PYAD HYP 2019_04 – Update 30 April 2019

[IanTHughes]

This is the first of what I intend to be regular updates on the HYP constructed by pyad, as recorded on this thread:

viewtopic.php?f=15&t=16868&start=140

In the future there will be two portfolios as follows:

PYAD HYP 2019_04 REINVEST
PYAD HYP 2019_04 DRAWDOWN

But for now, as there have been no dividends to drawdown or reinvest, this single update will do.

The portfolio currently looks like this:

EPIC  |  Company Name             |  Shares   |  Cost        |  Price        |  Value        |  Value %  |  Profit/Loss  |  Business        |  Annual Inc  |  Yield  |  Inc To Date  |  Ex-Dividend  |  Total    
AV    |  Aviva                    |   3,637   |  14,996.21   |    429.5000   |   15,620.92   |    6.05%  |      624.71   |  Insurance       |   1,091.10   |  6.98%  |        0.00   |      754.67   |    754.67 
BA    |  BAE Systems              |   3,043   |  14,995.20   |    494.0000   |   15,032.42   |    5.82%  |       37.22   |  Weapons         |     675.54   |  4.49%  |        0.00   |      401.67   |    401.67 
BHP   |  BHP Group                |     838   |  14,992.51   |  1,809.4000   |   15,162.77   |    5.87%  |      170.26   |  Mining          |     764.70   |  5.04%  |        0.00   |        0.00   |      0.00 
BLND  |  British Land Company     |   1,280   |   7,497.95   |    594.0000   |    7,603.20   |    2.94%  |      105.25   |  Property        |     393.85   |  5.18%  |        0.00   |        0.00   |      0.00 
BP    |  BP                       |   1,347   |   7,496.10   |    559.0000   |    7,529.73   |    2.92%  |       33.63   |  Oil             |     427.08   |  5.67%  |        0.00   |        0.00   |      0.00 
CCL   |  Carnival Corporation     |     384   |  14,979.79   |  4,035.0000   |   15,494.40   |    6.00%  |      514.61   |  Cruise Ships    |     593.92   |  3.83%  |        0.00   |        0.00   |      0.00 
GNK   |  Greene King              |   2,266   |  14,994.78   |    641.0000   |   14,525.06   |    5.62%  |     -469.72   |  Brewing & Pubs  |     752.31   |  5.18%  |        0.00   |        0.00   |      0.00 
GSK   |  GlaxoSmithKline          |     941   |  14,999.37   |  1,573.4000   |   14,805.69   |    5.73%  |     -193.68   |  Pharma          |     752.80   |  5.08%  |        0.00   |        0.00   |      0.00 
HSBA  |  HSBC Holdings            |   2,425   |  14,998.27   |    667.1000   |   16,177.18   |    6.26%  |    1,178.91   |  Bank            |     956.42   |  5.91%  |        0.00   |        0.00   |      0.00 
IBST  |  Ibstock                  |   5,849   |  14,999.47   |    261.2000   |   15,277.59   |    5.91%  |      278.12   |  Bricks          |     555.65   |  3.64%  |        0.00   |        0.00   |      0.00 
IGG   |  IG Group Holdings        |   2,762   |  14,999.32   |    509.8000   |   14,080.68   |    5.45%  |     -918.64   |  Gambling        |   1,283.50   |  9.12%  |        0.00   |        0.00   |      0.00 
IMB   |  Imperial Brands          |     568   |  14,988.79   |  2,436.0000   |   13,836.48   |    5.36%  |   -1,152.31   |  Tobacco         |   1,066.64   |  7.71%  |        0.00   |        0.00   |      0.00 
ITV   |  ITV                      |  11,652   |  14,999.08   |    136.6500   |   15,922.46   |    6.16%  |      923.38   |  Television      |     932.16   |  5.85%  |        0.00   |      629.20   |    629.20 
LAND  |  Land Securities Group    |     818   |   7,499.19   |    923.0000   |    7,550.14   |    2.92%  |       50.95   |  Property        |     397.13   |  5.26%  |        0.00   |        0.00   |      0.00 
RDSB  |  Royal Dutch Shell        |     309   |   7,481.66   |  2,464.5000   |    7,615.31   |    2.95%  |      133.65   |  Oil             |     449.24   |  5.90%  |        0.00   |        0.00   |      0.00 
