SIPP PROGRESS

Current Value (As at 4th August 2017) = £148,846 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 23 months @ £750 = £28,050
Capital Growth = £148,846 less (£51,684.02 + £28,050) = £69,112+

Friday, 4 August 2017

PAYS recommends accepting offer


The current holdings (as of today 4th August) are:
1) BAE (BA.) : 1115 shares valued @ £ 6,562 (down £258 from £6,820)
2) BlackRock Smaller Co IT (BRSC) : 1181 shares valued @ £14,278 (UP £283 from £13,995)
3) G4S (GFS) : 2058 shares valued @ £6,783 (down £187 from £6,970)
4) GlaxoSmithKline (GSK) : 393 shares valued @ £5,985 (down £410 from £6,395)
5) GVC Holdings (GVC) : 1031 shares valued @ £8,113 (UP £168 from£7,945)
6) HG Capital Trust (HGT) : 220 shares valued @ £3,720 (UP £50 from £3,670)
7) ICG Enterprise Trust (ICGT) : 470 shares valued @ £3,492 (UP £59 from £3,433)
8) JPMorgan Emerging Markets (JMG): 625 shares valued @ £5,121 (down £9 from £5,130)
9) Lancashire Holdings (LRE) : 1209 shares valued @ £8,850 (UP £180 from £8,670)
10) Legal & General (LGEN): 2489 shares valued @ £6,767 (UP £187 from £6,580)
11) Pacific Assets (PAC) : 1931 shares valued @ £4,929 (UP £9 from £4,920)
12) Paysafe (PAYS) : 7000 shares valued @ £41,300 (UP 490 from £40,810)
13) Sage Group (SGE): 931 shares valued @ £6,335 (down £85 from £6,420)
14) Schroder Asia-Pacific (SDP) : 1252 shares valued @ £5,402 (UP £56 from £5,346)
15) Segro (SGRO) : 1607 shares valued @ £8,605 (UP £417 from £8,188)
16) Senior (SNR) : 1574 shares valued @ £4,112 (UP £325 from £3,787)


Shareholdings total = £140,359 (UP £1,280 from £139,079)
17) XBT Provider (BIT-XBT): 798 units valued @ £8,487 (UP £329 from £8,158)
Cash @ £669
SIPP Value = £148,846 (UP £1,609 from £147,237)


In early July, I decided to sell-off my holding in Imperial Brands Group (IMB) at 3422-pence (recouping £5,842) and - in hindsight - that looks a good call.

I’ve invested the proceeds of that sale in crypto-currency Bitcoin (BTC) via XBT-Provider tracker fund (BIT-XBT).  I’ve accumulated 798 units in the fund at the equivalent of approx. US$2,455 per BTC. The value of BTC has remained between $2,700 - $2,800 this past week, and the expectation is that if the value can crack US$2,800 then there is likely to be a strong surge of pent-up support that will push the price to over US$4,000.

The news today is that the Paysafe board of directors have accepted (and recommended to shareholders) the US$3.70bn, 590-pence a share, offer from Blackstone and CVC Capital Partners. Now that we have a formal bid on the table if there is an alternative offer being prepared then we will see it soon. I was hoping that the 590-pence offer would be rejected by the board of directors, but I suppose the CEO Joel Leonoff wants to see a return for the efforts he has put in building this company up, and he holds nearly 10 million shares worth about £57 million – a nice “retirement” fund!

My problem – when the sale goes through – is that I will have to find somewhere to invest the proceeds. The Paysafe holding represents 27.50% of the total value of the SIPP and even if I rebalance with a minimum of 5% of value with each holding, then I’m still going to have a fair percentage in cash.

Friday, 21 July 2017

Super Friday


The current holdings (as of today 4th July) are:
1) BAE (BA.) : 1115 shares valued @ £6,820
2) BlackRock Smaller Co IT (BRSC) : 1181 shares valued @ £13,995
3) G4S (GFS) : 2058 shares valued @ £6,970
4) GlaxoSmithKline (GSK) : 393 shares valued @ £6,395
5) GVC Holdings (GVC) : 1031 shares valued @ £7,945
6) HG Capital Trust (HGT) : 220 shares valued @ £3,670
7) ICG Enterprise Trust (ICGT) : 470 shares valued @ £3,433
10) JPMorgan Emerging Markets (JMG): 625 shares valued @ £5,130
11) Lancashire Holdings (LRE) : 1209 shares valued @ £8,670
12) Legal & General (LGEN): 2489 shares valued @ £6,580
13) Pacific Assets (PAC) : 1931 shares valued @ £4,920
14) Paysafe (PAYS) : 7000 shares valued @ £40,810
15) Sage Group (SGE): 931 shares valued @ £6,420
16) Schroder Asia-Pacific (SDP) : 1252 shares valued @ £5,346
17) Segro (SGRO) : 1607 shares valued @ £8,188
18) Senior (SNR) : 1574 shares valued @ £3,787

