Adamski portfolio

[Adamski]

I thought I'd share my portfolio. Always interesting to see what others are investing in, and welcome feedback and pointers from experienced investors. May help new investors who are starting out. So looking under the hood...

Fidelity Index World (class P) - 26%
Vanguard Lifestrategy 60% - 24%
Capital Gearing Trust (CGT) - 16%
L&G Global 100 (class I) - 11%
BG China B (OEIC) - 8%
iShares PhysGold (SGLN) - 6%
Fundsmith Equity (class I) - 5%
Fidelity China (FCSS) - 2%
Aegon Diversified monthly - 1%
Cash - 1%

Portfolio YTD return (weighted average) - -1.3%
Benchmark YTD (VLS 80) - -2.1%
so doing quite well really bought gold after the bounceback and China funds recently, which is why not higher

Asset allocation - weighted average
Equities - 74%
Bonds - 17%
Gold - 7%
Cash 2%

Ongoing charges all quite low except BG China 0.78% and FS 0.95%. Weighted average charges OCF 0.2% + Custody charge 0.3%

Fidelity Index World - core holding. Happy with this one. Done well since I started investing in Oct 18.

VLS 60 - Was handy during the Feb/March CV crash. Smoothed things a lot.

CGT - helped reduced volatility. Standard deviation lowest at 4.37. Does very good job, so far.

L&G Global 100 / Fundsmith - overweight in US and Tech. Sold some UK holdings in April as losses and these two did the heavy lifting in Apr-Jun to return pf to profit (unless this month!).

BG China/FCSS - recent purchases. Bought after the recent China bull rull, but did well past few weeks, whilst everything else has dropped. FCSS long term holding, with China V shaped recovery, want to be overweight in China.

Gold - helpful to diversify. Bought a few months ago and built up to 15% at one point, sold some recently to buy China funds.

Aegon Diversified - monthly income to pay fees. Bad performance in CV crash, but happy with this.

Disappointed to be back in loss after chaos of a year. Feedback welcome.

[Adamski]

Just to add, investing doesn't really matter much this year, as such a tough time for everyone, when there are people losing their lives and the state we are in. But have learnt a couple of things in investing technique 1. Not to check prices too often. And 2. not to panic sell, but to be patient. Cheers, Adam

[TUK020]

Just to add, investing doesn't really matter much this year, as such a tough time for everyone, when there are people losing their lives and the state we are in. But have learnt a couple of things in investing technique 1. Not to check prices too often. And 2. not to panic sell, but to be patient. Cheers, Adam

Now those lessons are worth a lot!
Especially as it looks like we might be heading into round 2.

[Adamski]

those lessons are worth a lot!
Especially as it looks like we might be heading into round 2.

Thanks, TUK. Markets took another hit yesterday, unsurprisingly. Has the same feel as last time, but stocks been dropping consistently over 3 weeks instead of a sudden correction. Think we'll have extra restrictions rather than a full lockdown again.

My latest way of looking at things which I find helpful when markets are dropping is not to think in terms of absolute prices but how you are doing relative to your benchmark.

[shetland]

A lot depends upon your investing horizon. Are you investing for the future or do these invests provide income you are living off.

I would be inclined to ditch the CGT holding. Compare its performance to Fidelity World Index or even Monks Investment Trust to see how much this holding has cost you in lost growth.

I like your investments in China, I have just purchased BG China Growth and intend adding to that and purchasing another AP trust / fund with a high weighting in China.

I also hold Fidelity World Index although a small portfolio weighting than you.

I wouldn't bother with the Lifestyle 60 but I do not need my investments for income

[shetland]

Deleted

[Dod101]

Deleted

???

Dod

[Adamski]

A lot depends upon your investing horizon. Are you investing for the future or do these invests provide income you are living off.

Thanks for your comments, food for thought. I'm investing in China trying to rebalance my pf there as think that will be the next high growth. I'm investing for retirement, specifically for a house move to by the coast, not sure when but estimate 5 years.

[Adamski]

Interesting what a couple of weeks of good news can do. Post US election and post vaccine announcement.

Year to date return from loss to profit, now..

Portfolio YTD weighted average = +4.8%
Benchmark VLS80 = +4.8%

That is better than I though where we'd be in the midst of a second lockdown, but markets are forward looking. Wouldnt be surprised if falls back a bit. Seems to be some recent rotation from tech to value, UK market also did well last couple of weeks, may continue next year? We shall see.

