January 2018 investment trust review.

January investment, a good start.

My new ‘capital growth’ investment trust portfolio has started the new year in a positive fashion. Of the ten trusts only one, TR Property, is currently in negative territory. All the others have moved positive more than sufficiently to cover trading costs et. cetera, which is rather nice.

The area showing the greatest growth is currently the Far East. My Baillie Gifford Shin Nippon and Templeton Emerging Markets ITs showing gains of 5.1% and 4.3% respectively. However my stand-out performer is the (high risk) Vietnam Enterprise, up a fraction over 10%. Quite how long this rate of growth can continue… we’ll just have to see. TrustNet gives this fund a FE Risk Score of 219 (cash score:0, FTSE 100 index score:100) so a fair bit of volatility must be expected.

Overall, for this investment trust growth portfolio we’re looking at a gain of 3% so far this year.

My income portfolio is also up since the turn of the year, by 0.6%. Not massive, but competing with the FTSE 350 index. I’m more than happy with this considering this is a long term income-targeting selection of investments.

As for how things may for these investment trusts for the rest of this year, I guess I’ll have to start drinking a lot more tea so I can get practicing my tasseography. (I must confess to being particularly attached to gunpowder tea; a light slightly smokey-tasting green tea.) This skill will probably be as useful as reading all the current thoughts and comments being put out by many (highly paid!) brokers and financial advisor experts. Or perhaps buy shares in companies that do 3D printing, hoping they will be able corner the market in producing a better quality crystal ball for the financial wizz-kids to gaze into. Their abilities make Professor Trelawney’s look positively amazing.

New Investments

New year, new investments

First, looking back at the investment trust income portfolio.For the year 2017 it grew 12.9% in value, added to that must be dividends of around 4.5% of original amount invested. This compares to a FTSE 350 Total Returns index gain of around 12% for the same period.  (Investments in Brunner IT, City of London, F&C Capital and Income, JPM Claverhouse, Merchants, Murray Income, Schroder Income & Growth, Scottish American, Temple Bar, and Value & Income.)

So no changes to the portfolio, steady as it goes.

As for the large cap ‘BullBearings’ portfolio, ummm… a mix of finding myself too distracted with other things and the BullBearings stock market simulator website closing has killed this one off. Since it was set up on the site last March it has grown by over 10% but with no more BullBearings let’s clear the decks and start again. Ten investment trusts, each with equal weighting, bought right at the start of January. The idea is to hold these for the year, however a (flexible) stop-loss of around 12.5% (danger zone, may sell) to 15% (cut and run time) is on the cards. Investment trusts are usually not the most volatile of shares, so this should not result in too much churning. If this works then great. If it doesn’t work well, then a case of ‘learn from the experience’.

Allianz Technology (Technology)
Baillie Gifford Shin Nippon (Japan)
Blackrock Throgmorton (UK)
Edinburgh World Wide (Global)
JP Morgan American (America)
Schroder Asia Total Return (Asia ex-Japan)
Templeton Emerging Markets (Emerging markets)
TR European Growth (Europe)
TR Property (Global Property)
Vietnam Enterprise Investments (Vietnam)

This selection covers most of the obvious areas, though perhaps an odd one out being Vietnam Enterprise investment trust. With wage costs in China now approaching the level of many western countries, labour-intensive industries are moving their production facilities across to relatively low cost Vietnam. So this one has been added to give a little extra spice to the selection.

June July performance

End of July (what happened to June?!) so let’s see what’s what.

Big cap portfolio.

There have been a few more ‘downs’ than ‘ups’ than I’m really happy with in my big cap portfolio, but then that’s the nature of the stock market. As for general performance, fallers include GlaxoSmithKline and Tate & Lyle, but the main nasty has been JD Sports which through June and into early July fell by nearly 25%. However if you look at JD’s performance over the last three years it’s been a pretty solid non-stop climb. Add to that a sudden upsurge in April, then a bit of a correction was not unexpected. This fall has brought the share price back to where it was about 6 months ago and is also now showing signs of perking up again, so I’m not too worried.

