Responsible Investor Portfolio Update, August 15th, 2020 | $TCEHY $NEM $BK $SYF $GILD $GRUB $SQQQ $SCO $PCG $LVMUY $LRLCY $PEUGF $ELC.MI $WBD.MI

Another positive week for the global stock markets with Europe over-performing the US. The Italian stock market jumped almost 5% while the Stoxx index gapped 2.77% higher. The Dow and the S&P500 were up 2 and 1%, respectively. The Nasdaq was very quiet and closed marginally higher.

There are increasing calls from investment banks for a potential future over-performance of the Stoxx versus the US Stock Markets which have run a lot: YTD, the S&P500 is up 4.7% while the Stoxx index is down 10% and the FTSE MIB lags behind with a -13,82%. There are exceptions within Europe: for example the Danish stock market being up 15% YTD and currently has a P/E of 31. With our portfolio consisting of European stocks for 68% at present, we are geared to benefit from a possible mid-term rise of the European stocks.

We have had 3 winners this week as $SYF , WeBuild and Elica rose between 5% and 7%. This week’s sell off in gold has negatively impacted on $NEM , down 7%, however this precious metal is expected to rise further in the near future.

$TCEHY continues to be hit by anti-China US policies and, more recently, by the dispute between $AAPL and $GOOG vs Epic Games, the company behind popular video game Fortnite in which Tencent has a stake.

Two of our positions hit the SL price, namely $SCO and $GILD. For the latter it might have just been bad timing as the fundamentals and the valuation remains strong: we might get back in if the earnings continue to grow and the technicals suggest an entry point.

The table below summarises the portfolio performance since inception.

2000814 RIP

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Responsible Investor Portfolio Update, August 1st, 2020 | $TCEHY $NEM $BK $SYF $GILD $GRUB $SQQQ $SCO $PCG $LVMUY $LRLCY $WBD.MI $IMA.MI $ELC.MI

It is surprising how the global stock markets are capable of shrugging off just about any news headline recently. This week was no different. The pandemic keeps wreaking havoc in many developing countries and of course in the US as a second wave in Europe seems inevitable now. Check out these great graphs from the Financial Times.

On Wednesday the CEOs of the largest 4 tech companies, Apple, Amazon, Google and Facebook appeared before a US Congress Committee to be “grilled” on anti-trust accusations. You can’t say anyone of them lost their cool, really, and when the same companies all reported their Q2 earnings after the close the following day on the one hand it seemed that as if there is nothing to stop them from hoarding cash, and on the other it does reinforce the point of whether there is fair competition and reasonable profit.

The US markets were up this week, especially the Nasdaq, while the World Stocks Index was mostly flat. Italy saw a sharp decline, just shy of 5%, and the European stock markets in general were also down (Stoxx index fell by 2.6%). The other stock market we watch closely, the Nasdaq Copenhagen, was less badly hit with a 1.4% loss and continues to outperform most European stock markets.

We keep finding great investment opportunities in the Italian stock market. A classic  rule when it comes to personal finance is to invest in what you know. This past week I have sent two new buy alerts, one for mid-cap in the Industrial sector called IMA (which is already up 14% since my buy alert) and another one for a Consumer Cyclical stock called Elica, both traded on the Italian stock market.

I am disappointed by the recent weakness in WeBuild which tanked 21% this week. This is a good example of why focusing only on valuation is not sufficient to pick (or deciding to stick with) a stock: if the market is against it, you won’t see it grow. With the 38.2% fib level broken, there is the risk of further depreciation. I will look into it more closely in due course and send an alert if I sell/reduce/accumulate.

WBD.MI_YahooFinanceChart

I realised that one of our SQQQ position was incorrectly reported despite the ETF having hit our SL price of 8.1$: apologies for the inconvenience.

So far we have not included dividends in the total return and I will endeavor to add this information in a future update as some of our stocks have already paid a quarterly dividend since the inception of the RI portfolio.

The table below summarises the portfolio performance since inception.

200731 RIP

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 20+ positions and can be accessed via this link.

$NEM $BK $SYF $GILD $GRUB $SQQQ $SCO $PCG $LVMUY $LRLCY| Responsible Investor Portfolio Update, July 4th, 2020

Q2 ended with a bang and Q3 started on a positive note. All major markets were up this week as the sentiment continues to be positive despite the concerning news about C-19 in the US and other non-European countries. Note the typical behaviour of the “momo crowd” erroneously reading certain news like the jump in new jobs in the US which however reflects events which occurred in the past rather than focussing on the future like “smart money” does.

