The no pain, no gain column started life 12 years ago this month, and it seems appropriate to examine the portfolio which evolved in the following weeks. I recall my first share was Regal Hotels; it later disappeared, the victim of a takeover strike. Indeed, corporate action was an important influence in the early years of my little share exercise. Around a dozen constituents have fallen to bids and one, Six Continents, was split into two: InterContinental Hotels and Mitchells & Butlers.
And, of course, I have suffered more disasters than I care to remember. They include MyHome International and Pubs'n'Bars. However, the drinks industry has been rather kind, with bidders swallowing the Burtonwood pub chain, the cider maker Merrydown, as well as the wine and spirit group Allied Domecq and the brewer Scottish & Newcastle. Each produced a rewarding profit.
I have concentrated on home-grown shares, avoiding such fads as emerging markets. Although the mad dot.com boom had some impact, the portfolio did not get too involved, primarily because I have difficulty understanding the functions of many hi-tech groups. Perhaps that is why I wrote about the online retailer Asos when the shares were in single figures but did not include them in the portfolio. Despite some controversy over options and some observers claiming that the shares are far too high, their progress has appeared irresistible and they recently breached the 1,800p mark.
To my regret I have, in the main, steered clear of resource shares, despite some years ago being advised by the investment guru Jim Slater to get involved. I suppose my reluctance stemmed from my early days in the City when I became acutely aware of mining and associated frauds.
It was probably my inherent distrust of the resources industry that prompted an unfortunately far too short flirtation with Anglo-Pacific, an investment mining group. I purchased the shares at 16p, held them for a while and then sold at 15p. The price recently hit 380p. I did not, also, have much luck with my venture into the oil business. Nighthawk Energy was recruited at 44p, went to 107p and them bombed. I sold at 14p.
Still, despite such vicissitudes the portfolio has managed to keep in the black, and is currently showing a profit of around £105,000, on a £200,000 outlay. Before the banking crisis almost overwhelmed us, the gain neared £150,000.
Although I am a buy-and-hold investor, the portfolio has seen many changes. Takeover bids forced action, some constituents went belly up, and profits and losses were locked in.
All told, I reckon around 50 shares have featured during the past 12 years. None of the early stocks survive. Last to go was Scottish two years ago.
One weakness I must accept is my tendency to hang on to shares for too long when they are on their way up, or down. If I had been a little quicker off the mark, the likes of Goals Soccer Centres and the restaurant chain Prezzo would have been even more profitable. Nighthawk and Private & Commercial Finance are examples of my reluctance to sell. There is no need for long-term investors to jump in and out of shares; such activity merely adds to the riches of City dealers. But, even so, it is always wise to try and be aware of any changing picture and react accordingly.
I usually give a detailed report on the current position of the portfolio each quarter; the next one is due in a few weeks. There has, in the meantime, not been much unrecorded activity among portfolio members. One, Patsystems, providing electronic systems for derivative trading, offered a rather flat profit performance, with "true" pre-tax profits emerging at £3.2m (against £4.5m) and an adjusted figure of £3.6m (£3.9m). But the group remains cash generative, and the year's dividend goes up 29 per cent to 0.55p a share. It had warned that results would be rather unexciting but the dividend increase indicates a significant degree of confidence.
Another constituent, Hargreaves Services, the coal to transport group, continues to attract positive analyst comments. Latest bulletin to come my way is from the stockbroker Arbuthnot, and suggests that this year's profit should approach £40m, against £34.3m last time. For next year Arbuthnot is looking for £43.2m.