SLA   |  Standard Life Aberdeen   |   5,503   |  14,997.65   |    278.9000   |   15,347.87   |    5.94%  |      350.22   |  Fund Manager    |   1,188.64   |  7.74%  |        0.00   |      786.92   |    786.92 
SMDS  |  DS Smith                 |   4,310   |  14,997.11   |    357.0000   |   15,386.70   |    5.96%  |      389.59   |  Packaging       |     646.50   |  4.20%  |        0.00   |      224.12   |    224.12 
VOD   |  Vodafone Group           |  10,077   |  14,998.48   |    142.0000   |   14,309.34   |    5.54%  |     -689.14   |  Telecom         |   1,310.27   |  9.16%  |        0.00   |        0.00   |      0.00 
WPP   |  WPP                      |   1,780   |  14,997.55   |    956.4000   |   17,023.92   |    6.59%  |    2,026.37   |  Advertising     |   1,068.00   |  6.27%  |        0.00   |        0.00   |      0.00 
      |                           |           |              |               |               |           |               |                  |              |         |               |               |           
      |  Sub Total:               |           |              |               |  258,301.86   |           |    3,393.38   |                  |  15,305.45   |  5.93%  |        0.00   |    2,796.58   |  2,796.58 
      |  Cash:                    |           |              |               |        0.00   |           |               |                  |              |         |               |               |           
      |  Ex-Dividend:             |           |              |               |    2,796.58   |           |               |                  |              |         |               |               |           
      |                           |           |              |               |               |           |               |                  |              |         |               |               |           
      |  Total:                   |           |              |               |  261,098.44   |           |               |                  |              |         |               |               |           
      |  From:                    |           |              |               |               |           |               |                  |              |         |               |               |           
      |  Cash In:                 |           |              |               |  254,908.48   |           |               |                  |              |         |               |               |           
      |  LESS Cash Out:           |           |              |               |        0.00   |           |               |                  |              |         |               |               |           
      |  Dividends:               |           |              |               |        0.00   |           |               |                  |              |         |               |               |           
      |  UnRealised Profit/Loss:  |           |              |               |    3,393.38   |           |               |                  |              |         |               |               |           
      |  Ex-Dividend:             |           |              |               |    2,796.58   |           |               |                  |              |         |               |               |           
      |                           |           |              |               |               |           |               |                  |              |         |               |               |           
      |  Total:                   |           |              |               |  261,098.44   |           |               |                  |              |         |               |               |

