Occasionally we’ll review the performance of our portfolio. It has been over a year since we started, so it’s a good time to look back on our performance.
A market beating performance
Our performance since the Giles Capital fund inception (21/06/2020) compared with other indices:
A comparison of performance the major indices and us:
HSI: +3.34%
CSI 300: +20.24%
S&P 500: +43.41%
Giles Capital fund: +101.69%
Key highlights & holdings over the year
Cathay Pacific (HKG: 0293) in Hong Kong was our first purchase in the autumn of 2020. Travel stocks tumbled. At the time we understood that, given the number of vaccines in production and the historic success rates - there would eventually be a vaccine and one in record time. This proved true and in November 2020 travel stocks moved upwards. We’ve adjusted our Cathay Pacific position as sentiment changed due to hope one day or Hong Kong’s draconian rules the next. It is and has remained our best performing trades in Asia.
Occidental Petroleum (OXY 0.00%↑ ), Exxon Mobil (XOM 0.00%↑) in the US and Delek Group (TLV: DLEKG) in Israel were all plays on oil. Oil stocks were hurt badly by Covid, with a lack of demand and global oil prices dropping. It was inevitable that the price would recover, with the world recovering. Furthermore, many of the oil companies cut any exploration projects during this period, which means there will be less available oil in the future. We’ve cut some of our positions here (Delek has too much short term debt which made us uneasy) but we still keep some. We’re still bullish on oil.
FLY Leasing (previously NYSE:FLY) was a stock we held briefly. We were interested in its great financials but lean operations. It does not manage its own fleet and strictly focuses on the investment and return of the aircraft. In the summer Carlyle Aviation Partners acquired FLY sending the stock up. We sold at a 27% gain.
Rolls-Royce (OTCMKTS:RYCEY) in the UK was, and still is our biggest holding. We have more than a 20-25% gain here so far. We were bullish as the stock price crashed, but saw the potential in the number of flights slowly recovering and we’re convinced of the cost cutting the Rolls-Royce management were making.
Looking forward
Rolls-Royce (OTCMKTS:RYCEY) We still remain bullish as travel continues to open up. We don’t think this has been reflected in Rolls-Royce’s numbers yet, but when it does, we think this stock will move up further.
West Japan Railway (TYO: 9021) in Japan is one of our investments we’re keeping an eye on. We’re currently at a slight loss here but have the same conviction. Japan has good vaccination rates and we know demand for travel to Japan will be high once Japan does open up. It is looking quite cheap at the moment.
Alibaba (BABA 0.00%↑) in China has been discussed on many different channels, so we’re not going to add to this discussion. But we think companies outlast world affairs and that Alibaba is undervalued.
Seritage Growth Properties (SRG 0.00%↑ ) in the US is one of our positions we’re expecting an improvement in. It’s a spin-off REIT managing old SEARS properties, with a strategy of selling less valuable locations and concentrate on prime real estate. With the prime real estate it looks to increasing the square footage by building upwards and making the real estate multipurpose. It’s also a stock in which Warren Buffet has shares in (his personal portfolio).
Finally, Bijou Brigitte Modische in Germany is a stock we’re looking to add to. While the big high street names such as H&M have recovered, we noticed this smaller, but still sizeable high street jewellery chain has not recovered. They have ample cash and no debt, so we don’t think they’re going anywhere and neither will we - we will wait until this one recovers.
Disclosure:
This article features some but not all of the stocks owned. We may have either sold or kept some of the stock mentioned in this article.
Disclaimer:
This is not investment advice. Our content to be used for informational purposes only. It is important you do your own analysis before making any investment based on your own personal circumstances.
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