HYP1 is 20 - thread discussing income and capital diversification
Posted: November 14th, 2020, 5:45 pm
Pyad has released his 'HYP1 is 20' anniversary post here -
https://www.lemonfool.co.uk/viewtopic.php?f=15&t=26213
I've started this separate thread looking at the HYP1 income and capital diversification so as not to disrupt that thread with this analysis, as I completely understand that it may not interest everyone, and I do want to be respectful of Pyad's great ongoing HYP1 experiment by not including discussion of this specific aspect on that anniversary thread.
The data discussed in this thread is specifically looking at the ongoing lumpiness of the income and capital derived from HYP1.
Over the years, HYP1 has developed in a way that relies on a really quite small subset of holdings to deliver the bulk of its income and capital performance, and even though this year has seen a near 50% reduction in dividend income, we can still see that the current HYP1 portfolio stands at new highs when considering the percentage of overall dividend-income and capital delivered from its current top five holdings -
The underlying historical HYP1 income and capital data for the above table can be found here - https://i.imgur.com/IugDcmx.png
Here's a chart showing the reliance that HYP1 has continued to develop on it's top five holdings for both income and capital over the last eleven years -
Pyad has reported that HYP1 has seen a 47.6% drop in dividend income since last year, which equates to a loss of £5024 over the 2019 HYP1 income.
Given that loss of £5024 of income, I think it might be instructive to see how much of that fall actually came from the top five income-holdings highlighted from last year (https://tinyurl.com/y5f85quv) -
As we can see from the above table, the top five income-delivering shares from last year took a hit of £3909.08, which is 78% of the total loss of income seen this year of £5024.
The final table that I show below is an aggregated-income table, showing how much income is currently being delivered by HYP1 when we look at the ranking of top income-producing shares -
As we can see from the above table, no less than 60.3% of HYP1 income is currently being delivered from just two holdings, with nearly 75% of HYP1 income being delivered from just four...
Whilst I've no doubt that the overall income from HYP1 will recover somewhat over the coming years, I think this exercise to look 'under the bonnet' a little regarding the income and capital concentration of HYP1 is instructive to those of us who might be interested in how a largely 'hands-off' income-portfolio can develop over the years, and in ways that might not be immediately obvious to anyone just looking at the headline HYP1 numbers...
Cheers,
Itsallaguess
https://www.lemonfool.co.uk/viewtopic.php?f=15&t=26213
I've started this separate thread looking at the HYP1 income and capital diversification so as not to disrupt that thread with this analysis, as I completely understand that it may not interest everyone, and I do want to be respectful of Pyad's great ongoing HYP1 experiment by not including discussion of this specific aspect on that anniversary thread.
The data discussed in this thread is specifically looking at the ongoing lumpiness of the income and capital derived from HYP1.
Over the years, HYP1 has developed in a way that relies on a really quite small subset of holdings to deliver the bulk of its income and capital performance, and even though this year has seen a near 50% reduction in dividend income, we can still see that the current HYP1 portfolio stands at new highs when considering the percentage of overall dividend-income and capital delivered from its current top five holdings -
The underlying historical HYP1 income and capital data for the above table can be found here - https://i.imgur.com/IugDcmx.png
Here's a chart showing the reliance that HYP1 has continued to develop on it's top five holdings for both income and capital over the last eleven years -
Pyad has reported that HYP1 has seen a 47.6% drop in dividend income since last year, which equates to a loss of £5024 over the 2019 HYP1 income.
Given that loss of £5024 of income, I think it might be instructive to see how much of that fall actually came from the top five income-holdings highlighted from last year (https://tinyurl.com/y5f85quv) -
As we can see from the above table, the top five income-delivering shares from last year took a hit of £3909.08, which is 78% of the total loss of income seen this year of £5024.
The final table that I show below is an aggregated-income table, showing how much income is currently being delivered by HYP1 when we look at the ranking of top income-producing shares -
As we can see from the above table, no less than 60.3% of HYP1 income is currently being delivered from just two holdings, with nearly 75% of HYP1 income being delivered from just four...
Whilst I've no doubt that the overall income from HYP1 will recover somewhat over the coming years, I think this exercise to look 'under the bonnet' a little regarding the income and capital concentration of HYP1 is instructive to those of us who might be interested in how a largely 'hands-off' income-portfolio can develop over the years, and in ways that might not be immediately obvious to anyone just looking at the headline HYP1 numbers...
Cheers,
Itsallaguess