Shareholdings total = £139,079
19) XBT Provider (BIT-XBT) : 798 units valued @ £8,158
Cash @ £669
SIPP Value = £147,906

When I wrote my last blog on 4th July, it was with the news that Worldpay had received and offer (which was successful) and that Paysafe (PAYS) would fit the bill as a follow-up target.  Here we are, not 3 weeks later, and Paysafe is the subject of a US$3.70bn, 590-pence a share, offer from Blackstone and CVC Capital Partners.

I’m hoping that the 590-pence offer will be rejected by the board of directors as insufficient as, in my opinion, PAYS is worth a lot more than that. I’d be more comfortable with a bid that values PAYS at about US$8bn (which would be 800-pence a share). Apparently, Blackstone & CVC first approached PAYS in May but that initial offer was rejected – since then the PAYS board of directors has received 4 offers! This could be interesting.

In another major development since early July, I’ve decided to sell-off my holding in Imperial Brands Group (IMB) at 3422-pence, recouping £5,842.  Since investing £6,500 into the shares in March at an average of 3840-pence, the SP of this company has done nothing but go down.  There has been a flat-line of the SP through July, but the outlook is difficult to understand. There is a bid expected from Japan Tobacco International (JTI) – however, as the SP of that company has also been in retreat in 2017, any bid may be a long time coming.

I’ve taken the proceeds of that sale and bought the crypto-currency Bitcoin (BTC) via XBT-Provider tracker fund (BIT-XBT). This week, I’ve invested £7,540 into Bitcoin as that represents approximately 5% of the value of the SIPP. Approximately 200 units of BIT-XBT buys one Bitcoin, and I have accumulated 798 units. So, I’m in at a £1,890 per BTC (approx. US$2,455 per BTC).  The price of Bitcoin fluctuated a fair bit this week, from a low of US$1,863 to a high of US$2,940. As I write, the price is at US$2,740 and as more and more “legitimacy” is given to BTC (this week the London Stock Exchange started accepting BTC) in my opinion those negative fluctuations will reduce, and a long-term positive outlook will dominate.  It would not surprise me to see BTC trading at over US$4,000 before the end of 2017.

Tuesday, 4 July 2017

Worldpay bid, and the onset of Crypto-coin

A change in direction this week on the SIPP, and it could lead to a significant future investment strategy. First though, early today there was strong speculation (later confirmed) of a bid for the Worldpay Group by the US-based payment processing and technology provider Vantiv Inc and JPMorgan Chase Bank. The SP is up over 20% this morning from Monday’s close of 320 to 390 as I write this (noon on Tuesday 4th July). That a major bank is starting to take the internet payment processing system seriously enough to put together a bid for Worldpay is extremely significant. To me it signals that banks (some of them at least) are beginning to come to the conclusion that the internet (combined with other technology such as smart-phones and pads) is bringing an end to the banking industry as we know it.   

For my SIPP, there has been some strengthening of the SP of PAYS (up 9 to 515) and I can see that should the Worldpay bid prove successful, and Worldpay is swallowed-up and removed from the FTSE100, then we could see other banks looking to find their own similar target.  PAYS would fit that bill well and, at only 35% of the Market Value of Worldpay, would be a very cheap option. Not that I’d expect a bid at 515-520 for PAYS to be successful, we can look forward to a significant premium on that SP should a bid occur.

I've long been of the opinion that banks as we know them are coming to the end of their shelf-life and a new form of finance-house will take their place. It will mean "adapt or die" for the major banks, and it looks like JPMorgan Chase is the first bank to take that step to protecting and preserving their future.  Hopefully, my strong position in PAYS which forms 25% of my SIPP value will see that opinion bear fruit.  However, I have been growing in awareness over the past 12-months of another financial development that is undermining the foundations of the banking industry - crytocoin.