On the performance plus side Rio Tinto and Electrocomponents are up nicely. Rio has moved up 20% from a local low in May, while Electrocomponents continues its general climb which started back in early October 2015. Back then we’re talking of a share price of around 170p, now around the 620p mark.
So despite JD Sports upset, the portfolio is still outperforming the FTSE100 index and is showing an annual rate of growth equivalent of a little over 8%.

Income portfolio.

As for my investment trust based income portfolio, that’s been flat-lining for the last couple of months. Despite this it ‘s still up 12% since its inception in December last year. However in dividends (it is, after all an income portfolio) it has returned an equivalent annual yield of 3.9%. Add that to its capital growth and I’m more than happy with it.

So it’s all very much let things continue on as they are, no plans to sell anything yet. The first real review time for that won’t be till September for the big cap portfolio (its 6 month point). Even then any re-balancing may not occur till its first birthday. Likewise not till December (1 year) for the income one.

May Monies

Coming to the end of May and my big cap portfolio is coming along okay.

It’s up a little over 2.5% for the proverbial Mad Month of May. However as nice as that sounds it has underperformed compared to the FTSE 100 (up around 4%). The main problem here for this portfolio was a sudden fall by Tate & Lyle. Despite announcing a healthy increase in pre-tax profits there was only a small increase in sales.This sales performance appears to have disappointed the market so it has punished Tate with an 8% fall over the last few days.It could well be time to say goodbye to them, also possibly to Ashtead which since a peak in April seems to be starting a downward trend.

Looking at the others, Burberry seems to have recovered from its nasty fall in April with the rest generally coming along nicely.

As for replacing Tate and / or Ashtead, then the investment company 3i (III) and the digital payment company Paysafe (PAYS) are on the short-list. Much depends on what happens when the market opens tomorrow.

My income portfolio (up 2.6%) has slightly outperformed my big cap portfolio in capital growth while also providing dividends at an equivalent annual rate of over 3.3%. No plans here to make any changes to this. It is targeting long term income rather than capital growth with a holdings review probably not till December.

End of April finance

End of month finance review time.

What’s happened on the finance and investment side of things? Redrow has done rather nicely but star performer has been JD sports, up neatly 15% over the last month. On the downside, Burberry recently announced a reduction in sales and so suffered a sudden fall in price but looks to be recovering a little. Rio Tinto seems to be on a bit of a downer, but it’s GlaxoSmithKline that’s going to be sold out of the portfolio. So on Tuesday (Monday being a bank holiday) Glaxo will go and be replaced with Persimmon (PSN).
Overall the portfolio is up over 2% and is nicely outperforming the FTSE 100 index. It is generally targeting capital growth, any dividends will be seen as a bonus.

Income.

As for setting up an income virtual portfolio I’m doing something a little non-standard. I’ve sorted out 10 high income type investment trusts (Brunner (BUT), City of London (CTY), F&C Capital and Income (FCI), JPMorgan Claverhouse(JCH), Merchants (MRCH), Murray Income (MUT), Schroder Income Growth (SCF), Scottish American (SCAM), Temple Bar (TMPL), Value & Income (VIN)), and have, in my simulation, bought £1,000 of each of them.

The slightly non-standard thing is that having decided on what to buy (based on long term dividend stability / growth) I back-dated the purchase to the start of last December. This does immediately give me an idea of how the income side is performing in respect to dividend generation. The start of December is also an important date regarding some pension stuff I have, so having this income portfolio running parallel to my pension stuff will be useful to me. This straight away lets me see that it’s currently paying out dividends at an equivalent interest rate of 3.5% a year, but if I add this to overall capital growth then since December it’s showing a 10% gain. This compares to an 8% gain in the FTSE100 Total Return Index over the same period.

I’m happy enough with things at the moment. It is a learning experience and will be useful later in life when I’m no longer having a wage as an income but am relying on other investment sources.

