The only poor performers this week were both due to placings. APAX:Apax Global Alpha has been riding high, up by 47%. However the biggest shareholder sold all 32 million shares in a placing at a discounted price, which caused an immediate drop to that price, before recovering a bit by the end of the week. They ended up 13% down, but I don't think it will last long as many will see it as a good buying opportunity.
The other placing was TLOU:Tlou Energy which did a raise at a hefty
discount in order to fund construction of the electricity transmission lines.
This is excellent news, and shows they are serious about producing electricity
and getting it on to the grid. I'm very tempted to take advantage of the 11%
drop in price to buy some more as the project is being de-risked at quite a
pace.
WRES:W Resources climbed 6% for no obvious reason. I get a bit worried
when junk shares go up unexpectedly, as I tend to think it's down to shorts
closing in time to get out before the company goes bust.
DDDD:4D Pharma had a good week, climbing 10%. Unfortunately my buying
opportunity was after the price had gone up. Nasdaq listing should kick in
next week, after which anything could happen.
Share of the Week is FXPO:Ferrexpo which announced amazing results and
a stonking special dividend, after which the share price went up by 21% of my
original purchase price. My holding is now 115% up, and I've had 10% dividend
already before this special one kicks in. The magic formula ranked this share
at the top of the list, and it wasn't wrong!
This shows the cost going up a bit and the value also increasing, but the deficit is still quite wide.
The real picture of banked profits and widening deficit.
Here's the ISA and shares portfolio after week 33 of year 6.
| Weekly Change | |||
| Cash | £13.54 |
+£3.55 | |
| Portfolio cost | £67,058.62 | +£2,458.50 | |
| Portfolio sell value (bid price-commission) | £57,524.22 | (-14.2%) | -£1,432.95 |
| Potential profits | £7,293.67 | -£2,279.19 | |
| Yr 6 Dividends | £0 | +£0 | |
| Yr 6 Profit from sales | £4,629.22 | +£2,462.05 | |
| Yr 6 projected avg monthly profit | £603.94 | (17.3%) | +£314.53 |
| Total Dividends | £1,343.15 | +£0 | |
| Total Profit from sales | £25,055.83 | +£2,462.05 | |
| Average monthly cash profit | £386.54 | (11.1%) | +£35.21 |
|
(Sold stocks profit + Dividends - Fees / Months) |
|||
| Compound performance | 63% | +6% |
I sold two lots of JLP:Jubilee Metals to take my holding down from
80,000 to 60,000. I may come to regret it if they fly, but it remains one of
my biggest holdings in terms of share cost, and they are also free shares as
I've covered more than the cost with profits. If all goes well I will still
get a nice dividend.
The first lot of 10,000 was sold for 16.4526p and made £1,205.91 (274.4%)
profit. I used these to buy 3,217 shares of OPTI:Optibiotix at 50.47p
costing £1,632.57.
The second lot was sold at 16.955p and made £1,256.15 (285.9%) profit. I used
these to buy 1,283 shares in DDDD:4D Pharma at 130.7712p costing
£1,686.74, as I wanted to buy more before they list on Nasdaq when we could
see a significant re-rate.
The effect was a big drop in potential profits as they were realised, a big
increase in portfolio cost, an increase in the deficit between cost and value
of £1,432 which is £1,000 less than the profits banked which is good.
The sales had a stunning impact on my performance. Year 6 projected
performance increased by £314 a month, and even if I sell nothing for the rest
of the year will be 11% and above target, making me consider getting rid of a
junk share at a loss. I guess I need to be prepared to write off
MTFB:Motif Bio as there's no sign of a reverse takeover and that will
lose me £2,521 and wipe out this week's profits.
Long term average went up to 11.1% which is well above target and gives me a
bit of wiggle room.
Big spike in cost, smaller rise in value.
The real picture shows the down side of taking profit.
The SIPP looks like this after week 277 overall and week 17 of year 6.
| Weekly Change | ||||
| Cash | £207.44 | +£2.99 | ||
| Portfolio cost | £65,997.55 | +£694.82 | ||
|
Portfolio sell value (bid price - commission) |
£58,736.32 | (-11.0%) | +£547.02 | |
| Potential profits | £4,796.19 | -£284.83 | ||
| Yr 6 Dividends | £433.05 | +£0 | ||
| Yr 6 Interest | £0 | +£0 | ||
| Yr 6 Profit from sales | £4,112.10 | +£397.81 | ||
| Yr 6 projected avg monthly profit | £1,141.49 | (33.9%) | +£36.40 | |
| Total Dividends | £2,500.13 | +£0 | ||
| Total Interest | £0.20 | +£0 | ||
| Total Profit from sales | £19,571.54 | +£397.81 | ||
| Average monthly cash profit | £334.53 | (9.9%) | +£5.04 | |
|
(Sold stocks profit + Dividends - Fees / Months) |
||||
| Compound performance | 53% | +1% |
Some sales in this account too, for the same purpose but making significantly
smaller profits.