The major "player" of crypto coins is Bitcoin which currently have a total market value of US$43bn which is approximately 40% of the total value of cryto coins in circulation.  Yes, cryto coins have a total market value in-excess of US$100bn (see coinmarketcap).
There was recently an article on the Crypto Coin phenomena published in the Investors Chronicle and I expect we will see more written about crypto coin in the next 6 months as the banking industry starts to get it's head around just what the future does (or rather, doesn't) hold for their businesses. The big advantage of something like Bitcoin is that international financial transactions using bitcoin "side-step" the need to pay commission and fees to the banks - and banks make considerable profits from the movement of currencies in business around the World. That profit is in serious danger of being lost to the banks, unless the banks do something about it - and that (in my opinion) can only be by taking a serious interest in the cryto coin market.
With much of my funds tied-up in the SIPP, in order to take advantage of cryto coin I've bought some units in the XBT-Provider tracker fund (BIT-XBT) which trades in "notes" which tracks the movement in the Bitcoin currency. My intention is to build-up a position equivalent to 5% of the value of the SIPP over the next 6 months, and my initial purchase is £1,250 worth of units.      
The current holdings (as of today 4th July) are:
1) BAE (BA.) : 1115 shares @ 654
2) BlackRock Smaller Co IT (BRSC) : 1170 shares @ 1175
3) G4S (GFS) : 2058 shares @ 341
4) GlaxoSmithKline (GSK) : 393 shares @ 1710
5) GVC Holdings (GVC) : 1031 shares @ 775
6) HG Capital Trust (HGT) : 220 shares @ 1680
7) ICG Enterprise Trust (ICGT) : 470 shares @ 743
8) Imperial Brands (IMB) : 170 shares @ 3454
9) JPMorgan Emerging Markets (JMG): 625 shares @ 791
10) Lancashire Holdings (LRE) : 1209 shares @ 705
11) Legal & General (LGEN): 2489 shares @ 262
12) Pacific Assets (PAC) : 1912 shares @ 246
13) Paysafe (PAYS) : 7000 shares @ 515
14) Sage Group (SGE): 931 shares @ 678
15) Schroder Asia-Pacific (SDP) : 1252 shares @ 409
16) Segro (SGRO) : 1607 shares @ 487
17) Senior (SNR) : 1574 shares @ 235
18) XBT Provider (BIT-XBT) : 129 units @ 986.82

Cash @ £531

SIPP Value = £140,140

Thursday, 22 June 2017

Some changes to the SIPP Portfolio

There have been a few changes this week. I decided to take advantage of the share price of Paysafe (PAYS) breaking through 500, and sold-off 1000 shares @ 518 resulting in £5,170 available for new purchases.
I have recently become aware that Private Enterprise IT's have been doing well and, together with the fact that some 50% of the corporate wealth of the UK is tied-up in private equity - that is companies that are NOT quoted on the Stock Markets - that has made me look to diversify into Private Equity funds. The 2 that I've chosen are:-
HG Capital Trust (HGT) and I've bought 220 shares @ 1604
ICG Enterprise Trust (ICGT) and I've bought 470 shares @ 748

The current holdings (as of today 22nd June) are:
1) BAE (BA.) : 1115 shares @ 660
2) BlackRock Smaller Co IT (BRSC) : 1170 shares @ 1195
3) G4S (GFS) : 2058 shares @ 333
4) GlaxoSmithKline (GSK) : 393 shares @ 1714
5) GVC Holdings (GVC) : 1031 shares @ 786
6) Imperial Brands (IMB) : 170 shares @ 3579
7) JPMorgan Emerging Markets (JMG): 625 shares @ 806
8) Lancashire Holdings (LRE) : 1209 shares @ 709
9) Legal & General (LGEN): 2489 shares @ 256
10) Pacific Assets (PAC) : 1912 shares @ 259
11) Paysafe (PAYS) : 7000 shares @ 516
12) Sage Group (SGE): 931 shares @ 712
13) Schroder Asia-Pacific (SDP) : 1252 shares @ 419
14) Segro (SGRO) : 1607 shares @ 493
15) Senior (SNR) : 1574 shares @ 237
16) HG Capital Trust (HGT) : 220 @ 1625
17) ICG Enterprise Trust (ICGT) : 470 @ 747

Cash @ £1,683

SIPP Value = £142,500


Considering the SIPP value on 1st November 2016 was £112,631.16 and since then I have only made a further 8 contributions @ £750 totalling £6,000 the SIPP has made startling progress. My target for the end of the year is £153,000 and (with luck) that should be met - and the SIPP could top £150,000 by my 58th birthday on 8th November.

Wednesday, 14 June 2017

Dividend reinvestments on 14th of June 2017

Dividend reinvestments on 14th June were:-
BA. - 20 shares at a cost of £134.38
LGEN - 93 shares at a cost of £246.18
GFS - 35 shares at a cost of £116.84
SNR - 14 shares at a cost of £34.41
GVC - 14 shares at a cost of £110.05
SGE - 6 shares at a cost of £42.24
Total dividends reinvested = £684.10

Here are my top 5 investment ideas for you to consider.
1) Start your portfolio early
The earlier you start investing, the more time you have to compound your gains into a substantial sum. If you start investing early, the more likely it is you will accumulate a large share portfolio. Also, when you start investing early (say in your mid to late 20's) as you will initially be investing relatively small values, any major mistakes will be limited in value. This time you spend investing (before you start earning at your peak) will be educational and invaluable for when your pension fund is at it's largest.

