Welcome to my October 2023 Portfolio Report.
My stock portfolio fell in value by £1,855.71 (-6.6%) across the month of October 2023. This figure excludes the benefit of any additional deposits made and focuses solely on return achieved on existing capital.
£400.00 additional deposits were pumped into the fund this month, £0.00 worth of stocks were sold, with £511.73 of total capital being invested into additional holdings. £115.85 in additional deposits were made due to income from dividends being transferred into the capital account. The additional deposits and dividend income minus the capital difference invested and account fees has therefore led to a decrease in the capital held on deposit which has risen from £161.70 to £139.38
Capital held on deposit now sits at 0.5% of the value of the fund.
The total value of the fund, along with the cash held on deposit sits at £26,492.84
2023 Performance
On 1st January 2023 the account sat at a value of £22,630.27. Since then I’ve pumped in a further £2,565 into the fund. Today’s value of £26,492.84 minus the £2,565 additional deposits, means that I’ve made an investment return of £1,257.97 so far this year which represents +5.7% gain in value for the year.
My Thoughts
I can’t recall if I had said it in last months report, or one of the many other reports, emails, blog posts and articles I tend to write, but I suggested that it was quite possible that by the end of the year I may end up giving a lot of this years gains back.
Therefore, it now feels like the markets were reading my comments this month as that’s precisely what has happened. Some may call it a ‘jinx’ a ‘curse’. But trust me, if I truly held the power to manipulate the markets in such a way, i’d be richer than I am today. Alas, I do not bear this ability. Nor do I ever proclaim to be able to predict what’s coming around the next month. Unlike many dare I refer to them as ‘social media influencers’ whose channels seem dedicated to attempting to convince us that they are ‘the ones’ (the one?) who somehow can read what’s coming.
And so, the whole market took a dive this last month. Largely off the news that the Bank of England are saying that rate drops are not around the corner and are not coming anytime soon until significant reduction in inflation is seen.
The ‘why’ really isn’t important here, nor all that helpful to any of us. The fact is, prices fell, and my portfolio took a sizable hit. It’s been a while since we saw a 6-7% drop in value, and it’s knocked my portfolio back to the value it sat at back in May, albeit it with some funds since deposited.
I’ve been here a few times now in my short decade of investing. In fact, it’s really only been the last 3 years, since the covid event, that we’ve been experiencing this drawn out rise and fall of market prices. The sensible investor will be adding more to their portfolios when prices are cheap. And that’s largely what i’ve done. In fact, I feel like i’ve done a rather good job of it. And whilst the portfolio doesn’t yet show much in the way of tangible (or intangible for that matter) results, it’s the work that i’m doing during these phases of cheap prices that will yield results for me later down the line.
This is where many investors make mistakes. They tend to do the opposite. They view these periods as ‘scary’ because they are measuring success and failure on the back of their portfolio value right now. Many of them are nursing imaginary wounds right now looking at their portfolios in October and getting in a stress about the whole thing. But it’s the wrong way to look at the situation. They have it all backwards. Which is why, after 20 years of investing, they have backwards results.
It’s hard to do the right thing when your mindset is all wrong. It’s hard to buy a stock when the price has fallen by 50% because most investors are thinking “what if it goes down even further?”.
Well, this is where knowing what you are investing in is key. Because if you know with total clarity that the business is in very good shape financially, and that they are doing everything right with their surplus profits and re-investing them in the right way to support continued growth, and if you know that there’s room for that business to grow and enough market share attainable to sustain that growth, and everything else is all pointing towards “this here is a great business I’d like to own a slice of” then it becomes very ‘easy’ to buy shares at 50% off.
Alas, most investors do not have access to my research. They don’t know how to do their own research either. So they can’t ever possibly know how that feels. They’ll never have that confidence in a stock. But I do. And so, in times like these, i’m buying. Over 50% of my watchlist of stock is now at a price we’d want to buy at. We don’t see 50% very often. Now, this isn’t necessarily reflective of the wider market. We’re talking about only the best 52 stocks out of 1000 FTSE stocks. Many of the 950 odd that didn’t make the grade are still massively overpriced. I don’t believe we can take that 50% rate from my 52 handpicked stocks and assume it applies to the other 950 FTSE stocks. I suspect the % priced at a bargain level would be far lower as much of the market is still overpriced and has been for many many years.