Time to think about generating income.

Income please.

As well as my big cap portfolio I’m playing with, I might start a second one looking to see about generating income. A mix of relatively high yield unit trust / OEICs and of investment trusts, say 5 of each. The idea will be very much a buy and hold routine, reviewing it once a year in case any disasters need to be weeded out.
As it will be targeting income I won’t be too concerned about capital growth and will assume any growth in one investment will probably be balanced out by losses in another. Any actual ‘overall growth’ in the portfolio will be through reinvesting any income not withdrawn at yield or dividend payment time. This should be an interesting experiment. Dividends are usually paid out twice a year, so this will not be a portfolio to be ‘rushed’. As a target a 4% income seems a reasonable objective to aim at. As this will be a learning experience I’m not too worried as to what it actually turns out to be, so long as I can gain some knowledge and experience doing it.

As for my main virtual portfolio, then I think I will go for the idea at the start of each month of culling out the worst performer if it really has behaved badly. I don’t want to get into the bad habit of too much churning and replacing things just for the sake of it, that will only rack up unnecessary charges. However cutting losses is so important in ensuring an overall gain. Remember that if an investment falls by say 50%, then a 100% gain will be needed to get it back to where it was.
The portfolio is currently just getting into profit mainly through a nice set of results from JD Sports. Rio Tinto is still looking a bit weak, so if anything’s going to go at the start of next month it is still favourite for the chopping block. It would be nice if it did burst back into life.

financial ups and downs

Time to kick this blog back into life, so let’s try by occasionally talking about some financial ups and downs type stuff.

As part of my Master Plan to become stinking rich and rule the World – or perhaps at least become financially stable – I thought I’d experiment a bit with some virtual stock-market trading. So (using the financial BullBearings.co.uk web site). I have, as of 6th March, ‘virtually bought’ 10 of the leading UK stocks. And as this virtual portfolio moves up and down (I hope far more of the ‘ups’ than ‘downs’) I’ll report back here.

The current virtual portfolio is split across Ashtead (AHT), Burberry (BRBY), Carnival (CCL), CRH (CRH), Electrocomponents (ECM), GlaxoSmithKline (GSK), JD sports (JD.), Redrow (RDW), Rio Tinto (RIO) and Tate & Lyle (TATE).

Various financial targets, looking at things over say 6 months or a year. First, and perhaps the most obvious – not to make a loss! Moving up in scale, to beat a high interest bank account. To outperform the FTSE 100 index (surprisingly few ‘professional advisers’ can actually achieve this over the long term). To learn a bit about the financial world of how to sensibly save money.  Also, and perhaps most importantly, to have a bit of fun.

So now we are almost a month in, time for some first thoughts.

These are all big-cap companies varying in market capitalisation size from Carnival at around £680 million up to Glaxo at £1200 million. With these sort of sizes I would not be expecting too many sudden large jumps in value. Six (AHT, BRBY, CRH, ECM,GSK, RIO) are showing small losses, that leaves CCL, JD., RDW and TATE into profit. However despite the majority in loss, overall things are into positive territory through JD Sports increasing by around 8%.

Even as I am writing this there is something I might try. If I have a reason to sell something then it will obviously get sold. However, on a monthly basis, assuming there was the usual mix of ups and downs, then look to see which was the worst performing and if it has fallen by more than 5% then sell it. I must think about this over the weekend (this is being written on a Saturday). Assuming I decide to go with this, then Rio Tinto (down nearly 6% and below its 50 day moving average) will go and probably replaced by Smiths Group (SMIT).

Oh decisions, decisions!

iPhone 6s Plus First Impressions.

I’ve had my iPhone 6s Plus for a couple of weeks, so I thought I’d comment on my first experiences with it.

As soon as I got it (from my local 3 shop) it was straight off to Starbucks and investigate. (Come on now, you can’t seriously expect any self-respecting technology-related guy not to want to play with a new gadget like an iPhone as soon as is humanly possible.)

