SIPP value as at 1st December 2021

 One month on from the birthday blog and it has been a period of consolidation.

Unfortunately, a new variant of Covid has developed and that has put a dampener on the markets, taking a bit of the froth of the recent growth away.  Fingers crossed, we don't go into another spiral of falling values that hit the markets in Feb-March of 2020; but maybe the markets are more resilient now?

It's not a time to be doing anything drastic (just yet), and I'm on the lookout for where the next direction is coming from - so you may see a few share purchases in the next few months as I endeavour to reposition the SIPP portfolio for more growth.

The Birthday Blog - 62yo on Monday 8th November

 It is that time of year again: the Birthday Blog!

The plan is to "retire" on my 66th birthday on 8th November 2025, as that's when I can draw on my UK Old-Age Pension. About 5-years ago, my plan was to carry on working for as long as possible; but - probably due to Covid - I've decided that I'm going to give-up full-time work at the earliest opportunity and enjoy living rather than working.  I've still the same blog photo: taken at the time of my 50th birthday - maybe this is the time to change it.

This time last year, the SIPP value was at £243,147 - the SIPP had made a terrific recovery from the depths of despair surrounding the impact of Covid, and I was confident about the coming 12 months.  As per the table below, the value of the SIPP at close-of-business on Friday 5th November was £307,654 - and increase of £64,507.

As £12,000 of that increase was my own monthly contributions, that indicates a growth of £52,507 or 21.59% - an absolutely brilliant result even if I say say myself.  

I've smashed my target value of £291,000 for the year, and I'm 2-months ahead of my year-end target of £300,000.  You may notice that I have reduced the number of holdings from 13 down to 10, and in doing so I've increased the value of my "plays". 

The above graph doesn't show the value of the SIPP but only the value of the investment holdings not including cash.  The reason for the recent uplift is that after a period of holding +10% of cash, I'm now fully invested.  

Having broken the target for the year, I will recalculate the target for 8th Nov 2022, and (based on the final value achieved for 2021 on 31st December) will recalculate for the year ending 31st December 2022.

SIPP Value as at 1st Octber

Not the greatest month for the SIPP, as the value has gone down from £303,518 to £287,581 which is a drop of 5.25%.  

From the top, the changes are:-

Share                Prev Value            Current Value         Change £             Change %

BRSC                 £31,854                £30,362                    £1,492                (4.68%)

DPLM                £14,699                £13,804                    £895                   (6.08%)

GBG                  £24,146                £23,012                    £1,134                 (4.70%)

HGT                  £33,227                £31,919                    £1,308                 (3.93%)

IEFM                £29,728                £28,245                    £1,483                  (4.99%)

KWS                £41,486                £38,324                    £3,162                      (7.62%)

SDP                    £21,567                £20,803                    £764                    (3.52%)

SDV                    £29,658                £29,652**                £6                        0.00%

SGRO                £32,599                   £30,383                £2,216                    (6.80%)            

VUSA                £30,142                £29,166                    £976                        (3.24%)

SIPP Value as at 28th August 2021

 What a month!

Even though I've not added this months bi-monthly contribution to the portfolio (pay-in £1000 a month in installments of £2000 every-other month) the portfolio has cracked through £300,000 in value.

Progress has continued unabated, with BlackRock Smaller Companies (BRSC) is up nearly 6% in the month; and Keywords Services (KWS) also up over 5%. Reducing my holding in VUSA and moving the money into Redde (REDD) was possibly done a bit too early, as VUSA is up 3.60% in the month.

Schroders Asia (SDP) has pulled back from a recent low but is still in a negative position.  The discount has been widening recently, but this investment trust is usually a good long-term play, and I will be exploring ways to increase the holding to 10% of the SIPP portfolio.

The month was a milestone for me outside the SIPP too, as my general investment portfolio of SIPP, ISA and general investments topped £500k, which - considering in April 2010 I had only a little over £300 to my name after 9 months of unemployment - I think is a tremendous achievement.

The current (as at 3rd September) 50-day moving averages are:

BRSC =  2050p

DPLM = 2995p

GBG = 865p

HGT = 385p

IEFM = 802p

KWS = 2800p

REDD = 422p

SDP = 600p

SGRO = 1210p

VUSA - 6150p

SIPP value as at 31st July 2021 - annual target hit 3 months early!

