June 2012: Portfolio Update.

Well June was again dominated by European trials and tribulations, with Greece, Spain and Italy chipping in with problems.

Greece finally put together a Govt but illness almost immediately denied them their first choice Finance Minister.
Spanish borrowing continued to border on unsustainable levels in spite of an agreement to bail-out Spanish banks.
And then almost at the death the brinkmanship of the EU Summit appeared to yield a number of agreements that boosted markets on the last trading day of the month.

It does however, remain to be seen if these are just words or can be meaningfully implemented to set the Euro onto a rescue path.

Elsewhere, and hovering in the background are ongoing (everything is ongoing), growth concerns in the US and China.
There is also the developing scandal of LIBOR manipulation that is enveloping the banking industry. And who knows how that might yet explode.

Looking at the FTSE 100 in June, the index managed to sustain a rally of 4.98% which almost... almost, brought it back to parity for the year to date.
In turn this bettered my portfolio which only managed 4.3% to claw itself back to 9.78% year to date and within reach of 10%.

In my portfolio, IG pushed ahead 10.6% in June (Investment update: IG Group pre-close trading statement year ending 31 May 2012) followed by GE, BP, BAE, and SSE all managing more than 5%.
The portfolio's 3 heavyweights: R-R, NG., and Aviva also chipped in with respective gains of 4.38%, 4.24%, and 3.92%.

The only shares not turning up to the end of June party were Morrison's and Apple with 1 month falls of -3.66% and -0.68%. The latter exposed by a strengthening dollar.

Of the portfolio's 4.3% gain in June, 0.37% came from dividends received (Dividend update: ex dividends to roll in.) with plenty more to follow as my big guns (R-R and NG) pay out over July and August.

So onto the Portfolio:

Merchant Adventurer's Index
			Forecast	1 month	YTD	17 mth
	Price	% holding	Div. yield	% gain	% gain	% gain
R-R	858.00p	33.57%	2.28%	4.38%	14.94%	37.72%
National Grid	675.50p	17.59%	6.05%	3.92%	8.08%	22.15%
Aviva	272.60p	7.72%	9.91%	4.24%	-10.42%	-21.68%
Apple **	$584.00	5.62%	0.28%	-0.68%	42.81%	75.88%
BP	421.95p	5.46%	4.90%	6.85%	-7.13%	-7.81%
William Hill	282.80p	3.12%	3.78%	4.55%	39.45%	65.67%
IG Group	479.00p	3.00%	4.51%	10.60%	0.44%	-6.08%
General Electric **	$20.84	2.56%	2.70%	7.28%	15.24%	35.82%
Microsoft **	$30.59	2.37%	2.17%	2.93%	16.70%	8.92%
Centrica	318.00p	2.36%	5.14%	2.78%	9.92%	-4.10%
SSE	1391.00p	2.27%	6.01%	5.14%	7.75%	13.55%
BG Group	1300.00p	2.25%	1.24%	4.63%	-5.56%	0.31%
Vodafone	179.25p	2.06%	7.25%	3.61%	0.20%	11.24%
Morrisons	266.10p	1.98%	4.55%	-3.66%	-18.42%	-0.56%
BAE Systems	288.60p	1.71%	6.75%	5.79%	1.23%	-12.55%
Tesco	310.05p	1.47%	4.96%	2.48%	-23.15%	-22.28%
Cash		4.91%	0.00%
		100.00%	3.97%

1 Month

YTD

17 mth

Virtual Portfolio gain (incl. Dividends)

- 1 month gain   1483.64 - 1547.41

4.30%

- YTD gain        1409.55 - 1547.41

9.78%

- 17 month gain 1264.20 - 1547.41

22.40%

- 30 month gain 1000.00 - 1547.41

54.74%

FTSE gain (excl. Dividends)

- 1 month gain   5306.95 - 5571.15

4.98%

- YTD gain        5572.28 - 5571.15

-0.02%

- 17 month gain 5971.01-  5571.15

-6.70%

- 30 month gain 5412.88 - 5571.15

2.92%

Transactions:

01/06/2012

Div

BAE @ 11.3p per share

08/06/2012

Div

William Hill @ 6.7p per share

13/06/2012

Div

Centrica @ 11.11p per share

20/06/2012

Div

Microsoft @ 10.93p per share

20/06/2012

Div

Morrisons @ 7.53p per share

27/06/2012

Div

BP @ 5.15p per share

Notes:

*     US Dividends are adjusted for exchange rate and 15% withholding tax

**   Sterling : Dollar exchange rate = £1: $1.5688 as at 30/06/12

And the chart:

Click to enlarge, close to return.

Still following a very similar profile then which suggests some kind of tracking correlation and supports a view that macro events can affect individual companies despite individual prospects.

But, looking forward again. All eyes remain on Europe which remains centre stage with a currently positive reception of the decisions made at the most recent EU summit.
From the summit it appears that an agreed proposal (still to be ratified) could allow the current rescue mechanisms to bypass sovereign states and feed directly into individual banks thereby preventing this additional debt sitting on Govt balance sheets and threatening their credit ratings.
It remains to be seen if this will be ratified and have the desired effect.

The summit also proposed that a percentage of GDP be ploughed into growth initiatives.

But there is still a post summit buoyancy in the markets which even includes UK banking shares today, despite them bouncing around following the LIBOR scandal and yet another mis-selling scandal. So fines, compensation, possible lawsuits, inquirys, and resignations look set to plague the sector for the foreseeable.

Portfolio wise I am looking forward to dividends continuing to roll in as follows:

04 July - Rolls-Royce @ 10.6p per share
06 July - Tesco @ 10.13p per share
01 Aug - Vodafone @ 6.47p per share
15 Aug - National Grid @ 25.5p per share

Despite benefitting from a reducing risk profile courtesy of the EU Summit, the caveat in the portfolio continues to be Aviva following the resignation of Andrew Moss and concerns over the company's capital position, strategy, and how it might address this.

As mentioned markets are buoyant today though, so I will enjoy my near 10% year to date performance and, hopefully look forward to more to come supported by those dividends.

Earlier posts:
- Dividend update: ex dividends to roll in.
- Barclays fined for LIBOR/EURIBOR manipulation.
- Aviva up on Fitch and EU comments.
- Investment update: IG Group pre-close trading statement year ending 31 May 2012

Links to Portfolio updates:
- May 2012: Portfolio Update.
- April 2012: Portfolio Update.
- March 2012: Portfolio Update.
- February 2012: Portfolio Update.
- January 2012: Portfolio Update.
- December 2011: Portfolio Update.

- Portfolio Updates (older).