The first thing that struck me was the minimalist (if that’s the right word) amount of documentation that was included, and what was there was of such small print size it was almost impossible to read. Putting the SIM in and powering up the iPhone, it immediately wanted to connect through to an Apple registration centre, but not through its SIM / phone data connection but using Wi-Fi. The first efforts through Starbucks’ Wi-Fi failed miserably. It just would not connect to the registration centre. Next I tried using my Samsung Note 2 as a Wi-Fi hot-spot. That got thing a bit further forward in that it did say it was now connecting, but it just sat there and sat there and wouldn’t go any further.

So out with my lap-top (a MacBook Air, but running Windows 10), and with it tethered to the Note 2 it was off to do a bit of internet research. It appears I’m not the only one to have start-up registration problems, the solution being to connect the iPhone to a computer and then use iTunes. A little annoyed at this routine but at least this did work. However considering this was a brand new latest model iPhone straight out of the box I was surprised to see that it wanted to do a major operating system update.

Oh well, at least it’s up and running, but rather than update in Starbucks I thought I’d wait till I got home and use my broadband connection there.

This is where things got a little bit odd. On energising the iPhone at home it immediately locked onto my router Wi-Fi and started updating through that, but without asking for the router’s password! There was also confusion over PIN numbers relating to different levels of security functions – such as me entering in a 4 digit PIN but then later it wanting a 6 digit number (which I had not given it). I don’t know if it had picked up information or numbers that had been attached to my iTunes account, but it got to the stage where I said “sod this, this is leading me round in circles, let’s wipe the machine and start again”, so factory re-set time.
This time (and not going via iTunes) the set-up went as I would have expected. Passwords, PIN numbers, finger-print set-up etc. all ran smoothly. So at least by the end of the day I had, up and running, a nice shiny new device.

I am suitably impressed with it (as I would expect considering its cost!!!). I have all my essential apps loaded and am bringing on-board a range of additional ones. The fingerprint scanner has worked well and I hope more apps will adapt to using that as authentication. Setting up Apple Pay was simple enough, though the touch system has worked about 75% of the time, which means I don’t yet have the confidence to not carry around my (still using touch where appropriate) other bits of plastic.

The best feature of the iPhone – battery life. I’m so glad I went for the physically larger device (with its suitably larger battery). I can’t give an exact between charge figure as most lunchtimes I cable tether my MacBook Air through it, so each day it is getting around a 45 minute top-up. This does mean that I’m going for a good few days before I’m needing to give it a proper (usually overnight) charging session.

The worst feature – the camera, especially the camera app. The camera itself does take good pictures, however I find the physical location of the lens to be too close to the edge of the phone. This means that when taking pictures (or video) in landscape mode it’s all too easy to move your finger over the front of the lens. Or to put it another way, in portrait mode it makes the phone awkward to hold especially when trying to use the on-screen controls; I really am not impressed with this. The controls are poorly laid out, It keeps on taking multiple pictures when I don’t want it to, the whole thing I find annoying to use. If you just want to call up the camera, take a snap, and that’s that then I’m sure it’s okay. However I would like to use it a bit more creatively, but working my way through the controls is a pain and really slows everything down. There are numerous other apps out there for camera control, but each of these seems to concentrate in just one area (perhaps slow shutter / night time, or its effects-rich, or good for video…) and not suitable for ‘universal’ use. I assume over time I’ll adapt, but this is still no replacement for my Panasonic Lumix ‘point & shoot’ camera.

One other indirect side effect. As I put apps onto this 6S the Apple eco-system keeps on trying to put the same version apps onto my old iPhone 3GS. The install process starts, then grinds to a halt half way through. On the 3GS I have to then delete the app, go directly to the app store and select the app from there. The store will say that I can’t install this app because my 3GS is too old, but offer me the most recent version that was compatible with this device. That install will then naturally work without any problem. Why it can’t use the correct version to start with I don’t understand. Oh well, never mind. I can live with this.

