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They are not happy!
Look like they lose more today!!!!!
Look like they lose more today!!!!!
Show More
They need to be in an institution if they thought 13 quid was the right price for BF. Spoke to an asset manager b4 the launch and he said price was the most crazy thing he's ever seen - said they should be half the price given the multiple was bizarre.
You should name the institution as clearly its one to avoid investing with.
You should name the institution as clearly its one to avoid investing with.
Company who buy Betfair share at begining.
I tell them every person think is stil sell sell sell bad price.
I tell them every person think is stil sell sell sell bad price.
Pretty much every user of the site knew it was a crazy price, but as always the cityboys knew better 
Maybe is good time should hire SHOOK HARDY BACON to ask for money back.
" Pretty much every user of the site knew it was a crazy price at the time ".
What ?
100% overpriced crazy ?
50%, 40% , 20 %.
I don't remember too many exact type postings on what the float price should really be at the time of the float.
A lot now of course.
What ?
100% overpriced crazy ?
50%, 40% , 20 %.
I don't remember too many exact type postings on what the float price should really be at the time of the float.
A lot now of course.
http://uk.finance.yahoo.com/echarts?s=BET.L#symbol=bet.l;range=3m;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=;
566 pounds!
Even Titanic not sink as fast!!
566 pounds!
Even Titanic not sink as fast!!
zebadei Joined: 18 Jan 02
Replies: 2665 18 Jul 10 14:05
Imo the valuation looks far too high,any gambling website is subject to future legislation that could seriousy damage future profits.
Saying that i imagine those who invested ten years ago are salivating at the prospect of lottery style returns on relatively modest sums.
waytowin Joined: 11 Oct 05
Replies: 287 18 Jul 10 14:20
I agree Zebadei their valuation is far too high....... future expansion in overseas markets may now be limited given some are looking at building their own platforms.
viva el presidente! Joined: 10 Jun 06
Replies: 8856 18 Jul 10 15:48
zebadei is right, imo.
if I had wealth tied up in betfair, I'd want to monetise it sooner rather than later for two reasons.
1 - future legislation is likely to curtail a lot of what they do.
2 - there's no inherent reason someone can't build a platform to do the same thing better/cheaper, and destroy their current de facto monopoly.
neither of those things currently seems imminent, which makes it a good time to get out.
LeinsterBeliever Joined: 26 Jun 09
Replies: 624 19 Jul 10 19:56
Agree Zebadei & Waytowin. I personally believe it is too high. You can see the previous years profit and revenue on the reports and the valuation of £1.5 billion is over 30 times last year profit.
Sure share prices are based on future growth and if de-regulation occurs in key markets in Europe and US there is massive scope for growth but it's a gamble still.
However we've been reading these 'Betfair will float' statements for over a year and we still haven't seen anything official. They say there is no smoke without fire but they must have run out of wood for the bloody fire at this stage. Also I'd trust a more research article from Financial Times than Sky News speculation merchants.
That's on the first thread I checked. There were dozens of similar posts.
Replies: 2665 18 Jul 10 14:05
Imo the valuation looks far too high,any gambling website is subject to future legislation that could seriousy damage future profits.
Saying that i imagine those who invested ten years ago are salivating at the prospect of lottery style returns on relatively modest sums.
waytowin Joined: 11 Oct 05
Replies: 287 18 Jul 10 14:20
I agree Zebadei their valuation is far too high....... future expansion in overseas markets may now be limited given some are looking at building their own platforms.
viva el presidente! Joined: 10 Jun 06
Replies: 8856 18 Jul 10 15:48
zebadei is right, imo.
if I had wealth tied up in betfair, I'd want to monetise it sooner rather than later for two reasons.
1 - future legislation is likely to curtail a lot of what they do.
2 - there's no inherent reason someone can't build a platform to do the same thing better/cheaper, and destroy their current de facto monopoly.
neither of those things currently seems imminent, which makes it a good time to get out.
LeinsterBeliever Joined: 26 Jun 09
Replies: 624 19 Jul 10 19:56
Agree Zebadei & Waytowin. I personally believe it is too high. You can see the previous years profit and revenue on the reports and the valuation of £1.5 billion is over 30 times last year profit.
Sure share prices are based on future growth and if de-regulation occurs in key markets in Europe and US there is massive scope for growth but it's a gamble still.
However we've been reading these 'Betfair will float' statements for over a year and we still haven't seen anything official. They say there is no smoke without fire but they must have run out of wood for the bloody fire at this stage. Also I'd trust a more research article from Financial Times than Sky News speculation merchants.
That's on the first thread I checked. There were dozens of similar posts.
What happen if BETFAIR buy back all share, for less than the 50 million pound they choose to spend? If there still money left after all share are bought? Maybe they can spend other moneys left on buy share in **** or WILLIAM HILLS.
As to you asking for an exact value, that's a bit of a turnaround.
FINE AS FROG HAIR Joined: 12 Mar 07
Replies: 3844 19 Oct 10 07:18
Lori
People on here talk about trading in and out of the betting prices based on some sort of analysis of what the correct " absolute value" should or should not be.
Trading on financial mkts. usually has nothing to do with the "absolute value" of the financial instrument being traded. It is usually to do with momentary arbitrage opportunities caused by certain stock or commodity prices getting out of comparative alignment with each other or other general market indicators.
FINE AS FROG HAIR Joined: 12 Mar 07
Replies: 3844 19 Oct 10 07:18
Lori
People on here talk about trading in and out of the betting prices based on some sort of analysis of what the correct " absolute value" should or should not be.
Trading on financial mkts. usually has nothing to do with the "absolute value" of the financial instrument being traded. It is usually to do with momentary arbitrage opportunities caused by certain stock or commodity prices getting out of comparative alignment with each other or other general market indicators.
I said a long time ago £5 was a reasonable price. I've now revised that down to £4.
Not that I value my opinion on this very highly as I'm no expert, no more so than most that claim they are, like 90%+ of money managers.
Given current conditions, I would buy at £4. Seeing as I'm not confident enough to short the stock though, it can all be taken with a pinch of salt, which I suggest you do every time someone seems certain about what will happen in the future [;)]
Not that I value my opinion on this very highly as I'm no expert, no more so than most that claim they are, like 90%+ of money managers.
Given current conditions, I would buy at £4. Seeing as I'm not confident enough to short the stock though, it can all be taken with a pinch of salt, which I suggest you do every time someone seems certain about what will happen in the future [;)]
I think, if Betfair shares go down to £3, they would take betfair back to a private company
What price of share would be price when BETFAIR is not in FTSE top 250 no more?
Lori et al
The supposed big time corporate finance experts on here.
Giive us a break.
I would like just one of you to try to convince me that you even have the remotest idea how the flotation process works.
You all seem to be indicating that the institutional investment community which underwrote this issue has made a mistake that has cost them collectively circa 750 million pounds.
Do you for simple starters have the slightest idea how much BF actually received in cash from the float ?.
Do you understand how the prices the underwriters commit to pay relate to the retail float price ?.
Do you understand the concepts of new shares vs founders shares etc etc ?.
Do you know how many shares were actually sold to the retail public in the float ?.
The list goes on and on and on.
Come on, somebody please step up to the plate and tell me exactly how all this played out, who is losing what and when and why ?
For sure you can say in general the float price was aggressive, probably overvalued the company's intellectual assets, actual and future, but that's all .
What does it mean bottom line to you guys anyway, unless your personal stockbroker took you for the flunkeys apparently many of you obviously are, and convinced you to buy some shares at tne inital offering at full retail.
Hands up those who did ?
You at least have my sympathy if nothing else.
You're all just embarassing yourselves with your ignorance of matters that are well beyond your knowledge base.
So what's new.
After all you're all supposed to be big time knowledgeable gamblers aren't you.
At least on that point some of you undoubtedly are, but that's all you are.
The supposed big time corporate finance experts on here.
Giive us a break.
I would like just one of you to try to convince me that you even have the remotest idea how the flotation process works.
You all seem to be indicating that the institutional investment community which underwrote this issue has made a mistake that has cost them collectively circa 750 million pounds.
Do you for simple starters have the slightest idea how much BF actually received in cash from the float ?.
Do you understand how the prices the underwriters commit to pay relate to the retail float price ?.
Do you understand the concepts of new shares vs founders shares etc etc ?.
Do you know how many shares were actually sold to the retail public in the float ?.
The list goes on and on and on.
Come on, somebody please step up to the plate and tell me exactly how all this played out, who is losing what and when and why ?
For sure you can say in general the float price was aggressive, probably overvalued the company's intellectual assets, actual and future, but that's all .
What does it mean bottom line to you guys anyway, unless your personal stockbroker took you for the flunkeys apparently many of you obviously are, and convinced you to buy some shares at tne inital offering at full retail.
Hands up those who did ?
You at least have my sympathy if nothing else.
