BHB Investment Portfolio – DEC & YEAR END 2020
2020 FULL YEAR PERFORMANCE:
- PURCHASES: BABA
- SALES: None
- DIVIDENDS: TSCO, INTC, MSFT, WBA, PAF, SWKS, RDSB, BP
BEST PERFORMERS (+5%)
Aston Martin Lagonda Global Holding Plc: +36%
Greatland Gold Plc: +32%
NCC Group Plc: +24%
Anglo Pacific Group Plc: +22%
Hemogenyx Pharmaceuticals Plc: +21%
Walt Disney Co: +19%
Take-Two Interactive Software Inc: +13%
iShares Physical Silver: +10%
Rio Tinto Plc: +10%
Entain Plc (Previously GVC Holdings): +9%
Pan African Resources Plc: +9%
Boohoo Group Plc: +8%
Apple Inc: +6%
Banco Santander SA: +5%
WORST PERFORMERS (-5%)
Virgin Galactic Holdings Inc: -18%
Mirriad Advertising Plc: -14%
Alibaba Group Holdings Plc: -11%
Nokia Corp: -6%
LM Ericsson: -6%
Welcome to the BHB Investment Portfolio December and Year End Review. 2020 is finally over and it has certainly been an interesting one. There have been plenty of learning opportunities but also a lot of confident to be taken away.
I have read quite a few end of year performance reports already and there is a big spread of results. For the traders who have made short term trades there was a lot of money to be made this year if you got it right! But I have also read about some horror stories for some of the beginners who have tried to trade the markets without enough knowledge.
I am primarily a long term investor rather than a trader and it seems my portfolio has finished the year pretty strong at +17%. There are a lot of portfolios that have finished the year with negative returns or have only just recently broke even. From what I have read through the year it seems the people who have finished with negative returns panicked in March and April. This resulted in them selling shares at a loss out of fear to prevent even bigger losses. Most of these shares have eventually recovered through the year.
Fortunately I have held my nerve and actually bought some shares while the prices were low. This is something that has given me a lot of confidence this year. There are some decisions that I do regret but I will learn from these and I can still take some positives from them. Where some people were selling their shares at a loss to try and stop further damage, my mistake was taking profits too early.
There are several stocks in the Gold and Tech sectors that I had good profit in and so I decided to sell some of the my holdings. Greatland Gold, Apple, Skyworks and Mirriad Advertising where all significantly up around the half year point. I decided to sell a proportion of each of these to bank some profits in case the markets dropped significantly, with the hope to then buy back in again. In hindsight I should not have done this, as they did not drop and instead continued to rise further. Therefore I could have had much more returns from them than I currently do. Luckily I did not sell all of my shares in these companies and only sold a proportion of each. However, the decision to sell the shares was made for risk management purposes and for that reason I will not beat myself up to much. In the long run that mentality might prevent me from big loses in the future, I just need to improve on my timings.
Something I have improved on this year is my confidence to sell shares that I’m currently losing money on. I sold several shares this year not because I was panicking, but because I recognised it was the right time to cut my losses and put the money somewhere better. This is something I have struggled with in the past and have kept hold for too long hoping for a recovery that resulted in larger losses.
With regards to my dividends, December again increased vs 2019 by 70%. So that is an improvement every month vs last year which is great considering how many dividends got suspended. Overall my dividends were up 73% vs 2019, however I have invested more money this year in income stocks and specifically in UK income stocks. I am not expecting the same growth next year.
All in all I am very happy with 2020 from an investment point of view. My portfolio has had a good year with capital growth and income growth and I am a better investor as a result of my learnings. Lets see what 2021 brings as we continue the fight against the virus as well as the every changing political scenarios play out.
Alibaba Group Holdings Inc. (BABA)
Buy Price: £161.74 / $219
Fair Value Calculation: $297
Analysts Estimates: $346
Dividend Yield: N/A
Alibaba Group Holdings Inc. has been one of my favourite holdings of 2020 and one that have had a lot of confidence in for the long term.
It has been a tricky couple of months for Alibaba with the ANT IPO going from one of the biggest in history to being halted by the Chinese government. Then the Chinese government hit them with an anti-monopoly investigation causing more uncertainty for the company. This has sent the stock price falling 30% from 27th October to 28th December.
Now this news is not great and there is a lot of head wind for Alibaba right now. However, I am still confident that in the long run this company will continue to grow and the share price will follow. So I’m happy to take advantage of this recent drop and purchase more shares.
BHB PORTFOLIO RADAR
This month I have published my analysis for the first time. You can see this analysis of Activision Blizzard Inc in my post or video.
It is the first time I have written up my analysis and I recognise I need to improve how to present it. Please let me know your thoughts and feedback so I can present my analysis in a format that others can get benefit from.
I am now going through Apple’s 2020 results and realigning my fair value calculations. I will share this analysis once it is completed.