I thought it might be good to share something about my objectives and my investing style. I hope you find it of interest and generates some discussion as I think Moneyam needs something more at the moment.

I work full time so I’m an investor now. In general I do have time to check the markets during the day but there are days when I’m in meetings for hours on end and it’s not appropriate. This works well for me as stops me over-trading. I suspect I would make less if I sat at a computer all day trying to invest.

Please feel free to discuss you trading style and reflect on how I could improve what I do.

I have two pots. The first pot is my SIPP and I therefore consider I must invest this with extreme caution. I consider a return of 5-10% as acceptable and any more as a bonus. The second pot is my trading pot where I take more risk. I am looking for 10+% plus a year from this. I only invest in UK equities. I no longer trade CFD’s or spreadbets due to the nature of my job, although many years ago I made a living day-trading.

My performance over the last 6 years is as follows:
2010 -0.3%
2011 -34.8% (too little diversification, bad timing and not very pleasant)
2012 +70.7% (umm – too little diversification –just got the timing wrong on the previous years purchases)
2013 +36.8% (umm – still too little diversification but what do you do when you’re in the right trades??)
2014 +5.5% (diversification getting better but my biggest share-holding hurt me badly)
2015 +5.5% so far

I have a very simple trading style. My primary objective is to sell equities when Ftse is high and buy when it is low i.e. I choose my entry and exit point depending on whether Ftse is overbought or oversold. The choice of share is secondary.

I often buy stocks in a clear downtrend on chart support points when Ftse is beaten up on the premise that Ftse will turn up in a short time frame setting up a bounce for the stock. These stocks will generally also have attracted me because of fundamentals, dividends or I believe they are significantly oversold. I also like recovery stories with long circulating bid rumours. Sometimes I buy stocks after research leads me to believe the share is significantly undervalued – this can be very profitable but usually a great amount of patience is required.

So, to explain in more detail this year as Ftse moved up early in the year I started selling heavily as Ftse reached 6700. By the time it reached its peak I was 91% in cash. As it headed back down again in June I started buying again at 6700 and by the end of June as Ftse was around 6500 I was 95% invested. Clearly I haven’t called this that well this year based on the evidence but I’m comfortable about it as doing something was better than doing nothing. Ftse is down 3.8% year to date and I’m up 5.5%. I suspect most people would be pretty happy with that – I am.

Here is my portfolio. It’s quite unbalanced and deliberately so. It breaks a load of rules with regard to diversification
24.3% - Sorry but I can’t share this stock with you yet as it’s not that liquid and I’m still acquiring stock. I’ve done my research and honesty believe a doubling of share price in three years would be a really poor outcome.

14.8% RBS. Most of these I have acquired between 337 and 362 although I have a few from 307. Already sold a few from 307 last week and if I can get somewhere between 339 and 342 next week they will be gone too. Earlier in the year they were trading at 400 and there were no sellers in sight as it trudged up day after day from 380 to 400. I’m of the view that this will come back over time as the government require the banks to be strong and make profits so we don’t have another crisis. I intend to hold all of these for a while (except for the few I’m selling next week) and start off-loading around 385 and see what happens from there

8.3% RDSB. Like many PI’s I’ve got drawn in by the dividend and most of these were bought between 1845 and 2025. I have a few at 1598 from last week which I honestly thought would be far higher given the rise in oil this week. I think oil has a bit higher to run yet and I’m looking to sell the ones from 1598 soon as I’ve got a few too many. Not sure what to do about the rest but the dividend of around 6% helps.

6.3% VSVS. Provides products to the steel industry. I’m in this as I think there is/will be global move away from concrete to steel due to construction costs and environmental issues. I bought these a few months ago and I’m a few percent down at the moment which is pleasing given general state of Ftse. The share register is interesting and the price activity over the last few weeks intrigues me and I have a “feeling in my waters” we may see some rumours around this stock over the next few months.

