Portfolio Update

After first reading about Beximco Pharma on Alpha Vulture, I have purchased a position in the Global Depository Receipts listed in London. The main company trades on the Dhaka Stock Exchange for an equivalent of 0.32GBP however the GDRs sell at 0.15GBP. That’s pretty much the investment thesis. This position is 5.4% of my portfolio and takes my cash level down to 5.2%.

I want my cash level to be higher, but at the same time there isn’t really anything I want to sell at the moment. I have put in a limit sell order on Awilco Drilling at 159, the company has paid large dividends since I bought as well as the share price being slightly ahead (though this was negated by adverse currency movement. I also want to reduce my Craven House stake as I stated in my previous article on them. However the share price has been falling recently, and has dragged my performance down substantially. It’s still at about 50% of book value trading at 0.39p, I will be looking to reduce the position at 0.65p at the least.

The rest of the portfolio is doing well overall, but with 2 big detractions. Avangardco’s stock is getting hammered because of the Ukraine situation, but I’m still not showing a loss which just goes to show how ridiculously cheap it was when I bought it! Tesco’s shares also continue their decline – more on that later.

This is my portfolio currently.

Thoughts on blogging

In the last couple of years of blogging I have noticed my habits changing in certain ways for the worse. My investments are spread across various banks and accounts which used to make tracking my portfolio difficult. This was actually beneficial because I wasn’t focused on performance of share prices, just on the businesses themselves. However I now have a live spreadsheet which makes it easy for me to keep track of prices and position sizes. It’s also needed to track progress against the S&P 500 and FTSE, which I report on every 6 months here.

I find myself getting more and more focused on short term share price changes and my performance against benchmarks and this is mainly due to the fact that I publish results on this blog for all to see. I now check prices every day, especially for Craven House Capital which is such a large position for me.

This is a habit I must break, but at the same time I view posting my portfolio and its performance as essential, how else are readers supposed to judge my content if they can’t see how my ideas perform? No, this is a habit I must break with force of will and by accepting that at some point I will under-perform the indices as well as the harder fact I must accept – I will lose money on some positions.

I have never sold a position for a loss (of more than a couple of %). This is most definitely not because I’ve picked only great stocks. It is a combination of great fortune and psychological weakness. My investment in Tesco is one I should learn the most from. I made it a huge position well before I started this blog, and through sheer luck managed to sell the majority of it at a small profit as the underlying business deteriorated before the markets eyes. A few weeks of market madness after months of being down 20-30% allowed me the opportunity I needed to get out and save face. My original thesis was totally wrong, yet I still hold a small position in the stock. I considered selling a few months ago and even put in a limit order about 5p above the share price then. It never got hit and the shares are down another 20% since then.

There is a similar story with Clear Leisure, where I made a mistake on the maths and greatly overestimated upside to the point where I probably wouldn’t have invested had I done it correctly first time round. But I didn’t sell because the shares had fallen a little bit – I didn’t want to realize a loss. The shares fell further and are now suspended following the company failing to file its annual accounts. As the share price is a lot lower now, the upside actually makes it an attractive investment so I wont sell, but it’s got a long way to go just for me to break even.

These are things I’ll try and work on, experience gives us lessons that can’t be taught in books, I’m just fortunate so far that my lessons haven’t cost me too much.

Investing Sidekick

Founder of Investing Sidekick. Works as a research analyst and is an avid value investor, always searching for undervalued shares.