Well, the end of 2020 wasn’t too bad marketwise and the santa rally kind of worked if you were in reasonably early. And the beginning of 2021 has been decent.
Markets are assuming vaccines will work and by the autumn we’ll be back to normal. Also with a new USA president plenty of stimulus is expected.
What on earth is in store for 2021? Glad I am not a forecaster as I haven’t got the
foggiest. Either a major plunge or a major boom would not be surprising.
The main thing is to follow what is happening cos if you take a view then stubbornly stick to it and it goes the wrong way you could do some serious financial injury.
We have to be careful – there are quite a few anecdotal signs we could be in a major bubble which could easily burst.
Bitcoin on a high is one sign. Students trading shares through phone apps is another. Crazy valuations on risky shares another. Some US shares with no profits on PE’s of 100 plus another.
I’m also getting emails from youngsters betting in high risk shares not sure what to do next. Tesla is trading on crazy multiples and someone worked out each car is being valued at over a million dollars.
These are all beginning signs of a bubble. BUT on the other hand looking at the less risk end of the market – ie companies actually making profits some of these seem reasonably valued. The crash will probably be in anything highly valued.
And with interest rates non existent where else is there really to put your money?
Most of the shares I hold pay out 3-6 percent interest and that means I can pick up well over £100,000 a year just on dividends.
Onto some trades of which some came up at the zoom follow up seminar where my long-term students came up with some real goodies!
However first I came up with a share by accident!
I was waiting in a cubicle for my steroid injection ( see above somewhere for my health travails) when I heard lots of chat.
The nurses were saying they were so busy. Loads of people like me were self paying for elective operations cancelled by the nhs. The porter then told me he could never remember them being so busy. Then I realised I was at a Spire hospital listed on the market! The place was working to absolute capacity.
In total I had already given this Spire hospital over £15,000. And btw it was a brilliant place
and I add I know how very lucky I am to be able to afford to pay.
Anyway I bought some Spire shares on the busy-ness and full capacity I could see it working on.
Then guess what happened! A day or two later they put out an ahead of expectations
statement. So I am now a happy holder of Spire (SPI) – judged from what I saw there is probably more upsideas the statement said they were winning NHS contracts. Also net debt is coming down fast and profits they reckon should be booming up.
I would rather of course had not had the operation or been in there at all but at least there was a tiny bit of upside! I am looking to hold for 3-6 months looking for a kick up to 200p plus. ps, fat lot of good the steroid injection proved!
Moneysupermarket (MONY) came up at the zoom seminar. I frankly am dubious about all comparison sites – there is the feeling they bump up companies that pay them the best commission and all may not be what it seems.
But, the fundamentals look good and if I was a bigger similar company I would take it over, hence I bought the shares. It has some cash and I think it looks an interesting buyout target – there’s a dividend as well. So I am in with a medium term view.
An interesting play backed by a number of my best long-term students is Fonix Mobile (FNX) The company says it provides mobile payments and messaging services for clients across media, telecoms, entertainment, enterprise and commerce. The Company offers an application programming interface for charging users directly to their phone bills through desktop, mobile and applications.
It’s quite a recent market issue and even after some decent rises it does not seem especially expensive.There seems to be some cash, and if profit forecasts are right it should be making some nice profits in the next two years and I wonder if it could pick up a rerating.
I discussed this also earlier this week with the beginners/improvers group and we noted the shares tend to move in steps. Goes up, consolidates for a while then up again. But it is on the higher risk side.
I picked up some Volex (VLX) – what seems like a boring company is doing rather well and is gradually on the rise. Some of my best students are in it. When I say boring I mean boring. Cables and that type of thing. Not that it matters as its products appear to be in demand and statements coming from the company appear bullish with raised profit forecasts. As I always say some of my biggest wins have come from boring!
As many of you know I have been stacking up on buying any shares in the gambling space with the US opening up with the view of getting a bid.
I got some Entain – the gambling company. Not soon after there was a bid, the shares flew and there could be rival bids to now push the price up more. I wasn’t sure whether to highlight this buy but as a lot of people at the online seminar saw the buy and it was discussed it seems reasonable to know I am not making it up! Like Codemasters it is a matter of whether there will be a higher bid. A reasonable chance I think which would push them higher.
My buy in gambling co 888 has doubled and my flutter in Flutter has flown up. 888 looks the likeliest to be the next bid. After Codemasters I am also eyeing up potential bid companies in the games space and plumped for Gamesys (GYS)
GYS is a UK-based online gaming holding company. The Company focuses on building a portfolio of brands that deliver gaming content and operates online casino and bingo-led brands.
If forecasts for next year are anywhere near right it is looking cheap. Downside is it has a lot of debt but not enough to worry about a bust or anything like that.
With lots of bids going on in this area of the market my suspicion is this could easily be a bid target and with that in mind I will try and hold unless any massive question marks appear.
I sold some of the bid for Codemasters. Lucky holders it is a question of how much profit will be made. There could be another bid, in which case we will get an even better price!
Seemed to me a good idea to bank some of the profits anyhow which banks a profit of £8333 for the website. I’ve kept about 60pc of my shares to see if there is a bigger bid.Profits for me personally are £150,000 plus.
The portfolio has made giant leaps recently. ITV is getting close to doubling from the original buy and looks a decent bet to get bid for in 2021. Spreadbetters IG and CMC are doing the business for me with nice gains.
I Energiser (IBPO) has soared on news of a giant 49p cash payout. And it has negotiated a giant debt facility,
Be careful with stop losses on this! That is because on Thursday it goes ex dividend for 49p so it should start the day with what looks like a giant fall of 49p! You do not want stops taken out if you are in it. The dividend is worth a fortune in cash. If the shares begin to rise from a 49p drop then you get the dividend AND a capital rise. It has been a great investment so far.
By year end IBPO could easily be over 600p as they still look cheap and loads more dividends to come, a real ideal long-term isa hold.
Qinetic announced a big contract win and continues to look very cheap.