 What a month for the SIPP - it has already hit the value target for the year of £290,000 and that's 3 months early and with another £4,000 of monthly contributions yet to be paid in!  Remember, the value of the SIPP on 1st November (9 months ago) was £243,127 and my contributions since then have been £8,000 - so essentially £39,000 of capital growth in 9mths on £243,000; that's about 20% pa.

The target I set was based on maintaining the growth rate since I started managing the SIPP myself of 12.90%pa.  If I can hold onto and/or build on these gains between now and 1st November then I will have increased the overall growth-rate.

Performance has been tremendous: gains from GBG; HGT; IEFM; SGRO, VUSA; and a massive gain from KWS (this has to be a FTSE100 company within 3 years). 

The only loser in the period was SDP: Schroders Asia Pacific (IT) Fund which has been affected by the recent decisions of the Chinese government (pretty much out of the blue) to be "critical" of the major China-based internet companies. Also, the discount on this investment trust has grown to about 10%. In the hope of a reverse of fortunes on this holding, I have sold £7,000 of IEFM and moved the proceeds into SDP - it may be a good move, or it might not, time will tell.

Diploma (DPLM) has gone sideways for the past 3-months, after improving nearly 200% from 1st Jan 2018; and I'm thinking this is the time to take my profits and move into something else with more positive momentum.  Overall, I am a momentum investor: that's the one investment principle that has shown consistent positive results - what goes up, keeps going up (and what goes down, keeps going down).  So, I'm looking at companies whose SP's have improved over 10% in the past 3 months and have a market value of between £1bn - 3bn.

GB Group (GBG) is also going sideways - slightly - but I'm confident that the SP of this company will break through 1000 this year: and I expect this will come with a takeover bid from an American company - and that could mean a price of over 1500 could be seen in the next 12 months.

SIPP on 6th July 2021

 

The SIPP is looking good as we enter the 2nd-half of 2021.

Smaller Companies (BRSC) has overperformed and is now 10.70% of the portfolio value: this is a "benchmark" holding at 10% of the portfolio.

HGT which is my "private equity" investment trust is also over performing, and is 10.80%. 

There's a couple of holdings which are under-performing: SDP (Asia/Pacific) isn't doing well, and I'm not sure if this is a buying opportunity or time to cut & run and move the funds into something else.

Chelverton UK Equity Growth is just under 10% (I'm using another quoted Chelverton fund SDV to identify the holding above), but I'm not unduly worried about this holding.  I'm more worried with my European Momentum ETF (IEFM) which appears to be going sideways.

The IT holdings GBG and KWS are well down on their 12-month highs but both have serious upside potential - so no worries there for me.

Segro (SGRO) goes from strength-to-strength and is one of the best share purchases that I've made in 10 years of managing my own pension - just wish I'd found this company earlier and had the conviction to invest more of my SIPP.

The S&P500 investment trust managed by Vanguard (VUSA) is up 9% which is tremendous considering a 3rd of my holding was purchased in mid-April just 3-months ago.

So, all looking good and I will probably just undertake a small amount of rebalancing. 

SIPP at COP 16th April 2021

 No posts for a few weeks, been very busy.

The SIPP is looking tremendous.  The value is at a record high and I think there's a long way to go this year. My target for the year-end is £300,000 and at one stage this year (early March) I was getting a bit worried that I was likely to fall well short of that target - but my, what a rally in recent weeks!

Since my "birthday blog" on 8th November 2020 (long-term plan is to "retire" on the day before my 67th birthday in 2026) the SIPP has gained £29,500 of which £6,000 is contributions; so that's £23,500 gain, equivalent to just under 10% - if this keeps up the £300,000 for 31st December could be hit a bit earlier.

My "bellweather" holding of Blackrock Smaller Companies IT (BRSC) which should always be about 10% of my entire SIPP portfolio value is just ahead: having gained £5,154 in the same period, or 22%. Personally, I think there is a fair bit of headroom still to fill as smaller companies have huge potential to unlock in the immediate post-Covid period. If the holding reaches 12% of portfolio value then I shall re-balance. 

The major factor of the portfolio in the past 6 months has been the reduction in the individual company holdings and transfer of the value into Investment Trusts and ETF's. There's a couple of reasons for this. 1) Plain SIPP management: I'm happy to accept that I do not have the expertise to beat professional financial managers.  Occasionally, I strike lucky and play against the market; but finding situations that my "gut" tells me is an opportunity is time-consuming. 2) I want to be in the market, and diversified, but to mitigate the risk of violent fluctuations in value. 

