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The Shareswatch Random Stocks Portfolio: January 2013

January 28th, 2013 · Greg Atkinson · 11 Comments

Back in May 2012 when I last reviewed the performance of the Shareswatch Random Stocks Portfolio the S&P/ASX 200 (XJO) closed at 4165. On the 25th January the ASX 200 closed at 4835 which means the XJO has risen by around 13.85% since the last review.  So it will be interesting (for me at least) to see how this randomly selected collection of stocks has been performing against this ASX 200 Index.

Before I look at the portfolio in detail I need to deal with some portfolio management & administration issues.  Firstly Onesteel (OST) has undergone a restructure and is now known as Arrium Limited with the new ASX code of ARI.

Next Gunns Limited went into voluntary administration on the 25th September 2012 so the stock price shown in the portfolio is the  last price it traded at.

Lastly the Shareswatch Random Portfolio is sitting on just under $50,000 cash thanks to the takeover of Riversdale Mining. My intention is to randomly select three more stocks for the portfolio ($10k in each) plus allow readers to pick the final one.

I will set the date for the acquisition of these new stocks for the portfolio to the 1st March 2013 with the cost price being the closing price for each stock on that day.

The “reader’s choice” stock for inclusion into the portfolio will be selected randomly from stock suggestions left in the comments area.

Now let’s see how the portfolio has fared since May 2012.

Shareswatch Random Portfolio January 2013
On the 16th May the portfolio was worth $144,605 which included cash of $47,184.  As of the end of trading on the 25th January the value of the portfolio had increased to $151,101 with the amount of cash held unchanged. This represents a rise of around 4.5% since the last review.

The drag on the portfolio when compared to the S&P/ASX 200 Index, which rose around 13.85% during the same period, was mainly due to:

– The amount of money being held in cash.
– The slump in MacMahon Holdings Ltd. shares. (ASX:MAH)
– Gunns being put into administration.
– The continued slide of the Arrium Limited (ASX:ARI) stock price. (formerly Onesteel)

On the plus side other stocks rose in value with Woolworths (ASX:WOW), Platinum Asset Management (ASX:PTM) and Monadelphous Group Limited (ASX:MND) posting solid gains.

MND shares in particular have had a good run as the chart below clearly shows.

Monadelphous (ASX:MND) 1 year stock price chart


Overall the portfolio is up 51.1% since October 2008 which isn’t a bad return and means it has on average, gained just over 10% per year.  Remember dividends are not included in this figure as I assume that any income from these have been used for portfolio administration & trading costs.

So the open issue now is for readers to suggest which stock should be added to the portfolio from March, so please feel free to nominate any stock within the S&P/ASX 200 Index along with the reasons why you think the stock should be included. (just to make things more interesting!)

The Shareswatch Random Portfolio is a random selection of stocks from the ASX 200 range of companies. For further details regarding how it was constructed please see: The Random Portfolio

Greg Atkinson is the editor of Shareswatch Australia and the Managing Director of Ohori Capital. He is originally from Australia but currently resides in Japan. He can be followed on twitter via @GregAtkinson_jp

11 responses so far ↓

  • 1 Stillgotshoeson // Jan 30, 2013 at 3:18 pm

    I have a couple in mind. Will spend a couple of weeks narrowing it down to just 1 and will post it up.

  • 2 BoomOrBust // Jan 31, 2013 at 12:46 pm

    I’d like to see another miner on this list, even with the current volatility, Australia is still predominantly mining focused for the years to come. I’d add AGO as it appears to be deflated in price currently and is set to improve once Fortescue’s rail vendored, or they manage to build their own.

  • 3 Greg Atkinson // Jan 31, 2013 at 2:18 pm

    Yes the portfolio is a bit on the light side in terms of mining stocks now that Riversdale is out.

    So AGO will be a candidate then.

    Stillgotshoeson you can nominate more than one stock if you wish.

    As for me, I’d like to see one of the big banks in the portfolio – ANZ, WBC, CBA or NAB.

  • 4 Stillgotshoeson // Feb 1, 2013 at 1:50 pm

    I have 3 Picks Greg

    EHL Supply and lease equipment to mining companies.

    Trading around 60 cents. Paying a dividend. Getting debt under control and rebuilding the business. Book value around a $1.

    We are in volatile times but mining will continue into the future for some time yet.

    SBM Still my favourite of the mid tier Gold companies. There are a few others in the ASX200.

    Lastly SAR Another Gold miner, I still do not believe Golds bull run has finished and further upside is woth having some coin onto.

    I think Lachlan likes/owns SAR in his portfolio, I have been hesitant about them in the past but I think things are turning around in a more favourable way.

    EHL, SBM, SAR.

  • 5 Matthew // Feb 1, 2013 at 3:06 pm

    5 for me from difference industries in order of preference

    FGE – this is a MND story in the wings. We work closely with a couple of their divisions and our workload is up 45% YOY without any gain in market share. They have 3 years upside at least.

    NAB – I just like NAB!

    TFC – Moving closer to their first harvest, significantly undervalued IMO still tarnished by the collapse of other MIS producers. Perhaps a WA centric stock but heavily publicised over here.

    WDC – Yet to make the gains lost with the collapse of Centro etc. Reasonable yield

    EGP – if you are going to gamble on the market, why not hold a gambling stock! Seriously though I see upside here as long as Packer is wandering around the wings

  • 6 Lachlan // Feb 3, 2013 at 3:09 pm

    Greg I have not had a very good look around but i have a few with some upside potential which may need looking at again later. They are RIO which I believe has upside at least into the 80’s and AWE which are probably near a bottom and although I know you you don’t favour gold, in case you do go that way I would probably keep with a large one like NCM since the portfolio is not a gambling portfolio.

    I looked at Codan CDA but they are too over-bought now. It’s a favourite of my fathers and has just put on a very good run.

    Shoes I think SAR would be still possible to hit 30c only because of price technical reasons and because I believe the small cap goldies are about to hit a long term bottom (next few weeks). I expect large gains (eg 500%) in some but these shares have been given an absolute hiding of similar proportions. They have not generally rallied with gold (following indexes) and therefore I believe they may well be a target of institutional short selling which is a popular proposition put forward by people like Jim Sinclair…I know Jim says a lot of sensational things which require sober judgement. However since the mid 1990’s small cap gold shares have been in a bear market while the metal has gone up 400% roughly. Something does not add up there. Anyhow there is an opportunity since all these things still behave in cycles.

  • 7 Lachlan // Feb 3, 2013 at 3:22 pm

    I would not pay more than the current price for RIO either and of course the market is hard not easy to buy in in at present. AWE is likely to pull back at least a few cents for better entry prices.

    As you say Greg a better time to trim profit really while we approach key resistance on the indexes.

  • 8 Greg Atkinson // Feb 3, 2013 at 4:54 pm

    Lachlan, AWE would bring some oil & gas into the portfolio so that could be a good thing. I have an interest in some AWE stock by the way which I will mention in the interests of disclosure.

  • 9 Greg Atkinson // Apr 14, 2013 at 8:38 pm

    The candidates for inclusion into the random portfolio are:

    AWE, WPL, NAB, WDC, EHL & SBL. If anyone wants to push for any one of the above please feel free to push, otherwise I am going to use a dice to pick one of the six.

  • 10 Stanley // Oct 24, 2013 at 12:05 pm

    A good read thanks.

    How about a refresh.

  • 11 Greg Atkinson // Oct 25, 2013 at 8:58 pm

    Good point Stanley, a refresh is way overdue. It will be coming soon 🙂

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