There was much festive gladness when I logged in to discover I had indeed purchased the PAF:Pan African shares in time, and there was a £90.29 dividend waiting for me.
I also decided it was time to wave goodbye to a couple of my oldest shares. These are ones I bought before developing the new stock picking rules and using my colour coded spreadsheet.
BA.:BAE Systems had been dropping ever since I bought them. They were laying off workers and slowing down production of the Euro fighter. I was most concerned however by their whopping great debt. They fell down on loads of my other measures for buying shares too. PE ratio was high at 22, ROCE below 10%, Market to book ratio 7.56 when I look for below 2.5, assets to liabilities ratio of 1.1 when I look for over 1.5, 22.5 rule of a staggering 167. I had been fretting for some time about how I was going to get rid of them, but didn't panic as their order backlog is huge, so I hoped they would become profitable at some point. I hate to say it, as it was such a ghastly crime, but the announcement of increased Government defense spending following the Paris atrocity was the catalyst that sent the share into profit. I sold at 498.98p which was a 5.9% profit of £33.26 plus a £10.92 dividend. Not big bucks, but marginal gains, and above interest rates.
HLMA:Halma was my first share. It was meant to be a long-term dividend earning share, but I couldn't bring myself to keep a share with PE ratio of 31 when I'm looking for 15, and a 22.5 rule of 190. I feared that if there was a stock market correction, these would plummet. As I only held 100 shares, the dividends didn't add up to very much anyway. I thought I could make the capital work much better for me. I sold at 871.40p which is up 9.9% with a £74.78 profit. If I had held for a few more days I would have got a huge £4 interim dividend, so I didn't bother.
So, here's the result of my changes
| Weekly Change | |||
| Portfolio cost | £33,534.01 | -£1,387.03 | |
| Portfolio value (share price) | £31,665.41 | (-£1,667.55) | +£112.36 |
| Portfolio sell value (bid price - commission) | £30,533.88 | (-£3,000.13) | +£22.50 |
| Dividends | £241.09 | +£90.29 | |
| Profit from sales | £450.91 | +£108.03 | |
| Average monthly cash profit | £145.96 | +£37.55 | |
| (Sold stocks profit + Dividends - Fees / Months) |
One slight change to my calculations. The weekly change of the portfolio share price value and sell value now takes into account the increase or decrease of the portfolio cost, so it's effectively how much better or worse the difference is between the cost and value of what's left.
This week wasn't too bad. Up on last week despite over £100 of profit being banked. The most satisfying result is the average monthly cash profit rising by £37.55 a month thanks to the big dividend and selling a few. Now it's double the best interest I was earning beforehand. Still very titchy in the big scheme of things - but it's moving in the right direction until I'm forced to sell something at a loss, and as the portfolio slowly grows in size, so should the profits on each transaction.
The plan for the £1,495 profit from the two sells is to bank £495 to pay for a deposit to go to Peru next year, and transfer £1,000 into my SIPP to start gradually building that up. The settlement date isn't until 30th Dec, so I won't be able to do that for a few days. I've already identified the perfect share to add to my pension - more on that soon...
Talking of the pension, this is how we're doing
| Weekly Change | |||
| Portfolio cost | £3,298.08 | +£0 | |
| Portfolio value (share price) | £3,901.03 | (+£602.95) | +£151.34 |
| Portfolio sell value (bid price - commission) | £3,842.68 | (+£544.60) | +£203.84 |
| Dividends | £0 | +£0 | |
| Profit from sales | £0 | +£0 | |
| Average monthly cash profit | -£0.02 | +£0.01 | |
| (Sold stocks profit + Dividends - Fees / Months) |
Another great week, with the sell price increasing by more than the share price. That might have been the HGM:Highland Gold spread narrowing, and may also be influenced by the artificial non-existent spread on AA:Alcoa, as I only have the Hargreaves Lansdown current selling price to go on, as they factor in the exchange rate. This has been going for 4 weeks now. £544 profit in a month on a £3,200 investment - wow!! The 2p fee for the last few days of November is divided by 1 (ish) rather than .75 (ish) last week or .5 (ish) the week before. When December's fee is levied, the performance will be much worse until I decide to sell something - which may be some time! Looking forward to adding another £1,000 and then the additional £1,000 from the tax man in January - woohoo!!
Not back at work until 4th January now, so I may have some fun tomorrow. I've spent a lot of the Christmas break studying potential new shares and have discovered a few that I'm very excited about. I may take a long hard look at some of my in-profit shares and see if I think the capital could be put to better use elsewhere...
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