With the breakdown by Business as follows:

Business                 |  Cost        |  Value        |  Value %  |  Profit/Loss  |  Annual Inc  |  Yield  |  Inc To Date  |  Ex-Dividend  |  Total    
Advertising              |  17,023.92   |   17,023.92   |    6.59%  |    2,026.37   |   1,068.00   |  6.27%  |        0.00   |        0.00   |      0.00 
Television               |  15,922.46   |   15,922.46   |    6.16%  |      923.38   |     932.16   |  5.85%  |        0.00   |      629.20   |    629.20 
Bank                     |  16,177.18   |   16,177.18   |    6.26%  |    1,178.91   |     956.42   |  5.91%  |        0.00   |        0.00   |      0.00 
Insurance                |  15,620.92   |   15,620.92   |    6.05%  |      624.71   |   1,091.10   |  6.98%  |        0.00   |      754.67   |    754.67 
Packaging                |  15,386.70   |   15,386.70   |    5.96%  |      389.59   |     646.50   |  4.20%  |        0.00   |      224.12   |    224.12 
Cruise Ships             |  15,494.40   |   15,494.40   |    6.00%  |      514.61   |     593.92   |  3.83%  |        0.00   |        0.00   |      0.00 
Fund Manager             |  15,347.87   |   15,347.87   |    5.94%  |      350.22   |   1,188.64   |  7.74%  |        0.00   |      786.92   |    786.92 
Property                 |  15,153.34   |   15,153.34   |    5.87%  |      156.20   |     790.98   |  5.22%  |        0.00   |        0.00   |      0.00 
Bricks                   |  15,277.59   |   15,277.59   |    5.91%  |      278.12   |     555.65   |  3.64%  |        0.00   |        0.00   |      0.00 
Mining                   |  15,162.77   |   15,162.77   |    5.87%  |      170.26   |     764.70   |  5.04%  |        0.00   |        0.00   |      0.00 
Oil                      |  15,145.04   |   15,145.04   |    5.86%  |      167.28   |     876.32   |  5.79%  |        0.00   |        0.00   |      0.00 
Weapons                  |  15,032.42   |   15,032.42   |    5.82%  |       37.22   |     675.54   |  4.49%  |        0.00   |      401.67   |    401.67 
Pharma                   |  14,805.69   |   14,805.69   |    5.73%  |     -193.68   |     752.80   |  5.08%  |        0.00   |        0.00   |      0.00 
Brewing & Pubs           |  14,525.06   |   14,525.06   |    5.62%  |     -469.72   |     752.31   |  5.18%  |        0.00   |        0.00   |      0.00 
Telecom                  |  14,309.34   |   14,309.34   |    5.54%  |     -689.14   |   1,310.27   |  9.16%  |        0.00   |        0.00   |      0.00 
Gambling                 |  14,080.68   |   14,080.68   |    5.45%  |     -918.64   |   1,283.50   |  9.12%  |        0.00   |        0.00   |      0.00 
Tobacco                  |  13,836.48   |   13,836.48   |    5.36%  |   -1,152.31   |   1,066.64   |  7.71%  |        0.00   |        0.00   |      0.00 
                         |              |               |           |               |              |         |               |               |           
Sub Total:               |              |  258,301.86   |           |    3,393.38   |  15,305.45   |  5.93%  |        0.00   |    2,796.58   |  2,796.58 
Cash:                    |              |        0.00   |           |               |              |         |               |               |           
Ex-Dividend:             |              |    2,796.58   |           |               |              |         |               |               |           
                         |              |               |           |               |              |         |               |               |           
Total:                   |              |  261,098.44   |           |               |              |         |               |               |           
From:                    |              |               |           |               |              |         |               |               |           
Cash In:                 |              |  254,908.48   |           |               |              |         |               |               |           
LESS Cash Out:           |              |        0.00   |           |               |              |         |               |               |           
Dividends:               |              |        0.00   |           |               |              |         |               |               |           
UnRealised Profit/Loss:  |              |    3,393.38   |           |               |              |         |               |               |           
Ex-Dividend:             |              |    2,796.58   |           |               |              |         |               |               |           
                         |              |               |           |               |              |         |               |               |           
Total:                   |              |  261,098.44   |           |               |              |         |               |               |

PYAD HYP 2019_04 REINVEST

The Reinvestment will take place on the 10th of each month, or first business day after the 10th, when the Cash Balance is equal to or greater than £2,000.00. This date in the month has been chosen simply because that is the day I use my broker’s “Regular Dealing” for my own HYP so making an occasional further selection for this virtual HYP should not prove too onerous. The amount £2,000.00 - 13.33% of the original holding cost - has been chosen to ensure that any purchase made is of a reasonable size.

I will advise the details of the intended top-up in this monthly update and of course will welcome any comments and/or advice. However, this selection process will not be a full democratic exercise as I just do not have the time to organise the necessary polling. Even if I am swayed by comments/advice received on here, I may still amend/cancel that decision if further news is received – profit warnings and the like – before the trade date.

