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The portfolio after one year - a newbs journey

A helpful place to also put any annual reports etc, of your own portfolios
Pipsmum
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The portfolio after one year - a newbs journey

#102364

Postby Pipsmum » December 7th, 2017, 9:51 am

I thought I would publish the latest state of the folio giving recently adjusted the ISA balance. It contains some of the advice given from this site, so thank you to you all. In particular the advice taken about investing in Vanguard and trusts and trackers instead of being so naive as a newb. Lots of good lessons being learned along the way.

I am happy for your criticism and comments. This folio gets added to slowly and is a year old now. As yet it isn't balanced but that is the aim eventually.

18.1% Woodford CF Woodford Income Focus Class Z - Yield 5%
15.7% Jupiter India Class X - Yield 0.7%
11.9% NewRiver REIT - Yield 6.36%
11.0% Kier Group - Yield 6.57%
10.1% Hargreaves Lansdown Select UK Income Shares Class A - Yield 5%
6.8% Hurricane Energy - Yield 0
5.7% City of London Investment Trust - Yield 3.96%
4.1% Sirius Real Estate - Yield 3.64%
3.7% Aminex - Yield 0
3.1% Hargreaves Lansdown Select UK Growth Shares Class A - Yield 5%
3.0% BlackRock iShares Emerging Markets Equity Index Class H - Yield 2.21%
2.5% CQS New City High Yield Fund - Yield 7%
1.9% Vanguard ETFs FTSE All-World UCITS ETF - Yield 1.86%
1.3% Phoenix Group Holdings - Yield 6.18%
0.6% Walker Greenbank - Yield 2.69%
0.5% Residential Secure Income - Yield not yet but aim is 5% eventually
0.1% Cash

I've sold the first four below to help a friend with a house deposit and recently swapped First derivs for Kier.
Boohoo @230.18 (received just below equal)
Petrofac @467.52 (approx £200+)
Sirius minerals @27 (received just above equal)
CF Woodford income focus @101.07 (received just below equal)
First Derivatives (approx £200+)

There have been a few divis paid so overall the income stream has averaged approx £12.81 a month at this early stage. Not to be sniffed at as it will buy over 12 pukka pies in sale at the coop per month. That's nearly half a juicy pie per day.

Overall plan. I'm an older investor of 57 looking for immediate returns and yields for the first part to reinvest and grow the base of the folio safely-ish. I'm not wealthy so just trying to learn and use the system so it has a little time to do something useful before I might need some of it.

Strategy wise, and for personal encouragement, I'd rather not see these largish red loss SP/% figures I'm seeing and prefer the blue figures, however small. Green 0's are good too. Growth isn't the primary concern although it's obviously nice. I do sometimes wonder at the wisdom and think I could have just put monies safely and slowly in a Nationwide high interest account of 5% and Tescos or TSB @3%. I'm not entirely convinced I have the stomach for this, but it is early stage and the maths seems to work in the long run. Bubble stories scare me. I'm not wealthy enough to lose large quantities.

I'm with HL for ease of use as a newb. As much as poss is in an ISA wrapper and the rest is in a normal vantage account before I knew to do that. I'm just wondering about a SIPP and have invested a tentative amount of £100 to start one up. I have a small pension arranged but there is a ten year gap from now to then to think about. I'm hoping to be perfectly capable of hard work from now onwards and beyond. I see this share activity as making some oil to ease the creaky system later as my pension won't be huge. So not huge anticipation but realistic I hope.

Risk appetite overall not huge, but on very small amounts, it's very huge just for a bit of a flutter.

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Re: The portfolio after one year - a newbs journey

#102383

Postby dspp » December 7th, 2017, 10:24 am

Pipsmum wrote:Strategy wise, and for personal encouragement, I'd rather not see these largish red loss SP/% figures I'm seeing and prefer the blue figures, however small. Green 0's are good too. Growth isn't the primary concern although it's obviously nice. I do sometimes wonder at the wisdom and think I could have just put monies safely and slowly in a Nationwide high interest account of 5% and Tescos or TSB @3%. I'm not entirely convinced I have the stomach for this, but it is early stage and the maths seems to work in the long run. Bubble stories scare me. I'm not wealthy enough to lose large quantities....Risk appetite overall not huge, but on very small amounts, it's very huge just for a bit of a flutter.


