I have regularly spoken to individual clients in review meetings about how we decide what shares we buy, at what price we buy and at what price we sell. However I have never explained it to everyone in a blog. Having sold out of BooHoo.com last week, we have just committed to buying back more of their shares. Describing our recent actions will show how we work.
If you work on something everyday, occasionally you get lucky. Fyffes, Worldpay, The London Stock Exchange and Dart to name just a few lucky results in recent years. Now we can add Boohoo.com either to that lucky list, or we can take credit for an investment process that highlights value and helps us to make more good decisions than bad ones.
Collectively we have just safeguarded a swift £370,000 in extra shares. Normally that takes patience and time. The BooHoo.com story has unfolded in just 1 week.
The last time I flew solo was in April 2015. I had lost my appetite to fly to a different UK airfield just to eat a bacon sandwich, refuel and return. On reflection the long term goal I held was to obtain my UK private pilots licence. After I had that goal in the bag in April 2011, to keep my interest alive, I would have needed to progress up to being able to navigate above the clouds and to possibly learn to fly multi engined aircraft. I didn’t have the funds to commence all of that training.
The reason I mention this is because of the lessons that learning to fly taught me. Flying a single engined aircraft inherently carries the risk of losing power whilst in the air. Much of demonstrating that you are a competent pilot revolves around risk assessment and the procedures you learn by heart just in case.
Loss of Power
Here’s the procedure for what to do if the propellor stops spinning. At a normal altitude of around 2500 ft you can stay aloft about 2 minutes only. You need to know instinctively what to do.
It’s many years since I completed a jigsaw, but recently I came across a partly completed puzzle of a Spitfire flying into the sunset. It struck me that we vary hugely as individuals and yet we approach many problems in exactly the same way.
Most people, maybe all people, start with the corner pieces of a jigsaw. Then all the edges are completed to create the overall size of the puzzle. Then the detail and finally the undifferentiated areas like the sky. Pretty standard stuff.
We don’t just approach jigsaws in this way, but pretty much any problems or questions we have generally.
What are bank holiday’s for these days? Why do we get two of them in May but none in June or July? I’m certainly not complaining, especially as the weather is all set to be excellent again. But since most banking is done on-line these days via smartphones, our business with our banks will continue whether the bank is on holiday or not.
It was as long ago as November 11th that I published Things you maybe didn’t know about UK Shares – Part One. So it’s high time I published Part Two. I said I would move on from the FTSE 100 to the FTSE 250. However I will help you to understand the whole FTSE market framework.
The FTSE All Share Index
The FTSE 100 Index is the top of the tree. It comprises the top 100 largest UK listed companies. Below it sits the next 250 largest UK listed companies – The FTSE 250. Unsurprisingly together they form the FTSE 350 Index. Finally we add the FTSE Small Cap Index to make up the FTSE All Share Index in total.