You're all just embarassing yourselves with your ignorance of matters that are well beyond your knowledge base.
So what's new.
After all you're all supposed to be big time knowledgeable gamblers aren't you.
At least on that point some of you undoubtedly are, but that's all you are.
Their not many betfair share out there in the open float anyway
Ballabriggs
What's an institutional investor look like these days ?.
I mean does have a uniform ( a pin stripe suit perhaps), a post it note on his forehead, is he just one person who invests hundresd of millions of pounds on his individual say so, drives a big car, plays golf, shoots pheasants etc etc.
What did the ones you meet look like ?. Jolly nice chaps, toffee accents, p!ss artists, in a strip club, at a freemason's dinner, in a private box at Chelsea ?
What's an institutional investor look like these days ?.
I mean does have a uniform ( a pin stripe suit perhaps), a post it note on his forehead, is he just one person who invests hundresd of millions of pounds on his individual say so, drives a big car, plays golf, shoots pheasants etc etc.
What did the ones you meet look like ?. Jolly nice chaps, toffee accents, p!ss artists, in a strip club, at a freemason's dinner, in a private box at Chelsea ?
betfair is currently has authority to purchase a maximum of 5,671,346 of its own shares
So not only does Froggy not understand Gambling, he doesn't even understand the stockmarket.
Can we get to a lower point, or have we reached it now.
Can we get to a lower point, or have we reached it now.
share lock-up arrangements amount to approcimately 11% of shares
Edward Wray 11,472,024
Softbank 11,033,109
Andrew Black 10,898,390
Le Peine SA 9,769,722
SBI holdings 7,274,577
Richard Koch 6,592,238 (80/20 rule books Koch)
Fidelity Inv 6,539,781
Balderton Cap 4,227,170
so maybe more share out there, then I was thinking
Edward Wray 11,472,024
Softbank 11,033,109
Andrew Black 10,898,390
Le Peine SA 9,769,722
SBI holdings 7,274,577
Richard Koch 6,592,238 (80/20 rule books Koch)
Fidelity Inv 6,539,781
Balderton Cap 4,227,170
so maybe more share out there, then I was thinking
80/20 rule Richard Koch , 80/20 rule....why you think many many paid the PC1 20% and stayed, but now will not pay PC2 of 40% to 60% ...because the 80/20 rule
Edward Wray not that rich any more....i hope he hasn't spent to much money on those horse and has some cash left
Met peoples from nairdas list yesterday and some from other invester too.
They not happy!
They not happy!
Ok Lori.
I'm waiting for my first lesson from you as usual.
I'm all ears.
I'm waiting for my first lesson from you as usual.
I'm all ears.
Btw Lori why do I always somehow get an image of you with a comb over and wearing cuban heels ?.
Just hope I'm wrong.
Just hope I'm wrong.
softbank paid 13.30 per betfair share , like 5 years ago...he should have stick to Alibaba.com
Have you bigger list nairda? Met peoples from your list but more too not on list.
You're all just embarassing yourselves with your ignorance of matters that are well beyond your knowledge base.
Come on FAFH, these matters are beyond virtually anyone's knowledge base (not the specifics you mention, but the valuation process itself). Most Institutional Investors don't have a clue.
Come on FAFH, these matters are beyond virtually anyone's knowledge base (not the specifics you mention, but the valuation process itself). Most Institutional Investors don't have a clue.
BETFAIR think new USA dereguletion will help them. Maybe opposite is true, big new opportunety make moneys for companys in AMERICA mean big money spending on make rival to squash BETFAIR.
" Most institutional investors don't have a clue"
Well in that case Investor, I suggest you pull all of your hard earned savings out of any insurance policies, money funds, pension plans etc etc you might have invested in over your life so far and just put it all into gambling on sports events.
Not saying they are always get it right ( now that would be a bit of a stretch given the current GFC, but to dismiss the whole professional investment community as a bunch of incompetents( in much the way most on here tend to dismiss all the BF mgt. as a bunch of incompetents) is just plain ridiculous, and is more indicative of the level of incompetence of most of the debaters on here.
You and a select few others are clearly not in that incompetence category, but geez the ground is pretty thin to say the least.
Well in that case Investor, I suggest you pull all of your hard earned savings out of any insurance policies, money funds, pension plans etc etc you might have invested in over your life so far and just put it all into gambling on sports events.
Not saying they are always get it right ( now that would be a bit of a stretch given the current GFC, but to dismiss the whole professional investment community as a bunch of incompetents( in much the way most on here tend to dismiss all the BF mgt. as a bunch of incompetents) is just plain ridiculous, and is more indicative of the level of incompetence of most of the debaters on here.