2) Save continuously to invest
Be careful with your expenditure. Try not to be profligate, and spend large amounts only on useful items. That way you can save the money not spent and invest it in your portfolio.
What I do is empty my bank account into my savings account on the day before I collect my salary cheque, and live on my monthly salary. That means (home made) sandwiches and re-heated leftovers for lunch; making my own ground-coffee at work rather than paying £2.50 per cup from the nearest coffee-shop; buying good quality and practical clothing (especially for the winter months). Consider finding a "look" for yourself, and building a smaller wardrobe around it.

3) Choose the investment method suitable for you - and stick with it
There are inumerable investment books on the market, but the one factor that keeps being repeated is finding great companies and holding-on to them - for years if necessary.
Great companies start small, so don't be afraid of investing in a small company if it is a strong business. Great companies also maintain their position by being well-run and profitable over long periods, so don't be afraid of investing in a great company even if it has been the market leader for 30 years - it may continue to be the market leader for another 30 years!

4) Put your money where your mouth is
When you find an investment opportunity that looks too good to be true, then back your judgement.
I try and keep my portfolio below 15 shareholdings as, when you own more than this, management becomes increasingly difficult. As such, I don't think you should have less than 5% of your portfolio value in a shareholding - and you should be prepared to invest over 20% of the value of your portfolio in a single shareholding.
Put your money where your mouth is - be bold.

5) Use every investment opportunity available
I own the house I live in - and I also own a property that I rent out.
I have a SIPP (Self Invested Pension Plan) - and I also invest the maximum annual allowance into an ISA.  Having a "rainy-day fund" is a good idea, but keep it realistic at no more than a maximum of a months earnings. If you want to own an expensive watch, buy a "vintage" watch at an auction. It will cost a fraction of the new price and, if you need to sell, you know that you will get back what you have paid

Monday, 12 June 2017

Post-election thoughts on the SIPP

 The current holdings are:
1) BAE (BA.) : 1095 shares @ 665
2) BlackRock Smaller Co IT (BRSC) : 1170 shares @ 1100 (was 1248.00)
3) G4S (GFS) : 2023 shares @ 331.00
4) GlaxoSmithKline (GSK) : 393 shares @ 1690.00
5) GVC Holdings (GVC) : 1017 shares @ 770.50 (was 812.00)
6) Imperial Brands (IMB) : 170 shares @ 3595.50 (was 3680.50)
7) JPMorgan Emerging Markets (JMG): 625 shares @ 800.00
8) Lancashire Holdings (LRE) : 1209 shares @ 690.00 
9) Legal & General (LGEN): 2396 shares @ 257.00
10) Pacific Assets (PAC) : 1912 shares @ 258.50
11) Paysafe (PAYS) : 8000 shares @ 498.50
12) Sage Group (SGE): 925 shares @ 680.00 (was 713.50)
13) Schroder Asia-Pacific (SDP) : 1252 shares @ 414.00
14) Segro (SGRO) : 1607 shares @ 498.00
15) Senior (SNR) : 1560 shares @ 236.60
Cash @ £4,148
SIPP Value = £139,750


Overall, the SIPP has performed well following the General Election result, but there have been a few valuation reductions; notably with the UK Smaller Company IT (BRSC).  The only other significant correct is that of GVC which is down to 770.50 from 812.00 (which is about 5%). Through the election week, it became apparent to me that the market was looking fairly resilient and that was the case come Friday morning when the result was known.
Overall, the SIPP has still gained over £4,000 in value (there was a £750 contribution last week), which is another 3% and that cannot be sniffed at.


I have to give myself a bit of a pat on the back as when the election was called back in April, my post on 18th April did suggest that the decision by Theresa May to hold an election was audacious and would be either declared brave or stupid depending on the result. My prediction then was it would be a Labour-led coalition government - so I was correct in predicting a "hung" parliament, and missed-out on being absolutely spot-on with my prediction by just a few seats.  If Labour had won just another 2 seats from the Conservatives then the current "alliance" between Conservatives and the Ulster DUP would not have been enough to guarantee a government.  I actually had a wager on the number of seats Labour would win, and took the 7/1 available on Labour winning between 250-299 seats - odds which I considered extremely generous given the indications of the polls which was backing-up my own opinion.