For now the anticipated top-up schedule is as follows:

Date       |  Balance    |  Top-Up?
10-May-19  |    224.12   |  N      
10-Jun-19  |  3,176.76   |  Y      
10-Jul-19  |  1,380.54   |  N      
12-Aug-19  |  2,664.86   |  Y      
10-Sep-19  |      0.00   |  N      
10-Oct-19  |  2,683.80   |  Y      
11-Nov-19  |  2,029.97   |  Y      
10-Dec-19  |    764.35   |  N      
10-Jan-20  |  1,774.94   |  N      
10-Feb-20  |  2,494.35   |  Y      
10-Mar-20  |    357.95   |  N      
14-Apr-20  |  2,156.42   |  Y

PYAD HYP 2019_04 DRAWDOWN

All income received within any month will be transferred out on the last day of that month. I will also publish the following:

Year  |  Jan - Mar  |  Apr - Jun  |  Jul - Sep  |  Oct - Dec  |  Total
2019  |      0.00   |      0.00   |      0.00   |      0.00   |  0.00 
2020  |      0.00   |      0.00   |      0.00   |      0.00   |  0.00

Of course there is nothing to report as yet as the first dividend - for D S Smith (SMDS) - is only due tomorrow, 1 May.

The currently forecast monthly dividend receipts are as follows:

Date       |  Dividend 
30-Apr-19  |      0.00 
31-May-19  |  2,394.91 
30-Jun-19  |  1,310.92 
31-Jul-19  |  1,150.09 
31-Aug-19  |    985.70 
30-Sep-19  |  2,591.37 
31-Oct-19  |  1,196.76 
30-Nov-19  |  1,113.17 
31-Dec-19  |  1,316.19 
31-Jan-20  |    470.62 
29-Feb-20  |    877.96 
31-Mar-20  |  1,095.79

So, there it is. I know there is as yet not a lot to report but I did just want to try out the format and if anyone has any suggestions for adding to or changing the regular updates to either of these two virtual portfolios, then please let me know. As long as it is possible within Excel, it can be done.

See you again on the 31 May 2019, or shortly thereafter


Ian

[PinkDalek]

In the linked thread you wrote (1) - Yield and Forecast Income are based on my own Share Database Spreadsheet and are essentially calculated from the dividends that would have been earned over the previous 12 months. which I think would be useful to mention as Pyad's numbers were forecast yield at selection.

Anyway, let's hope this topic doesn't degenerate into a selective stock by stock dissection.

[IanTHughes]

In the linked thread you wrote (1) - Yield and Forecast Income are based on my own Share Database Spreadsheet and are essentially calculated from the dividends that would have been earned over the previous 12 months. which I think would be useful to mention as Pyad's numbers were forecast yield at selection.

You are quite right and in future I will make that clear

Anyway, let's hope this topic doesn't degenerate into a selective stock by stock dissection.

Well, anyone is free to agree of disagree with any selection but as this virtual HYP has now been selected, I hope that any such discussion is conducted on a separate appropriately-named thread. If any Moderators are reading this any advice would be welcome


Ian

[idpickering]

Excellent work Ian, thank you. I look forward to seeing this HYP evolve.

Ian.

[Bookbinder]

Thanks for posting this Ian; given the huge number of replies on the referenced thread I think there will be a lot of interest in this!

Bookbinder

[funduffer]

Interesting that there are no retailers in this HYP.

FD

[Dod101]

Interesting that there are no retailers in this HYP.

I'd rephrase that a bit. 'Sensible that their are no retailers in this HYP' (Despite the reasonable figures from Sainsbury this morning)

The absence of dividends at this early stage makes the table largely redundant, with the emphasis inevitably on the very unHYP like capital values.

It will no doubt develop over time.

Dod

[Arborbridge]

Interesting that there are no retailers in this HYP.

I'd rephrase that a bit. 'Sensible that their are no retailers in this HYP' (Despite the reasonable figures from Sainsbury this morning)

Dod

The explanation is simple: there are none that qualify - at least from the big supermarkets, though I don't know about other retailers. No supermarket has a suitable five year history of dividends and apart from arguably SBRY, the yields are too low: so they would not show on the HYP radar. Marks might have qualified, but I believe has just announced a dividend cut.