Thank you. With ~10% in two speculative minor oils (HUR & AEX) there is an apparent contradiction between what you say and what you do. Unless of course you have written those two off mentally as being a complete gamble. Personally I have a rather larger % in HUR but that doesn't make me correct and I would certainly not want anybody to follow me blindly. There could be nil return of capital from HUR. I've no opinion re AEX except that any minor oil is in puntland. The rest all looks unexceptional to my eyes.

regards, dspp

Pipsmum
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Re: The portfolio after one year - a newbs journey

#102392

Postby Pipsmum » December 7th, 2017, 10:51 am

dspp wrote:The rest all looks unexceptional to my eyes.


That is the sort of comment that makes me happy that I've not been daft.

The oils - Hurricane was some early impetuous behaviour that I don't yet utterly regret. Perhaps the timing, not the purchase. The other was definitely puntland. Both doing terribly, with no yield, so are written off mentally as much as one can ignore prickles.

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Re: The portfolio after one year - a newbs journey

#102459

Postby Raptor » December 7th, 2017, 2:03 pm

It is refreshing to see a portfolio without a single share that I own.
I put 18 months to 2 years timescale before making any decisions as to whether I am going in the right direction. Keep at it and thanks for posting.

Raptor.

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Re: The portfolio after one year - a newbs journey

#102693

Postby Plutus » December 8th, 2017, 10:07 am

Hi.

This is just an opinion and I’m not an expert.

My understanding of your strategy/aims in simple terms:

You want income - is there are target overall yield on your capital?

You don’t want to lose capital.

You don’t need growth but it’s a bonus.

You are investing for 10 years until you reach pensionable age.

There is about 40% of the total invested in income funds/ITs and some also in a REIT. These produce a decent yield.

The rest is a mixture of India, growth and individual companies.

My personal opinion would be to sell the assortments of non income producing equities and replace them with 2 or 3 income ITs. Maybe including a top up of CTY.

If you are worried about losing money then keep 10-20% in high interest accounts, maybe 5% of which in zopa or another peer to peer lender.

When markets dip you can always buy more equities.

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Re: The portfolio after one year - a newbs journey

#102704

Postby Pipsmum » December 8th, 2017, 10:51 am

Raptor wrote:It is refreshing to see a portfolio without a single share that I own.

Maybe it shouldn't. I'll check yours and crib some thoughts if I may.

Plutus wrote:You want income - is there are target overall yield on your capital?

Yes. More than 0 and preferably more than a high interest current account can pay, so between 3-5% (loosely applied when attached to a growth stock or opportunism/foolishness).

Plutus wrote:You don’t want to lose capital.

Would rather not.

Plutus wrote: You don’t need growth but it’s a bonus.

Yield or growth taking any gain above the capital invested level + inflation is fine. One or the other but preferably both.

Plutus wrote: You are investing for 10 years until you reach pensionable age.

Investing forever, but with that as a guideline timescale to have an income plan of sorts. The capital might be useful later or for the kids when I'm pushing daisies.

Plutus wrote: There is about 40% of the total invested in income funds/ITs and some also in a REIT. These produce a decent yield. The rest is a mixture of India, growth and individual companies.
My personal opinion would be to sell the assortments of non income producing equities and replace them with 2 or 3 income ITs. Maybe including a top up of CTY.

I may well do that but need them to get out of the red first with enough gain to make the sell trade. Otherwise they have to stay ignored and redundant as the 'flutters' and maybe one day they'll catch a fish.

Plutus wrote: If you are worried about losing money then keep 10-20% in high interest accounts, maybe 5% of which in zopa or another peer to peer lender. When markets dip you can always buy more equities.

There is a little in a 5% account and some at 3% for a cushion.

Buying dips are where experience pays. Some of my dip choices have been knife-ish and although a little cut has been made, hopefully it will eventually heal. If it's a high yielder then it doesn't matter in the shorter run.

Learning as we go...