You and a select few others are clearly not in that incompetence category, but geez the ground is pretty thin to say the least.
City boys bleed more than us so want to get out quicker from unknown territory.
The insecurity in the price is no reflection of the companies profit growth history
and will not effect its future profitability, I cant see any new change too the tax laws
that would have a targeted effect on exchanges for the very reason they are marginal businesses
and unfairly susceptible to a change compared to there rivals.
If there were a change then revenues from pc2 will help clean up and this in my opinion
along with any rival getting even close to betfair in performance means the price is under-valued for betfair.l
The insecurity in the price is no reflection of the companies profit growth history
and will not effect its future profitability, I cant see any new change too the tax laws
that would have a targeted effect on exchanges for the very reason they are marginal businesses
and unfairly susceptible to a change compared to there rivals.
If there were a change then revenues from pc2 will help clean up and this in my opinion
along with any rival getting even close to betfair in performance means the price is under-valued for betfair.l
but to dismiss the whole professional investment community as a bunch of incompetents( in much the way most on here tend to dismiss all the BF mgt. as a bunch of incompetents) is just plain ridiculous
I agree with you there FAFH. People who do that are themselves incompetent as they've missed out the word total twice.
I agree with you there FAFH. People who do that are themselves incompetent as they've missed out the word total twice.
Lots of tasty PRAWN sandweches, thankyou BETFAIR investers.
FINE AS FROG HAIR
Date Joined: 12 Mar 07
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When: 04 Aug 11 16:06
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" Most institutional investors don't have a clue"
Well in that case Investor, I suggest you pull all of your hard earned savings out of any insurance policies, money funds, pension plans etc etc you might have invested in over your life so far and just put it all into gambling on sports events.
Not saying they are always get it right ( now that would be a bit of a stretch given the current GFC, but to dismiss the whole professional investment community as a bunch of incompetents( in much the way most on here tend to dismiss all the BF mgt. as a bunch of incompetents) is just plain ridiculous, and is more indicative of the level of incompetence of most of the debaters on here.
You and a select few others are clearly not in that incompetence category, but geez the ground is pretty thin to say the least.
That's pretty much what I have done. Having a pension / investing in a managed fund is better than not building equity at all though.
I think an investor worth his salt will beat the market. Almost no-one can. The people that can't are just wasting time and resources by enganging in active management.
The statements 'the bookie always wins' and 'the markets are efficient' are similar in that in both cases it's not true, but it might as well be for most people.
Example like this are the norm rather an exception.
http://www.economist.com/node/15453041?story_id=15453041
Date Joined: 12 Mar 07
Add contact | Send message
When: 04 Aug 11 16:06
Joined:
Date Joined: 12 Mar 07
| Topic/replies: 3,854 | Blogger: FINE AS FROG HAIR's blog
" Most institutional investors don't have a clue"
Well in that case Investor, I suggest you pull all of your hard earned savings out of any insurance policies, money funds, pension plans etc etc you might have invested in over your life so far and just put it all into gambling on sports events.
Not saying they are always get it right ( now that would be a bit of a stretch given the current GFC, but to dismiss the whole professional investment community as a bunch of incompetents( in much the way most on here tend to dismiss all the BF mgt. as a bunch of incompetents) is just plain ridiculous, and is more indicative of the level of incompetence of most of the debaters on here.
You and a select few others are clearly not in that incompetence category, but geez the ground is pretty thin to say the least.
That's pretty much what I have done. Having a pension / investing in a managed fund is better than not building equity at all though.
I think an investor worth his salt will beat the market. Almost no-one can. The people that can't are just wasting time and resources by enganging in active management.
The statements 'the bookie always wins' and 'the markets are efficient' are similar in that in both cases it's not true, but it might as well be for most people.
Example like this are the norm rather an exception.
http://www.economist.com/node/15453041?story_id=15453041
Shocked, the government asked for a review of the fund’s active-management approach by Mercer, a consultancy, and for a report by three business-school academics—Andrew Ang, William Goetzmann and Stephen Schaefer from Columbia, Yale and London respectively. The three professors found that for all their stock-picking and do-gooding, the fund’s managers could just as well have thrown darts at a board. Taking the crash into account, the oil fund’s performance was essentially indistinguishable from that of a passively managed index fund. “The evidence points to the fact that over time, managers do not provide extra profits,” says Espen Sirnes of the University of Tromso.
