Monthly report 4-2020

Summary:

  • Corona-virus was still the most debatted topic this month, but the stock market stabilized and much of the downturn evaporated
  • Many good buy opportunities are now gone
  • Cash position at 24 %
  • Current portfolio is comprised of 19 companies, which is down from 29 companies
  • I’m still working on the “Edd Invest 2.0”-investment strategy
  • Current watchlist is now comprised of 51 companies
Current portfolio

The portfolio return for April ended at 9.43 % and turned green YTD after the turmoil in March.

Performance as per 30 April 2020

So, even though the portfolio has outperformed the benchmark and is positive for the year I’m amending my investment strategy.

Why? I don’t believe the current turmoil is over and I expect a second downturn in the market. The decline we experienced in March and partly in April gave great insight into how the indiviual holdings performed during a downturn, shortfalls in my current strategy and a hope for a even more robust portfolio of quality companies going forward.

On the basis of the Covid market drop I have come to realise that I was not ready for such a sharp decline over a short time period and made some transactions, in hindsight, that was based on irrational behaviour. I want to reduce subjectivity as much as possible and be even more in control of what I own and why I own it. Not an entirely new strategy, but redefining it a bit.

Investment Journal:

Many transactions took place in April as well, but I don’t expect to be as active in May. There are several reasons for this. In April I tossed out all non-Nordic holdings (Transalta Renewables, Abbvie, Brookfield Renewable Partners and Visa) as well as Equinor and Cloetta. Even though I would rate the companies sold as high-quality companies I chose to divest non-Nordic holdings since I want to have greater control of the companies in my portfolio, and because I want a greater portfolio concentration.

Cloetta AB was sold due to their poor relative performance in a weak market (Consumer Defensive), profit warning and dividend cut. Equinor was sold due to the weak oil market outlook for months to come. The proceeds from my sales means I’m now holding a cash position of 24 %.

I increased my stakes in Bakkafrost, UPM-Kymmene and Beijer Ref, and reduced my position in Tomra by 1/5.

Short write-ups for Bakkafrost and Beijer Ref can be found here:

Bakkafrost ASA – The cost leader in salmon farming

Beijer Ref AB – global refrigeration wholesaler

Tomra – downsizing position

Dividends in April:

Dividends received this month was down from last year due to a lot of dividend cuts, witheld dividend tax was received in April 2019, and because I’ve sold Sparebanken Midt-Norge, Sparebanken Nord-Norge and Nordea since last year.

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NordicDGI

A Norway-based investor with a background from finance and accounting. I'll use this site to share and to document my journey of becoming a full-time private investor.

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