Pinned straw:
$TOP annual report out and the clown show rolls on... In the past 5 years the fund is down $163k and Management have been paid $22.7 million.
Clown show just about say it all.
From the Annual report:
“Management fee is calculated at 0.75% of the gross assets. A performance fee of 20% of the increase in the net asset value net of base management fee for the year. The base management fee is calculated half yearly (my underlining added) while the performance fee is calculated on an annual basis” .
The manager is Thorney Management Services owned by Alex Waislitz..
Note the half yearly calculation of the base fee means the annual management fee is near enough to 1.5%. (Nice little sleight of hand to write it up as 0.75% half yearly)
The 20% performance fee is calculated on an annual basis, however the annual report does not state the benchmark that needs to be exceeded for payment of the performance fee. (You can bet it is pretty low). Also the annual report is silent as to whether a “high water mark” operates. Guess what? There is no high water mark. So the asset value goes down, then up again, as often as not due to the gyrations of the market alone, and management takes a 20% cut!
Over the last five years management has ripped out around 4% of the asset value out of TOP every year.
TOP you will see from time to time trumpeted by a sympathetic journalists (or a just plain ignorant journalist) as having a share price at a discount to Net Tangible Assets of over 20% and offering a great bargain.
The only one doing any good out of TOP, or likely to ever do any good out of TOP is Mr Waislitz.