So overall a thumbs up for my new iPhone 6s Plus.

iPhone Upgrade

I’ve just updated my mobile phone to a new iPhone.

As much as I love my Samsung Note 2, it is getting left behind technology-wise. Finger print readers, contactless payment systems, 4G connection speeds, camera quality and so on has made my Note 2 somewhat dated – though it’s still quite a powerful machine. The obvious natural choice would be to move up to a Note 5 (though for some reason Samsung seems very slow in releasing it in the U.K.), however for one specific reason I’ve shifted across to the iPhone.

I’ve got rather fed up with the Android operating system update routine.

Google goes through its usual announcement of the next major operating system release. Naturally the phone manufacturers then announce their support for it too. We then have, sometime later, it arriving on one or two of the Nexus devices. The other manufacturers will announce which of their new phones may get it, they may release it as an update for some very recent models (while still bringing out new models still running the old version), and though the manufacturers may have released updates there is still the local carriers, your Vodafones and all that crowd, to decide if and when they will put out the update. Rumours circulate, companies say one thing, then a couple of months later say the exact opposite, networks aren’t interested…

Then there ‘s the problem with those models (like my Note 2) which are no longer front line devices, and as such no longer make money for the suppliers and manufacturers. They may or may not at some time in the near or distant future get a full or partial upgrade depending even on what region of the world you are or are not located in.

This even means that you can have a nice new shiny model but with this system and its delays you may not get your upgrade until the next upgrade cycle is already happening!

Compare this to Apple. You get operating system upgrades announced. Sometime later they’ll announce actual dates and to which models it will apply to. Then you have it released around the world at the same time. Yes, there are problems and bugs and things don’t go as planned, but then this happens with Android, Windows and everything else. However at least with Apple you know where you stand. A certain range of models will get the update, others won’t.
That’s that. (If you really want to there is the possible option of jail-breaking older devices to force an update onto them, but that’s another can of worms altogether.)

So it is because of this that I have moved (back) to Apple for my latest phone improvement. I’ll still have my Note 2 with its stylus (which I really like) as my secondary or stand-by device with a pay-as-you-go SIM in it, but right now I’m busy getting my apps sorted out and seeing what this iPhone can actually do.

Evernote thoughts

What’s happening in the world of Evernote?

Came across an interesting article in Business Insider about the ups and now downs of Evernote that highlighting their recent laying-off of staff, and I’m afraid I do agree with the overall conclusion that Evernote, unless it gives itself a big kick up the backside, has had its day.

I first started using Evernote a bit over 4 years ago and found it a really useful cloud storage cross platform note taking application with a versatile screen clipping function. However as time’s gone by Evernote seems to have stood relatively still whereas other providers have either tweaked their existing services or brought on-board newer more comprehensive applications. Google Docs has vastly improved since its conception, Microsoft has developed OneNote and its other OneDrive services, Dropbox (as well as others) can seamlessly cloud store your documents as you work on them. It was only when I read this Evernote article that I realised how little I’d been using it recently. Not any conscious decision to avoid it, but just finding other services so much nicer to use such that Evernote’s usage just naturally fell away. One problem with it is that it’s yet another application that I need to be logged in to. I use various services from both Google and Microsoft (even when I’m using my Apple products) so I have to be logged into them. It’s a bit of a pain but I accept that it’s now part of my computer related life. As they provide overlapping / greater functionality to that of Evernote I really don’t want to be logging into another application to do something I can already do.

I suspect in reality it’s been Microsoft’s recent expansion away from concentrating its services just on Windows to encompassing Apple and Android that’s changed me. That cross-platform expansion then got me looking at Google’s services in greater detail. As much as I like my MacBook and iPad I find the Apple world too restricting considering I also use Windows both at home and at work, so at the moment I am writing this (in Starbucks tethering via my phone) using Google Docs on my MacBook, which incidentally is running Windows 10.

I do hope Evernote can develop itself and compete with the other players in the field. Competition (and choice) is good, but at the moment my choice is not to use Evernote.