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Diary of a Dumb Investor: my 7% return in 7 months
It may not have been the toughest market environment, but for a beginner I reckon I've done okay.
‘You had to try hard to lose a lot of money in 2012,’ said a smug-sounding senior City figure last week.
Barring some commodities and individual basket cases like the share markets of mainland China and Spain, practically everything has gone up over the past 11.5 months.
Me, I’ve made 7% on my investments, but that’s only in the space of the seven months since I took over this portfolio from Dumb Investor Mark 1 back in May.
My portfolio 7 months on: Click to enlarge
You might uncharitably say I’ve merely ridden a wave, as Ben Bernanke and Mario Draghi, the generous chiefs of the US and European central banks, have propped up markets.
And more fundamentally, even as a meek investment greenhorn I at least didn’t make the same mistake as the managers of investment trust RIT , one of the losing holdings in my portfolio (and part of my inheritance from the first Dumb Investor, who thoroughly lived up to his name, losing just shy of 10% of the original £10,000 before bowing out disgracefully in May).
The managers of RIT, which is chaired by Lord Rothschild, were just too cautious. Not so many months ago, in the depths of the eurozone’s existential crisis, such investors chose safer stuff to invest in.
They’re now promising riled investors remedial ‘steps’. But RIT’s performance this year shows how avoiding risk is in itself a risky business; you risk not making as much money as you could have otherwise done. RIT remains on the ‘naughty step’, as Citywire reader sgjhaghsdg put it.
But if RIT was a slippery banana left for me by my predecessor on the portfolio, then BP (BP.L) was a vicious punji trap.
More about this:
Look up the shares
- BP PLC (BP.L)
- Aggreko PLC (AGGK.L)
- Standard Chartered PLC (STAN.L)
- Lloyds Banking Group PLC (LLOY.L)
Look up the investment trusts
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