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Re: The portfolio after one year - a newbs journey

#102753

Postby Raptor » December 8th, 2017, 1:48 pm

Pipsmum wrote:
Raptor wrote:It is refreshing to see a portfolio without a single share that I own.

Maybe it shouldn't. I'll check yours and crib some thoughts if I may.




Here is link to latest portfolio...Hope it helps.

viewtopic.php?p=101002#p101002

Raptor.

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Re: The portfolio after one year - a newbs journey

#102788

Postby Urbandreamer » December 8th, 2017, 3:50 pm

Pipsmum wrote:Overall plan. I'm an older investor of 57 .....I'm just wondering about a SIPP and have invested a tentative amount of £100 to start one up. ....


My thoughts.

Assuming that you pay tax, by investing outside of a SIPP you are choosing to pay tax now rather than later, possibly at a higher rate and deciding to pay tax that you may not be required to.

I'm not a newby, though I don't claim to be great at this investment lark, however it does seem to me that the advantages of a SIPP make that tax shelter a serious contender for those near 55 or over.

Let me do some maths based upon a standard rate tax payer, assuming no investment return and excluding costs (in practice SIPP's do cost more than ISA's).

ISA contribute £80, later spend £80.

SIPP
contribute £80 and get £20 returned tax.
Later take £25 tax free and £60 after tax giving a return after tax of £85 for every £80 invested.

Of course should you currently be a higer rate tax payer and a standard rate in retirment then you will see significantly better returns.

Contribute £80 and get $53.33 returned tax (40% tax).
Later take £33.33 tax free and £80 after tax (20% tax) giving a return after tax of £113.33 for every £80 invested.
Even if you are still a higher rate tax payer in retirment you still see £93.33 for every £80 invested.

When I was younger I contributed to a PEP followed by its replacement the ISA as the government kept changing the pension rules. I'm now of an age that any changes that they make may likely be avoided by crystalising (taking) my pension. So given a choice I invest via my SIPP. I'm even taking my dividends out of my ISA and invesing the same amount into my SIPP.

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Re: The portfolio after one year - a newbs journey

#103127

Postby Plutus » December 10th, 2017, 11:00 am

It does make sense not to sell at a loss, but going forward I think that I’d only buy collective funds and ITs rather than individual punts.

Depending on how risk averse you are another idea would be to annually rebalance to an equity-cash ratio of your choice.

E.g. if equities race ahead to 90% of the portfolio you’d trim back and take gains.

If equities fall to 70% you’d buy more of an income IT from your cash accounts.

You don’t need to time the market and be concerned about individual company loss.

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Re: The portfolio after one year - a newbs journey

#103309

Postby Pipsmum » December 11th, 2017, 9:44 am

There is a newbies vague perverse anti-logic reassurance that even the funds aren't doing much better than the punts right now in % terms. Well aside from hurricane of course, but that SP popped up a bit this morning. I haven't looked to see why yet.

Thanks for the SIPP thoughts. I don't know why I was/am slightly nervous about using SIPPS. I think it was because a SIPP isn't immediately retrievable.

OLTB
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Re: The portfolio after one year - a newbs journey

#103312

Postby OLTB » December 11th, 2017, 10:00 am

Pipsmum wrote:
Thanks for the SIPP thoughts. I don't know why I was/am slightly nervous about using SIPPS. I think it was because a SIPP isn't immediately retrievable.


Hi Pipsmum - just to say that you mention that you are 57 years old at the top of the post, so a SIPP would be retrievable if needed (you can access a pension fund after age 55). You could draw 25% of the SIPP value as a tax-free lump sum, with the remainder in the SIPP being available (but taxed as income at your highest rate) if needed - care as you could trip into higher tax bands. If you did draw the remaining funds in the SIPP as taxable income, then you would restrict yourself to further annual pension contributions of £4k p.a. (unless you opted to draw tax-free lump sums and income under the 'small pots' rule which you can do up to three times (although that's perhaps a little complex at this stage)).

Cheers, OLTB.

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Re: The portfolio after one year - a newbs journey

#104010

Postby Kipling » December 13th, 2017, 9:30 pm

I'd just point out that with Hurricane (+12.8%) you'll have done quite well earlier today - well done!