However, it would be instructive to know if Pyad had deliberately avoided retail for some wider reason, as Dod does.


Arb.

[pyad]

The explanation is simple: there are none that qualify - at least from the big supermarkets, though I don't know about other retailers. No supermarket has a suitable five year history of dividends and apart from arguably SBRY, the yields are too low: so they would not show on the HYP radar. Marks might have qualified, but I believe has just announced a dividend cut.

However, it would be instructive to know if Pyad had deliberately avoided retail for some wider reason, as Dod does.


Arb.

It was because none were sufficiently attractive at the time of construction. It doesn't require every sector in the world to construct a well diversified HYP. Portfolios constructed at different times will often have some sector variation as it depends on what is attractive at that stage and sectors to some extent go in and out of HYP desirability over time.

I have no interest in anyone else's opinion. As Dirty Harry memorably remarked, "opinions are like assholes, everybody has one". Including myself of course.

[kempiejon]

edit I see pyad has replied still here's my thoughts anyway

Interesting that there are no retailers in this HYP.

FD

Of course pyad doesn't have to have something from each sector, there's nothing in Chemicals or Transport. I've had a quick look at retailers in the FTSE350 and if you want a yield over 5% and a history of increasing dividends the pickings are slim. M&S cutter, Sainsbury serial cutter, Kingfisher yield only 4ish% Morrisons another cutter, Next barely 3%, Dixons cutter.
Looks like Pets at Home and Card factory both sub £1b and barely 5 years including forecast might warrant a further look but there were plenty of better shares to pick over them.

My most recent retail pick Dunelm was available at 5% much of last year but following price appreciation the yield is down at 3% now.

[Arborbridge]

In other words, no one needs to invoke special incantations or smell tests: the HYP process pure and simple came up with this result, as I thought.


Arb.

[Dod101]

I have no interest in anyone else's opinion.

Arrogant or what? I am always interested in the opinion of others because I might have missed something. Most often I ignore them of course.

Dod

[Arborbridge]

I have no interest in anyone else's opinion.

Arrogant or what? I am always interested in the opinion of others because I might have missed something. Most often I ignore them of course.

Dod

You are both self-confident, I would say, and that's not quite the same as arrogant. You "most often ignore them" which is not far off what Pyad says he does, so I reckon you are rather similar - both will look around at the various signals, and make up your mind accordingly.
This gives you both an air of confidence which you may or may not feel!

But, why would a fellow (Pyad) making a career from writing about finance want to give to impression that he isn't confident "...ooh, I'm really not sure...ooh maybe, maybe not.". That isn't going to earn anyone many readers

[Dod101]

Your final paragraph is right when I think about. As to being self confident, I am not into self analysis but with investment I just think that you need to know what you want, and do it. I am not often a ditherer with investments. I do not by any means always feel very confident that I have done the right thing, but I do it and will monitor the move and see how it works out.

Dod

[OhNoNotimAgain]

The older I get and the more I learn I realise there is more and more that I don't know.

[PinkDalek]

Well, anyone is free to agree of disagree with any selection but as this virtual HYP has now been selected, I hope that any such discussion is conducted on a separate appropriately-named thread.

I'd have thought the discussion of the selections could well take place on the original thread (which is already 8 pages long) viewtopic.php?f=15&t=16868&start=140 rather than recommence on here.

Yet I feel I'm already too late in suggesting such a thing.

I hope you will consider placing your further updates on this Topic, changing the header as necessary, but that's your choice of course.

[Gengulphus]

I hope you will consider placing your further updates on this Topic, changing the header as necessary, but that's your choice of course.

That might lead to a rather long thread over time - with six updates for dividend reinvestments expected in the next 12 months, that rate likely to increase slowly over time, and updates for corporate actions bound to happen sporadically, it could become very intimidating to a newcomer who wants to know about the portfolio's history in a few years' time, and also to someone trying to find a particular past event in it. But equally, a whole lot of small threads would also be rather intimidating... I think what I would consider would be starting a new thread once a year, for that year's annual review and subsequent updates.

