Australian NAPs Portfolio

19th Aug '17 by Ned Kelly

10 comments 7367 reads

After Ed's recent NAP's Ticker Name BSL BlueScope Steel ORI Orica GWA GWA SXL South.n Cross Media $1.35 API Aus.n Pharma Indu $1.55 MTS Metcash CTX Caltex Australia WHC Whitehaven Coal ABP Abacus Property HFA HFA Holdings ANN Ansell LHC Lifehealthcare AQZ Alliance Aviat.n Serv NWH NRW Holdings $0.95 CDA Codan DWS DWS MAQ Macquarie Telecom MNF MNF AGL AGL Energy PEA Pacific Energy This is a real money I would love to hear portfolio webinar I decided to try and create a NAP style portfolio of stocks listed on the ASX. I did the analysis on August 1st or shortly thereafter using the rules outlined in the webinar, i.e. the 2 top StockRanks in each Sector and trying to avoid having two stocks from the same industry group. It has a reasonably good spread of Market Caps with a minimum cut-off at £50mm. (It was a bit confusing at first as whilst the stock prices are in A$, Stockopedia gives the market caps in £'s) Most seem to be "Super Stocks which I suppose is not that surprising. The portfolio is as shown below:
Stock
Last Price A$ Mkt Cap £m Rank™ Sector
$13.93 4,851 99 Basic Materials
$19.75 4,466 97 Basic Materials
$3.12 503 99 Consumer Cyclicals
623 99 Consumer Cyclicals
450 95 Consumer Defensives
$2.60 1,514 99 Consumer Defensives
$31.57 5,036 98 Energy
$3.24 2,022 99 Energy
$3.35 1,149 99 Financials
$2.75 270 94 Financials
$21.50 1,868 97 Healthcare
$2.34 61 98 Healthcare
$1.16 85 99 Industrials
129 99 Industrials
$2.20 241 99 Technology
$1.59 123 97 Technology
$14.68 187 82 Telecoms
$5.02 198 88 Telecoms
$24.85 9,750 93 Utilities
$0.62 139 96 Utilities

portfolio and is now fully invested.
from anyone who has done anything similar or who has any relevant comments. I will try to remember to report on the progress or any changes during the next year.

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Oscar Nimo

21st Aug '17

Hi Ned
Good start for process investing. I've started exactly the same approach last year at the same date, 1st of Aug, with 20 european shares, mainly concentrated in France, Belgium, and Netherlands (Due to lower broker fees on Euronext market). It returned 39% for my first year. I am sure this bullish market cannot be so bullish for the years to come, but it's a good start.
Main point for me to start a ´NAPS' approach is to have time to mature and to adapt the selection and screening approach. After one year, i move a little bit, and i decided to introduce some sector momentum, as in the last ed's proposal for the SNAPS update of July (up to 3 shares in the same sector)
Time will tell if it was a good choice.
Safe investing!

gregatr0n

18th Mar '18

Hi Ned,
I'm about to follow a similar path and start my own NAPS solely on ASX listed stocks. How has your AU-NAPS portfolio fared after c7months? Have you done a SNAPS rebalance? Keen to see your progress as dipping my first (little) toe into the Aussie market...
Thanks!
G

jhmtaylor

20th May '18

I too would be interested in hearing how your NAPS portfolio is performing.

PhilHofGrowYourDough

I crunched the numbers quickly using a Google finance spreadsheet and here's the results ...

Note: HFA Holdings changed name to Navigator Global Investments

An average return of 17.3% set against a gain of 6.45% for the ASX 200 over the same period.

Hope that helps
Phil

3rd Jun '18

Thanks very much, that has been very helpful
.

Edinburgh Investor

Be interested to hear how you find investing in the ASX compared to other markets i.e. the UK, I will move back to OZ at some point so will probably start research ASX listed companies.

5th Jun '18

Up until now, I have been using portfolios managed by 3 investment managers that I rate highly as a screener and then using Stocko to cherry pick. I also run another portfolio that is primarily stocked in an industry with a good theme and lots of momentum. I am going to replace the first portfolio with a modified NAPS portfolio. I think the modification is necessary due to the peculiarities of the Oz market (35% of the asx mkt cap is banks (on the nose)and 30% resources(volatile)). I am still going to do the 2 stocks in 10 sectors but some will not have a ranking of 90 or more. I am pondering whether 8 out of 10 sectors may be more appropriate for the ASX.

Ned Kelly

My actual return as of today is 23.9% including dividends . It dropped 0.9% last night so with just under 2 months to go for the first 12 months I am pretty happy. I have not rebalanced but will do so come August 1st. Nor have I receinvested the dividends, other than when I was able to take a scrip dividend, but will do so when I rebalance. There is no significance to using August 1st, it is just when I decided to give it a try. At current one stock has been taken over (Life Healthcare at $3.75) but I have not yet chosen a replacement so have $11,280 in cash in the account being the proceeds of the take over plus cash dividends.
I was not too bothered by the predominance of Banks and Resources stocks on the Australian market but did not actually choose any of the Banks as they didn't qualify at the time. Telecoms was the only sector where I had to go below a stockrank of 90.

I find dealing on the Australian market very straightforward with the added benefit that no nominee accounts are needed so you go straight on to the share register and get communications direct from the company.

Re Edinburgh Investors comment on researching the market, one of the main reasons I tried this approach was that it did not require researching the market other than analysis of the Stockranks.

I look forward to any other comments and hearing how anyone else has done with this approach.

My stock picking has been more trades rather than longer term portfolio and has been very messy delivering a return of 38% but I know it has been more good luck than substance. Standouts were GSW, PLS, A2M. Dogs included GNG, HVN, RFG. I do not wish to spend so much time watching screens hence my interest in NAPS.

25th Aug '18

My Australian NAPS portfolio finished it’s first year at the beginning of August up 35% including purchase costs and dividends. No changes were made during the year.
Of the 20 stocks there were 5 losers: AGL -17.1%, DWS -14.7%, ORI -14.2%, PEA – 13.1%, SXL -5.9%.
Of the other 15 the big winners were AQZ +116.5%, NGI +126.7%, NWH +144.7%, WHC +69.8%, MAQ +65.3% and LHC was bought out for cash for 65.6% gain. All these have been retained plus ANN (taken a bit of a hit in the last few days), BSL and CDA
I have now kept the top 8 and sold the poorest 11 stocks (everything that made less than 20%)
Stocks added and their StockRanks so far are: BSE 99, CPU 87, MCP 99, NEC 99, PNC 97, SDG 99, TLS 96, VRT 92 and WPL 93. I still need to select 3 more stocks.

Australian NAPs Portfolio

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Ned Kelly

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