Does provide food for thought. I may be just as well off selling all and just holding VLS80. Although I did have to make up for losses taken in March. A one fund pf would require less thought, and less churning, but wouldn't be as much fun. Guess many here in this position, portfolio just broadly tracks an index.

I've been investing for just over two years and surprising difficult to beat a benchmark. You either need to get lucky or take on a lot of risk, or both.

[Itsallaguess]

Portfolio YTD weighted average = +4.8%
Benchmark VLS80 = +4.8%

That is better than I though where we'd be in the midst of a second lockdown, but markets are forward looking. Wouldnt be surprised if falls back a bit. Seems to be some recent rotation from tech to value, UK market also did well last couple of weeks, may continue next year? We shall see.

Does provide food for thought. I may be just as well off selling all and just holding VLS80. Although I did have to make up for losses taken in March. A one fund pf would require less thought, and less churning, but wouldn't be as much fun. Guess many here in this position, portfolio just broadly tracks an index.

I started to drip a modest but fairly persistent part of my fresh investment capital into Vanguard Life Strategy 80% a few years ago, and whilst I'm happy to continue with my income-strategy for the bulk of my investments, it is interesting how my view of that particular VLS80 section has developed, and in a much more positive way than I'd imagine it would have done by simply looking at external 'performance-chart' comparisons on their own...

As you suggest - when something like that is a baked-in part of our overall portfolios, it's much more difficult to ignore....

As an income-investor primarily, and one who's largely moved away from the vanilla 'HYP' process, and into income-related Investment Trusts as my primary income-producing method going forward, I've been very happy to 'diversify away' the granular 'company-level' decisions to the IT-managers I look to use within their varied sector and geographical areas that I want to be involved with, but I do think that including a separate section of my overall portfolio for something like the VLS80 makes some sense too, in terms of adding an additional layer of diversity, well away from my more income-oriented section...

Cheers,

Itsallaguess

[Adamski]

My pf underperformed verses my benchmark, vls80, in month of november. In particular BG China, fidelity china, fundsmith and cgt. Capital Gearing I expect as primarily for capital preservation and stability.

Disappointed with FS seems to be underperforming for a few months now. Value its defensive qualities. But if continues to underperform vs global funds will consider reducing holding in future.

China tech took a big dip in November due to Bejing clamping down on the Ant IPO and the country's tech regulator making steps to antitrust rules to curb power of big tech there. I sold some gold etf and increased BG China at precisely the wrong time. Not concerned however as long term hold and will switch to the IT version, once bgcg premium down to a reasonable level.

[Dod101]

My pf underperformed verses my benchmark, vls80, in month of november. In particular BG China, fidelity china, fundsmith and cgt. Capital Gearing I expect as primarily for capital preservation and stability.

Disappointed with FS seems to be underperforming for a few months now. Value its defensive qualities. But if continues to underperform vs global funds will consider reducing holding in future.

China tech took a big dip in November due to Bejing clamping down on the Ant IPO and the country's tech regulator making steps to antitrust rules to curb power of big tech there. I sold some gold etf and increased BG China at precisely the wrong time. Not concerned however as long term hold and will switch to the IT version, once bgcg premium down to a reasonable level.

What is FS, Fundsmith? I do not follow it but generally, you cannot expect any share or fund to go upwards in a straight line, nor have a few months where is does not do much. As much as anything else you are buying the investment style of S, Terry Smith. His Smithson is doing fine, and so probably is Fundsmith.

RE Baillie Gifford China IT, the premium is still very high at about 18% the last time I looked so you may have to wait a while. I bought it just as BG were taking over at £4.10 so in a few weeks it is looking good, but I am in it for the long term and simply do not mind what it does in the meantime (within reason anyway)

Dod

[Dod101]

RE Baillie Gifford China IT, the premium is still very high at about 18% the last time I looked so you may have to wait a while. I bought it just as BG were taking over at £4.10 so in a few weeks it is looking good, but I am in it for the long term and simply do not mind what it does in the meantime (within reason anyway)

Dod

There was an RNS on Thursday saying a resolution had passed at the company meeting to continue allowing issuing of shares, so presumably that will bring the premium down, although in what time frame I don’t know. Investment trusts are new to me so I don’t have any experience observing discount/premium manipulation. Like Adamski, I have a chunk ready for BGCG but I have mine sitting in VFEM rather than in the BG China Fund. VFEMs top holdings and BGCG/Trust top holdings intersect somewhat, at least for the time being.

