My portfolio is allocated between fixed interest (40%) and equities (60%), which in turn are divided between individual shares and (mostly) investment trusts.
Since the start of 2013, the FTSE 100 is up 14.4% at 6,749 - if we add on say a further 3.4% for dividends paid, this will give a ballpark figure of around 17.8% total return for the full year.
My portfolio of individual shares have been a little mixed, providing a total return of 12.0% over the 12 month period. The better performers have been Reckitt & Benckiser (27.2%), Sainsbury (14.9%), GlaxoSmithKline (26.4%) and Abbey Protection (18.1%).
2013 has not been a good year for mining and resources shares - BHP Billiton has recovered a little in recent months but remains well down over the year(-8.8%). Others that have struggled to make much progress during the year are Imperial Tobacco down 1.1%, BSkyB up 1.1% and Unilever up 0.1%.
Additions to my portfolio acquired during the past 6 months are not included in the above. Many have got off to a decent start since purchase - Next up 9%, easyJet up 8% and Sage Group up 8%.
As I said in a previous post, I regret the sale of DS Smith and RPC Group earlier in the year - both have put on gains in excess of 30% during the second half of the year since the sale.
Total income on shares over the period is 3.9%. Collectively, dividends have increased by an average of 10.5% - the highest increases have come from Dialight 35%, AMEC 19.6%, BSkyB 18.1%, Unilever 15.4% and NEXT 16.6%. The shares with the lowest increases were Tesco 0.0%, Billiton 3.6%, Sainsbury 3.7% and Carillion 5.4%
Most of the trusts have recovered the ground lost earlier in the year. The total return for the year was 15.1%.
The best return came from smaller companies specialist Aberforth with 61.2% and which has been leading the pack all year. Others continuing to provide solid returns are Law Debenture (27.7%), Temple Bar (28.1%), Bankers (29.1%), Edinburgh (23.7%) and City of London (24.1%). The only trusts that has struggled for me have been Aberdeen Asian Income (-17%) since purchase earlier this year, the other Asia-focussed trusts Henderson Far East (+4.0%), Schroder Oriental (+1.9%) and Murray International (+4.7%) which has pulled back during the second half.
Income yield from the trusts portfolio has been steady at 4.0%. Most trusts have continued to bolster income reserves this year and therefore the collective increase in dividends has been just 4.7%. The highest increases were Schroder Oriental 9.5%, Murray International 9.4% and Aberforth 7.2%. The lowest increases came from Dunedin Income 0.9%, New City High Yield 2.2% and Dunedin Smaller Companies 3.0%
Following the problems with the Co-op Bank in May which affected capital values over the 2nd quarter, I am pleased to report that my PIBS and preference shares have seen a strong performance during the second half of the year. Total return for the 12 months was 12% including income of 6.9%.
The best performance came from Skipton BS PIBS which provided a return of 33% which more than compensated for the loss arising from the smaller Co-op holding.
As a whole, the portfolio has advanced 13.3% over the past year including the payment of 5.0% income. Bearing in mind that 40% of the portfolio is represented by PIBS and fixed income securities, I am reasonably happy with this.
I believe successful investing, whether for income or growth, does not need to be complicated. You don’t need to be an expert when it comes to selecting shares but it helps to avoid unnecessary mistakes - or at least keep them to a minimum. In the words of Warren Buffett: “you only have to do a very few things right in your life as long as you don’t do too many things wrong”
Over the past year, my main mistakes have been the premature sale of just 2 shares that then went on to make significant gains - DS Smith and RPC Group. Both were sold in June and the proceeds recycled into Vanguard All World High Dividend ETF.
I need to be a little more patient with the shares I have purchased and maybe do a little less monitoring of share prices.
As ever, I would be interested to hear how others have done over the past 12 months - leave a comment if you keep track of your portfolio.
Finally, Happy New Year to all and good luck with your investing for the coming year!