Once again the US markets gapped higher, led by the Nasdaq (+4.6% weekly gain), while Europe lagged behind whilst delivering a gain, with the Italian stock market staging at 3.2% gain (#Stoxx +2.0% and #OMXC20 1.8%). Note however that most European indices have a lot more room to recover compared to the US stock market and this may affect the relative weight of our positions going forward. The Copenhagen stock market is up 10%+ YTD and its valuation is getting expensive.

Gold has passed a key resistance level and opened the opportunity for further appreciation: our position on $NEM enabled us to benefit from this move.

Our RI Portfolio was positive this week (+0,6%) but its growth was muted compared to the tracked stock markets because the hedges dragged it down. The markets are so buoyant and the valuations so high that I did not want to sell the hedges as things may change direction after the 4th of July weekend.

Five weeks after initiation we are showing a positive total return of 2.0% beating the Market by 0.6%.

No alerts this week ! I know it is nice to receive them but timing is also important.

This week’s winners in our RI Portfolio were both from Europe: Danske Bank (+6,4% gain) and Inwit (+5,7% gain).

No relative changes between the three currencies of the RI Portfolio.

We now have 15 open positions, 2 of which are leveraged hedges (inverse ETFs). Even in times of high valuations I keep finding cheap stocks and a possible further drop of the markets next week may offer an opportunity to initiate new positions.

The table below summarises the portfolio performance since inception.

2000703 RIP

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 10+ positions and can be accessed via this link.

$NEM $LVMUY $LRLCY $BK $SYF $GILD $GRUB $SQQQ $SCO $PCG | Responsible Investor Portfolio Update, June 27th, 2020

This week was a roller-coaster for the global markets which pushed higher in the first two trading days to then loose strength and finish the week down. We still did not manage to have two consecutive negative days though !

In the US markets the #Dow suffered a 3.3% loss, followed by the #S&P500 which closed 2.9% lower than last week and the #Nasdaq which limited the loss to 1.9%. The weekly performance in Europe was no different, however all the three indices we follow more closely fared better than the US markets (#Stoxx -1.1%, #OMXC20 -1.3% and #FTSEMIB -1.6%).

Our RI Portfolio was nominally positive this week (+0,2%) and therefore outperformed these 6 indices by a weighted average of +2.6% thanks to selected stocks and especially to the hedges I had put in place during the preceding week, namely $SQQQ and $SCO.

We now have one full month of track record and I am pleased to see that we are showing a positive total return of 1.4% (+0,4% vs the Market).

There was only one Buy Alert this week, for precious metals stock #Newmont which benefited from the stock markets coming to a screeching halt. We also added to the triple inverse Nasdaq ETF $SQQQ position which proved to be the right move. With reduce and accumulate alerts the relative weight of the open positions change of course.

This week’s winners in our RI Portfolio were $SQQQ (+7,4% gain) and, once again, Grubhub (+8,1% gain).

No relative changes between the three currencies of the RI Portfolio.

We now have 15 open positions, 2 of which are leveraged hedges (inverse ETFs). Even in times of high valuations I keep finding cheap stocks and a possible further drop of the markets next week, especially around the quarter close, may offer an opportunity to initiate new positions.

The table below summarises the portfolio performance since inception.

200626 RIP

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 30 positions and can be accessed via this link.

A potential takeover target: Nokia $NOK

This week saw the first group of earnings come in with the financial sector under the spotlight. The big US banks did rather poorly, for the most part: this is for example the case for Wells Fargo, which we own in one of our portfolios, who took a 14.6% weekly loss while the Dow was up 2.2%. On the flipside, our other bank stock, the Bank of New York Mellon Corp (ticker: $BK ) reported better an expected earnings and ended the week with a 0.6% gain. Even within a badly hit sector, there can be outperformers.

But our last week’s biggest winners were Danone (ticker: $BN.PA ) and AstraZeneca, both European stocks, one operating in the food industry and the other in the pharmaceutical sector, who boasted a 9.1% and a 12.1% gain, respectively !

We have made several buys and sells this week. For starters we have locked in a 5.41% gain on Dexcom (ticker: $DXCM ). This company is so promising that I am sure we will be back, but I don’t trust this overly positive sentiment at the moment and, feet to fire, I would guess that next week the market may pause.

The ETF we own which reproduces the German stock market has run a lot lately, after a period of consolidation (those who swear by technical analysis would say “bull flag”), and this week we have exited the position on $EWG with a 7.12% gain in just 2 weeks !

Finally, we have closed our long position on gold, via the $GLD ETF, with a nice 5% gain in less than two months.

From the buy side, we have initiated a long position on Nokia (ticker; $NOK ) which is a potential takeover target. We’ll keep a close watch on it and if it plays out it can result in a significant upside.

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