Trying again, I need to admit I by no means imagined reaching this type of anniversary…however yeah, the Wexboy weblog turned 10 years-old earlier this month! A journey that kicked off with this Sirius Actual Property purchase (at an astonishing 0.31 P/B!) in Nov-2011. Which was clearly a stock-picking tour de pressure – noting SRE‘s been a 7-BAGGER+ since. Properly, besides I by some means managed to distract/scare myself out of the place two years later…for a mere double-digit achieve! And possibly that’s the place this submit ought to abruptly finish, as a result of:
The one BIG lesson most traders nonetheless have to study is how one can Hodl!
However let me be clear up-front – that is not meant to be some lessons-learned victory-lap submit. As traders, we by no means actually know what’s coming down the highway…subsequent yr may very well be a celebration, or a complete humiliation. And all of us make dumb errors, we repeat them, we reside with them & we lastly transfer on – nice traders simply make much less errors. And we are able to’t afford to get disheartened, or to relaxation on our laurels – nice traders (ought to) by no means cease studying & adapting ’til the day they lastly exit this nice sport. To imagine/fake in any other case is to tempt the gods, which makes investing such a uniquely bizarre mixture of confidence…and humility.
That mentioned, this yr & final yr have been an accelerated studying expertise for me – as is presumably true for all traders (& everybody we all know). And sure, I do know I’ve promised to put in writing about this – and hopefully share some constructive learnings & helpful recommendation – significantly in gentle of my precise FY-2020 & YTD-2021 efficiency. However I gotta admit, I maintain placing it off…as a result of now I desperately need & want it to be a closing epitaph for this (Zero-) COVID hell we’re nonetheless caught in. (Regardless of many of the world getting vaxxed since!?) So yeah, that’s clearly one thing I gotta work on…
However in the meantime, I’m thrilled I’ve really managed to ship that distinctive & rarest of beasts…a public/auditable 10-year funding monitor document by way of the weblog (& my Twitter account). I clearly don’t disclose the precise euros/cents of my portfolio, albeit my long-abandoned profession & my household’s safety/future clearly depend on it – which suggests return of principal is simply as necessary to me as return on principal, in true family-office fashion – however readers & followers have all the time been in a position to assess my stage of conviction/threat tolerance by way of my particular % allocation in (disclosed) shares, and by way of (primarily real-time) monitoring of my (uncommon) incremental buys/sells in these shares.
And in return, I’m way more proper now in seeing readers draw (& even share) their very own conclusions – privately, or publicly – from my stock-picking & funding monitor document so far. To facilitate that, right here’s my annual returns…full with hyperlinks to my annual efficiency evaluation & precise stock-picks/funding write-ups for annually.
(NB: I ought to spotlight this 2015 submit, the place I went again & scrubbed my 2011-2014 efficiency for consistency…however because it really lowered my portfolio returns & raised my benchmark returns, we don’t have to rehash these changes right here.)
(And for reference, this was my 5 yr monitor document again in 2016.)
YTD-2011 (from Nov-Ninth): +7.6% Return
(Diminished from a +16.4% common return to replicate an precise weighted common return.)
FY-2012: +18.3% Return
(Diminished from a +20.2% return, primarily to replicate elimination of dividends.)
FY-2013: +19.0% Return
(Elevated from a +18.4% return, to replicate corrected common stake sizes.)
FY-2014: (0.8)% Return
(Elevated from a (1.3)% return, to replicate a return of capital.)
FY-2015: +9.3% Return
FY-2016: (4.6)% Return
FY-2017: +26.3% Return
FY-2018: (13.5)% Return
FY-2019: +14.9% Return
FY-2020: +56.4% Return
YTD-2021 (to Nov-Ninth): +228.9% Return
For reference, right here’s my H1-2021 efficiency submit:
Now let’s replace it to reach at a YTD-2021 (to Nov-Ninth) index benchmark return:
And right here’s my Wexboy YTD-2021 (to Nov-Ninth) Portfolio Efficiencyby way of particular person winners & losers:
(All positive factors primarily based on common stake measurement & 09-Nov-2021 vs. end-2020 share costs. All dividends & FX positive factors/losses are excluded.)
That’s 33 disclosed portfolio buys over the past decade. Which can look fairly front-loaded (i.e. principally purchased again in 2011 & 2012), however that’s principally a perform of progressively introducing pre-existing holdings from my portfolio…to not point out, I’ve additionally purchased different new (undisclosed) holdings prior to now few years. So 33 buys over the course of a decade is pretty consultant of my investing (& low turnover) strategy – IRL, I usually joke my final ambition was all the time to remain house, veg out on my sofa, learn annual stories & hopefully uncover a few nice firms annually to purchase. So yeah, life is ideal…and yeah, I actually do imply that!
So right here’s my Prime 10 Winners:
(NB: *Not quoted, or merged with one other enterprise/ticker. **Takeover, or liquidation.)