6.1% HSP – Hargreaves Services. In some ways I wish I’d never heard of this stock and I’m 14% down on them at the moment although it was far worse. This is a case of me doing research, working out its undervalued and buying on the expectation others would realise this too. The market can remain irrational for some considerable time when it has a mind to! It got really bashed around recently on a trading update and then bounced significantly on its interims. Since it delivered what it would said it would in the trading update nothing ceases to surprise me any longer.
Surprisingly it fell last week as oil rose. Offering a 9% dividend with two-thirds of this already declared for next month. I’m hoping to scale back on this in the near future and if not I’m fairly relaxed due to the dividend

5.8% PFL. Premier Farnell. Famous for the Raspberry Pi although that’s not why I bought it. I bought about two-thirds between 170 and 180 because of the chart and I thought the euro would strengthen (which has proved to be correct but hasn’t helped). The other third I bought last week at 119 and if I can get somewhere between 133 and 138 next week I’m selling. They may go for less. I don’t really want this many and I’ve got my eye on a few other things (HMSO around 620 looks a much better place to be). 8% dividend if it can afford to maintain it which the city boys seem to doubt. I’m of the view it has sufficient cash to pay this for the moment but I guess won’t be surprised if it’s cut. We’ll know soon enough

5.8% SFR. Severfield. Steel again. I like the man in charge. I bought at 69p and it held up well until the last couple of days of the recent FTSE fall. It hit a brickwall at 70 and a huge amount of shares have changed hands there. It had just crept over when the ftse carnage started. It’s fallen to the current price on very little volume so hopefully it will bounce back on similar. Happy to hold as comfortable enough with where this is going long term

4.8% Weir. Industrial with large exposure to US shale industry. Has been bashed down and I bought in at 1725-1825. Got some more last week at 1264 so those are getting sold any day now as I’ve got enough of these and I don’t believe in averaging. Every trade should stand on its own. The dividend is just over 3%. There were takeover rumours earlier in the year when the price was around 1700 so I’m hoping they will get resurrected. I’m happy to hold the rest for a while and see what happens

4.4% SPHR. Sphere Medical. This is speculative part of my portfolio. The share that will make me rich or I’ll lose all my money on it. 10 bagger or bust! It makes blood gas analysers for an intensive care setting without drawing any blood from the patients and provides instant results. Pretty good as I understand in ICU up to 19 blood tests can be required a day from patients. I imagine its pretty good for paediatrics too where babies don’t have loads of blood to start with. The product is launched and is at an early stage in the sales curve. This was Neil Woodford’s first investment from WPCT and he continues to add to his holding. Shares are very tightly held. An upgrade to the analyser is on its way which is hoped will significantly change the sales profile. I can talk endlessly about this company if anyone is interested which is a really bad sign as I’m too attached to it.

3.5% INTU. Property. I have a small profit on this despite buying months ago and Ftse being bashed around. I guess I’m looking for a 10% rise and to collect the dividends as I go. Very safe.

3.3% TATE. I’ve got a small profit on this too. Trade hasn’t gone as well as planned and I’d like to start reducing if it goes up as little as 3%

3.1% Another nameless stock I’m afraid. Quite illiquid and I haven’t decided if I’ve finished accumulating or not. I’ll only be taking a little more if I do.

2.9% LLOY. Who wouldn’t have Lloyds in their portfolio? Some dividends and good potential for growth. Share price a bit disappointing of late but I bought this at 39p so it owes me nothing.

1.9% STAN. Bought most of these at 737 last week although the rest are dire and out of the money from 890. I’m not feeling comfortable with them. Not sure what to do which means I’ll probably let them go and then watch the stock fly

1.4% BG. Held these from 820 from before the bid and just watched. Part of the reason I need to reduce my RDSB

1.2% CSG. Cyril Sweet Group. Bought at 22p so basically flat although I had the chance to sell higher. Quite speculative.

0.6% BP The only thing I can say about this is that having bought at 484 I didn’t buy any more on the way down. The dividend eases the pain ;-) Actually I did once buy some more on the way down but I had the sense to get out for a tiny profit on them.

0.6% AV. Bought at 498p a few months ago and this is all that’s left after selling four fifths higher up, so this has been good to me

0.5% FENR. 12% down on this although it’s bounced. Not much to say – not my best trade. The dividend is good.

0.5% HSBC. Out of the money on this. Could have done better.

0.1% Cash – I’m fully invested with Ftse at 6200 as I write today. Whilst I may rotate my stocks around a bit as there are some bargains out there right now I’ll in general be staying fully invested until Ftse hits 6500. I’ll reappraise then. I may change my mind depending on the mood of the market

or blow him a kiss. lol

Elegance? And what would you know about that aldgit..your a laugh a minute.

