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The Beginners Portfolio is a virtual portfolio, run as if based on real money with all costs, spreads and dividends accounted for. Transactions made for the portfolio are for educational purposes only and do not constitute advice to buy or sell.
I dont check on the Beginners Portfolio progress very often. In fact, my general approach to investment is to buy and forget, and I only update the numbers whenever Im writing a new article. And this time it was the first time since, well, probably ever, that none of the constituents had fallen since my last check!
Barclays and Sirius Minerals were both flat, but all the rest were up some quite nicely putting us 39% up since inception. But which were the big winners?
When I added Aviva (LSE: AV) in March 2013, the insurance sector was in a bit of a rout after the financial crisis, and overstretched dividends were tumbling like dominoes. But Aviva had already bitten the bullet and rebased its dividend, and had started on its restructuring strategy aimed at strengthening its capital position.
A clear recovery play
The share price had taken a hammering, but was already starting to recover, and I saw one of those opportunities that actually come along surprisingly often a good company in a business that can be quite cyclical, which was looking fundamentally solid with a long-term view, but whose shares were afforded little more than pariah status.
When you see that, you buy and the portfolio has since enjoyed a 71% profit, including dividends and after all costs, with the shares up to 510p. And with a forward P/E of under 12 and a new progressive dividend policy already in place, I see more to come.
Buy the best
What do you say about Apple (NASDAQ: AAPL)? Its got to be one of the safest growth shares out there, and people just love its products at the last iWhatsit launch, my local Apple Store was so crowded that people were having to queue outside to get in.
When the Apple Watch was launched, a lot of the critics panned it but the customers just couldnt stop buying it. And then theres Apple Pay the signs are popping up all round the local shops even in my backwater in Liverpool. Why are retailers so happy to get on board? I think a lot of it is to do with Apples reputation for doing things that just work if you deal with Apple products and services, youre going to get carefully thought-out stuff that doesnt cause you any growing pains.
Were up 84% on Apple since January 2013, and with a P/E of only 13 the shares are still not on a high growth rating.
Once in a lifetime?
The housebuilding sector in 2012 was one of the few total no-brainers Ive ever come across in my investing career, and I happily jumped on Persimmon (LSE: PSN) and after a 212% gain, the initial investment has now more than trebled.
What we had was a sector being pummeled during the crisis, yet filled with companies that were cash rich and suffering no actual fundamental problems. By their very nature, housebuilders are long-term in their outlook, building up their land banks years in advance of actual building, and able to buy when land is cheap and then build and sell when houses are more expensive.
At the time, Persimmon, along with the others, was filling its boots with cheap land at rock-bottom prices, and I bet the directors were going to bed every night with big cheesy grins on their faces, hardly able to believe their luck.
And even after such an impressive gain, the shares still look good value to me, with big dividends expected.
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Alan Oscroft owns shares in Aviva. The Motley Fool UK owns shares of and has recommended Apple. The Motley Fool UK has recommended Barclays. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.