Sale of BAT and purchase of Boingo

During the second half of December the remaining holding in BAT was sold at 3179p. Standing a bit higher today, but overall strategy is to exit tobacco shares and not get involved in fossil fuels – although BP or Royal Dutch might be considered from time to time.

I previously noted that I would not be buying US small caps and bought an ETF instead. However this ETF could not get approval for my ISA account, so was left with a smaller overall holding than planned.

Today I bought a smallish holding in Boingo @ $10.84. This company provides WiFi services – notably in airports – that are a lot quicker than free services. The interesting development is the company’s expertise in capturing WiFi signals, bearing in mind that 5G signal capture is a whole new ballgame. As the shares were double the current level earlier in 2019, and the tax loss sale season is coming to a close, I thought a purchase before the year was a good idea. Boingo is a small cap with a chart going back to 2011 , so not a unicorn.

Profits taken on Superdry and Nvidia

Superdry published results a few days ago. The item that stood out was that the turnaround/reorganisation will take about two years. Also noticed a few unfavourable comments about the former CEO (now taking the job at Saga) relating to his management style. The shares popped up on the Election result so took profits @ 510p. The cost back in May was 452.76p.

Nvidia has recently made intra day lows of >200 in late November and again in early December. Clearly the shorts have not got it right yet apart from a few potential scalping trades. As I am uncertain about the future trajectory – 225 seems like resistance – and I would prefer to be holding more cash right now, I decided to sell my entire position and received 223.33. The cost of 80% of the combined holding was 166.49 from November 2018, and the remaining 20% was added at 141.19 end May 2019. Not at all bad for my first chipmaker investment, but may have a few losses to cover if markets peak soon then weaken on something unexpected.

Bought a US Small Cap ETF

Both Barron’s and Knox Ridley have been writing about US Small Caps during the past week. As Findlay Park started as a US Small Cap fund before changing to an unconstrained portfolio I thought that this would be a good area to consider at the present time. I do not like the idea of buying a few small cap stocks as the risk is very high, so I looked at the funds mentioned in Barron’s.

I prefer ETFs over managed funds for additional investment in the U.S. , mainly because mutual funds pay local taxes and spin off tax credits to holders. I am investing tax free funds, so the tax credits have no value.

The ETF which I decided to buy is iShares Core S&P Smaller Companies and 320 of these went into my pension fund yesterday @ 82.50. I will also add another 180 to my ISA account whenever fund is approved by my ISA managers – as long as the price is close to 82.50.

Sale of Slack, purchase of more Zoom

Prior to quarterly results I made a decision to sell Slack (WORK) as the stock had been underperforming and there might be better opportunities to reacquire when valuation looks more reasonable in relation to growth. The sale went through at 22.09 giving a loss on all accounts except the ISA.

Also noticed that Knox Ridley intended to add to Zoom (ZM) following a price drop after their quarterly results, so increased my holding – buying 200 for my ISA @ 63.38

The point has been made that both companies face competition from big tech, notably Microsoft. My feeling is that Zoom could be the better opportunity of the two because it has more of a global reach. Big tech will also be constrained from seeking monopolies by politics – it’s better to have at least one competitor at present to avoid anti trust actions, and try to increase the size of the overall market.

End November update

As things turned out November was a surprisingly good month for most of the technology stocks in the portfolios. The three with negligible changes were WORK 22.82, SNAP 15.25, and PINS 19.48.

BABA finally went ahead with their HongKong listing and the ADR price improved from 176.67 to 200 even. My best guess is that Beijing decided that a mega listing would help restore confidence in HK as a financial centre despite the protests and riots. Notable gains were also made by NVDA 216.74, MSFT 151.38, ROKU 160.37, MDB 148.70, WDAY 179.12, and ZM 74.50.

In the real world the general strength in US equities was reflected in Findlay Park American – up from 129.81 to 134.60, SCHD up from 55.52 to 57.09, and VIG up from 119.61 to 122.54.

U.K. funds and investment trusts were generally a bit firmer. However SSON up from 1202 to 1302, and the Buffettology fund up from 322 to 343 stood out as gainers while FEET lost a bit from 1177 to 1138. There is a U.K. General Election on 12th December and Sterling has remained reasonably strong. Once again the result is unpredictable despite opinion polls showing this and that. Theresa May experienced this last year.
People in general are sick and tired of the whole political class.