SIPP PROGRESS

Current Value (As at 25th September 2017) = £147,679 including cash
Target for 31st December 2017 = £170,000 (was £153,000)
Value at commencement of this blog on 1st August 2012 = £51,684.02.
Monthly contributions since commencement of blog = 36mths @ £300 plus 25 months @ £750 = £29,550
Capital Growth = £147,679 less (£51,684.02 + £29,550) = £66,445+

Monday, 15 December 2014

Coming-up to the year end

The past few months have been "dodgy" for the SIPP, and this week one of my shareholdings has fallen off the cliff!

The current holdings are as follows:
Investment Trusts
Fidelity Asian Values IT (FAS): 1337 shares
JPMorgan Emerging Markets IT (JMG): 600 shares
Jupiter US Smaller Co IT (JUS): 500 shares
Individual Companies
Booker Group (BOK): 4500 shares
GlaxoSmithKline (GSK): 620 shares
International Personal Finance (IPF): 2000 shares
Optimal Payments (OPAY): 3500 shares
Scapa Group (SCPA): 2080 shares
Segro (SGRO): 1140 shares
Telit Communications (TCM): 850 shares
XChanging (XCH): 1740 shares

Cash: £16,315.46

Current Value (15th December 2014) = £72,500 (approx)

As I started the year with the SIPP at a value of £70,400 and I've added £3,600 to it in direct monthly contributions AND £1,295.88 in dividends, the performance this year has been disappointing.

The portfolio has taken a few big hits in recent weeks, the worst of them being in the past week with OPAY dropping to under 320 today (from a high of 550 in mid-September). I just don't know what the issues are with this share as the 4 broker forecasts are all suggesting a value greater than 600. Add to that the comments of Joel Leonoff, President & CEO on 17th November 2014: “We are finishing 2014 stronger and more diversified and, as a result, increasingly confident in the outlook for the accretive organic and inorganic growth opportunities available to us."

IPF is another shareholding in the SIPP that has been having a poor time on the markets with no obvious reason to explain it. The share value has slumped from 630 in early-June to under 440 now - yet the company is expecting to declare full year results showing increased profits up 20% on last year. The company looks stronger now than it did 6-months ago when the share price was 50% greater.

These companies both look strong: they both hold unique positions in their relative fields and I can only think that it is just a matter of time before the markets recognise this and the share price is driven higher.

Tuesday, 25 November 2014

Another bid "hit" for the SIPP - Friends Life to AVIVA

The SIPP has managed to find another company that has become a bid target - Friends Life Group (FLG) is subject to interest from AVIVA valuing the company in the region of 370-400.
Between June and October this year, I've purchased 2900 shares in Friends Life (FLG) at a cost of £9,005.35, or 310 per share (on average).
This afternoon, I've sold off the entire holding of 2900 shares and recovered £10,671.40 after commission and fees which has realised a profit of £1,666.05 or 18%.
I can't see a further increase in the offer coming up as much of the "press" comment hasn't been in favour of a merger of the companies and, if the bid collapses, it is likely to have an adverse affect on Friend Life. I'm a "bird-in-the-hand" man, and 18% profit in a few months looks like good business to me.

This has provided me with a significant cash balance of £15,975 which will allow me to take advantage of any reduced prices in the companies in which I already hold shareholdings; or other buying opportunities.

Of my shareholdings in:-
Booker Group (BOK) purchased at an average cost of 124 per share, continues to grow in value and today stands at 145 per share.
GlaxoSmithKline plc (GSK) purchased at an average cost of 1406 per share, also continues to grow in value and today stands at 1467 per share.

 

Tuesday, 4 November 2014

SIPP treading water

The past couple of months has been a bit of a hairy ride for the SIPP.
Thankfully, the damage to the SIPP has not been too great and the value has remained fairly static around £76,000.
I've undertaken a bit of re-structuring by selling the remainder of my holding in the Herald Investment Trust and my entire holdings in :-
Blackrock World Mining (Investment) Trust
Henderson European Focus (Investment) Trust, and
JPMorgan Mid Cap Investment Trust

This provided me with a significant cash balance which allowed me to take advantage of reduced prices in some of the companies in which I already held shareholdings.
My shareholdings in:-
Booker Group (BOK) was increased at a cost of 119.50 per share. This has worked well in my favour and the share price is currently standing at 140 per share.
GlaxoSmithKline plc (GSK) was increased at a cost of 1363.60 per share. This has also worked well in my favour and the share price is currently standing at 1417.50 per share.
Finally, Friends Life Group (FLG) was increased at a cost of 295.90 per share. This has also worked well in my favour and the share price is currently standing at 325.20 per share.

