
If youre associated with forex trading you could possibly short a couple currencies that trade against the US to hedge funds aswell

well you can take comfort in the fact that nobody in your industry has any fucking clue of what they're doing either.

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Legit advice here, thx. I kind of feel that US is the only place for me to have a chance to produce the kind of returns I want. The tenbaggers and outperformers from there are simply outrageous. I have always envy US comp corporate earnings while my local market simply pale in comparison.

LOL. But having my first 20% down leave quite a bad taste in my mouth, and I dun wish to jeopardize my track record for now.

The only thing I can right now is pretty much:

1) cut-loss and find a replacement that can break-even or overcome the losses.

2) hold on until the storm goes away.

why dont you invest in the asx stocks? theyre listed in asia arent they?

selling because of a down market is the definition of buy high sell low mentality; I wouldn't say stocks are your thing if you can't remove emotion from the strategy.
also 29.49% CAGR since 2014? the S&P500 made 40%-60% in that time period.

you're joking, right? equities are at all time highs in a 9 year bull market and you're down 20% this year?
You must be a fucking retard

I may trade any stocks once I apply for international brokerage services, planning to go that direction to hedge country risk in the future.

Well can't argue with you on the emotion part, guess I must have much to learn then, btw S&P CAGR is 9.8%, cumulative and CAGR is a diff thing.

I know right, fuck me, seriously. I must be high when I hit the buy button back then.

How the fuck did you get the capital to start this?

What is your benchmark? Do you beat it?

Absolute return is meaningless, OP.

If this isn't a LARP i'm fascinated, do you implement any risk management? Like VaR? Do you even aggregate your portfolio's returns and volatility? Are you diversified?

Starve and save like a madman during my 1st 4 years of employment.

I dun really look at other kind of measurement for returns, so I only look at CAGR. Benchmarking wise each for their own, personally around 30% to 50% region, higher if possible.

How do you focus your portfolio without a bench mark? Is your strategy just to maximize your CAGR?

I dun really know what is LARP? And I heard what is VaR during my uni time but too dumb to understand and implement it.

As for risk management, since I only do long only position (due to lack of sophisticated tools but generally just too dumb to do those esoteric maneuver), so you can say I kind of eliminate/reduce them during the research process? Only diversified depends based on value accretion.

1. It isn't about intelligence do your research and have some confidence. Read a book or two.

2. You're not diversified unless you know the correlations so you need to back test.

3. You will be less emotional if you take the blindfold off and learn your portfolio metrics.

Correct me if I am wrong but I feel like they are the same in the long-term? Sure you try to beat the market annually, and is consider "out-perform" once you are 1% over your local index, but what about the next year and the following year? Cause in theory risk-free asset can compound and have their own CAGR, so if I am earning lesser CAGR then risk-free asset in a long years, I'd commit seppuku as it would deny my entire work to this point LOL,

Why would I buy into your portfolio if I could buy an index fund of the local index? Theres a lot of things that "beat" the risk free rate. The whole point of taking on additonal risk is to beat the risk free rate.

The problem with that methodology is that you're comparing apples to oranges. A risk free asset like a sovereign treasury makes no sense to look at if you're picking oil stocks.

Guess I misunderstood something here? What I am trying to say is that so long the CAGR > the index then I am all set. So year, just maximise the CAGR will do, but the hardest part is to do it consistently, thats why I am frantic if I cant achieve that.

Very hard to have consistent performance on assets that vary in price. You're going to have bad years even if you use CAGR because you're in more volatile assets.

Yup thats what I am challenging myself to do. Haha.

Anyway this thread is closed officially, cause I got what I am here for.

And all the best to readers too!

Cheers!

You are running an investment business yet you have questions like "is it normal for stock to go so low that they will be traded at the same price 4 years ago despite the earnings have 5x as of now"? Does whatever country you operate in have their SEC analogue? Because they are clearly not doing their job.

just use more money to buy the dip right now dumbass
why are you asking Jow Forums these question you should know?

So this guy is making 30% and panic selling because of a 20% dip?
He's going to explode when were in a real bear market