And as for you D/C..keep your big conk out of it http://1.bp.blogspot.com/-K68MkzDbkS4/TxWsHgolGTI/AAAAAAAAArA/EDWCOKyyIJ0/s400/Funny+Nose+Picture+%252813%2529.jpg


😜

Stan that does not look like a nose. :-))

Well if it's not your nose what is it? 😃

It's what's on top of your head Stan

Your being one stan. lol,

Why I like CTO

Financial year end Dec 2016
Cash £12.3m, revolving credit facility drawn £3.0m = Net Cash £9.3m
Interest paid in year £0.1m, in-line with revolving credit facility suggesting debt does not exceed £3.0m at any point in year
Underlying profit £6.2m, Reported £3.7m. Difference due to £2.7m fraud
EPS underlying 11.7p, reported 6.9p

Current dividend 3.2p. Yield 3.7%. In order triple the dividend to 10p, if 30% of pre-tax profits distributed (50% retained, 30% dividends, 20% corporation tax), pre-tax profit of £14m is required.
As company has nearly no debt, pre-tax profits service pension deficit, acquisition and shareholders. Pension deficit is £20m but agreement with pension trustees in place to fix by 2029 and payment profile similar to recovery payment in 2016.
Order book up 22% compared with this time last year. Margins improving driven by market recovery but more importantly by improving product mix and vertical integration.
In February company stated would beat analysts expectations for year and re-affirmed same in May. Not unreasonable to suggest an underlying profit of £9m for 2017.
£9m profit this year = £6.5m free cash flow assuming only minimal rise in dividend in 2017 as strengthening balance sheet and building cash for acquisition more important in short term than dividends. Would give £15.8m net cash by end of year.
By this time next year net cash will be £20m and what are they going to do with it? CTO used to pay dividend of 13p back in 2008. By 2020 if they get to £14m profit by then, if they don’t increase the dividend net cash will be £32.5m or 95p per share (recognizing that pension fund deficit will still exist, although I expect annuity rates to recover in this timeframe)
Downside Brexit apparently. Upside is government get hold of PSBR and are able to fund increased capital spend.

Think within 3 years worst case scenario is 50% upside, best case a multi-bagger.

Half year results will be interesting but we will have to wait until year end until we see the full picture. The management team imho are excessively cautious at half year to give themselves some slack in case the second half does not go well

A good year for me. 30.2% up overall although most of the money was made in the first half.

Takeovers on SHAW, ALD and INTU showed just how undervalued some of the stocks I hold are.

CTO my biggest holding I was desperately disappointed in this year but it was up 37%. I still think it's massively undervalued but Mr. Market does not yet agree.

NMD was up a mere 78% this year and has now tripled since I bought it. I continue to hold as it's got a long way to go yet.

The banks were good to me although I'm still running a loss on RBS. I've sold out of everything oil and oil related, my remaining builders and stuck the money on more CTO, INTU, LWB and PCF.

SPHR turned out to be a disaster and in 2 years the management managed to reduce the share value by 100%. I sold out before it completely fell apart with around a 85% loss and lessons learnt.

Mostly my success this year was due to being nearly 100% invested in the market as confidence rose post Brexit and being in Brexit sensitive stocks. I continue to believe there is further to run with these.

I finish the year with 2% cash. My biggest holdings are as follows at the current share price.

CTO 49.6%. (Need to think about the size of this holding as I've been saying for the last 2 years but with a 37% rise in 2017 and I feel somewhere between 25% and 50% in 2018 I'm not inclined to do anything but sit tight)
NMD 8.4%
INTU 7.6% (subject to merger with HMSO)
ALD 7.0% (takeover completing soon so can convert to cash anytime I want)
RBS 6.6% (all the stock beginning with a 1 and 2 now sold so reducing on this as the price rises)
SFR 3.8%
PCF 3.6%
LWB 2.8%

Rest of it is all pretty small. Some Lloyds, Burford Bonds, HSP, BLND, SBRE, STAN and a dog called GPH which was one of the worst IPO's of the year.

Update. The first four months has seen me continuing to think about removing risk from my portfolio as I move into that area of life when I think more and more about retirement.

I've gave up my job last summer so now I live off my investment and trading income. I have discovered my income from day-trading to be poor. I am making a little but it is scarcely worth the time and effort and distracts from from investment portfolio. Interestingly since I have stopped trying to make money day-trading it's going much better but I'm only now placing trades when I can't lose (lol). The number of day-trades I'm placing is falling and falling.

Portfolio looks like this now.

CTO 51.6% . It's all very disappointing. Clearly the size of my holding would suggest I have a very high level of conviction on this trade but I've now been waiting for the market to re-rate for 4 years and it's not happening. The dividend is getting higher, the P/E is getting lower, the cash pile is getting bigger and net assets are going up yet the share price is stuck. I'm in profit overall and the dividends are nice but my level of patience is being tested. Despite the size of my holding I shall continue to hold as all the metrics continue to look good for the future. I believe this stock has been a victim of MIFID II which is nice as I've been able to buy lots of stock at good prices, but it's apparent the impact of this is still working it's way through.