SHOCKED!
SHOCKED!
BetFAIR is still best bookies. Shareholder are just peoples who dont bet on BetFAIR like big CITY companies. They lose but we don't, so why should we care?
BetFAIR share jump up before end of day, so down only 8.5p each today.
Still mean top 4 in list lose £1m each today. Very expensive day!
Edward Wray 11,472,024
Softbank 11,033,109
Andrew Black 10,898,390
Le Peine SA 9,769,722
SBI holdings 7,274,577
Richard Koch 6,592,238 (80/20 rule books Koch)
Fidelity Inv 6,539,781
Balderton Cap 4,227,170
Still mean top 4 in list lose £1m each today. Very expensive day!
Edward Wray 11,472,024
Softbank 11,033,109
Andrew Black 10,898,390
Le Peine SA 9,769,722
SBI holdings 7,274,577
Richard Koch 6,592,238 (80/20 rule books Koch)
Fidelity Inv 6,539,781
Balderton Cap 4,227,170
how long do you think before betfair start firing their Staff....Really, betfair has always look to have far to many staff working on non gambling sh!t
Firing staff? Why do you think Betfair want firing staff? Big bosses at Betfair just got big bonuses! :-)
http://www.guardian.co.uk/business/2011/jul/25/betfair-bosses-huge-pay-increases
"Soon-to-be-former chief executive David Yu gets 125% rise in total package, while finance director Stephen Morana enjoys 445% boost"
Good news for us that Betfair still do good job. Share price is not what matters. If Big Betfair Bosses make big money, must be good news because Betfair is making good targets success.
http://www.guardian.co.uk/business/2011/jul/25/betfair-bosses-huge-pay-increases
"Soon-to-be-former chief executive David Yu gets 125% rise in total package, while finance director Stephen Morana enjoys 445% boost"
Good news for us that Betfair still do good job. Share price is not what matters. If Big Betfair Bosses make big money, must be good news because Betfair is making good targets success.
because, if the share price keep going much lower. Wray, Black will no longer be rich, they will be just well off...
Plus, if PC2 doesn't work, and Turnover drop, City will not be happy
Plus, if PC2 doesn't work, and Turnover drop, City will not be happy
Who care about share price? If city bigboys lose, ha! They are all bad bankers people anyway. BETFAIR are do right thing now - they should pay big money to staff and ignore share price.
The premium charge was the catalyst for the downward momentum.Where will it stop?
pmbets you arnt right
BetFAIR make big peoples pay FAIR share. It helps everyone rich have to pay FAIR share. BetFAIR help customers by stopping greedy big peoples winning so it is easier for everyone else!!! Why you not understand!? It is ok to say THANKYOU to good BetFAIR bosses by giving 445% salary increase. BetFAIR are still BEST bookie, so no stopping for long time.
BetFAIR make big peoples pay FAIR share. It helps everyone rich have to pay FAIR share. BetFAIR help customers by stopping greedy big peoples winning so it is easier for everyone else!!! Why you not understand!? It is ok to say THANKYOU to good BetFAIR bosses by giving 445% salary increase. BetFAIR are still BEST bookie, so no stopping for long time.
The faces of investers was funny. Dont think they were happy! Oh dear!
Who care about share price? If city bigboys lose, ha! They are all bad bankers people anyway. BETFAIR are do right thing now - they should pay big money to staff and ignore share price.
that not the way the world works...Plus, betfair have to many staff
that not the way the world works...Plus, betfair have to many staff
froggy needs to brush up on his malkiel, imo.
Viva
What's Malkiel go to do with the share price analytical or corporate finance skills of the amateur stock pickers, but professional gamblers, on here ?
Hey the share price right now is obviously reflecting all the sentiment out there both specifically for the stock and generally for the market, but that's an entirely different matter to saying I told you so in exact terms when the float occurred.
What's Malkiel go to do with the share price analytical or corporate finance skills of the amateur stock pickers, but professional gamblers, on here ?
Hey the share price right now is obviously reflecting all the sentiment out there both specifically for the stock and generally for the market, but that's an entirely different matter to saying I told you so in exact terms when the float occurred.
Also , apart from putting unneeded pressures on the mgt. to appease certain shareholders, perhaps to the detriment of us simple punters using BF ( that is money grabbing with the PC), what has it got to do with us general punters who mostly don't even own one share of BF ?.
It's just gratuitous BF bashing imo.
It's just gratuitous BF bashing imo.
Oh wait a minute I think I might in fact be getting you rather subtle post after all Viva.