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Re: The portfolio after one year - a newbs journey

#105803

Postby Hariseldon58 » December 22nd, 2017, 5:04 pm

Good luck on the investing journey, with respect the portfolio does look rather complicated and contain some speculative elements for what I presume is a developing portfolio.

This is not dissimilar to some of my earlier decisions in my investing past and I hold far fewer investments now then I did when I started and with hindsight I’d side with the suggestion of a handful of Investment trusts or a passive index tracker such as the Vanguard ETF All World you hold.

I have ended up with a handful of ETFs that look like the All World with a modest bias to the UK , its cheap and simple but very effective.

The income side is not that great in % terms (but I could never eat more than a 100 pukka pies a day anyway...) and the capital gains have been very helpful in recent years and would have bought a lot more pies than the income stream !

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Re: The portfolio after one year - a newbs journey

#105845

Postby Pipsmum » December 22nd, 2017, 10:20 pm

Well I'm certainly rueing having sold the First Derivatives. That was plain foolish. The button is all too easily pressed.

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Re: The portfolio after one year - a newbs journey

#121106

Postby Pipsmum » February 28th, 2018, 5:03 pm

Update on the folio. I've listened and acted wherever possible (much is now in the red, so untouchable in this dull Feb). Mainly added to in order to rebalance the weights of industries. The oily punts hopefully seem quite promising minnows. (The Aminex fleetingly made a virtual £200 profit for a very short while when the recent news made the SP wake up, but then settled back down and is slumbering again. At least it proves it can, which is encouraging.)

Holding percentage, holding, yield, industry

14.80% .. woodford Income focus ............... 5.0% (aim) .... UK all companies managed fund for income - aim 5%
12.50% .. jupiter india ............................ 0.8% ............ Indian market managed fund for long term growth
11.30% .. newriver reit NRR ...................... 6.35% .......... Financial direct property
8.20% ... hl shares income ....................... 5.0% (aim) .... UK all companies managed fund for income - aim 5%
7.10% ... aminex AEX ............................. 0 ................ Oil and gas
6.90% ... kier KIE .................................. 6.48% .......... Industrials
6.80% ... hurricane HUR .......................... 0 ............... Oil and gas
5.80% ... first derivatives FDP ................... 0.52% .......... Technology
4.70% ... city of london it CTY ................... 4.03% ......... Managed medium risk fund for growth
3.80% ... hl shares growth ........................ 1.70% .......... UK all companies managed fund for growth
3.30% ... watkin jones WJG ...................... 3.28% .......... Consumer goods
3.00% ... sirius real estate SRE .................. 4.77% .......... Financial direct property
2.00% ... CQS city high yield fund NCYF ........ 7.34% ......... managed high yield fund estimated yield 7.11%
1.90% ... micro focus int MCRO .................. 3.60% ......... Technology
1.60% ... ishares emerging markets blackrock.. 2.06% ........ Global emerging markets tracker fund
1.60% ... vanguard fund VWRL .................... 1.83% ........ Exchange traded All world tracker fund
1.40% ... ULS technology ULS ..................... 1.59% ........ Technology
1.10% ... numis corp NUM ......................... 3.41% ......... Financials
1.10% ... phoenix group holdings PHNX ......... 5.93% ......... Financials insurance
0.50% ... residential secure income reit RESI .. 0 .............. Financial direct property
0.50% ... walker greenbank WGB ................. 2.53% ........ Consumer goods

The load is spread out a bit more evenly, and more of it put where it's properly managed by expert managers and trackers. Plus I've changed the regular saving to go into the SIPP. It's going to have to stay like this for a bit as a sons uni fees are gobbling up any readies, but any suggestions to look at are always very welcome.

Does anyone know the proper formula to work out the prospective yield overall? I'm having a problem working that out for myself.

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Re: The portfolio after one year - a newbs journey

#121115

Postby Itsallaguess » February 28th, 2018, 5:36 pm

Pipsmum wrote:
Does anyone know the proper formula to work out the prospective yield overall? I'm having a problem working that out for myself.