And my Subsequent 13 Winners:
Which leaves, exactly…my Prime 10 Losers:
Kr1‘s the apparent #megamultibagger within the room. However that’s how markets & investing really works…index/your web returns primarily come from a small fraction of shares, as Bessembinder reported some years again (& all VCs intuitively know!). And in case you’ve adopted me for some years, you’ll know I’ve all the time thought-about KR1 a #YOLO funding – i.e. a once-in-a-lifetime multi-bagger development alternative (at an absurd worth value) in an rising foundational expertise/asset class – however NOT some YOLO guess, noting it was solely a 4.5% portfolio allocation for me initially of final yr. (Per me recommending all traders ought to now take into account an inexpensive 3-5% allocation, by way of a diversified crypto funding firm like KR1 (for instance)).
Large image although, I’m delighted I nonetheless personal 4 of my Prime 5 winners…I have to be doing one thing proper, and eventually getting just a little higher at this complete purchase & maintain factor! And even my different winner – Universe Group – was lastly acknowledged final week for its underlying M&A price (thankfully, regardless of the astonishing 129% provide premiumI’d already extracted most of UNG’s worth again in 2015)! However this doesn’t change my underlying philosophy…whereas I’ve clearly targeted on owner-operator high-quality development firms extra just lately, paying a worth value has constantly remained the important thing to my winners. This was even true of Google again in 2017 – simply after it turned Alphabet & simply earlier than it turned a SOTP play for everybody – I estimated the core search enterprise was on an underlying 15.5 P/E a number of (& continues to be low-cost as we speak)! And the identical was true (for instance) of Applewhich I purchased (& posted about) forward of Buffetthowever alas by no means formally disclosed as a Wexboy portfolio holding – ‘cos who needed to take care of the fan-boys, not to mention the haters on the time – I purchased it on an ex-cash 10 P/FCF a number of & it’s a 5-BAGGER since!
My win-loss ratio’s helped too – 23 out of 33 shares have been winners, a 70% win ratioon the higher finish of the vary I’ve seen with {most professional} fund managers. Something increased is uncommon & would affect returns (presumably, by way of an arbitrage/event-driven technique), however I’d argue a decrease win ratio wouldn’t essentially restrict returns in the identical means…in reality, perversely, concentrating on & accepting a a lot decrease win ratio may really be the important thing to superior/best-in-class returns (once more, as any VC would argue)!? And in the meantime…they weren’t essentially multi-baggers, however I’ve additionally loved & exited shut to three in 10 shares by way of takeovers (primarily) & liquidation (that’s 8 winners & 1 loser out of 33 shares).
As for the wall of disgrace…all of us have losers, however the reply guys will like it anyway (& ignore the massive winners), so knock yourselves out! My solely excuse (or lesson), is how troublesome it may be to struggle world sector/macro tides – rising markets have been a (relative) misplaced trigger for the previous decade, however that didn’t cease me searching for out rising market losers. (Thankfully, my ‘New China’ guess by way of the VinaCapital Vietnam Alternative Fund was an enormous/successful exception – a reminder cherry-picking‘s lengthy been the one viable various to more and more absurd rising/BRIC-type bucket investing). For many of the final decade, the identical was true of useful resource shares…although clearly my quixotic (however small) tilt at micro-cap explorers/producers was remarkably silly in its personal proper! And total, my losers are a reminder how troublesome investing in small/micro-cap firms with poor and/or intransigent administration may be, no matter value/worth. The one saving grace is that I personal simply 2 of my losers as we speak – which possibly flip money-good with an precise sale/takeover, albeit that is by no means an awesome thesis to depend on – and looking out again at my exit costs (vs. the chance to take a position elsewhere), I positively don’t remorse promoting the remainder of my losers!
OK, let’s transfer on to the grand finale – however first, right here’s my benchmark index returns for the final decade. Word my benchmark’s a easy common of the ISEQ, Bloomberg Euro 500, FTSE 100 & S&P 500 – which finest represents my total portfolio – so I’ll get away these element indices too. No surprises there…the UK’s been dreadful, Europe was mediocre, whereas Eire really made a formidable try to sustain with the US (albeit, a lot of its positive factors got here earlier within the decade):
And now, lastly, it’s a very powerful desk of all of them…my Wexboy Portfolio returns over the past decade (vs. my benchmark index return):
And what an unimaginable journey & decade it’s been…ending up with a 10-BAGGER Portfolio & 26.0% pa funding monitor document!
And that’s not even counting dividends, that’s an extra couple of % pa. In fact, you possibly can argue my latest/distinctive KR1 positive factors are diluted total…i.e. a 13.8% Kr1 stake in 2020 is clearly extra impactful to my at the moment disclosed portfolio, than my total portfolio. However hey, by way of its real-world pound/greenback/euro affect, you possibly can guess I’m not sweating that distinction! And thankfully, I’ve loved different undisclosed multi-baggers in my portfolio – significantly within the final two years – in Apple (per above), in luxurious & even in (crikey, a distinct segment/alpha-generating) property inventory!? To not point out, Cell/E-commerce shares – as referred to (obliquely) in my H1-2020 evaluation – one among which turned out to be my third takeover inventory in simply 9 months & even (briefly) surpassed Alphabet in my portfolio!
So sure, total, I feel it’s truthful to contemplate this public/auditable monitor document as fairly consultant of my precise complete (disclosed & undisclosed) portfolio returns over the past decade.
And right here’s to an awesome Xmas season – regardless of the lingering COVID angst – and the last decade forward! Might the highway rise as much as meet you…