After last years 77% gain (to Aug 2007) in my SIPP, last month it fell from £32,000 to around £29,200, so getting my target return of 50% this year will be a challenge. Warren Buffet says he would guarantee 50% year on year for a portfolio under $10 million, so my work is definitely cut out.
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It’s funny how confident I was getting inside about my performance, and I was brought back to earth with a big bump. Buffet says there are often many preening ducks in the pond all proud that they are higher up after heavy rain -but it takes a drought to find out who the winners really are and what ducks are fried – see Bear Sterns below.
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Also, another famous Buffet quote is - you only find out whose swimming naked when the tide goes out – mainly refering to derivatives.
That brings me to think what sub prime banking casualties we will have – US banks are reporting next week – in preparation for this I tried to do a strangle option on Bear Sterns by buying a call - BSC Sep 115 Call – and a put – BSC Sep 100 Put total permium $4.8- (in my mad money account and not in my SIPP account may I add) - a sort of volatility trade so I’d be in the money if it moved alot by the exercise date of 22nd Sep - but my account was not authorised! Even so, I will monitor this fictional trade and see if it would have made money on the 22nd.  I reckon BSC shares will either soar or crash. Interesting that Joe Lewis, the currency speculator billionaire bought 7% of the company. I wonder if he’s hedged it a bit as well.
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Also, I just sat the Securities exam on Securites and Financial Derivatives and I discovered I am a marginal failure – 3 1/2 hours to find that out! Here’s a link if any of you are interested! Anyone can sit it. back to the resit – another £180.   Â
http://www.sii.org.uk/web5/infopool.nsf/HTML/qU4sfd?OpenDocument
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Back to my SIPP. I have derisked my portfolio and now have around 10 stocks, mostly small companies. To see my recent additions and positions, just click on the image below.
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Stocks include,
- RCG – Biometric
- BNH – Insurance Broker consolidators
- PST, – Software used by many blue chip companies – exciting management
- POLL (just updated the market with some bad news)
- TAN – Electric Vehicles and Ariel Platforms
- QXL – Eastern European Ebay type business
- TAIH – chinese pharm
- HAIK – chinese chemical – risky
- GNG – chinese software
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Also, I plan to look over my purchases and sales over the last year
more critically and see if I can form some guidelines for improvement. I will post more on that in the future.
I would really appreciate if you would let me know how your retirement SIPPs is going, or any other investment comment you wish by posting on my blog.
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