Wednesday 9 October 2013

Portfolio Update - October

Two days ago I had a clear out of some of my weaker positions. I sold all my holdings in BG Group, all my holdings in Vodafone and half my holdings in Tesco.

BG Group & Tesco were sold for just below purchase price, although including dividends received I'm probably at break even overall. Vodafone has made about a 20% capital gain and also paid me a 5% dividend for a couple of years so that has been a more solid but not spectacular investment. These three companies have all performed poorly in a rising market and they are all facing their own headwinds that make me think the substandard performance might continue, at least for the short/medium term. I think my money will be better off elsewhere.

Some of the proceeds have been used to top up existing holdings in AstraZeneca, GlaxoSmithKline, Imperial Tobacco, and Murray International Investment Trust.

Of the remainder, some has been invested in Molins, a small cap company who make specialist machinery for consumer goods markets, mainly tobacco and food. They are very cheap on paper with a P/E of around 8, a decent dividend of 3% and good growth prospects in the form of potential new contracts in the near future.

Also despite saying I wouldn't get involved in the post office IPO I had a last minute change of heart yesterday and put my name down for a few shares, am not sure if I will actually get them as they have been over subscribed and I was very late to take action. It will be interesting to see how the IPO plays out.



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