Yes they have been issuing shares on a more or less daily basis since BG took over. These are shares in treasury which were bought back as a result of the tender offer to those shareholders in Perpetual Income who did not want to continue under the new mandate. So far it has not made a lot of dfference to the share premium but in time as you say, it should.

Dod

[Adamski]

@RVF, @Dod101, thanks for comments.

The performance of Fundsmith Equity does seem to have taken a dip the past two years relative to its category, Global Large-Cap Growth Equity.

It's % rank relative to category is:

2014 - 1
2015 - 1
2016 - 18
2017 - 3
2018 - 3
2019 - 41
2020 - 46

The short term issue I queried was a 3 month return of 1.92% versus category 5.11% and VLS80 5.63%. Which highlights recent underperformance which is ok short term, but I don't clearly understand why, and if course wouldn't want to pay ongoing costs of 0.95% when the returns are lower than a tracker fund.

[Dod101]

@RVF, @Dod101, thanks for comments.

The performance of Fundsmith Equity does seem to have taken a dip the past two years relative to its category, Global Large-Cap Growth Equity.

It's % rank relative to category is:

2014 - 1
2015 - 1
2016 - 18
2017 - 3
2018 - 3
2019 - 41
2020 - 46

The short term issue I queried was a 3 month return of 1.92% versus category 5.11% and VLS80 5.63%. Which highlights recent underperformance which is ok short term, but I don't clearly understand why, and if course wouldn't want to pay ongoing costs of 0.95% when the returns are lower than a tracker fund.

Thanks I did have a closer look at FS versus a few usual suspect alternative OEICs after your post yesterday afternoon. It's really this year that stands out as less than best in class. Further looking shows that amongst the alternative usual suspects that out performed FS, there is a notable exposure to Tesla and/or Amazon, both are not Smith style stocks at all. Usual suspect alternatives that didn't have that exposure are pretty similar to FS. So, I concluded (this is not in depth research by the way just my high level opinion) that present relative lagging versus peers is quite narrowly based and not necessarily a reason to divert funds elsewhere. I continue to watch and wait.

RVF

A thing to bear in mind with Fundsmith is the very high management cost. For that you need outstanding performance (over whatever period you care to choose) otherwise it will chip away at the returns.......well it does that anyway but we tend not to notice it if the underlying performance is much better than the average fund.

Dod

[Dod101]

[Dod, fair point and well noted. But honestly, I couldn't care less. The return I get is net of fees. If I think I can do better elsewhere then fine, FS will be history, fees or not. But frankly, cost of ownership is one of the least of my concerns.

RVF

I understand your point of view and I guess we all do the same for most of the time, but Fundsmith is at 0.95% and Scottish Mortgage say, is at 0.3% on the first £3 billion and 2.5% thereafter which on £10 billion means a fee of 0.265% if my arithmetic is correct. That is a huge difference. Terry may be good but not that good. Smithson, which I hold, is only a little less.

Dod

[Dod101]

I don't think it is very much off topic, with respect to Adamski. SMT is of course a very different vehicle to Fundsmith, but if they were very similar in their investing prowess, SMT would clearly come out tops, that is all I am saying. neither will be tops all of the time so I would prefer the one with the lower charges. Being LTBH by nature, I watch charges very carefully.

Dod

[Adamski]

2020 - a year to forget for the pandemic and for UK investors. December update - switched 4% out of Capital Gearing, into Monks 2% and BG Pacific 2%.

Portfolio weighted average return +8.0% vs benchmark 7.2% which happy with considering big losses I took on UK stocks, and recent China purchases up then down with antitrust investigation into Alibaba and Ant IPO halted. Total return 10.3% (profits 8% + 2.3% tax relief in SIPP). Doesn't quite feel right to be up over 10%, but I reason the global stock market is not the UK economy, particularly when your portfolio is very overweight in US and China tech.

Looking forward to my Mum & relatives getting the jab, and getting back to normal. Positive about 2021, and the markets this year (but wouldn't surprise me if rocky).. It's going to be good just doing normal things, when that eventually happens. Hope you have a happy and healthy new year all LemonFools.

[PinkDalek]

... Total return 10.3% (profits 8% + 2.3% tax relief in SIPP). ...

Well done but I'm surprised you include the tax relief as part of Total return.

[Adamski]

... Total return 10.3% (profits 8% + 2.3% tax relief in SIPP). ...

Well done but I'm surprised you include the tax relief as part of Total return.

It's because I plan, if rules don't change, just take out personal allowance plus tax free 25% from 55, so not pay tax on withdrawals. Although right could have left that out.