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Tuesday, 2 October 2018

September Result


Bloomberg Ticker Percentage
FLYBE FLYB 16%
Tripadvisor TRIP 13%
Rolls Royce RR/ 13%
Jefferies JEF 9%
FIAT FCAU 8%
Dignity DTY 7%
COTY COTY 6%
Card Factory CARD 5%
Bayer AG BAYER 5%
Imperial Brands IMB 5%
IG Group IGG 4%
Seritage SRG 3%
GBP Cash 6%
Quarterly Return Quarterly Benchmark Return
-4.93% 5.65%
Return Since Inception Benchmark Return since Inception
46.56% 122.74%
Annualised Return since Inception Annualised Benchmark Return since Inception
6.87% 14.94%
Quarterly Leveraged Return Annualised Leveraged Return
-3.95% 10.89%
Gross Leverage 39%
Leverage not Inc. shorts 18%

Wednesday, 26 September 2018

Hard Brexit Hedge: Short Dart Group PLC

New Short: Dart Group PLC

The Brexit process seems to have reached a crucial stage, with the deadline for an exit deal less than 6 months away and the threat of a hard Brexit.  Rather than politicians coming together in a mature and co operative way to negotiate like professional adults, the process seems to have deteriorated into a game of factional brinkmanship with all involved seemingly trying to game what is best for them rather than what is best for countries.  While I do not believe in hedging generally, it's time for me to face facts: A hard Brexit will result in a plunging pound, possible economic chaos and possible airline industry specific chaos.  In addition we are in a rising oil price environment, which has in the past caused the downfall of many an airline.  Given my largest investment in in a small, not very profitable airline, a hedge is necessary because there is a chance it goes bankrupt if a certain type of Brexit occurs and the oil price continues to rise.  That hedge is Dart Group PLC: It's a UK package holiday company which runs its own airline and offers flights only as well.  It's profitability and share price have had a good run recently as a competitor has gone bankrupt, the economy has remained stable and its particular offering has struck a chord with holiday makers.  It has no competitive advantages and trades in the teens in terms of P/E ratio.  I feel it is fully valued and the risk of Brexit is not priced in.  Given nearly all its routes are to Europe, and an extremely large proportion of costs are outside the GBP given it not only runs airplanes but has to buy hotels in Europe, it will get hit extremely hard by a GBP shock.  I tried to do some work to calculate the ideal hedge ratio for Dart Group PLC vs Flybe but then realised it's a fools game: 1:1 seems as good a guess as any and the aim of the hedge is purely to prevent a hard Brexit making a sizeable hit to my portfolio.  I will reassess in 6-9 months when hopefully the outcome of the initial negotiation is known and developments in the oil market have also played out.

Wednesday, 4 July 2018

Q2 Portfolio Update


Bloomberg Ticker Percentage
FLYBE FLYB 18%
Tripadvisor TRIP 15%
Rolls Royce RR/ 13%
Jefferies JEF 10%
COTY COTY 9%
FIAT FCAU 8%
IG Group IGG 7%
Dignity DTY 6%
Card Factory CARD 5%
Imperial Brands IMB 5%
Seritage SRG 3%
GBP Cash 9%
Quarterly Return Quarterly Benchmark Return
10.1% 7.1%
Return Since Inception Benchmark Return since Inception
54.2% 110.8%
Annualised Return since Inception Annualised Benchmark Return since Inception
8.2% 14.5%
Quarterly Leveraged Return Annualised Leveraged Return
9.1% 13.0%
Leverage
20%

Friday, 11 May 2018

Eyewear Industry

I loved this article about the merger of Essilor and Luxottica, their histories, their moats and the future growth of the eyewear industry.  I don't know about the price, but this business is about as high quality as it getsL

https://www.theguardian.com/news/2018/may/10/the-invisible-power-of-big-glasses-eyewear-industry-essilor-luxottica

Wednesday, 25 April 2018

Value Investing Videos: James Pan

I was happy to find James Pan has posted another video on YouTube of one of his university lectures. He is totally under the radar, managing family money only, though his returns are spectacular (c18% over c20 years).  I'm not sure he would agree with my characterisation but I seem him as a long term growth at a reasonable price type or reversion to the mean type investor - he talks about trying to find the "second leg of growth".  I thoroughly recommend both of his talks both for his practical advice on successful value investing but also his wry humour.  He is pretty inspirational.

https://www.youtube.com/watch?v=8Flci3xYJpo&t=4799s
https://www.youtube.com/watch?v=S6ahjNIXH8g





Thursday, 5 April 2018

Q1 Portfolio Update


Bloomberg Ticker Percentage
FLYBE FLYB 14%
Rolls Royce RR/ 11%
Leucadia LUK 10%
FIAT FCAU 9%
COTY COTY 8%
Card Factory CARD 8%
AIG AIG US 7%
Next PLC NXT LN 7%
IG Group IGG 6%
Tripadvisor TRIP 6%
Dignity DTY 5%
Imperial Brands IMB 4%
Seritage SRG 4%
GBP Cash 0%
Quarterly Return Quarterly Benchmark Return
-0.82% -5.75%
Return Since Inception Benchmark Return since Inception
40.10% 96.95%
Annualised Return since Inception Annualised Benchmark Return since Inception
6.63% 13.78%
Quarterly Leveraged Return Annualised Leveraged Return
-0.09% 11.05%
Leverage
22%

Monday, 8 January 2018

Q4 Results


Portfolio as at end of December
Asset Bloomberg Ticker
Leucadia LUK 12%
Rolls Royce RR/ 12%
FIAT FCAU 11%
Novo Nordisk NOVO-B 10%
COTY COTY 10%
FLYBE FLYB 9%
AIG AIG US 8%
Next PLC NXT LN 7%
IG Group IGG 6%
Tripadvisor TRIP 4%
Card Factory CARD 4%
Seritage SRG 3%
Emergent EMGC 2%
Plaza Centers PLAZ LN 0%
Dolphin Capital DCI LN 0%
GBP Cash 2%
Quarterly Return Quarterly Benchmark Return
-2.74% 6.42%
Return Since Inception Benchmark Return since Inception
41.20% 1.09%
Annualised Return since Inception Annualised Benchmark Return since Inception
7.15% 15.88%
Quarterly Leveraged Return Annualised Leveraged Return
-3.38% 12.06%
Leverage
19%