So, in respect of reason (1) above, I sold holdings in:- 

Dunelm (DNLM): wrong move as sold at 1200p and the SP is now 1440p (up 20%)

Dechra Pharma (DPH): sold at 3200p and the SP is now 3850p (up 25%) 

Hikma Pharma (HIK): sold at 2340p and the SP is now 2365p (n/c)

Homeserve (HSV): sold at 1164p and the SP is now 1184p (n/c)

Spirent Communications (SPT): sold at 263p and the SP is now 243p (down 9%)

That's 3 out of 5 good calls, but the couple I called wrong would not have compensated for the 3 that I called right - so, overall, I made the right calls.

In respect of reason (2) above:-

I sold my holding in (US) S&P500 Info Technology ETF (IITU) at 1178p as I thought my holdings in technology were too great for my portfolio, and the SIPP was vulnerable to a negative market sentiment. That ETF is now at 1300p (up 10%).

New additions include:-

iShares - MSCI Europe Momentum Factors UCITS ETF (IEFM): it's a bit of a mouthful, but a ETF specializing in "momentum" shares of European companies.

iShares - CORE FTSE 100 UCITS ETF (ISF): and ETF specializing in the FTSE100.

Schroder Asia Pacific IT (SDP): I have been in & out of this share, and now I'm back in.

Vanguard - S&P 500 UCITS ETF (VUSA): this is a more general S&P500 ETF that the S&P500 Info Technology ETF that I sold out of (see above).

The "cash" element is not in cash: it is invested in Chelverton UK Equity Growth (Class B - Accumulation) Fund; but the London South East (www.LSE.co.uk) website does not track funds.

I like to keep an eye on the moving averages, and if the SP of any holding drops below the 50-day MA then I make a note to keep an eye on it, and be prepared to sell if required.

The current 50-day MA's (as of 16th April) of the holdings are:

BRSC - 1785p

DPLM - 2525p

GBG - 850p

HGT - 330p

IEFM - 730p

ISF - sold since at 685p (50-day MA @ 665p) 

KWS - 2600p

SDP - 640p under scrutiny

SGRO - 940p

VUSA - 5400p

WWH - 3725p

SIPP at 15th February 2021

 It has been a little over 6-weeks since the SIPP was last reviewed, and a fair amount has changed.

I've SOLD Hikma Pharmaceuticals (HIK), mainly as the SP seemed to be going nowhere.  In fact, I ended-up selling at a loss, which was not good.  I also reduced my holding in WWH.

I've moved the proceeds into:

 BRSC; SDP; VUSA; and IEFM

31st December 2020

 

Annual growth rate is 8.59% 

Cumulative growth rate since August 2012 is 12.905%

It was a tricky year for the SIPP and I'm glad that I came out of it ahead, especially when the FTSE100 is down over 14% in the past 12 months (from 7542 to 6460), and the All-Share index is down over 12.40% (4196 to 3674).

The Target for 31st December 2021 is £300,000 (£299,803 to be exact) and that's based on maintaining growth at 12.905% for the next 12 months. 

The graph below (screenshot from LSE where I manage my portfolio) shows the volatility of the SIPP over the last year. You won't believe this, but after reading about Covid (then called Corona) in The Guardian on 16th January 2020, I told a close friend that Armageddon was coming! Over the next few weeks I sold-off 40% of my portfolio into cash (see value hit £125k on 1st March).

My close friend then convinced me that holding cash was the wrong thing to do, and he persuaded me to buy back in to the market (see value up to £180k in early March).

I then watched my SIPP value fall like a stone.

Thankfully, I didn't continue to listen to my friend and (in the period late-March to early-April) I restructured my Portfolio and took a decision to focus on internet-based companies as I anticipated those recovering quicker than traditional "bricks & mortar" companies.  Thankfully, I was right.

The lesson in this?

Keep your own company!

If you make a financial decision, don't bother telling anyone for confirmation - if they have missed the opportunity, they will only try and tell you to reverse it to level-up the playing field.  

People do not like to feel as if they have missed-out.

I made the same mistake with Bitcoin in 2016.

I bought £20,000 at US$2,500 and was convinced to sell when the BTC price was around US$3,800 as Bitcoin was a "fad".

If I'd followed my own instinct back in March, I'd probably have a SIPP of more than £300,000 now.

If I can maintain the current growth rate, and the contributions at £1,000 per month, then on my 67th birthday I can retire with a SIPP fund value of  £617,000.