ScotGems taking own good time to find best long-term stocks – ScotGems (SGEM) was launched at the end of June 2017 and has released its first formal final report for the period up to 31st December.
In that short time period, the fund managers have been investing £50.3 million from the initial fundraising and a further £3.2 million raised from subsequent share issues. They have been doing this slowly and methodically. Of the targeted 20 to 3o holdings that you should see in the long run , only 17 were in the portfolio at the end of December.
The companies they are looking for are global smaller companies with a market capitalisation of less than USD 2.5 billion at the time of investment. Stocks are to be held for a long period of time, and will be very well known and understood by the fund managers. In the report, they focus on one stock, Philippine Seven to fully illustrate this. If that is anything to go by, one can see that this would take some time and they will not be rushed. It underline the long term nature of the company.
In that short time frame, however, the NAV of the company fell by 4.2% while the share price fell by 7.0%, representing a discount to NAV of 2.9% at the period end. The board suggest in the report that, as the Company has been established as a long-term venture and is relatively young, it is unlikely that they will buy back shares in the short term.
SGEM – ScotGems taking own good time to find best long-term stocks