Are you implying that you think that the dramatic downward spiral in the BF share price is largely reflective of widespread growing customer dissatisfaction both with recent BF pricing changes, and with continuing technical glitches occurring at inopportune times ?.
If so, that is a valid and relevant point.
Though I doubt that the "smart money " in the city is that much involved in a stock like BF tbh.
Are you implying that you think that the dramatic downward spiral in the BF share price is largely reflective of widespread growing customer dissatisfaction both with recent BF pricing changes, and with continuing technical glitches occurring at inopportune times ?.
If so, that is a valid and relevant point.
Though I doubt that the "smart money " in the city is that much involved in a stock like BF tbh.
Well in that case Investor, I suggest you pull all of your hard earned savings out of any insurance policies, money funds, pension plans etc etc you might have invested in over your life so far and just put it all into gambling on sports events.
I did that 20 years ago!
I did that 20 years ago!
no, I'm making the far more simple point that professional investors historically underperform the market.
in other words that your "professional investment community" as a class do worse than the dart-throwing blindfold monkey.
in other words that your "professional investment community" as a class do worse than the dart-throwing blindfold monkey.
I think it's to early for PC to be doing anything to betfair share prices..
The only recent rallying of the share price was actually the day of the pc2 charge introduction so that dispels any link to the downward trend that has been on a gradual decline since the flotation.
Lot of complex factors involved with market support in a share exchange.
Betfair.l price would of been much better if the glitches in the upgrading of systems hadn't
caused so much downtime of the system, perhaps some of the staff changes were then due to this
and then a knock on effect of more concern in the numbers of staff at the top positions leaving
causing more share price decline.
Also nearly all shares were bought with a cant sell for 180 days condition on them, the persons having bought those shares then have been steadily selling on the basis of continual no-confidence
of the price rising in the near to mid future!
Lot of complex factors involved with market support in a share exchange.
Betfair.l price would of been much better if the glitches in the upgrading of systems hadn't
caused so much downtime of the system, perhaps some of the staff changes were then due to this
and then a knock on effect of more concern in the numbers of staff at the top positions leaving
causing more share price decline.
Also nearly all shares were bought with a cant sell for 180 days condition on them, the persons having bought those shares then have been steadily selling on the basis of continual no-confidence
of the price rising in the near to mid future!
I believe that to be a total myth Viva. You can produce statistics to prove the argument either way quite compellingly. Which says more about the veracity and usage of statistics than the underlying supposition.
Although I do accept without reservation your comparison of the average poster on here with a dart-throwing blindfold monkey.
Although I do accept without reservation your comparison of the average poster on here with a dart-throwing blindfold monkey.
Lori
And what is the exact comparative result ?.
What is your compound annual growth in savings been over the past 20 years ?.
No fibs please.
And what is the exact comparative result ?.
What is your compound annual growth in savings been over the past 20 years ?.
No fibs please.
That's right viva.
A dart throwing monkey can adequately perform the task of an average fund manager, but it can't perform surgery, fly a plane or design a building.
It's hard to see how it could be untrue that the vast majority of the investment community is completely superfluous despite being very handsomely rewarded.
A lot of smart people are being sucked into lucrative careers that add very little value to society. I know that sounds a bit rich coming from a professional gambler, but most of these guys are effectively professional gamblers too. Except they don't know how to make money as investors at all.
Look at it this way, the index return is what you effectively get 'for free' by doing nothing (minus some small fees). If you as a money manager choose to deviate from the index, you are gambling that you can beat it. The concept is so simple. Of course indexing goes against the self interest of active money managers, and brokers that receive fees and hedge funds that do dodgy deals. As indexing gains in popularity that is going to lead to new problems of its own, but I don't think that will happen for some time.
When you get an actuary to set investment return assumptions for pension funds at 9%+ things start to unravel. Deliberate obfuscation and extreme naïveté cause lots of problems.
The parable in this article explains the principles nicely.
http://money.cnn.com/2006/03/05/news/newsmakers/buffett_fortune/index.htm
A dart throwing monkey can adequately perform the task of an average fund manager, but it can't perform surgery, fly a plane or design a building.
It's hard to see how it could be untrue that the vast majority of the investment community is completely superfluous despite being very handsomely rewarded.
A lot of smart people are being sucked into lucrative careers that add very little value to society. I know that sounds a bit rich coming from a professional gambler, but most of these guys are effectively professional gamblers too. Except they don't know how to make money as investors at all.
