Meeting:

Monthly Meeting - November 2003

 

Held at:

The Brocklebank, Crewe

Date:

21st November 2003

 

 

Time:

17:15 – 18:10

Prepared by

Dave G

 

Chairperson:

Adrian T

 

Present:

Adrian T

 

 

Richard W

 

 

Dave G

 

 

Chris  B

 

 

 

 

 

 

 

Apologies:

Kit P,  Simon B

 

 

 

Chairman’s Acceptance of Minutes

 


_____________________________________________


____ / _____ / ____

Signature

Date

 

 

 

1          NEXT MEETING

To be arranged by email.

Venue: The Brocklebank 17:15 – 18:45.

2          Minutes of previous meeting

Accepted.

3          ACTIONS FROM PREVIOUS MEETING

3.1      Actions Closed Since Last Meeting

Ref.

Description & Progress

Status

CB/1022/01

Take up the Parity rights issue

COMPLETED

RW/1022/02

Sell half of our Mothercare holding

COMPLETED

RW/1022/03

Sell Mowlem from mechanical portfolio

COMPLETED

RW/1022/04

Relax mechanical filters slightly to see whether it brings forward another selection for October

1121: It did, Severfield Rowen, and we bought it.

COMPLETED

RW/1022/05

Send out details of which attributes can be used as filters in the new stock screener.  This may help others in their consideration of ALL/0716/04 above.

1121: See Appendix to these minutes

COMPLETED

DG/1022/07

Send out details of URL which is being used as replacement of the now expired www.rsic.co.uk

1121: It is www.btinternet.com/~dave.m.gaskell

COMPLETED

3.2      Actions Carried forward to Next Meeting                  

See end of these minutes.

4          Treasurer’s Report

4.1      Monthly Report Summary

See separate report for detail. 

Highlights/Lowlights  Unit value down from 409.354 to 399.055 – our first drop in unit value for 9 months.  We have £4985.64 of non-mechanical cash. 

4.2      Matters Arising From Report

Typo noted – “Atlantic Capsian” should read “Atlantic Caspian”.  Chris to correct.

Chris to send out an email of what bank account details he needs from the members in order to allow bank transfers from the club account.

5          PORTFOlio Management

5.1      Monthly Money Management Checks

The part sale of Mothercare has pushed non-mechanical cash into the “Too High” category and brought the Fundamental portfolio into the “Too Low” category.   Need to try to find another buy proposal for the fundamental portfolio (buying back our half of Mothercare was rejected as a suggestion !!).

Mothercare pushing close to being 20% of the club’s asset value.  Discussion took place on whether to take some profit given this and the fact that the 50% rise in the last month makes Mothercare now appear at least fully valued…..possibly overvalued.  It’s almost trebled since purchase.  Decision taken to sell approximately half of current holding in Mothercare.

5.2      Mechanical Portfolio

Severfield Rowen (SFR) was purchased last month on tactically relaxing the filters after the last meeting.   We need to formalise the approach to relaxing filters so that it can be incorporated into the strategy.  Richard W proposed a mechanism in the attachment to his email of 15th November.  That attachment has been included as an appendix to these minutes for ease of review.  All to review and comment ahead of the next meeting.

No purchase this month.

Current holdings  …

WH Smith

HOLD until December 2003

British Vita

HOLD until February 2004

Crest Nicholson

HOLD until April 2004

TDG

HOLD until June 2004

European Motor Holdings

HOLD until August 2004

Severfield Rowen

HOLD until October 2004

 

5.3      Monthly Reports For Each Company in Fundamental Portfolio

CodaSciSys

Original sell criteria proposed a review after holding for 6 months.  We have now held for 6 months.  Agreed that there was no clear reason to sell and that the company was being ‘overlooked’.  Agreed to retain existing 50% stop loss but also to hold until another review in 6 further months.

HOLD – Review in May 2004 (see table in 5.5 below)

Mothercare

Dave apologised for not having written a monthly report.  Share price had gently fallen over the month then jumped 7% on publishing good results this week (managed to announce profit ahead of expectations).

HOLD – not met stop loss (see table in 5.5 below)

ISG

HOLD – Slight fall of approx 2% in the month.  Not yet met sell criteria (see table in 5.5 below)

 

5.4      Speculative Portfolio

Parity

HOLD – not worth selling but we took up the rights offer.

Atlantic Caspian

HOLD (especially as it’s delisted !!)

Templeton Emerging

HOLD – not worth selling but look to sell if opportunity arises as the warrants expire next year

London Clubs International

HOLD – has now doubled since purchase so 15% trailing stop can now commence (see table in 5.5)

Cape

HOLD – not breached trailing stop loss (see table in 5.5)

Ashtead

HOLD – not breached trailing stop loss (see table in 5.5)

5.5      Stop Loss / Sell Criteria (as of date of treasurer’s report)

The following is the summary of sell criteria for each stock held within the Speculative or Fundamental portfolios (the Mechanical holdings are dealt with as part of section 5.2 above).  The stop loss is invoked against the “end of day” price, but the sell decision may wait for the opening price to avoid rogue trades at the end of day.

Stock

Reportee

“High” Price

Stop Loss (based on the “high”)

Exit Criteria

CSY

Richard

320

160p

Hold until at least May 04 and then review;

In addition, review following any trading or results statement that expects / reports a fall in either revenues or profits over the previous reporting period;

Trailing stop loss of 50% to start from purchase price (based on mid-price due to large spread).

MTC

Dave

325

276.25p

Invoke vote on a sell proposal immediately following a bid announcement.  Otherwise,  sell on 15% trailing stop loss

ISG

Richard

170

85p

Hold for 6 months (March 2004) then review.  Before then, run trailing stop loss of 50% to start from purchase price

CAPE

N/A (speculative)

68

54.4p

20% trailing stop loss

PTY

N/A (speculative)

88

22p

Revise on taking up the rights offer.  Existing criteria are “Start price 44p. Invoke 15% trailing stop loss once price has doubled, or sell if price falls 50% from purchase (unless not worth selling)”

ACA

N/A (speculative)

20.4

5p

Start price 10.2p. Invoke 15% trailing stop loss once price has doubled, or sell if price falls 50% from purchase (unless not worth selling)

TEMA

N/A (speculative)

57

14.25p

Look for opportunities to sell (though currently not worth selling) as the warrants expire within a year.

LCI

N/A (speculative)

76.75

65.24

15% trailing stop loss

AHT

N/A (speculative)

29

7.25

Start price 14.5p. Invoke 15% trailing stop loss once price has doubled, or sell if price falls 50% from purchase (unless not worth selling)

 

5.6      New Buy Proposals

No new proposals

6          Lucky Llama competition

Simon wins again with a 7.6% rise in the month – two winning months out of two now for Simon.

Simon   

£117,633.16

Dave    

£109,208.64

Richard 

£107,381.83

Kit     

£100,000.00

Adrian  

£99,291.18

Chris   

£99,086.66

 

New selections put forward by Simon, Chris, Richard, Dave and Adrian. 

7.                         Competitions

Our October entry of Amvescap didn’t win (indeed, did pretty poorly so we’ll gloss over that).  Dave missed the entry this month.

Actions carried forward to next meeting

Ref.

Description & Progress

Target Date

SB/0716/01

Issue chairman’s annual statement via email

0820: No progress

0919: No progress

1022: No progress

1121: No progress

15/12/2003

ALL/0716/04

Consider different mechanical selection criteria for a new mechanical portfolio

0820: Deferred to September meeting

0919: All still to consider

1022: No progress

1121: No progress – see Appendix to the minutes to help