The first sale was PAY:Paypoint. I should really have held this share
until October, but I've been increasingly worried that they are operating in a
market that's becoming obsolete. I also wanted to buy some more
OPTI:Optibiotix quite badly, so decided it was a worthy sacrifice. I
sold them for 589.27p which made just £23.82 (2.3%) profit, but that rises to
6% if you add the dividends. I used the funds to buy 2,048 shares in
OPTI:Optibiotix at 50.2p costing £1,037.05.
I feel bad about my next sale. I sacrificed some more of my
CAML:Central Asia Metals holding and sold 500 at 259.91p making £374
(40.4%) profit. I also added £300 to my SIPP so I was able to buy 1,214 shares
in DDDD:4D Pharma for 130.275p costing £1,590.49. I really hope there's
a re-rate next week!
Year 6 performance is amazing, but it's only after 17 weeks so I'm unlikely to
keep it up. However, even if I sell nothing else, my annual performance will
still be 11% so as with the ISA we're in a good place, especially as I will
start selling some magic formula shares from May onwards. Long term
performance is still just under 10% so I do need some more sells to stop that
drifting back downwards.
Potential profits went down less than the amount I banked due to
FXPO:Ferrexpo doing so well this week, and there was actually an
improvement in the deficit between cost and value of £547.
Not too big a gap to make up in order to cross the red line
An increase, but well below the trend line so we need OPTI:Optibiotix to start behaving.
The trading account looks like this after week 243 overall and week 35 of year 5
| Weekly Change | |||
| Cash | £259.74 | +£10.16 | |
| Portfolio cost | £2,374.14 | +£9.71 | |
| Portfolio sell value (bid price - commission) | £1,813.11 | (-23.6%) | +£8.14 |
| Potential profits | £0.00 | -£14.00 | |
| Year 5 Dividends | £12.18 | +£0 | |
| Year 5 Profit | £651.51 | +£19.86 | |
| Yr 5 projected avg monthly profit | £82.17 | (41.5%) | +£0.11 |
| Dividends | £60.10 | +£0 | |
| Profit from sales | £937.88 | +£19.86 | |
| Average monthly cash profit | £17.80 | (9.0%) | +£0.29 |
|
(Sold stocks profit + Dividends - Fees / Months) |
Nice tick up despite the sale.
In the right direction but below the trend line.
So despite saying on many occasions that I'm overweight with
OPTI:Optibiotix shares, I'm still buying them. I think I will continue
buying them while they remain at this price, as the story just gets more
exciting. The ingredients are appearing in more and more products, and now
they are being added to existing mainstream products rather than niche
products or small markets.
The road to profitability has taken longer than most investors hoped, and some
have lost patience and reduced their holding. I certainly feel the
frustration, but that's not down to the performance of the company, it's down
to the performance of the share price. That's entirely out of the hands of the
company. It's due to a relatively small number of illiquid shares and trader
manipulation. The price has been managed up and down in a 20p range for years,
and I think that will continue until profits and dividends become regular.
My holding is now 145,375 shares costing £90,651 when you include commission.
My average price per share is 61.9p and they currently sell for 51p so I'm
around 18% down, which is a paper loss of £16,545. That I find utterly
frustrating after 5 years, but it says more about bad timing on my early
purchases than about anything the company has done since, as progress in
commercialisation has been impressive.
I'm still seriously expecting these shares to be worth 500p in the next 3 or 4
years, which would take my holding to just under £750,000 and a 5% dividend
would be worth £36,000 a year. That dividend alone would be enough to retire
on without having to sell a share.
They say you should have a diverse portfolio, and I understand the risk of
putting so many eggs in this basket, but it's not often you come across a
company that no matter how hard you try to find faults, you keep coming to the
same conclusion that you should buy more. There are faults. The choice of PR
firm was awful, and some of the early contracts came to nothing. Promises of
upcoming launches in major US retailers turned out to be one niche product,
and if Sweetbiotix isn't taken up by global majors then my dreams are unlikely
to be fulfilled.
However, the relatively fixed and low cost base and multiple revenue streams
from ingredients, licenses and royalties that are ramping up as marketing
starts to bear fruit, should mean that profitability is assured. The share
price will then be tied to how much profit is made. 500p could be as far as we
get, but it could easily be double if pharma trials go well and we replace
statins, if the microbiome modulators are found to significantly improve the
efficacy of the increasing number of probiotic drug treatments, and if
Sweetbiotix is capable of replacing artificial sweeteners as well as sugar. If
all that comes to pass, then I can retire to a farm!
Meanwhile I've increased my holding in DDDD:4D Pharma to 8,616 shares
costing £11,284, making it my second biggest holding. One successful phase III
trial in the pipeline of many could see this rocket to the £10 a share it was
in the early days. That's nothing like the extent of the profits I can get
from OPTI, but this is a very exciting company to be invested in, and
next week could see the start of that journey as the shares list on Nasdaq.
I'm very much looking forward to the American market opening on Monday.
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