I will be looking to maintain current holdings in the SIPP for the time being, unless I come across something that looks to good an opportunity to miss.  The markets were up on Friday, but are down today, and we could see this uncertainty until we know whether Theresa May will remain the Prime Minister (a leadership bid is anticipated), or we are heading back to the polls for another election in the autumn.


The problem for both the major parties is, if we do head back to the polls, whether there will be a clear winner.  No doubt, the Conservatives will put up a much better fight next time round and will be more "optimistic" rather than sniping and name-calling which certainly did not help their cause this time. As for Labour, they have to not just maintain the momentum but carry it on.  There was talk over the weekend that another couple of weeks of campaigning would have won them a clear victory - but that was against a poorly led Conservative party.  What I think is the only clear point is that the centre parties (Lib-Dems and Greens) and the more nationalistic extremists (UKIP and to some extent SNP) are dead in the water for the time-being.  If SNP are losing seats to the Conservatives in Scotland, then the Scottish vote is there for taking by Labour - but they may not have time to mobilise an adequate campaign if there is an election this autumn.  The more I think about it, the more I think that Labour have had their chance in 2017 and if we return to the polls - so long as the Conservatives don't do anything silly in the next few months - it is unlikely that Labour will be able to secure the gains they need to form a government.  Remember, they would need a significant swing in the vote to obtain a controlling majority, and so the likelihood is that they would only be able to form a coalition government with the SNP and Plaid Cymru.  Whether that would appeal to the voting public is debateable, so the probability is that the result of a autumn election would be a slight increase in Conservative seats.


Given that outlook, the prospects for the stockmarkets is probably fair as, with Conservatives in power, the Brexit negotiations are more likely to be more hard-line that conciliatory, and that will ensure a weaker £ which will hold shares at their current inflated values in the short-term.  Long-term growth for the UK though, is not good.       

Saturday, 27 May 2017

SIPP grows 6% in a month - tremendous!

Since my last post on 28th April when the SIPP was valued at £130,800 (including cash of £1,937) the performance - along with that of the FTSE100 - has been tremendous. At close-of play on Friday 26th May, the SIPP value was £139,471 (including cash of £2,861); that's 6.6% growth in a month. Okay, that increase of £8,671 includes my monthly contribution of £750 but, even so, £7,921 is still 6% growth.

The current holdings are:
1) BAE (BA.) : 1095 shares - up 4.39% to close at 665.50 
2) BlackRock Smaller Co IT (BRSC) : 1170 shares - up 9.16% to close at 1248.00
3) G4S (GFS) : 2023 shares - up 6.84% to close at 328.00
4) GlaxoSmithKline (GSK) : 393 shares - up 4.95% to close at 1643.50
5) GVC Holdings (GVC) : 1017 shares - up 8.70% to close at 812.00
6) Imperial Brands (IMB) : 170 shares - DOWN 4.35% to close at 3680.50
7) JPMorgan Emerging Markets (JMG): 625 shares - up 4.72% to close at 797.00
8) Lancashire Holdings (LRE) : 1209 shares - NO CHANGE at 689.00
9) Legal & General (LGEN): 2396 shares - DOWN 4.14% to close at 250.20
10) Pacific Assets (PAC) : 1912 shares - up 3.59% to close at 259.00
11) Paysafe (PAYS) : 8000 shares - up 7.97% to close at 494.50
12) Sage Group (SGE): 925 shares - up 7.37% to close at 713.50
13) Schroder Asia-Pacific (SDP) : 1252 shares - up 6.30% to close at  383.50
14) Segro (SGRO) : 1607 shares - NO CHANGE at 490.70
15) Senior (SNR) : 1560 shares - up 9.70% to close at 237.40

Dividends have been reinvested resulting in increased holdings with GSK, LRE, and SGRO. 

Currently, I'm about 5 months behind my original SIPP projection made back in August 2012 - based on an annual growth of 20% - which targeted a fund value at my 65th birthday in November 2014 of £640,000. I have since downgraded that projection to £500,000 (based on annual growth of 15%) but, right now, things are looking a lot better than they were.

I know this rate of growth cannot go on indefinitely, but I'm hopeful that SGRO will see more growth this year especially when promoted to the FTSE100 index (which is almost certain). The state of the World should see sustained, long-term growth for BA., SNR and GFS; the trio of SGE, PAYS, and GVC all look strong long-term growth plays too.  The only disappointment has been IMB as the demand for cigarettes seems to finally be on the wane. 

I was considering disposing and replacing a couple of holdings this time last month, and they were IMB and GSK, but I've held on to them both and will continue to hold for the time being.  I always thinks it is better to be in the market than out.