I've invested in a few new companies:-
Telit Communications Plc (TCM)
XChanging Plc (XCH), and
Scapa Group Plc (SCPA)

Scapa is a worldwide leading manufacturer of bonding products and adhesive components for applications in the electronics, healthcare, industrial and automotive markets, and I'm hopeful this company can continue to see significant growth.
Telit is in the business of providing wireless communications (the "internet of things") and is at the forefront of this technology.
Xchanging is an international provider of technology-enabled business processing, technology and procurement services to customers across many industry sectors.

A couple of my largest shareholdings have suffered corrections:-
OPAY is down from a high of 554 on 19th September 2014 to a price of 433 today (down 21.80%). I am not intending on reducing my shareholding in this company and will more likely be looking to increase my shareholding at around the 410-420 mark.
IPF traded at 634 on 6th June 2014, and is now at a price of 475 today (down 25.10%). Again, I have not intention of reducing my shareholding and - instead - I'm looking to increase my shareholding.  

You may have noticed that I've added a link  to another blog Iona's Young Money Blog. 

Thursday, 4 September 2014

SIPP restructured for Autumn "push"

One of the company shares I've bought for my SIPP recently, is one that I think I'll be holding onto for a long time: GLAXOSMITHKLINE (£GSK).
I've purchase 420 shares at a cost of £5,990.28 (ave 1426 per share including commission).
In the 2-years that I've been managing my own SIPP, the lowest pice of £GSK shares has been 1317 way back in November 2012. In the intervening period, they've traded over 1700, hitting 1782 in May 2013. However, they've recently slumped to 1377 in mid-August this year (my purchase was made on 1st August - I was on holiday in Crete in mid-August), so I think I've caught them at a low ebb.
£GSK have considerable dividend power, and should maintain a yield of over 5% for the next few years. I aim to re-invest those dividends in the company. £GSK is currently trading at 1470.

Since my last post on 28th July, there have been a few changes to the SIPP.

I decided to sell-off the last 162 shares I held in the Aberforth Smaller Companies Investment Trust: £ASL. This IT has been good to me since I opened my SIPP just over 2 years ago; in fact it was the first share that I purchased. Thing is, smaller companies have flattened-out performance wise in 2014 after spectacular gains in 2012-13, and this IT just seems to be treading water.

I also decided to consolidate my Far-Eastern IT's, and sold-off my holding in Edinburgh Dragon IT (£EFM), and re-invested it into my other Far-Eastern IT, Fidelity Asian Values (£FAS). As such, I now hold 1337 shares in £FAS.  I have a bit of history with £FAS as I originally bought shares in this IT back in the autumn of 2012, and then sold them off (at a small profit) in the summer of 2013. I really should have held onto them as my re-investment in the IT this year has been at a fair sum greater than what I sold off my initial holding for.

Another IT that I've decided to reduce my holding in is Herald Investment Trust (£HRI).  The performance has been fairly poor since I bought my shareholding. Even so, on reflection, I reckon this IT is a bit too speculative even for me, so I've reduced my holding to 400 shares.

One of my largest value shareholdings back in July was that in JPMorgan Mid Cap IT (£JMF), and I thought that it was too large a stake.  As such, I sold-off 440 shares to reduce my holding to 900 shares. I reinvested some of the proceeds in that sale by doubling my holding in JPMorgan Emerging Markets IT (£JMG) to 600 shares.

Some of the best gains in my SIPP over the past couple of years have been when I've invested in individual companies, and I've made some investments in the past month in companies that I think have potential to beat the market. One is GLAXOSMITHKLINE (£GSK) - see above.

One company that I think has a very bright future is International Personal Finance (£IPF) and, as this companies share-price has dropped to below 550, I've decided to increase my stake by another 500 shares to 2000 shares. This company now represents my largest investment (in terms of cash paid) with those shares costing me an average of 561. The current share price today is 528, so I'm sitting on a paper-loss of about £670.  However, this share has been at 683 (on 21st October 2013) and I think it'll visit that level again soon after posting a record half-year profit to June 30th 2014.

In addition to £GSK, I've added 2 new companies to the SIPP:
Booker Group (£BOK)
and
Segro (£SGRO)
Both these additions were on the basis of information obtained from investment publications, with both companies expected to out-perform the market in the next 12 months.


