A lot has been happening in the markets over the last couple of months but unfortunately I haven’t found much to take advantage of. Partly I have been too busy to look for investments but also most of the carnage seems to be hitting oil companies and mining, neither of which I think are particularly attractive on aggregate at the moment. I have made some changes to my portfolio in the last week however, but these are not a reaction to macro events these are specific adjustments I have made.
Asset prices throughout the western world, from property to shares, are at all time highs and show no signs of slowing. Quantitative easing and low interest rates, rather than encouraging new investment and entrepreneurship are simply fuelling price increases in existing assets. Now is the time to be fearful in my opinion, however that doesn’t stop me trying to find great investments even if it is that much harder at the moment.
I recently ran a stock screen of US companies to try and find some interesting prospects. The results were very interesting so I wanted to share them with you, and highlight some possible value traps I noticed going through the list, particularly retailers, along with some stories of my experiences investing in them.
I’ve held JD Sports for quite a while, and a few days ago its latest interim results were released. The core business is doing extremely well. JD Sports stores are currently the leaders in sports fashion wear, with pretty much no competition.
But while the JD business is thriving I am not at all pleased with how the overall group is doing. The group is made up of not just JD Sports but Fashion stores like Bank, and now Blacks which is a higher end outdoor retailer. The fashion and outdoor segments have no unique selling point, are in fierce competition with all sorts of competitors and unlike JD Sports shops, they do not offer something unique to the customer.
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