See all the previous Monthly Recaps here.
June Performance -1.1% vs FTSE All-Share benchmark -6.2%
YTD Performance +1.1% vs FTSE All-Share benchmark -6.4%
(Part Time) Fund Manager’s Report
At the half-year mark of 2022, I have managed to preserve my capital, while the FTSE All-Share is down -6.4%. YTD my outperformance vs my chosen benchmark is +7.5%, and annualised if it continues would be 15%+, which is the type of performance to feel very happy about. In any year, being on track to beat the index by 15% sounds amazing. Last year in 2021, I had managed only +7% outperformance for the entire year. However, in absolute terms, being more or less flat for the year, at +1.1% absolute return, is giving me indifference rather than even a small sense of joy.
Given that most of my investments are in small caps, I have managed to avoid the large landmines in the AIM index, with the AIM100 down -30% YTD. This was down to a few factors:
- I was quite heavily in cash going into 2022 (Y), having not seen enough bargains to tempt me
- My S&P500 short (started in X) and my Gold ETF (started in Y) did very well, a big contributor to my positive performance for the year
- I avoided big losses. None of my largest holdings declined much, and the ones that did like Oxford Biodynamics (LON:OBD) and Fulcrum Utility Services (LON:FCRM) (XYZ) were my smallest holdings, barely 1-2% each of my portfolio value
- I banked some spectacular gains in some of my riskiest holdings before they turned. For example System1 (LON:SYS1) at c410p, now down at 310p. Sosandar (LON:SOS) at c32p, now at 18.5p, and some of Rio Tinto (LON:RIO) at c6100p, now at 4850p
Where do we go from here? I was inactive in June, not buying any new shares. However, I am getting alerts on my buy price triggers weekly. Given the market momentum downwards, market PE deflation, and potential EPS downgrades, I am being more cautious and taking a haircut to my usual buy prices, only considering if shares are at least 10-20% below; to give me more of a margin of safety. So far, none of the shares on my watchlist have met that criterion.
I am in no hurry to buy, but also know that timing the bottom is…