Monday, 28 July 2014

Long time / no see : time for an update

Things have been busy in the office, so no time to update the portfolio on the blog.

There has been plenty happening and my current SIPP portfolio is as follow:-
Investment Trusts
Aberforth Small Co IT (ASL): 162 shares
Blackrock World Mining IT (BRWM): 800 shares
Edinburgh Dragon IT (EFM): 550 shares
Fidelity Asian Values IT (FAS): 700 shares
Henderson European Focus IT (HEFT): 700 shares
Herald IT (HRI): 1000 shares
JPMorgan Emerging Markets IT (JMG): 300 shares
JPMorgan Mid Cap IT (JMF): 1340 shares
Jupiter US Smaller Co IT (JUS): 230 shares
Individual Companies
Friends Life Group (FLG): 1900 shares
International Personal Finance (IPF): 1500 shares
Optimal Payments (OPAY): 3000 shares

Cash: £12,994.72

Probably the main thing to happen is that I've taken a loss on £HSBA and moved-on from that company. I bought at an average of 690 which (as it turned out) was too high. At the time of buying-in, I expected to be able to trade-out at over 730 but, instead, the price was weak and vulnerable to rumour. Overall, I sold out at an average of 637 recording a loss of £1,690.65 - all prices include the cost of trading.  Taking the dividend income into account, which amounted to £538.22, the "nett" loss was reduced to £1,152.43.

Due to work constraints, my ability to monitor, research and trade in individual company shares has been restricted since 1st January.  As such, I've expanded my portfolio of Investment Trust shares. While this maintains my exposure to the markets, there is no opportunity for speculative gains (or losses). Looking objectively at the portfolio of IT's, there is probably too much exposure to smaller companies. I'm going to explore moving part of the portfolio into a larger FTSE100-based IT such as Temple Bar (TMPL) or Perpetual Income & Growth (PLI) and reducing exposure to smaller companies.

Of the individual company holdings, it was only recently that I bought into Friends Life Group (FLG) and I've aquired the 1900 shares at an average of 318. Currently, the stock stands at 332 so I'm sitting on a paper profit of about £250. This share has a lot of potential upside in my opinion, as well as a healthy dividend income, and I'd expect it to be above 360 before the end of this year, maybe even testing the 400 mark.

International Personal Finance (IPF) has had its ups and downs but, overall, this looks a very strong business. When it's been on the up the price has easily breached 600 and touched an all-time high of 683. So, even though it's been hovering around the 575 mark for most of the summer, I think we'll see considerable upside and 700+ is not an unreasonable target.

My favourite holding is Optimal Payments (OPAY) and I only wish I'd bought more when the share traded at under 320 in May this year. This company only has a market value of £750 million (based on a share price of 450) and it would not surprise me in the least to see this company double in value in the next couple of years. It has just about cornered the market in internet "electronic" money and there is only one-way this market is going: up. Sooner or later, a big player is going to open it's chequebook and (without a doubt) a bidding war will ensue. Hang on to your hats!

Wednesday, 22 January 2014

Save more in your pension or face poverty

A stark headline on todays City AM (daily business free-sheet). A study by Policy Exchange - a government funded group gathering information for a better society - reckons that saving for a pension should be made compulsory. Today, average savers have just £36,800 in their own pension pot, well below the £240,000 target for the minimum required for a decent pension in retirement.

I fully support any move for enhancing pension pots for retirement but, rather than just pumping money into mis-managed funds or low-interest-rate bonds, my opinion is that more should be done to educate the population into managing their money throughout life.

This should start at school with lessons demonstrating principles such as compound interest, and pound-cost-averaging. The introduction of SIPP's was a significant step in removing the blinds from the "dark art" of pension funds. Now, the people of Britain need to be educated to know how to get the best from them.

I have set myself a Pension Fund target of £640,000 to be in my SIPP on my 65th birthday (8th November 2024). It may seem an impossible task from my current value of approximately £74,000 but you have to set yourself a goal.


Tuesday, 14 January 2014

SIPP off to a great start for 2014

Having ended 2013 with a SIP value of £70,400, the fund has picked-up nicely and as of today (lunchtime Tuesday 14th Jan) it has a value of approximately £72,900 - that's an increase of £2,200 less the £300 added to the fund myself on 7th Jan. I'd have been happy with that much growth in a month, never mind just 2 weeks.

