Investor John’s March

Welcome again…This is my Diary entry for March – Well what a month that was and possibly more of the same to come?

I’m writing this on the 3rd of April 2020

None of this is advice or recommendations.

Month Summary

  • Number of Holdings 34 at month end.
  • Calendar YTD -38% (ouch!)
  • Buy Trades 5 (4 Topups & 1 New Holdings)
  • Sell Trades 1

Like many have said on twitter… “Is it safe to come out yet?”

I hope first and foremost that you are all keeping well and staying safe, it is a worrying time for everyone and especially the elderly.

I have been busy these days so posting this a little later than normal with a little less detail. In my day job I run a wholesale Bakery factory so it has been hectic keeping up with social distancing measures and operating with less staff than normal.

What a month for the stockmarket! This will have been painful for all Investors no matter how big or small. As you can see from my YTD performance I have dropped from a positive 8 or 10% in January to the massive negative figure. I am still sane because I look at the long term picture, of course if I had grasped the full extent of the disruption from Covid-19 I should have sold in January! Hind sight is 20/20 as they say!

As I mentioned last month I have some capital on the sidelines which equates to somewhere around 15% cash. My plan is to continue to slowly add to holdings and you will see the number of holdings creep up slightly from my usual maximum of 35 up to as much as 40 holdings, subject to my being able to buy at suitable prices. My thinking is that I don’t mind diversifying a bit more when the price is right, some of my holding sizes are quite large already so rather than add to them I will open a few new positions. I can always reduce again to normal quantities on any recovery of normality.

Sells…

This was a tough one, but it had to go in the current climate – Ticker TEG Ten Entertainment Group

My note to self on Sharepad reads…

“Govt shutdown advised against non essential social contact – buy back cheaper?”

TEG is a great company but with the shutdown I felt safer to be on the sidelines on this one for the time being. Both TEG and BOWL have had to close for now with obvious negative impact on revenue for this year. They could be the bargain of the century at these prices but on the other hand I may be able to buy them cheaper in the not too distant future. I had been shorting TEG with IG to hedge my position and closed the short somewhere below 130p can’t remember exactly. I sold at 172p.

My top up buy in January looks daft now! Who would have thought things would change so much in a month.

Added to…

I bought more of the following topping up existing holdings at better prices.

  • Belvoir Group BLV,
  • Simply Biz SBIZ
  • Rockrose Energy RRE

On none of these I got the bottom they were bought early on in the month and after that I stopped all buying activity for the last few weeks of the month to see how the market would settle.

New Buys…

MTI Wireless Edge Ltd

This one has been on my watch list since Mello last November, it was one of the companies that I considered to be invest-able at the time. They are set to benefit from the roll out of 5G networks as they have a antenna solution that can be fitted as an upgrade to existing equipment. They also have successful solutions for municipal water and irrigation control. Their final results published on the 2nd of March show optimism and progress and with net cash on the balance sheet they look strong enough to keep going through all the uncertainty out there. (Note they are based in Tel Aviv in Israel)

  • Stockopedia Stock rank is 98 out of 100
  • Forward PE 11.8
  • PEG(f) 4.6
  • EPS Growth(f) 2.6%
  • Dividend Yield 6.52%
  • ROCE 14.1%
  • ROE 13.2%
  • Operating Margin 8.64%

As seems usual for now these metrics have improved since I bought as the price has dropped with the rest of the market to as low as 26.5p

Bought at £0.34

Trading (Short term trades using Spread trading with IG or Spreadco)

I currently have no trades on but had some success through the month shorting FTSE 350 Travel and Leisure sector.

Thanks for reading and don’t be afraid to comment below with your thoughts! Explore the rest of my website and have a look at my current holdings!

Looking forward…

I have done some buying at the start of April which you can spot in my current holdings (although most of the buys are top ups). I am still an optimist at heart so I want to deploy more capital while prices are somewhat suppressed although I need to be careful as further falls are possible.

Quote of the month

My Portfolio Allocation

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Investor John

Investing as a Private investor John has shown success over the last 15 years with a straight forward common sense approach to investing - He can help you to learn and will gladly share his knowledge to get you started.

2 thoughts on “Investor John’s March”

  1. Hi John

    Thanks for the update;

    Like you down in the low 30’s YTD (-31%). I went 2/3rds cash at the bottom 19/3 and until now had a desire to have a concentrated portfolio with one or two high conviction holds. These two (RRE & AAZ) are what did the most damage in the short term though I still hold a reduced holding in both of them.

    I am considering a less concentrated approach (and even funds) but do you feel your able to understand and keep track of 30 or 40 holdings?

    I am retired but still have a life outside investing 🙂 and struggle to keep track of 10 or 12 stocks!

    I am still 67% cash and feel that the extraordinary rises in the stocks that I sold since 19th March are absurd.

    I am going drip my money back in over the coming months but at the moment I am not optimistic.

    Best wishes
    Michael.

    1. Hi Michael,

      Sorry I have just seen your comment now!

      I sympathise on RRE as I hold it too!

      I am still working so am at a computer screen most days, so it is easy for me to read the RNS’s each morning if there is anything relevant to my holdings. Also many of the companies I have held for a long time for you get to know them quite well…

      If tracking 12 stocks already seems like a chore then probably better that you stay concentrated and then using a few funds sounds like a good idea to get diversification.

      Software like Stockopedia and Sharepad means that it takes less time to research and keep up to date

      Best Regards,

      John

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