Nov 2019: another great month for equities

That USA stock market just keeps on climbing. No matter what you read about Trump’s impeachment, US/China trade wars, US/France trade wars, etc – just check out below the light blue line showing S&P500 over 10 years.

S&P500 and FTSE-100 indices, over 10 years

In contrast the FTSE-100 (and, in fairness, the Eurostoxx 50) has been fairly rangebound for the last three years. The FTSE-100 at least delivers over 3% in dividends (not included in the index shown above), but I’d take the S&P’s combination of much higher growth, somewhat lower dividends, any day of the week.

Pity those short sellers like @WheelieDealer who have been calling Time on the S&P.

Remember: markets being at All Time Highs (ATHs) do NOT tell you they are due to fall. Stock markets have better-than-average businesses in them, and better-than-average businesses grow. All things being equal, stock markets therefore grow.

In fact it’s not just stock markets that grow. Bonds had an OK month too. Most of my bond ETFs are significantly down on their record highs, but they had an OK November.

Even the pound had an OK month, gaining over both AUD and the EURo.

Taking into account my weightings, how markets moved and how currencies rose/fell, my weighted market average saw an increase of 2.8%.

My own portfolio moved almost exactly in line with the weighted average. The year is proving to be pretty awesome, from an investment standpoint. Let’s hope December (which as I write this, is already looking like a negative month) doesn’t do too much damage to the year’s returns.


October 2019: a lousy month

October looked kind of fine, for key equity markets, in local currencies. The S&P hit record highs, for no particularly obvious reason. The the Europe (ex UK) MSCI index went up almost 3%.

However the big news in October was the pound, which rose against everybody. Against the USD, it was up 5%.

So in pound terms, the major overseas equity markets fell.

How about the UK FTSE market? Sadly that fell too, by almost 2%.

Bonds fell off a little bit too, almost everywhere.

So from a pound investor point of view, there was basically nothing going up this month. The markets + forex average (for my weighted alloocation) was -2.4%.

Against a weighted market average of -2.4%, my own portfolio‘s drop of 1.6% must be something to be thankful for. Sigh.


Angel investing (2): what happens next

Angel investing is not for the faint hearted. In my previous post in this series, I discussed the onset of the angel investing journey. In this, second, post I’ll take a look at ‘what happened next?’ across a series of my angel experiences. Truly, this is the Hindsight post.

Instant Riches?

Image result for golden ticket

What you’re hoping for, simply put, as an angel investor in a seed business, is that you’ve just backed the next Google/Facebook/Amazon/take your pick. You’re hoping your investment goes on to become a ‘Unicorn’, i.e. valued at above $1bn.

In the world of venture capital the professionals are generally looking for ’10x’ – i.e. making 10x their money – which often implies the business ends up, after taking on further rounds of investment, becoming a Unicorn.

One of my best ’10x’ investments is company T, shown below. OK, so it didn’t quite make me 10x (though see below). But it exited quickly – the key money back came in month 53, with a small (15%) amount retained for a further 12 months.

You’ll notice that I added to my initial investment in month 23. Whether to ‘top up’/’follow on’ your investments is one of the hardest decisions you have to take in investing, in my experience. In the case of company T, I’m glad I did – even though by so doing my multiple fell (i.e. my month 23 investment was at a higher price than my month 0 investment).

Company T was one of the best angel investments I know. But nonetheless, one of its investors was really p*ssed off when it exited. Why?

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