Small Share Portfolio - Advice please

[The Mad Monk]

I hold

AstraZeneca bought Sept 2012 value up by 63%, Dividend yield 4.61%
GlaxoSmithKline bought Sept 2012 up by 15%, Yield 4.81%
National Grid bought July 2011 up by 65%, yield 4.3%
United Utilities bought Jan 2010 up 85%, yield 3.89%

What should I do? Hold, or sell and buy - what?

These are not my only investments. I would appreciate any advice.

[bmwmike]

Similar position

My view is the div alone is better than you'd get in cash so leave them there provided they are tax efficient etc.

My only non div stocks are US and I keep those in case GBP falls further. I need to rebalance a bit as over 60% of my stocks are non GBP at present.

[bad company]

I hold all of those shares along with others.

Nothing wrong with that holding imo. All paying decent dividends and low risk so why sell?

[sidicks]

bad company said:

I hold all of those shares along with others.

Nothing wrong with that holding imo. All paying decent dividends and low risk so why sell?

That really depends on your definition of 'low risk' and your investment horizon is! Certainly a small portfolio of equities has significant drawdown risk and volatility. But if you are more concerned about income and are unlikely to need to realise any assets in the near future then it might be ok.

[mcbook]

You seem to be investing for income and that's something I've focused on in the past. It is a little boring though ;-)

I suggest you sell one of your current holdings and get into something more exciting. Maybe something in the health or tech sectors.

Looking at Woodford patient Capital Trust holdings (not everyone's favourite, I know), their top two holdings are Prothena and Purplebricks. Prothena is a NASDAQ listing so that leaves Purplebricks if you want to keep it simple.

I'll take half of your gains if it goes well and none of your losses if it goes badly. Good luck.

[The Mad Monk]

mcbook said:

You seem to be investing for income and that's something I've focused on in the past. It is a little boring though ;-)

I suggest you sell one of your current holdings and get into something more exciting. Maybe something in the health or tech sectors.

Looking at Woodford patient Capital Trust holdings (not everyone's favourite, I know), their top two holdings are Prothena and Purplebricks. Prothena is a NASDAQ listing so that leaves Purplebricks if you want to keep it simple.

I'll take half of your gains if it goes well and none of your losses if it goes badly. Good luck.

Hmmm.

Your kind offer is very generous - however -

http://citywire.co.uk/money/woodford-patient-capit...

[bad company]

sidicks said:

bad company said:

I hold all of those shares along with others.

Nothing wrong with that holding imo. All paying decent dividends and low risk so why sell?

That really depends on your definition of 'low risk' and your investment horizon is! Certainly a small portfolio of equities has significant drawdown risk and volatility. But if you are more concerned about income and are unlikely to need to realise any assets in the near future then it might be ok.

I don't think these shares are the op's retirement fund.

[mcbook]

The Mad Monk said:

Hmmm.

Your kind offer is very generous - however -

http://citywire.co.uk/money/woodford-patient-capit...

OK but I still think you should sell one of your current holdings and put the money somewhere exciting. How about Micro Focus? A FTSE 100 company with big presence in fast growing tech sectors such as cyber security and identity and access management.

Their share price has been on quite an upward trajectory recently but I wouldn't let that put me off.

Disclosure statement: I don't own it.

[The Mad Monk]

mcbook said:

OK but I still think you should sell one of your current holdings and put the money somewhere exciting. How about Micro Focus? A FTSE 100 company with big presence in fast growing tech sectors such as cyber security and identity and access management.

Their share price has been on quite an upward trajectory recently but I wouldn't let that put me off.

Disclosure statement: I don't own it.

I have had a quick look at Micro Focus. The yield is a bit low for me - 1.94%. Thanks for the thought.

I normally buy shares with a good yield. That seem to be British - even if they aren't actually.

I like to be able to understand what they do.

Having said that, I have some other shares which aren't going anywhere, perhaps I should sell some of them and be a little more adventurous.

[mcbook]

The Mad Monk said:

The yield is a bit low for me - 1.94%. Thanks for the thought.

I normally buy shares with a good yield.

Having said that, I have some other shares which aren't going anywhere, perhaps I should sell some of them and be a little more adventurous.

Micro Focus was just a bit of a random suggestion. What I was really saying was that you should move away from the yield-seeking approach and buy something for capital growth. Don't throw away your whole strategy but exchanging one of the stocks listed for something more exciting will create a bit of interest in your portfolio :-)

As a stock-picking methodology, think about the things you do every day, or your hobbies/interests. What do you see that is good, what do you enjoy? What companies are involved in that? Go buy their shares.

[bad company]

mcbook said:

As a stock-picking methodology, think about the things you do every day, or your hobbies/interests. What do you see that is good, what do you enjoy? What companies are involved in that? Go buy their shares.

That's an interesting investment strategy, not one I've come across before.

Having said that I did similar once and bought shares in Trafficmaster after they did a deal with BMW. Lost a fair few £'s on that.

[Jon39]

The Mad Monk said:

I hold

AstraZeneca bought Sept 2012 value up by 63%, Dividend yield 4.61%
GlaxoSmithKline bought Sept 2012 up by 15%, Yield 4.81%
National Grid bought July 2011 up by 65%, yield 4.3%
United Utilities bought Jan 2010 up 85%, yield 3.89%

What should I do? Hold, or sell and buy - what?

These are not my only investments. I would appreciate any advice.

As in your title, it may be a small now, but hopefully if you have time, holding good businesses and compounding should change that for you.
Do you measure each of your individual annual performances in comparison with say, the FTSE All-Share Index? That is a good way to see whether your portfolio is performing well.

I have those four within my own fund and have held them for many years. My system is based upon portfolio changes only occurring if I encounter a long period of overall underperformance. Much to my surprise, that has not happened yet. It is the fund total that is the key, not individual holdings. I am quite happy to continue holding the companies you have listed.

You have core holdings, international exposure to markets and currency, and a good yield, although the recent annual dividend increases have been static / modest.

I don't know whether your business stakes are just those four companies, but if so, I would want to gradually increase the number of holdings, to achieve a much wider spread of risk. I have always favoured mostly big defensive, non-cyclical businesses, such as those you hold and after almost 30 years, that basis has worked well for me. It has been during economic downturns, that this strategy tends to perform really well in relation to market. Those are just the occasions when confidence boosting is helpful, because that is when I like to buy, just when everyone else seems to be selling.

You may not like the industry, but the investors have been extremely well rewarded. Perhaps do some research on British American Tobacco.
Using your basis of figures;
From Jan 2010 up 167%, yield 3.3%.
What that div. yld. does not tell you, are the remarkable annual dividend income increases that have regularly been paid, for over 25 years.
During the 1980s one share was less that £2 (adjusted). Now £53. And some people work on the basis, of sell after a 20% increase !

Historical stuff I know, but it might continue. Nobody really knowsl

Edited by Jon39 on Sunday 16th April 11:13