I'm stuck with collecting the dividend and a flat share price until such time as the P/E ratio and cash pile create a share register with long term holders and a high level of conviction in the company.

NMD 8.2%. Although I've more or less tripled my money on this, it's another stock where I daily look at the share price and wait for reality to set in. I am hopeful though, the interims which are about 4 months away and I think they will make the difference. Will hold for 3-5 years

ALD takeover got completed and half got spent on tax. Ouch.

RBS 6.4%. Getting fed up with RBS. AT 300p I was beginning to feel more relaxed about it. I'm running a loss except for those bought in 2011 and more frustratingly no dividend which means the real cost of holding is even higher. I would be happy to sell if and when it can get a bit of upward momentum. I expect I'll still be holding in a years time

INTU 5.8%. I'm in at decent prices with a average yield above 6% and some higher. The market has decided that rent reviews in future won't be good. I disagree and even if I were to agree I suggest it's already in the share price. Happy to collect my dividends and wait for market to take a different outlook on rent reviews which I think may take in excess of a year

PCF 5.2%. Happy to say that the increase in portfolio percentage is because the share price is going up not because I've bought any more. Well I did buy a tiny amount more but nothing significant. This is going to be my wonder trade to replace ALD and SHAW and I'm thinking of holding for 5-10 years.

Fixed interest bonds 5.1%. Giving me 5% interest with expiry dates from 2 years to 8 years. Plan to raise this element over the next 2 years to 10% of my portfolio.

SFR 3.8%. This is slow going. It goes up, it comes down, it goes up, it comes back down again. Happy to hold but if it went up 30% I'd start selling

LWB 3.5% Recovery play currently awaiting the management to deliver. I'm looking for about a 50% rise in the next 18 months

HSP 3.2%. Looking for another 5% on this to sell some more. Already sold some last year and I don't have a long term commitment to this trade.

LLOY 2.6%. Well who wouldn't. Decent dividend. Decent share buy back in place. Ain't going to make me rich but slow and steady sometimes wins the race. I'll probably be still holding these in 10 years time. Some I've had 7 years already and they have treated me well.

Nothing else higher than 2.5%. A variety of different sectors but all FTSE100 or FTSE250 or just outside


As of yesterday I'm pretty much 100% invested. As you can see I'm mostly UK Brexit sensitive stocks with LWB the only exception. I think this is the place to be for the next 5 years.

CTO
i see that MAM management still can't be arsed to sort out the chart problem!

i have no idea of the size of your pension pot, but 50% in a small drinks(?) stock like this does not look the most prudent


LLOY
i got seriously bored with this one, and chucked it out of my own sipp a/c just a few days ago

why would you also hold RBS in what is not the greatest of sectors anyway?


i don't know the size of your pot or how reliant you are upon it to produce the sort of return you think you need - i'm several years older than you, but my circumstances may be very different

That said, i'm very surprised to see no exposure to USA nor to base metal producers (BLT, KAZ et al)
the US economy is looking good despite that dreadful president, and when world economies strengthen, base metals (especially copper = KAZ) are major beneficiaries

I'm 50 now, own the house, have no debts etc. A 5% return a year would mean some erosion of my capital until the kids complete University, ignoring any money I make day-trading. Thereafter 5% a year is enough for my capital to keep increasing but not as much as inflation and of course 2 state pensions will kick in at 67 plus my wife has a small defined benefit scheme.

The chancellor has been helpful. Being able to put £2x20k into an ISA each year with all that income tax free means is extremely generous and means over time less and less of my capital is eroded by inflation.


CTO is construction !?! I agree. It's not prudent and it is something I will have to do something about over time. If I were giving advice to someone I'd tell them to sort it out immediately! The increase I'm looking for in fixed interest will have to come from here.

RBS - fair enough. I'm holding mostly because I think it will re-rate once they start to pay a dividend again. This has been a very successful strategy for me in the past. I'm not overly attached to it and do wonder if I could get more return for my money elsewhere as their ability to not deliver goes on and on.

Lack of diversification. Agreed. I tend to invest in what I know and understand and this has served me well over the years. My attempts to move out of my comfort zone almost always results in losses so I carry on with what I know. Some further thought required on this

you are just a babe in arms compared to me

anyway,having had too many disasters on the stock market to count, far be it for me to comment on your choice of investment stocks and lack of will to chuck out non-performers, but honestly ........!!!

