@thunderhead I’d be very happy to set this out. And will either add it to an existing Forum or create a new one if appropriate.

While I have a process, it is not simple. So it will take me a while to codify it. What is also worth sharing is the consequences of when I have failed to follow my own process! The consequences are clear to all in my SM returns, and you can see most of my RL failures in my SM trading history! (So beware) That’s why this is such a great platform.

Spoiler alert: the biggest losses I have incurred is when I have taken positions that were too large in high risk companies I did not adequately understand. ($AMS and $EML are the nightmare poster children). Because I didn’t understand them properly, I held on too long and didn’t sell early enough, and in my ignorance, felt good in my willingness to be contrary along the way!!

Mercifully (for me) my SM holdings are a minor and risky part of my total ASX holdings. My overall active portfolio has been in place since late 2016 and has achieved a decent return, albeit nowhere near the best on SM. So I am here to learn, as much as anyone. And willing to share in return.

As to when? ASAP. But reporting season is about to kick off. So it’s a busy time ahead!

@thunderhead If you asked me "do you allow your highest conviction/quality positions to run over long periods regardless of periods of egregious valuation?" I would have to answer Yes.

Looking back over my (few) sells in the past decade, it has always been because my conviction in a company was no longer there:

RHC - too much debt, too low margins

APX - overtaken by technology

NFLX - too much debt, too much competition

CCP - ex growth

I have been sorely tried by the unquestionably ridiculous over valuation of NVDA, which I have held for 5 years and is the largest holding in my portfolio. But it remains far and away the market leader in its field, has excellent management and a huge amount of growth potential.

I simply refuse to sell a company I strongly believe in because of its share price (whether ultra high or ultra low).

Thank you for your thoughts gentlemen. I think it is a good idea to start a separate thread so we can collate views and discussions between everyone who is interested in this topic.

@lankypom - My best returns have also come from holding companies through ups and downs, and bouts of sizable overvaluation. But the experience from 2021/2022 have shaken my willingness/ability to do that - perhaps that is more reflection of my stock selection than the approach to position management and portfolio construction, and I need to tamp down on the allocation to riskier/relatively unproven companies (high growth, but deeply unprofitable too).

No rush with the responses at all in general.

P.S. When do you start a thread or post about this, do tag me so I don't miss it!

P.P.S On the 5th day of the slide with RMD - I would have expected some sort of a bounce by now, so that's a bit concerning.

Now down more than 10% from those levels. The force against it is strong.

However, it is entering an area where it should find support, looking at the longer term chart - ignoring the technicals and rushing to buy the dip hasn't worked here so far, though I did it intentionally given the quality of the business. Hopefully this slide is a distant memory in another 8 years, which will be double my holding period so far for this company.

The area of support is holding so far, though we are yet to see a convincing bounce.

Thanks @lankypom . Like you, I find it hard seeing red, but I am always happy to be given the opportunity to add more of a quality business on weakness. We are now on a forward p/e for FY24 of 28x, against a 5-year average of around 50 (although realistically more like 43 if you remove the distortion of 2021/20222). The gap in the SP to consensus 12-m target is now 33%! Personally, I don't expect to have to wait 5 years to see this look very different.

I agree with you about software and data. Medifox Dan was the signal that they want to accelerate in a serious way their efforts to build capability to use their vast and growing dataset and connectivity technology to innovate and find new ways to deliver services to customers and healthcare professionals. I hope their acquisition strategy remains focused on acquiring small players, as it is a quality business with great margins and it would be a shame to see that risked via larger M&A.

Anyway, happy to put this one away now until the next report. It's back to my 3rd largest position in RL.