my 2011 portfolio is running out of steam

[#1]

Last year saw an average 33% gain, but this year it is not joining the new year boom. BTI, Calgro, Rolfes, Metair are all up more than 50% and were the star performers. Redefine lagged, but I got the Arrow shares out of the deal (which seem worthless) and Bas Read forgot to stoke the fire, it hasn't moved and in accordance with my portfolio money management, I will be looking to ditch it. APN and KIO complete the purchases for 2011, and are doing OK. So far this year, I am tracking GND (shipping has to turn soon), Rolfes for stocking up, VMK (It has to participate in the retail boom), ELI, JSE, CIL. My focus is still very much on the small and mid-caps which I believe have a good chance of outperforming the index this year, if you can get the timing right (which is a separate topic of discussion)

[doomsdayza]

baltic dry index not looking good - http://www.zerohedge.com/news/baltic-dry-index-slumps-lowest-january-2009

for what it's worth skaap.

[#3]

Ja, GND is still in the doldrums. But there was a comment from Werner some time ago - invest in extreme price or extreme momentum. GND at R9 a share will constitute extreme price, in my book.

[Blik]

Skaap I hope GND doesnt turn like Captain Schettino turned the Costa Concordia.

[THRESHOLD]

Made a lot on the micro and smallcaps last year. Positions in the larger stuff were unexciting and trading was a waste of time for me. So this year - I will follow more of the same. I have been building positions in NTC, JSE, LBH; mostly in CFD's

[Blik]

Skaap I hope GND doesnt turn like Captain Schettino turned the Costa Concordia.

[WES]

Talking about smallcaps, what are your take on WINHOLD for 2012 ?

[Rams]

eh, eh

[Yatagan]

Skaaptjop, do you have any view on LHC?

[Rams]

skaap well done! Are all those shares geared?

[#11]

Rams, in a way, they are geared. I have been borrowing against my bond for some time to build a stock portfolio. The cheapest form of gearing out there by miles. Yategan, Wes - I don't follow those stocks, which is not to say I won't be having a look at them. Best to put the merit debate into a separate thread, so that we have the discussion tracked to the share.

[EkisDoep]

That is a very interesting remark you made, Skaaptjop. Borrowing against your bond. Is it cheaper than share instalments or SSF's? But I suppose the risk is higher?

[#13]

No, not higher - just different. By borrowing against the bond, you are putting existing assets at risk. But this risk is offset against your ability to pay off the bond over the long term. You wouldn't want to be doing this on a punt on say snakeoil (SCL), but with a balanced portfolio, the risk is minimum. Just remember, in terms of cost, a geared instrument (CFD, SSF) calculates your interest on your current exposure (current market value of your position), whereas borrowing against a bond and buying a share - your interest is against your original loan. For e.g. if you buy R100k stock and it doubles in 2 years - you will still only be paying interest against the R100k borrowing. If you buy R100k of CFD's, in 2 years time you will be paying interest against R200k of exposure. That makes a huge huge difference!

[WES]

I agree 100 % with skaaptjop. My situastion is the same. SSF when they roll over can also bite you. I stopped CFD's and SSF, only the banks make money.

[prancing_horse]

Can't really compare the two as with CFD's you would invest approx 15k to buy 100k worth of stock, besides CFDs not an instrument for long term hold. However with interest rates as low as they have been for a while now, it has made holding CFDs for 3 to 6 months very profitable, for me anyway

[Rams]

try this... work out your profit as a percentage of the geared amount and the loss as a percentage of the ungeared amount...