Wow, that budget seems to be weighted against my portfolio!
I guess I should expect the tax increases on tobacco etc. even the gambling duties, but the pension annuity was a surprise, and I'm sure that that change has mileage to run yet.
Whether or not the Pensions provider can respond with a more flexible product is now the question.
As an observer, the annuity v. drawdown question had been brought to the table by those savvy SIPP investors, who it can be assumed have shown they have the knowledge, and discipline to manage a suitable provision for themselves.
A further downside being what happens to annuity funds with regards inheritance and a persons estate.
So I would strongly suggest that, in many cases, annuities have become a dated, restrictive product, in a market where you had (before the budget), few alternatives, with seemingly too many financial gains weighted towards the providers.
I do welcome the change but it remains to be seen whether this widespread change has a different effect.
I recall a previous government white paper which compared the merits of pensions with those of ISA's which seemed to come down slightly in favour of the flexibility that ISA's gave to a consumer but this flexibility was also supporting life decisions rather than just being a retirement provision.
The risk and temptation is that rainy days, or even sunny days, become more of a here and now priority than long term income provision.
Perhaps pension release is a means of moulding pensions into this style of "lifetime" account.
I also wonder whether or not this sudden release of income might fall into the long running, long terms care costs debate.
It remains to be seen, and I'm sure that there is a lot to be gained from yesterdays changes but at the moment I am still picking myself up after the seemingly "targeted" attack on my portfolio.
Ha ha, be lucky.
Thursday, 20 March 2014
Monday, 17 March 2014
January 2014: Portfolio Update
Well January 2014 didn't have anywhere near as much momentum as January 2013!
More like a cold shower on my portfolio with a 1 month drop of -4.61% with profits warnings, disappointment, and negative sentiment stalking the markets.
-4.61% was worse than the FTSE100's -3.54%, showing a concentration of negativity around my less diversified portfolio.
This despite the fact that January is amongst my best months for receipting dividends with the latest interim payments from Rolls-Royce and National Grid being gratefully received.
| Merchant Adventurer's Index | ||||||||
| Forecast | 1 month | YTD | 37 mth | |||||
| Price | % holding | Div. yield | % gain | % gain | % gain | |||
| R-R | 1187.00p | 31.95% | 1.96% | -6.90% | -6.90% | 90.53% | ||
| National Grid | 789.00p | 14.13% | 5.38% | 0.13% | 0.13% | 42.68% | ||
| Aviva | 445.00p | 10.64% | 3.61% | -1.05% | -1.05% | 31.71% | ||
| BP | 478.00p | 5.66% | 5.05% | -2.06% | -2.06% | 5.52% | ||
| Apple ** | $500.60 | 5.54% | 2.20% | -10.39% | -10.39% | 19.48% | ||
| Vodafone | 227.00p | 4.64% | 4.82% | -4.22% | -4.22% | 19.91% | ||
| IG Group | 626.00p | 4.58% | 3.78% | 1.62% | 1.62% | 31.18% | ||
| William Hill | 332.00p | 3.08% | 3.82% | -17.39% | -17.39% | 80.26% | ||
| Imperial Tobacco | 2223.00p | 2.54% | 5.72% | -4.92% | -4.92% | -1.60% | ||
| BAT | 2916.00p | 2.25% | 5.05% | -9.94% | -9.94% | -13.07% | ||
| General Electric ** | $25.13 | 2.02% | 2.62% | -9.95% | -9.95% | 56.29% | ||
| Microsoft ** | $37.84 | 1.93% | 2.35% | 1.54% | 1.54% | 28.57% | ||
| BAE Systems | 429.00p | 1.74% | 4.80% | -1.38% | -1.38% | 30.00% | ||
| Centrica | 311.00p | 1.59% | 5.68% | -10.56% | -10.56% | -6.21% | ||
| SSE | 1307.00p | 1.47% | 6.71% | -4.60% | -4.60% | 6.69% | ||
| Morrisons | 240.00p | 1.23% | 5.36% | -8.05% | -8.05% | -10.31% | ||
| BG Group | 1022.00p | 1.21% | 1.81% | -21.23% | -21.23% | -21.14% | ||
| Tesco | 320.00p | 1.04% | 4.61% | -4.29% | -4.29% | -19.78% | ||
| Cash | 2.75% | 0.00% | ||||||
| 100.00% | 3.46% | |||||||
| 1 Month | YTD | 37 mth | ||||||
| Virtual Portfolio gain (incl. Dividends) | ||||||||
| - 1 month gain 2139.28 - | 2040.58 | -4.61% | ||||||
| - YTD gain 1644.62 - | 2040.58 | -4.61% | ||||||
| - 37 month gain 1264.20 - | 2040.58 | 61.41% | ||||||
| - 49 month gain 1000.00 - | 2040.58 | 104.06% | ||||||
| FTSE gain (excl. Dividends) | ||||||||
| - 1 month gain 6749.09 - | 6510.44 | -3.54% | ||||||
| - YTD gain 5897.81 - | 6510.44 | -3.54% | ||||||
| - 37 month gain 5971.01 - | 6510.44 | 9.03% | ||||||
| - 49 month gain 5412.88 - | 6510.44 | 20.28% | ||||||
Transactions:
| ||||||||
06/01/2014
|
Div
|
Rolls-Royce @ 8.6p per share
| ||||||
22/01/2014
|
Div
|
National Grid @ 14.49p per share
| ||||||
29/01/2014
|
Div
|
GE @ 22c per share
| ||||||
| Notes: | ||||||||
| * US Dividends are adjusted for exchange rate and 15% withholding tax | ||||||||
| ** Sterling : Dollar exchange rate = £1: $1.644 as at 31/01/14 | ||||||||
Chart wise the long term trend is still very positive but its starting to look like a trading channel of highs and lows (thankfully still higher highs and lows), has been developing since April 2013 for my portfolio and possibly earlier than that for the FTSE100.
 |
| Click to enlarge, close to return. |
Looking ahead it now seems certain that the mainstays of the supermarket sector are entering an extended period of under-performance as the lower and upper segments of that sector enjoy a positive boost and put a squeeze on the "big four".
Disappointingly this leaves me with a quandary over my 2 sector holdings: Morrison and Tesco.
I have voiced my concerns over Morrison a number of times as it just does not feel that management have a strategic clue. They seem to have responded to city views on what should be done rather than devise a strategy based upon their " expertise and knowledge".
Which puts a question mark over their capability for me, are they expert grocers, or at very least retailers.
The current strategy still has roots to the previous CEO, Marc Bolland who quickly took advantage of a positive reception, to satisfy his own career ambitions and jump into the hot seat at M & S.
Having failed to execute one strategy, he isn't exactly shining at M & S!
So my two supermarkets along with one or two others in my portfolio will need a good looking in the next few months, in order to determine if they still warrant a place and my patience.
But, on the other hand its nice to see that some holdings, such as Aviva, have started to reward my patience despite the painful dividend cut that caught me out last year.
Roll on February (and yes, I know....more bad news!)
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