The main driver has been £OPAY; valued at 351 at the start of the month, this share is now at 424 - an increase of 20% in a couple of weeks. I honestly think this share could have a market value of over £1 billion, which means there is plenty of growth from its current market value of £645 million, basically another 50% and more. It surely must be coming under scrutiny from a couple of major players in the financial markets who are stake-building pending making a bid offer.

I've also increased my shareholding in the Herald Investment Trust (£HRI) and now hold 650 shares. The plan is to reduce my shareholding in Imagination Technologies Group (£IMG) and move that money into £HRI. What is happening at £IMG is anyone's guess. Essentially, the firm is growing well with (according to the December 2013 interim statement) increased revenues of approx £14 million (or 19%) in the 1st-half-year. This time last year the share had a value of 435 which rose to peak at 540 - so why the shareprice is languishing at 178 is beyond me. There is a bit of bid activity going on elsewhere, and I'm sure that this company is currently being looked at by potential suitors.

I've also recently trimmed my shareholding in JPMorgan Mid Cap Investment Trust (£JMF) from 1315 shares to 1140, which was basically just a piece of rebalancing.

The share price of International Personal Finance (£IPF) continues to fluctuate wildly between 480 - 520, and is may be some time (8 to 12 weeks) before this share stabilises and starts rebuilding confidence. Given the efficiency of this company, I have faith that it wont be long before we see the share price above 600 again.

So, onwards and upwards.

Friday, 3 January 2014

What does 2014 hold for the SIPP?

There has been a bit of movement within my SIPP since I last updated my shareholdings last September.

I have increased my shareholding in Blackrock World Mining IT (£BRWM) to 1310 shares worth approximately £6,100. These were purchased at an average price of  468.20 and I'm hoping once the world economy starts to grow out of recession that these shares will increase significantly in value. Mining stocks are generally depressed so any increased demand should trigger a movement.

The international bank HSBC Holdings (£HSBA) has has a bumpy ride these past few months, despite most commentators suggesting the share has the potential for significant gains. I have bought again on the lows (another 480 shares at 657 on 10th December) and my shareholding has now cost me an average of 697 per share. My plan is to reduce the shareholding to 1500 shares once the price breaks the 700 level.

Not all life is rosy, two of my shareholdings have recently come unstuck. Imagination Technologies Group (£IMG) dropped sharply in value on 11th December after a warning issued by the company that shipments would be lower than anticipated. My opinion was the reaction was overdone, and so I doubled my shareholding to 3000 shares. I think this company has potential to exploit any economic recovery and I'm in for the long-haul. Even so, having lost £1,400+ of my original investment of £7,037 it may be some time before I see profits again.

Another company which has had a recent problem is International Personal Finance (£IPF). I was very hopeful that this company would have a great 2014 but, unfortunately, as a result of a significant financial "fine" in Poland on Christmas Eve the share price dropped sharply. This correction was not due to the level of the fine, which was £2.40 million, but that interest rate levels in Poland could be capped as a result.  The business model seems solid, so this setback should only be temporary, and so I increased my shareholding by another 300 shares at a cost of 500 per share. As they are 520 today (was 536 yesterday), that seems to have been a good move; altho' this share price is unstable.

I have built-up a small holding in the Herald Investment Trust (£HRI) in response to selling my shareholding in £AZEM. This is another long-term holding which is currently treading water.

My other 3 shares have all done exceptionally well.
Aberforth Smaller Companies Trust (£ASL) which was my first share purchase for the SIPP (oh, how I wish I'd made a larger investment now) is at 1095 which considering I bought at an average of 620 is a phenomenal return over the past 16 months; 76%. If I'd put my whole SIPP fund into only this share at the outset, my £51,684 would have grown to almost £91,000 by today!  Smaller companies are where the major recovery in values will come from in 2014.

JPMorgan Mid Cap Investment Trust (£JMF) has also made a significant improvement in value. I started buying shares in this investment trust in July 2013 at about 668 and today the share price is at 780; which is an increase in value of nearly 17%.

Finally, the jewel in the crown is Optimal Payments (£OPAY). My initial purchase in this company was way back in March 2013 at an average of 168. I added a further 1970 shares at 191 thru' the summer of 2013. and another 1000 at 302 in October after a set of brilliant results. Currently at 351, I can see this share continuing to grow in stature as it exploits internet finance and builds a plateform for the coming "cashless" society. With a market capitalisation of only £530 million this company looks ripe for a takeover bid from one of the big banks.

With the SIPP now valued at £70,000 my pension fund target for 31st December 2014 is £86,000.