The year that was 2019…

In Summary my overall portfolio is up by 21% for 2019 🙂

Number of Trades

Buy Trades 44 – (24 Different companies bought the rest of the trades were topping up existing holdings)

Sell Trades 30 (25 Different companies sold)

I have been adding capital to my portfolio throughout the year so this means I am buying into some new stocks and adding to existing holdings that are doing well and averaging up. I very rarely average down unless I am sure the market is mispricing something or over reacting.

In 2020 I will be adding another block of capital to my accounts, my biggest worry is finding quality companies that are not overpriced after this late rally in 2019. I will slowly follow the market and drip the money in as I see potential opportunities arise. In general I remain fully invested at all times.

Broker Charges

Charges for the year came to £435.50 – because I have 3 different accounts there are various fees… I expect fees to be less in 2020 as I have moved my SIPP from Barclays Stockbrokers to Interactive Investor along with my ISA. With ii I now pay 9.99 per month to cover both my ISA and my SIPP. I had the corporate account with Interactive investor also but for corporate accounts they pushed the fees up significantly so I quickly moved that to Hargreaves Lansdown Fund and Share account which has no fees except the 11.95 commission per trade.

Dividends

Dividends received were around 2.2% on Cash invested at the end of the year.

Profit Warnings/Short attacks

I suppose I can’t really grumble that I have had only 2 profit warnings that I can think of this year. Recruitment specialist Robert Walters and Social housing Software provider Castleton Technology. I kept my holding in both but am keeping a close eye on especially Castleton to see if they can turn things around at next update otherwise they will have to go. I am sitting at -33% on Castleton as I write so that is really at the limit of what I will allow.

EDIT: Just sold Castleton (Loss of 32.6%) as I want to start the new year without this low conviction holding – as ever it could outperform in the coming year but when I ask myself the question – Would I buy CTP now? the answer is no. Their PE is good but they have low margin low yield and I am just not convinced. They are changing over to SaaS model but this can take years to tyrn around and bear fruit as I have previously experienced with ECK Eckoh Technology who done the same.

My biggest disaster this year happened in December with Muddy Waters targeting NMC Health with a short attack. NMC Heath has been a long term holding of mine since I bought at £7.88 in October 2015. Earlier this month it had been sitting around £25 so was at a healthy profit and I still intended to hold it long term.

A bit like with Burford Capital the Muddy waters attack sent the share price reeling and by the time I noticed anything the price was already down to £20 my immediate thought was should I sell immediately and I can always buy back in at a lower point. To cut a long story short I didn’t and thought I would wait for a sturdy rebuttal from the company. The rebuttal came after the market closed the following day but so did an accusation from the FT that NMC had been trying to raise another 200m off balance sheet.

The price continued in freefall until I finally said enough was enough and sold at £12.40! I didn’t want to end up in a loss after the good run that I had. According to SharePad which I use to track my portfolio at the moment, I had made 27% on the investment in NMC.

NMC have since announced an independent investigation into the allegations against them which has boosted the price back up to just below £18 – painful to watch. However When I look at my portfolio performance overall for the year it helps me forget the pain! This one incident has pretty much wiped out my gains in my SIPP account this year.

Takeovers

SciSys Plc which I bought in November 2018 for 166p was taken over for 254p giving a 53% return including dividends.

Checkit Plc formerly known as EKT Electron Technology bought back 90% of my shares after they sold off their Bulgin connector business this gave a return of 51% I then sold the remaining shares as they weren’t enough to remain a core holding and I had still to be convinced on their strategy going forward. Overall return was 46%

General Performance/Comment

In 2019 I have been increasing the size of my portfolio so that has meant pretty steady buying as I feed money in, 2020 will be more of the same.

I have a portfolio of rental properties and my general plan is to increase my Stock market holdings to match or exceed the rental portfolio value. This should hopefully help diversify my overall portfolio and all being well boost my return on Investment. In my experience you are doing well to achieve 5 or 6% income from each property so this should be an easy figure to exceed with an average return from the stock market. (Hopefully!)

Of course the value of property can appreciate in value but I look at that as a bonus. The beauty of the share holdings is that you can liquidate your position in seconds (in most cases, if you don’t hold really illiquid stocks) whereas with property it can take months or even years! I have a property on the market since January 2019 and hopefully it will complete in Jan 2020 all being well… so as you can see it’s certainly not overnight!

I have tried to hold myself to a maximum of 35 stocks so that has resulted in larger positions than I would have typically held.

My top ten holdings at the end of December and their current overall returns are as follows (taken from Sharepad Portfoilio tracker)

• Future PLC +68%
• Arcontech Group PLC +9%
• Belvoir Group PLC +37%
• AB Dynamics PLC +45%
• Sylvania Platinum Ltd +33.8%
• SDI Group PLC +63.2%
• Ten Entertainment Group PLC +31.7%
• Rockrose Energy PLC +5.2%
• Boohoo Group PLC +12.8%
• The SimplyBiz Group PLC +12%

I am very happy with my return this year of 21% overall. It is more than I expected at the start of the year with all the uncertainty. I would love to work out previous years returns, surely this is possible in Sharepad without a massive amount of work? Maybe some of you pros can give me a tip on this? If NMC didn’t crash or if I hadn’t sold them at least, this return would have been better but no point in crying over spilt milk…

If I took the time I could analyse and comment a lot more but I have too much else to do sorry! I’m planning to try and keep better notes in the coming year so I can refer back to them for summaries like this…

Special thanks to…

• PI World https://www.piworld.co.uk/ whose videos provide interesting and relevant interviews and content. Also because Tamzin deserves a medal for her efforts at Mello this year to get people to use the microphone and get a decent recording behind the scenes.
• Pete https://www.conkers3.com/conkers-corner-investment-hub/ whose back catalogue of Investment related interviews has kept me occupied on my daily commute typically 1hr to get home with traffic…
• Also Twin Petes podcast is a interesting listen https://soundcloud.com/user-479955511 with the infamous @WheelieDealer
• Thanks to Graham Neary and Paul Scott for the insightful Daily small cap report on Stockopedia and Grahams more Mid cap orientated site https://cube.investments/ I again especially enjoy Grahams podcasts and it was nice to meet this fellow Irish investor at Mello
• Thanks to all the other Twitter guys and girls too many to mention who post relevant and considered tweets and the odd not so relevant but amusing tweet.

Also thanks to the Investment tool providers that I use for now (unfortunately I have to pay for them though 🙁 )

• ADVFN
• Stockopedia
• SharePad

Any questions on anything let me know and I will do my best to answer otherwise thanks for reading and have a Happy and prosperous new year!

You can follow me on twitter just click the link on the left menu my username is @investorjohnuk I don’t post that much because someone else usually beats me to it with company news releases etc so you won’t be spammed with tweets!