I’m an old dog but I’ve learnt a new trick, somewhat belatedly. I have an ISA and an account subject to taxation. I thought the former was doing better than the latter – and so it should as the income is re-invested and I make the maximum contribution every year.
In the ISA I can buy and sell without considering tax. So I sold Shell, very good, but then I swapped Astra Zeneca for Marks & Spencer – disaster. In my ISA I have thirteen holdings more or less balanced because I thought it was a good strategy. It’s a flawed strategy. In my account subject to taxation, coincidentally, I also have thirteen holdings. However four of them make up more than 75% of the valuation. This has arisen because I’m too mean to pay Capital Gains Tax but this has, so far, served me well. In alphabetical order the four are: MP Evans, Monks Investment Trust, Scottish Mortgage Investment Trust and Worldwide Healthcare Investment Trust. As they were all bought at different times comparisons of unrealised profits are meaningless but they are up by 412%, 59%, 432% and 82% respectively.
It’s much more interesting to see how they have fared in the last twelve months. MP Evans is now at a discount of about 50% to its Net Asset Value and the share price has fallen by 22%. Monks is down 3%, Scottish Mortgage up 12% and Worldwide Healthcare up 8%. I’m not going to look at the top four holdings in my ISA – too sad-making.
I have learnt a lesson; namely to add to what have proved good investments and not to take a profit unless circumstances change. For investment trusts circumstances change when the fund manager changes. The rejuvenation of Monks is due to the arrival of Charlie Plowden. There has been a gradual handing over of the reins at Personal Assets, from Robin Angus to Sebastian Lyon – it has taken eleven years – and I plan to increase my holding as they are a safe pair of hands; up 2% in the last twelve months. At McInroy & Wood co-founder Victor Wood has handed over to his son, Tim, and their investment ethos is unchanged. Their flagship Balanced Fund is unchanged from the end of April 2019.
PAT holders will miss Robin Angus’s quarterly wisdom – though Sebastian Lyon’s April update was literate, balanced, elegant and showed something of RA’s talent for relevant anecdotery………..
Meanwhile, Christopher, thank you for your daily contribution to making lockdown life less tedious!