Derek Pain: A little light relief for the ‘no pain’ portfolio
No Pain, No Gain
Saturday 20 June 2009
The slightly more benign stock market atmosphere in recent months has filtered through to constituents of the no pain, no gain portfolio, helping the June valuation to look a little more encouraging.
I was quite depressed when I did the March quarterly review as the overall gain had declined yet again. It stood at an uninspiring £77,000 with past successes having kept it in the black.
The days when the portfolio showed a near £150,000 profit seemed nothing more than a distant memory. True, shares had shipped severe punishment since those halcyon times, but that did not make it any easier to tolerate the seemingly relentless erosion of capital.
The portfolio’s dire performance in March must have mirrored the expe
rience of many small buy-and-hold investors. I hope they did not panic: gritting your teeth and letting this storm take its inevitable toll as it thunders by is the best response.
Now the big question is whether the storm clouds are disappearing. Or are we experiencing a lull before another bashing? As I said last month, I think the worst is over, but there are plenty of experts who expect further carnage.
Certainly the stock market has staged a decent show. But don’t forget that its rally is from a very low base. And I would suggest that, for the next few months, it is likely to record modest gains at best as the economy remains in recession.
In the March review only two constituents displayed gains and one of those was a token gesture. This time around, four are in the black and others have reduced their losses. As a result, the portfolio is now posting a near £85,000 gain. Nothing spectacular. Just a reasonable improvement. At least, for a change, a move in the right direction.
I am content with most of my dozen shares. In the main they will respond to any improvement in the investment environment. For a long-term player they appear to be splendid lock-aways.
Unfortunately, I nurse a couple of howlers. The most obvious is Green CO2. Its fall from grace is something of an illusion and has little to do with the current set-up. The company was formerly known as Wyatt and indulged in online employment services.
Then came one of those transformational deals so beloved by small caps. It acquired companies involved in energy performance certificates and home information packs, adopting a new name in the process. I would imagine the sluggish state of the property market is not helping the group, but it now embraces a collection of activities that could offer long-term benefits. However, I suspect the loss the portfolio has endured will never be made good. Still, it could be cut significantly.
I should, of course, have sold the shares when they were much higher, but there always seemed to be the promise of better things to come. Now with the shares bobbing around 2p, any sale hardly seems worthwhile.
Pubs ‘n’ Bars has been another disaster. The pub trade has been a major casualty of the depression and I am not expecting much cheer from the heavily-borrowed chain.
And it’s red faces all round at Nighthawk Energy. The US-focused oil and gas group seriously blotted its copybook with the shock statement that its brilliant deal to sell a minority stake in its Jolly Ranch development in Colorado had been abandoned.
No wonder the shares failed to respond to the transaction when it was announced. Still, stockbrokers Daniel Stewart retains a 102p target price and Hanson Westhouse is on 97p. I believe Nighthawk remains a promising play, but it could be some time before it recovers from such a brutal setback.
It is likely to cut its exploration cash burn or raise funds from elsewhere. The failed asset sale was a protracted affair and the group could have difficulty lining up another deal. It has already pulled in £10m through placings at 20p a share. I hope another such exercise is not on the cards, and a heavily discounted rights issue might be an option.
Whitbread, the leisure group once seen as a recessionary hedge, produced a respectable trading statement. The performance at its budget hotels continues to slip, but the coffee shops and pub/restaurants seem to be making up much of the shortfall.
The major worry is that turnover at the hotels will decline even further. Nonetheless, the group has a strong balance sheet and should be able to display considerable resilience in these cash-conscious times.
The Microsoft mogul told fans a few home truths during his Reddit AMA
10 tips for taking out a personal loan
Simon Read: Frozen in time - the expat British pensioners who deserve a better deal
Weekly Money: Round-up of the personal finance stories you may have missed 26-30 January
Revealed: Amazon earns more through government grants than it pays in tax
City Watchdog to investigate banks' handling of PPI compensation claims
- 1 Woman falls to her death as she celebrates marriage proposal at the edge of Ibiza cliff
- 3 Dad attempts revenge on teenage daughter, plan backfires spectacularly
- 4 Ball pool for adults opens in London
- 5 Amal Clooney gives excellent response to fashion question at European Court of Human Rights
9 reasons Greece's experiment with the radical left is doomed to failure
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
Have we reached 'peak food'? Shortages loom as global production rates slow
Greece elections: Syriza and EU on collision course after election win for left-wing party
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Liberal Democrat minister defends comments suggesting immigration causes pub closures
iJobs Money & Business
£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...
£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...
£13000 per annum: Recruitment Genius: This Pension Specialist was established ...
£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...
Day In a Page
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion