April 2014 Investment Review

How am I doing?

Another quarter has passed by with the FTSE100 index finishing broadly where it started. It began the period at 6,755 points and drifted down by 0.9% to end the quarter at 6,695 points. The tension in Ukraine dominated the news and caused global markets to fall. Thankfully it seems the US has no appetite for any further conflict, and hopefully it will be influential Russians themselves that eventually temper Putin’s aggression. Along with Russia’s stock market, it is the other Emerging Markets that continue to suffer. Thankfully we have no direct exposure to these stock markets.

Like the previous three months, this is usually a good quarter to be fully invested. However this period would have seen no growth without the dividends generated in our portfolios. We are pleased to say that our strategy over the last 3 months has meant that each of our managed portfolios have shown another quarter of growth.

What have you been doing? There have been lots of contract notes flying around again

We have been trimming back on stock market strength and buying on weakness. We added more Gold in January. For most portfolios we also introduced for the first time a small amount of Japanese investment along with a large stabilising amount of Commercial Property. We have not held Commercial Property in our portfolios since mid 2007. My previous blog details why I thought it was time to invest again.

More Gold? We have lost money holding Gold so far haven’t we?

Yes that is true. We bought well off the top but hindsight tells us that we still took the decision too early. I attended a meeting in November, presented by Marcus Grub, MD of Investment Strategy at The World Gold Council. He explained why the price of Gold had fallen massively from its peak and what its prospects were from here. My blog in January explained why I felt it was time to top up and since then the price has shown signs of recovery. The conflict in the Ukraine and volatility in the US stock market has helped its progress.

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So what next for markets?

We don’t have a crystal ball but we are within a few months of the time of year when traditionally markets tend to slow down. I hope they don’t this year as they have not really got going yet. However there are tell tale signs that a correction could be due. In the US the darling tech stocks and many biotech stocks have caught a cold recently (did you see what I did there? Biotech, colds) These are the stocks which tend to tell us when the more aggressive investors have had their fill for a while. With the US S&P index at all time highs, it is probably due a set back. However  Emerging Markets now look very cheap indeed, it’s not hard to see where the fringe investment capital may be heading.

When is the next update?

These updates are quarterly so we will write again in early July.