May completed the AGM reporting season and transformed my progress this year.

Up 8.5% so far this year thanks to good AGM updates from my twp biggest holdings CTO & NMD. PCF going wonderfully well too, up about a third over the last month or two.

June proved to by an annoying month. My bank shares headed down as did most of everything else to be honest although I had a decent number of stocks manage to stay still which kind of made the pain more bearable and I've picked up lots of MARS for the future


My largest holding CTO which for the last 4 years has been slow, steady, boring, reliable, robust, meets or beats management expectations has changed.

An aggrieved ex-employee has been posting that the company is under investigation by HMRC for any number of things going back several years. I assume he is short. It's all complete fiction of course, but he persists and assures us the Evening Standard will be running the story soon. He's got emails too which he's "taken without asking" and he posts these too. They prove nothing but I guess they are enough to persuade some to find another home for their money. Clearly he doesn't require a reference.
More recently he is saying the company are under investigation by HMRC for posting too much profits. I'm sure any company paying too much tax is at the bottom of HMRC's list not the top of it but he persists.

Anyways he's manged to get the price down 2.2% so far which is about the same as everything else at the moment and I trust he'll disappear once he gets margin called by his spread bet company. I'm trying to figure out whether he's actually done me a favour as the volume has increased about 10 fold and despite his best efforts the price now looks like it's about to rise. I hope his shorts get fried.


NMD continues on its' usual way. Directors continue buying as do the large shareholders. Price not really moving but we are getting to the point one wonders where the sellers are getting their shares from

CTO is a big % - but IMHO ( WhaddIKnow), there is no upside. CTO just plod along - it's unlike Biotech where they plod with some "potential" - my OXB is a large % and just maybe they've put the Begging-Bowl away, with 2-income streams of Products using their Lenticular...thingy. This has massively increased the "potential" as it's (almost) visible...whilst it has somewhat reduced two Risks, 1=Run out of money. 2=Drug-Trial failure . . . both of these are harmful for investors.... but back to CTO - I just don't see any huge upside, unless you are hoping for the sp to raise its head above yr averaged price. Even if a BIG Build is ann. by UK-Gov.... what % will CTO get and it will be years before construction starts. IMHO. CTO should be into Robotics, so they can work 24/7 with a much smaller skill-set....I don't hold.
You have LLOY - (& I) which may do well, but Bankers are never going to be trusted again - and there are Internet juniors snapping. BP is in a reducing market -except their purchase of the Electric Charging Co (last week), which may have been "Brilliant" ...as their foray into Solar has been so long ....everyone's forgotten.
Good Luck.

Monthly update - July was another frustrating month with reporting season underway. I am now 2.6% up for the year and most of my shares are stuck in a rut slowly falling as Brexit and trade wars issues roll on and on.

I have a few which seem to be just falling and falling (INTU and MARS) where the downtrend line is beginning to annoy me. MARS surely can't fall much further as the dividend yield has hit 8.13%, INTU could fall more although it's now supported by a dividend yield of 8.39%.

Looking forward for August I have results for 3 big holdings coming up. RBS I'm not sure about. CTO's and NMD I'm pretty confident about. CTO is most important to me as it's my biggest holding. The results will at worst definitely be in line and the interim dividend raised by 16%.

I am trying to decide what to do about my unbalanced portfolio. The lack of commodities has hurt it's performance over the last year as I sold out all my RDSB some time ago.





Hangon - you made some observations on CTO. Part of the struggle with the share price is that their is little analyst coverage given the market cap of £35m and it's bundled into the construction sector. Whilst it's true they do the largest high profile projects in the UK particularly in London, they are diversifying away from this towards higher margin products where they compete on skills and reputation rather than price. It also smooths out the economic cycle.
My trade isn't based on government or private sector spending in construction although that would nice. It's more about leveraging the brand into FM and tech heavy areas where the margins are better and there's repeat business.

Examples here:
http://www.tclarke.co.uk/news/an-interview-with-eton-associates-director-jamie-ward
http://www.tclarke.co.uk/news/tclarke-climate-solutions-the-complete-service

for myself, i was very happy to note that my sipp gain over the last fiscal year was almost exactly 25%

for the current fiscal year, i can't easily work it out as regular pension contributions are added every so often, but looks like about 12% which is fine by me

i had some smallish new funds in my sipp so bought NMC (new) and topped up AAPL and GOOG

though NMC is quoted on LSE it's really an M/E stock of course and the other two are (obviously) NAS

as things stand, I see no reason to buy into (more) UK stocks

I've had better days.