That’s largely irrelevant to me. I only care about the 52 stocks I want to own. Of which many of them are perfect pickings right now. I only wish I had more capital to put to work.
But since 2020, when the markets began to take a hammering, i’ve been buying. Most of that buying has been during the ‘dips’. How do I know when a dip has formed? Easy, it’s when we hit periods where 40-50% of my watchlist is cheap. It’s during these periods I need to get to work. It’s no use doing nothing during this period and waiting for the market to recover before you start buying. Why woud you want to wait until your favourite stocks are more expensive?
“Well”, you might say, “to be sure the market is going back up again”. But that’s illogical thinking. Because it might come back down again after it goes up. If you wait for a stock to go from £5 to £10 before you buy, and it falls to £5 again, you’re down -£5 a share. If you buy at £5 and it goes to £10, and then falls to £5, you’re breakeven. So buy more!
It all comes down to one simple rule that if you grasp it and really ‘get it’ it will all make sense to you. Some of you are there. You get it. Others are still trying. This is why I repeat myself so much. You can’t attend a jui jitsu dojo for one lesson and suddenly be able to call upon your training when the moment comes. It takes years of repetition. Doing the same thing over and over again. Hearing the same lessons over and over again.
The simple rule? Ask yourself this one simple question. If the answer is yes, buy the stock.
The question? Are you getting a slice of a wonderful business at a price that makes perfect sense? Forget the rest. Forget waiting for better timing. Forget waiting for the market to show its going back up. The market never shows it’s going back up. It’s an idea in your head. You can’t know a market has gone up until ‘after’ it’s happened and you look back at the historical charts. When you’re in the moment, it’s impossible. And ask yourself, at what point do we say its gone back up? If a stock falls from £10 and is now at £5 today at which point has it gone back up? £5.20? £5.80? £6? £8? Where’s the line? No, my advice is forget all that. It creates unnecessary stress. Just go back to the above question. Embrace that concept and long term investing not only becomes more simple and fun, but you learn to become excited by 50% drops in price.
Chris
Portfolio
| SHARES | STOCK | COST (£) | MARKET (£) | GAIN (£) | GAIN (%) |
|---|---|---|---|---|---|
| 120 | STOCK 1 | 877.62 | 1,165.20 | 287.58 | 32.77 |
| 1152 | STOCK 4 | 7,092.64 | 7,349.76 | 257.12 | 3.62 |
| 30 | STOCK 23 | 493.50 | 852.60 | 359.10 | 72.77 |
| 51 | STOCK 2 | 1,028.30 | 932.28 | -96.02 | -9.33 |
| 1902 | STOCK 25 | 2,584.60 | 2,111.22 | -473.38 | -18.31 |
| 1312 | STOCK 29 | 2,650.31 | 1,626.88 | -1,023.43 | -38.61 |
| 35 | STOCK 16 | 501.53 | 502.25 | 0.72 | 0.14 |
| 1505 | STOCK 32 | 1,269.04 | 1,083.60 | -185.44 | -14.61 |
| 110 | STOCK 34 | 1,557.70 | 1,461.90 | -95.80 | -6.15 |
| 13 | STOCK 17 | 248.05 | 611.52 | 363.47 | 146.53 |
| 2619 | STOCK 43 | 599.64 | 759.51 | 159.87 | 26.66 |
| 138 | STOCK 39 | 249.26 | 345.00 | 95.74 | 38.41 |
| 109 | STOCK 49 | 409.80 | 267.05 | -142.75 | -34.83 |
| 304 | STOCK 55 | 1,048.02 | 231.04 | -816.98 | -77.95 |
| 154 | STOCK 33 | 3,900.22 | 3,763.76 | -136.46 | -3.50 |
| 50 | STOCK 24 | 800.20 | 427.50 | -372.70 | -46.57 |
| 26 | STOCK 45 | 491.34 | 616.20 | 124.86 | 25.41 |
| 398 | STOCK 56 | 521.08 | 537.30 | 16.22 | 3.11 |
| 15 | STOCK 57 | 1,029.91 | 1,066.50 | 36.59 | 3.55 |
| 147 | STOCK 38 | 762.59 | 642.39 | -120.20 | -15.76 |
| TOTAL | 28,115.35 | 26,353.46 | -1,761.89 | -6.26 | |
| CASH | 139.38 | ||||
| TOTAL PORTFOLIO VALUE | 26,492.84 |
Dividend History
£115.85 was received this month in dividends and re-invested into the fund.