The way we do it in the HYP Top-up Spreadsheet tool is as follows -

1. Each individual holding has an individual yield attributed to it. This is the Digital Look 'Forecast Yield' in the case of our tool, but it might be the current yield, the rolling yield, or whatever yield figure you choose to use.

2. Each individual holding also has a current portfolio value at any given time.

3. The two fields above are used to calculate an expected-income figure for each holding.

4. The expected-income figures for all individual holdings are added up, to give the expected overall portfolio income using whatever yield figure is used.

5. Your portfolio will also have an overall capital value at any given time.

6. The portfolio-level expected-income figure from Step 4 is then divided into the whole-portfolio capital value from Step 5 to give an overall-portfolio yield.

Hope the above makes sense. I can give a worked example if it would help?

Cheers,

Itsallaguess

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Re: The portfolio after one year - a newbs journey

#121119

Postby Itsallaguess » February 28th, 2018, 5:48 pm

Itsallaguess wrote:
I can give a worked example if it would help?


Here's a snapshot showing a worked example of the HYPTUSS tool, which shows you how we do it -

https://i.imgur.com/ao1EbYQ.png

You can see the following information -

1. Individual holding yields in Column J

2. Individual holding capital values in Column G

3. The above two fields are used to generate an expected dividend income per share, and that can be seen in Column P / Rows 6 to 10. For the first share, BP, the yield is 6.1% and the capital value of the holding is £9027.85, so the expected income will be £9027.85 * 0.061 = £550.70, and this is reflected in Cell P6, with similar income calculations for the other individual holdings.

4. The individual amounts of expected income for each holding is added up, and the total expected income for the portfolio is presented in Cell P4 (£1790.60)

5. The full portfolio capital value is presented in Cell B3 (£43539.25)

6. We can now generate the portfolio yield by dividing the portfolio income into the portfolio capital, so £1790.60 / £43539.25 = 0.041126, which when rounded is equal to 4.11%, as shown in Cell P3.

Hope this helps.

Cheers,

Itsallaguess

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Re: The portfolio after one year - a newbs journey

#121126

Postby PinkDalek » February 28th, 2018, 6:25 pm

Itsallaguess wrote:
Pipsmum wrote:
Does anyone know the proper formula to work out the prospective yield overall? I'm having a problem working that out for myself.


The way we do it in the HYP Top-up Spreadsheet tool is as follows - ...


I think you may have intended, perhaps, to include a hyperlink to the tool itself, which I believe is here or hereabouts:

http://lemonfoolfinancialsoftware.weebl ... op-up.html

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Re: The portfolio after one year - a newbs journey

#121129

Postby ap8889 » February 28th, 2018, 6:30 pm

Hi Pipsmum,

I am a bit worried that with a lot of small holdings you may be incurring dealing expenses out of proportion to the position size. If I were starting out with a modest pot of money and 10 years to grow, I would probably keep the portfolio very simple to keep costs as low as possible. I am not sure what your edge or advantage over the market is. If you dont have an advantage then a cheap tracker is the way to go. That's what Warren Buffet advocates, and he should know. I am taking his advice.

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Re: The portfolio after one year - a newbs journey

#121474

Postby Pipsmum » March 1st, 2018, 8:49 pm

Thank you very much for all those tips and links. I shall have a go at it.

ap8889 wrote:Hi Pipsmum,
I am a bit worried that with a lot of small holdings you may be incurring dealing expenses out of proportion to the position size. If I were starting out with a modest pot of money and 10 years to grow, I would probably keep the portfolio very simple to keep costs as low as possible. I am not sure what your edge or advantage over the market is. If you dont have an advantage then a cheap tracker is the way to go. That's what Warren Buffet advocates, and he should know. I am taking his advice.


Having made the beginner mistakes already. I entirely agree because there is no edge. If I were to do it again sensibly, then I'd have kept them all within a single or a few fund pots and trackers so I didn't incur them. Or to save a bit first, and invest one lump all in one go with only one commission and not four times over with expensive top ups. Lesson learned now. Far too enthusiastic initially and now rubbing burned February toes. It'll swing back and i've now stopped meddling.


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