Portfolio updates

This is where you can find links to all the portfolios that are tracked by the Investment Reader network.

Jonathan Davis

Core fund portfolio

Jonathan Davis (visiting Harvard)

The purpose of this fund, which closely matches the way that I run my SIPP, is to back the handful of fund managers, many of them approaching veteran status, on whose performance I have confidence investors can genuinely rely over the long term. It has a strong and built-in equity bias – its default position – but that can be changed if it proves possible (as I quaintly still believe it may be) to have some sense of when the market cycle is about to turn. Turnover though is very low and the managers typically run high conviction portfolios that focus on companies with attractive underlying fundamentals. It is important to me that the managers of the funds have lived through at least two turns of the market cycle – both good and bad times, in other words. Initially funded with £100,000 in 2011, this portfolio is now worth approximately £350,000, having produced a compound return of around 18% annually.

Growth stock portfolio

This portfolio corresponds to the way that I run my ISA money. It is on conventional analysis a high risk, indeed speculative portfolio, but I believe that it remains a good way to take advantage of the myopia of the stock market. Core components of this portfolio are quality companies with high returns on capital, strong balance sheets and a business model that enables them to grow fast. Almost inevitably shares in this kind of business tend to display very positive momentum and it can require nerves to buy them after a strong run. The valuations are never cheap. Nevertheless the returns from this strategy in the current market environment have been very good; we  have been living through a momentum and growth driven market since the great financial crisis (the direct result, I believe, of central bank policies) and those who have failed to identify that this is the case have been penalised by poor performance.  With bond yields rising and QE being replaced by QT (quantitative tightening) I am watching closely for signs that the growth/value cycle has turned, as many predicted it would do two years ago. So far though there is no sign of that.