Investments

Official purchase of the month. Hennes & Mauritz has been in and out of my broader watch list. It has always had plenty going for it. Yet it never really has fit the bill for me. In general I like established global top brands which are able to generate plenty of cash year after year. However some business areas have been problematic for me. Clothing and fashion is one of them. Airlines and carmakers are also in the same list.

Now things changed a little bit as I opened a small position in Hennes & Mauritz with a purchase of 30 shares for 295,30 SEK per share. The real tipping point this time was the insider activity. I’ll consider doubling the position next month. One benefit is that this is the first position that will produce distributions in SEK (my other Swedish positions are actually double listed in Helsinki and therefore the distributions are automatically converted to EUR). I generally prefer to have income in multiple currencies and SEK will be the fourth following EUR, USD and NOK.

Links: H&M Investor Relations, Insider activity: Stefan Persson

Slight change in plans. I was planning to buy back all the Fortum shares I sold recently. I was hoping to do that around 10,80 EUR per share during the next six to nine months or so. Instead I decided to change my allocation a little bit. I still have a bit mixed feelings about Fortum. On the other hand there’s  the political risk which in my opinion is the worst kind of risk for any stock. Then there’s Nordea which has been hit lately because of the so called Panama papers leak. All this led to a new game plan. I decided to buy back 250 shares of Fortum for 11,60 EUR per share and 100 shares of Nordea Bank for 8,29 EUR per share. My original Fortum position was 320 shares and I’ll consider increasing my position to that or even beyond that if the renewables strategy plays out as expected. In general I wouldn’t even consider that if I wouldn’t have strong faith in the current management they have.

Fortum: Result for 2015 video 

Today I sold 320 shares of Fortum for 11,31 EUR per share. There a couple of reasons for this. First of all Fortum won’t be producing any cash flow until Q2/2017. Secondly I anticipate that there will be a possibility to buy back the shares for less money during Q2 or Q3. This also allows me to record some losses for tax purposes and while waiting for the buyback order to go through, this will reduce the interest costs for investment debt I have for the portfolio.

Since Coca-Cola is way too expensive for me at the moment, I was considering Diageo and VEREIT for my next purchase. VEREIT entered my portfolio as a purely speculative risk play after the infamous ARCP disaster hit. Now I decided the remove that status and purchased additional 120 shares for 8,61 USD per share.

This also means that there are no “risk positions” in this publicly tracked portfolio. In my strategy I’ve ruled that one of such positions is allowed with limited weighting. In future I might handle similar positions within a different portfolio but that remains to be seen.

Portfolio balancing for NYSE:GE with a purchase of additional 40 shares for 30,29 USD per share. I’m not a huge fan of averaging up but I suppose that would count as a first world problem. I’m actually quite bullish on GE so I don’t really have huge problems with the current valuation. Coca-Cola Company (NYSE:KO) would require similar actions but it has a bit more challenging valuation in my books. I’m also keeping an eye on the Diageo (NYSE:DEO) for my next purchase.

Market has been turbulent lately but I couldn’t resist the valuation NYSE:OHI is getting at the moment. On February 9th I bought additional 40 shares for 28,54 USD per share. Pretty much everything has been hammered down hard lately. Perhaps some for a good reason, but to me this valuation seems ridiculously cheap. This is now a full position and then some so it’s not very likely that I’d be adding on this unless it goes through the floor without any real reason.

Just another averaging down operation on NYSE:BBL. On February 4th I sold 130 shares for 21,01 USD per share and on February 8th bought back 140 shares for 20,42 USD per share.

Slightly unplanned action since “official” January purchase was already made and Nordea wasn’t really on my short term watch list. It has been hammered so down lately that I didn’t see any problems in adding to my position. Today I bought additional 110 shares for 9,07 EUR per share. Typically we would see a dividend rally during Q1 but in the current market environment it’s difficult to know what happens next. Technically I don’t even care.

Link: Nordea Investor Relations

Balancing of the portfolio with a purchase of additional 60 shares of Telenor for 137,50 NOK per share. This action was executed on January 14th and was the first buy of the year. NYSE:GE would require similar addition during February but the market turbulence is starting to look so promising that a better valuation might lay ahead. Meanwhile few other existing positions are starting to look really tempting, especially NYSE:OHI is really difficult to pass on.

This is most likely the last trade for FY2015. I decided to skip on GE and Telenor and instead slightly increased my position on Deere today by purchasing 13 shares for 77,35 USD per share. There’s nothing special behind this action but I skipped GE because of the valuation. I’m hoping to add on it in the 28-29 range. Telenor however is on my buy range at the moment which makes it the strongest candidate for January purchase unless GE drops to the mentioned range.