Wednesday, 13 July 2016

Some Consolidation and a new "Woohoo!"

I sold two of my long-standing shares this morning in an effort to consolidate some of my existing shares that appear on the verge of something interesting.

First I sold RCI:Rapidcloud International. This is a Malaysian cloud computing company, and at one point was one of my biggest losing shares. Within a week it went into profit, but since then has dropped back. I think it has lots of potential, and will keep it on my watch list for a future re-entry. However, I wanted to cash in the £118.50 (11.4%) profit and liberate £1,113.

The second share to go was TON:Titon Holdings. I had already sold half my shares for £178 (19.6%) profit, but a recent luke-warm trading statement has seen them drop off, and they are struggling to get going again. I sold this batch for a much lower £91 (8.3%) profit to liberate £1,266.

So, with a great big pot of cash I could go shopping!

I wanted to consolidate three of my existing shares and buy one new one.

The first consolidation was TLOU:Tlou Energy. I've not had them long and they have gone bonkers. They are a Botswanan gas company with an incredibly experienced board of directors and backing from the Botswanan government. Recent news that they have been given the go ahead to build a power station five times the size of the one originally planned, as well as supplying power to a local mine suggests this has a long way to go from the current 7p. I bought 7,000 shares at 7.245p costing £516.10. This brings my total holding to 19,767 shares costing an average of 5.21p at a total of £1,048.50. These are currently making a £273 (26%) profit.

The second consolidation was my nemesis share. Recent movement in AFG:Aquatic Food and the approaching dividend ex-date made me want to try and buy low to reduce my losses - or should I say speed up getting into profit. It worked for GLEN:Glencore so I'm hoping it will work here too. I bought 3,500 shares at 14.499p costing £516.42. This more than doubled my holding to 6,500 shares at a weighted average of 23.96p as opposed to the 35p from my original purchase. The total cost of these shares is £1,578.37 but tragically they are down by 60% and losing £940. At a P/E ratio of 0.9, based on current profits I believe a fair price would be 395p a share. This is unlikely, but it would make me £24,000 profit! It's a risk I'm willing to take.

My final consolidation is AMYT:Amryt Pharma. I'm completely non-plussed as to why this has dropped from the reverse takeover price of 24p to the current price of 15p. It's managed by pharma royalty. Harry Stratford built SHP:Shire Pharma based on exactly the same model he's employing here, and has brought in staff from Shire to help. They have a product in market already and are about to start clinical trials for using the same product to treat a rare disease. Other products are in the pipeline, and the revenues from these will allow the development of more products and the acquisition of more companies. I bought another 5,579 shares at 14.7p coating £829.06. This brings my total holding to 20,863 at an average price of 18.34p costing £3,870.88. It's about 8% of my entire portfolio. If it goes up to just £1 a share it will give me £16,980 profit. If it goes to the same price as Shire, it will yield over £1,000,000 profit - Mwoohahahahaha!! Of course that's not going to happen, but anywhere in between would be nice.

My final purchase was a new share. I was researching companies beginning with the letter i when I found IOG:Independent Oil & Gas. Their fundamentals were very strong, especially considering the current sentiment against oil and gas. They are a North Sea oil company and are about to drill a well, but there have been delays and the price has been dropping as a result. Their share price is almost the same as their net asset value per share, they have a ROCE of 38%, low market to book value, P/E value of 2.06, tiny amount of debt and I believe a potential 450% share price rise. It's high risk , as drilling could go horribly wrong, but I bought 3,500 shares at 15.325p costing £545.33. I'll now watch these closely and consider doubling my holding if things look good.

Meanwhile things have levelled off a bit for the portfolio. GVC:GVC Holdings is soaring majestically towards premium listing on 1st August and soon after FTSE250 status. Shares went up 4% today and are up by 53% from when I bought them. CAML:Central Asial Metals is also on a roll, gong from an undeserved £250 loss a few weeks ago to £302 profit today. HGM:Highland Gold just won't stop. It's now up 133% from when I bought it and making £1,434 profit. That's contributing towards my whole pension portfolio being up £2,244 (16%) on top of the £1,025 (12.8%) from dividends and sales.

I wish I could say the same for the main portfolio, which is still recovering from the Brexit disaster. That's down by £4,857 (12.6%) on paper, although up on dividends and sales by £4,155 (12.1%). It won't take very much more post-Brexit recovery to plug that £700 deficit and get back into overall profit for the first year.

I nearly forgot - adding up the total amount invested now comes to £51,334 so I've passed another £1,000 and can do another "Woohoo!". The great news is that when I sell the shares to pay for my holiday, if I extract £1,000 from the share account I'll still be over my dream target of £50,000. That would be a great way to end my first year.


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