Home Value Investing A Decade In The Making…a 10-Bagger & a 26.0% pa Funding Observe Report

A Decade In The Making…a 10-Bagger & a 26.0% pa Funding Observe Report

A Decade In The Making…a 10-Bagger & a 26.0% pa Funding Observe Report


Wanting again, I have 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 power – noting SRE‘s been a 7-BAGGER+ since. Properly, besides I in some way 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 publish ought to abruptly finish, as a result of:

The one BIG lesson most buyers 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 publish. As buyers, we by no means actually know what’s coming down the highway…subsequent 12 months may very well be a celebration, or a complete humiliation. And all of us make dumb errors, we repeat them, we stay with them & we lastly transfer on – nice buyers simply make much less errors. And we will’t afford to get disheartened, or to relaxation on our laurels – nice buyers (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 stated, this 12 months & final 12 months have been an accelerated studying expertise for me – as is presumably true for all buyers (& 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 – notably in gentle of my precise FY-2020 & YTD-2021 efficiency. However I gotta admit, I hold 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. [Despite most 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 file through 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 implies return of principal is simply as necessary to me as return on principal, in true family-office type – however readers & followers have all the time been in a position to assess my degree of conviction/danger tolerance through my particular % allocation in (disclosed) shares, and through (basically real-time) monitoring of my (uncommon) incremental buys/sells in these shares.

And in return, I’m much more proper now in seeing readers draw (& even share) their very own conclusions – privately, or publicly – from my stock-picking & funding monitor file up to now. To facilitate that, right here’s my annual returns…full with hyperlinks to my annual efficiency evaluate & precise stock-picks/funding write-ups for every year.

[NB: I should highlight this 2015 post, where I went back & scrubbed my 2011-2014 performance for consistency…but since it actually lowered my portfolio returns & raised my benchmark returns, we don’t need to rehash those adjustments here.]

[And for reference, this was my 5 year track record back in 2016.]

YTD-2011 (from Nov-Ninth):   +7.6% Return

[Reduced from a +16.4% average return to reflect an actual weighted average return.]

FY-2012:   +18.3% Return

[Reduced from a +20.2% return, primarily to reflect elimination of dividends.]

FY-2013:   +19.0% Return

[Increased from a +18.4% return, to reflect corrected average stake sizes.]

FY-2014:   (0.8)% Return

[Increased from a (1.3)% return, to reflect 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 publish:

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 Efficiency, when it comes to particular person winners & losers:

[All gains based on average stake size & 09-Nov-2021 vs. end-2020 share prices. All dividends & FX gains/losses are excluded.]

That’s 33 disclosed portfolio buys over the past decade. Which can look fairly front-loaded (i.e. largely purchased again in 2011 & 2012), however that’s largely a perform of steadily introducing pre-existing holdings from my portfolio…to not point out, I’ve additionally purchased different new (undisclosed) holdings previously few years. So 33 buys over the course of a decade is pretty consultant of my investing (& low turnover) method – IRL, I typically joke my final ambition was all the time to remain residence, veg out on my sofa, learn annual experiences & hopefully uncover a few nice firms every year to purchase. So yeah, life is ideal…and yeah, I actually do imply that!

So right here’s my Prime 10 Winners:

[NB: *No longer quoted, or merged with another business/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 internet returns basically come from a small fraction of shares, as Bessembinder reported some years again (& all VCs intuitively know!). And for those who’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 worth) in an rising foundational expertise/asset class – however NOT some YOLO guess, noting it was solely a 4.5% portfolio allocation for me at first of final 12 months. [Consistent with me recommending all investors should now consider a reasonable 3-5% allocation, via a diversified crypto investment company like KR1 (for example)].

Large image although, I’m delighted I nonetheless personal 4 of my Prime 5 winners…I should be doing one thing proper, and at last getting a bit of 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 (fortuitously, regardless of the astonishing 129% provide premium, I’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 not too long ago, paying a worth worth has persistently 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 at the moment)! And the identical was true (for instance) of Apple, which I purchased (& posted about) forward of Buffett, however alas by no means formally disclosed as a Wexboy portfolio holding – ‘cos who wished 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 ratio, on the higher finish of the vary I’ve seen with {most professional} fund managers. Something larger is uncommon & would affect returns (presumably, through an arbitrage/event-driven technique), however I’d argue a decrease win ratio wouldn’t essentially restrict returns in the identical approach…in truth, perversely, focusing on & accepting a a lot decrease win ratio might 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 through takeovers (primarily) & liquidations (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 combat world sector/macro tides – rising markets had been a (relative) misplaced trigger for the previous decade, however that didn’t cease me searching for out rising market losers. [Fortunately, my ‘New China’ bet via the VinaCapital Vietnam Opportunity Fund was a huge/winning exception – a reminder cherry-picking‘s long been the only viable alternative to increasingly absurd emerging/BRIC-type bucket investing]. For a lot 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 will be, no matter worth/worth. The one saving grace is that I personal simply 2 of my losers at the moment – which possibly flip money-good with an precise sale/takeover, albeit that is by no means a fantastic 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. Notice 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 powerful try and sustain with the US (albeit, a lot of its features 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 & a 26.0% pa funding monitor file!

And that’s not even counting dividends, that’s a further couple of % pa. After all, you’ll be able to argue my latest/distinctive KR1 features are diluted total…i.e. a 13.8% KR1 stake in 2020 is clearly extra impactful to my at present disclosed portfolio, than my total portfolio. However hey, when it comes to its real-world pound/greenback/euro affect, you’ll be able to guess I’m not sweating that distinction! And fortuitously, I’ve loved different undisclosed multi-baggers in my portfolio – notably 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 evaluate – one in every of 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 honest to think about this public/auditable monitor file as fairly consultant of my precise complete (disclosed & undisclosed) portfolio returns over the past decade.

And right here’s to a fantastic Xmas season – regardless of the lingering COVID angst – and the last decade forward! Might the highway rise as much as meet you…



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