Look at it this way, the index return is what you effectively get 'for free' by doing nothing (minus some small fees). If you as a money manager choose to deviate from the index, you are gambling that you can beat it. The concept is so simple. Of course indexing goes against the self interest of active money managers, and brokers that receive fees and hedge funds that do dodgy deals. As indexing gains in popularity that is going to lead to new problems of its own, but I don't think that will happen for some time.
When you get an actuary to set investment return assumptions for pension funds at 9%+ things start to unravel. Deliberate obfuscation and extreme naïveté cause lots of problems.
The parable in this article explains the principles nicely.
http://money.cnn.com/2006/03/05/news/newsmakers/buffett_fortune/index.htm
The long term price for betfair.l has to be much better that 6 quid and there will be stabilization
at some near point, then when company reports look more city boy friendly the price will start
ascending.
at some near point, then when company reports look more city boy friendly the price will start
ascending.
FINE AS FROG HAIR
Date Joined: 12 Mar 07
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When: 04 Aug 11 21:58
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I believe that to be a total myth Viva. You can produce statistics to prove the argument either way quite compellingly. Which says more about the veracity and usage of statistics than the underlying supposition.
Although I do accept without reservation your comparison of the average poster on here with a dart-throwing blindfold monkey.
The average fund manager does worse than the index. That's not even open to debate right?
Date Joined: 12 Mar 07
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When: 04 Aug 11 21:58
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I believe that to be a total myth Viva. You can produce statistics to prove the argument either way quite compellingly. Which says more about the veracity and usage of statistics than the underlying supposition.
Although I do accept without reservation your comparison of the average poster on here with a dart-throwing blindfold monkey.
The average fund manager does worse than the index. That's not even open to debate right?
Investor
It is true that there is a lot of dead wood in the finance advisory industry, just like in any.
But those that are good are very good, and vice versa.
Just like in gambling eh ?
I know from personal experience that I wouldn't have a cat's chance in hell of beating the returns my advisors have gotten me over the past 20 -30 years.
Kept me out of all sort of trouble tbh.
It is true that there is a lot of dead wood in the finance advisory industry, just like in any.
But those that are good are very good, and vice versa.
Just like in gambling eh ?
I know from personal experience that I wouldn't have a cat's chance in hell of beating the returns my advisors have gotten me over the past 20 -30 years.
Kept me out of all sort of trouble tbh.
Yep that is not open debate.
The average fund mgr is someone to avoid at all costs.
The average fund mgr is someone to avoid at all costs.
I think the % of 'dead wood' in the finance advisory industry is probably higher than any other major industry though.
It's good that you managed to do well FAFH. I believe that finding a good fund manager is just as difficult as finding good investments though.
What do you think?
It's good that you managed to do well FAFH. I believe that finding a good fund manager is just as difficult as finding good investments though.
What do you think?
I wouldn't ask the average fund manager whats going to be profitable in a race, ether sports or share market lol[;)]
If you had betfair.l in your portfolio would you not sell at the minute when you compare to some real
big climbers recently and since the float, there not a magnet at the moment and seem to repelling investment instead, marginal new business models need to keep good profiles to reach any early maturity in float price figure.
Although having clean sheets in annual profit growth last decade this important clean sheet in respect of other profile data has been marred.
big climbers recently and since the float, there not a magnet at the moment and seem to repelling investment instead, marginal new business models need to keep good profiles to reach any early maturity in float price figure.
Although having clean sheets in annual profit growth last decade this important clean sheet in respect of other profile data has been marred.
I think the concerns on updating the taxation on certain exchange activity is a white elephant and has caused a lot of unnecessary concern to investors.Its my bet that the government will not penalize
exchanges in isolation of other betting company types but the off-shore tax avoidance practice of all
betting companies looks like it will get taxation at consumption point, moving offshore could of been a waste of company funds but only in retrospect, unfortunate timing.
exchanges in isolation of other betting company types but the off-shore tax avoidance practice of all
betting companies looks like it will get taxation at consumption point, moving offshore could of been a waste of company funds but only in retrospect, unfortunate timing.
I will say one thing that makes very logical sense, when applying a change to any business policy,infra-structure change or upgrading the system , each act of change carries a certain weight of risk. If you don't space out your changes in safe periods of time then the weight of risk and inter-relational effects can become a exponential strain on management, cash flow, company image, etc.
perhaps betfair have applied to many changes to quickly?
perhaps betfair have applied to many changes to quickly?
I also find that if you don't space out your forum posts, then it can create a strain on your forum image ?
I believe that to be a total myth Viva.