I have received a total of £775.47 in dividends so far for 2023 which is an average passive income of approximately £77 a month.
At the start of the year I explained I was hoping for a 2.5% yield from my account each year which would have amounted to £625 in 2023. So I have therefore achieved this already with 3 months left to go which is very pleasing. By this time last year I had received £695.92 in dividends. So we’re ahead of last years year to date total.
I will add, however, that having done some forecasting, it’s looking likely I may have to wait another year to reach that £1000/yr dividend milestone. The lack of special dividends being paid in 2023, in addition to no longer receiving Medica Group plc’s dividends after being sold due to the takeover, all leads to the suggestion we are likely to only make it to £900. Still somewhat leaps and bounds above the anticipated £625, and an improvement on 2022’s total of £836 if attained. So I certainly won’t be complaining.
2022 Dividend Income = £836.58
2021 Dividend Income = £681.58
2020 Dividend Income = £107.75
Historical Performance Tracker
My goal is to reach £1,024,864 in account value within 23 years from the start of this project. I plan to get there by achieving an average annual return of 15% from my stock picks and an additional average 2.5% annual dividend yield which will be re-invested into the fund for compounded growth. This also assumes a £250/month cash input to aid growth. This progress is represented as the blue ‘trajectory’ line.
My financial forecasts suggest that to stay on track and reach my goal I must finish 2022 on £19,169. By the end of 2023 I needed to be on £26,132.
The value of my fund has already reached almost £26,500 at this stage. As a result I am just ahead of schedule of reaching my target of £1,024,864 by 2042. This is despite the poor market returns of 2020-2023. However, my projections are already based on conversative returns, obtained from historical performance. I am therefore left in no doubt that I will make my target far sooner than planned. Initial projections suggested I would reach my end target aged 61. However, current projections now suggest the milestone will be reached by the age of 59. I hope to get there before I hit 55.
Join Me On My Journey
I hope you continue to join me for this rollercoaster ride across 2023 and our forthcoming years of financial growth. I sincerely hope to one day be able to meet some members in person and bask in each others stories of success. Nothing will please me more than for my hours and hours of analysis to have had significant positive impacts on peoples financial lives and welbeing. This is an incredible journey, growing a starter portfolio of £4k to £1 million. It will take best part of 20-25 years to achieve.
However, I hope these monthly reports then become a roadmap of sorts that future generations can take. I certainly intend for my children to take on the baton and continue running with it long after i’m gone. For me, this is a the start of the Chillingworth legacy. Whilst I started in my 30’s with less than £10k, my children will start in their 20’s with perhaps £100k each. Their children may start with a million each. Their children could eventually be billionaires. Whilst I won’t be around to witness it, I’d be happy knowing I came into and then left this world having made a positive impact to my family in this way.
The Podcast
If you haven’t yet checked out the Diary of a UK Stock Investor Podcast, you can do so by going to the Podcast page which provides all the links you’ll need to tune in. The Diary of a UK Stock Investor Podcast is a show for everyday retail investors. With a new episode every Thursday, we focus on successful investing in UK stocks discussing education, strategy, mindset, ideas and even stock picks and analysis. The show is curated by Chris Chillingworth, a UK investor for some 9 years whose stock picks have achieved a 16.8% annual average return between Jan 2014 – Jan 2023.