However it is broken up into threads, it would be a good idea for each thread to link backwards to the previous thread, and to be finished with a post linking onwards to the next thread. This is one of my reasons for suggesting an annual new thread - it will allow a reader to jump backward and forward a year of portfolio history at a time, which I would reckon will become more and more useful over the years for people seeking a reasonably quick scan through the portfolio's history.

Two very minor observations about the OP: first, it would be quite good if the vacant spaces for "Subtotal:", "Cash:" and "Total:" in the "Cost" columns were filled in with the obvious values - that would allow easy comparison the "Cost" and "Value" columns for both the individual holdings and the portfolio as a whole. And secondly, I would actually prefer the share selection process not to be done by a "full democratic process" even if Ian were willing to take on the extra work involved - that's because it would be very inconsistent to do that for top-up share selections in a portfolio that had done its initial share selections on a one-person's-views-only basis.

Gengulphus

[Lootman]

I have no interest in anyone else's opinion.

Arrogant or what? I am always interested in the opinion of others because I might have missed something. Most often I ignore them of course.

You are both self-confident, I would say, and that's not quite the same as arrogant.

But, why would a fellow (Pyad) making a career from writing about finance want to give to impression that he isn't confident "...ooh, I'm really not sure...ooh maybe, maybe not.". That isn't going to earn anyone many readers

To my mind when someone is dismissive of the views of a community, or acts in a haughty manner, it actually connotes the exact opposite i.e. that the utterer is quite defensive and insecure, and is over-compensating for that in some way.

At least, that is what I notice in everyday life. I have not met this particular individual and so don't know how confident or not he really is. One can have an assertive manner on the internet and yet in real life be, say, a mild-mannered accountant. But generally the notion of trying too hard to appear to be the expert doesn't come across to me as confidence at all.

Interestingly you stated in another topic yesterday that you believed that Pyad did not originally target sophisticated investors. I think that is correct. However what happened at TMF and TLF was that some fairly sophisticated and experienced investors did come along, which elevated the quality of the criticism of HYP and led to various improvements to it, such as Terry's rebalancing idea.

I wonder whether the reason Pyad often criticises the community here is because he was never expecting such a smart audience. And instead of being flattered by that he sees it as a threat, and so says that he shuts it out. If I were claiming to have invented a method, I would want to receive feedback and constructive criticism, so that it can continually improve.

[dspp]

Moderator Message:
Folks, Could we please all take a chill pill. Remember it is alerts that often cause Mods to take a look in here. regards, dspp

[IanTHughes]

I hope you will consider placing your further updates on this Topic, changing the header as necessary, but that's your choice of course.

I think what I would consider would be starting a new thread once a year, for that year's annual review and subsequent updates.

I agree with Gengulphus on this. For PYAD HYP 2019_04 REINVEST, an annual thread, linking back to the previous one, makes most sense to me. As noted, at the start there will be 6 updates based on amounts being re-invested, which should be quite doable. With regard to the PYAD HYP 2019_04 DRAWDOWN portfolio, I will post an update once per quarter - 4 per year - with an annual review of income received.

So, should the Annual refer to Calendar years, 2019 being a short year, or should it refer to the anniversary of the start date?

Two very minor observations about the OP: first, it would be quite good if the vacant spaces for "Subtotal:", "Cash:" and "Total:" in the "Cost" columns were filled in with the obvious values - that would allow easy comparison the "Cost" and "Value" columns for both the individual holdings and the portfolio as a whole.

It will be done.

To start, I have now corrected the Cost column by Business Type, which was mistakenly a copy of the Value column. Damn "Copy and Paste"!

And secondly, I would actually prefer the share selection process not to be done by a "full democratic process" even if Ian were willing to take on the extra work involved - that's because it would be very inconsistent to do that for top-up share selections in a portfolio that had done its initial share selections on a one-person's-views-only basis.

I agree too. PYAD selected this HYP and who knows, he might pop up and tell me what top-up he wants. But if not, I shall endeavour to make a decision as close as possible to his diversification and other selection criteria.


Ian