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believe what you want froggy. but that's simply true, and has held true for many decades.
and even the funds which appear to outperform trend back towards the mean with time.
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believe what you want froggy. but that's simply true, and has held true for many decades.
and even the funds which appear to outperform trend back towards the mean with time.
Don't you believe that certain fund managers can systematically outpeform at all viva? The average fund manager under peforms, and the above average fund managers has probably been lucky, some of them will actually be doing something smart though.
As I stated in my 22:15 post, I can't see how finding a good fund manager can be any easier than finding a good investment though, so it kind of becomes self defeating.
As I stated in my 22:15 post, I can't see how finding a good fund manager can be any easier than finding a good investment though, so it kind of becomes self defeating.
probably a very few, primarily by taking advantage of the idiocy of the others.
buffett springs to mind. does well by doing little and waiting for others to make idiots of themselves in herd mode.
certainly not an argument in their favour as a class.
buffett springs to mind. does well by doing little and waiting for others to make idiots of themselves in herd mode.
certainly not an argument in their favour as a class.
btw, investor, iirc you're echoing another part of malkiel's argument - that picking a genuinely good fund manager is as hard as finding a good investment.
Yeah, I like A Random Walk Down Wall Street, but I think a great theoretician should go to great lenghts to try and falsify his own theories, which Malkiel doesn't do at all.
Just a snippet about George Soros from this book, who's achievements are marginalised by the author:
George Soros, a famous hedge-fund manager, supposedly endowed with a "Midas touch," made hundreds of millions when he correctly "bet" that some currencies would be stronger than others and translated his bet into hedged-futures contracts. The Midas touch turned to a minus touch, however, when he lost more than half a billion dollars during 1994 on a single currency deal.
As if to imply that he just got lucky. No mention is made of Paul Tudor Jones or Steve Cohen or Ed Thorp (other than a note that he found a way to win at blackjack).
I think Efficient Market Theory is deeply flawed and only useful for the reason that 'it might as well be true' for most people. When people model reality and then say that that model is reality, smart people start to do stupid things.
The greatest fund managers tend to be closed to new investment, or they have grown to the point where returns no longer massively outperform the market. It goes a long way in explaining why the top US universities (Harvard, Yale) investment funds have been able to beat the market: due to their prestige they will be accepted as clients by virtually any money manager that is otherwise closed to outside investment.
Just a snippet about George Soros from this book, who's achievements are marginalised by the author:
George Soros, a famous hedge-fund manager, supposedly endowed with a "Midas touch," made hundreds of millions when he correctly "bet" that some currencies would be stronger than others and translated his bet into hedged-futures contracts. The Midas touch turned to a minus touch, however, when he lost more than half a billion dollars during 1994 on a single currency deal.
As if to imply that he just got lucky. No mention is made of Paul Tudor Jones or Steve Cohen or Ed Thorp (other than a note that he found a way to win at blackjack).
I think Efficient Market Theory is deeply flawed and only useful for the reason that 'it might as well be true' for most people. When people model reality and then say that that model is reality, smart people start to do stupid things.
The greatest fund managers tend to be closed to new investment, or they have grown to the point where returns no longer massively outperform the market. It goes a long way in explaining why the top US universities (Harvard, Yale) investment funds have been able to beat the market: due to their prestige they will be accepted as clients by virtually any money manager that is otherwise closed to outside investment.
the way I see it, they're all playing against each other - so really it's a zero sum game masked by growth in the real economy.
are there some people who'll consistently win in that game? yeah, I can go for that. but can you confidently pick the ones who'll continue to consistently win from the ones that chance has just happened to put above the average for a sustained period? not so sure about that, for various reasons.
but in any case, seeing as a lot of the seemingly most successful traders basically thrive off the stupidity of the herd, that's not an argument for the expertise of the community as a whole in valuing new issues, imo. which is where this debate started.
are there some people who'll consistently win in that game? yeah, I can go for that. but can you confidently pick the ones who'll continue to consistently win from the ones that chance has just happened to put above the average for a sustained period? not so sure about that, for various reasons.
but in any case, seeing as a lot of the seemingly most successful traders basically thrive off the stupidity of the herd, that's not an argument for the expertise of the community as a whole in valuing new issues, imo. which is where this debate started.
The average fund mgr is someone to avoid at all costs.
IMVHO they should be killed.
IMVHO they should be killed.
What percentage of "the market" is held by managed funds + tracker funds? If it was anything close to 100%, expecting managed funds to outperform the market on average would be futile.
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