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17:30 – 18:40 |
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Chairperson: |
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Present: |
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Richard W |
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Dave G |
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Simon B |
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Kit P |
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Apologies: |
Chris B |
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Chairman’s Acceptance of Minutes |
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Signature |
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Friday 23rd January 2004.
Venue: The Brocklebank 17:00 – 18:30.
Accepted.
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Ref. |
Description & Progress |
Status |
|
CB/0919/01 |
Provide an explanation of how the subs are represented in the monthly treasurer’s report (forward payments, etc.) 1022: No progress 1121: No progress 1219: Supplied by email – see section 4.2 below. |
COMPLETED |
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DG/0919/03 |
Amend Club Strategy to clarify % composition calculation in section 5 and to add statement about a bid forcing a sell of a mechanical selection (in 12.5) 1022: No progress 1121: No progress |
COMPLETED |
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CB/1121/01 |
Correct spelling of Atlantic Caspian in the treasurer’s report |
COMPLETED |
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CB/1121/02 |
Notify club members of the information they need to provide in order to allow bank transfers from club account |
COMPLETED |
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ALL/1121/03 |
Review proposal for relaxing filters so that a mechanism can be agreed and incorporated into the strategy (see Appendix to these November minutes for Richard’s proposed mechanism) |
COMPLETED |
See end of these minutes.
See separate report for detail.
Highlights/Lowlights Unit value up from 399.055 to 402.916. We have £5261.49 of non-mechanical cash.
Chris had sent out an email describing how the application of subs and purchase of units is calculated. All agreed with Chris’s approach with the exception of point 1 on the section on conversion. The meeting believed that suspended shares should be valued at the discretion of the treasurer rather than defaulting to a zero valuation. Dave G was asked to append Chris’s document (edited as above) to the club rules as an Appendix and to send out for review.
Non-mechanical cash was still in the “Too High” category and the Fundamental portfolio is in the “Too Low” category.
Need to try to find another buy proposal for the fundamental portfolio.
WH Smith was to be sold this month but see section 5.6 below.
Four stocks satisfied the selection criteria this month and Countryside Properties comes out top. We are buying this stock for the second time, it being the first stock purchased for the mechanical portfolio.
Current holdings …
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British Vita |
HOLD until February 2004 |
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Crest Nicholson |
HOLD until April 2004 |
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TDG |
HOLD until June 2004 |
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European Motor Holdings |
HOLD until August 2004 |
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Severfield Rowen |
HOLD until October 2004 |
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Countryside Properties |
HOLD until December 2004 |
Brief discussion took place as to possible criteria for a second mechanical portfolio. One suggestion was to adopt a similar approach to existing criteria but to apply them to a different market (e.g. US market) or different investment instruments. Richard W to find out which instruments can be traded via our stockbroker.
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CodaSciSys |
HOLD – Review in May 2004 (see table in 5.5 below) |
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Mothercare |
HOLD – not met stop loss (see table in 5.5 below) |
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ISG |
HOLD – Not yet met sell criteria (see table in 5.5 below) |
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Parity |
HOLD – not worth selling but we took up the rights offer. |
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Atlantic Caspian |
HOLD (especially as it’s delisted !!) |
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Templeton Emerging |
HOLD – not worth selling but look to sell if opportunity arises as the warrants expire next year |
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London Clubs International |
HOLD – not breached trailing stop loss (see table in 5.5) |
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Cape |
HOLD – not breached trailing stop loss (see table in 5.5) |
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Ashtead |
HOLD – not breached trailing stop loss (see table in 5.5) |
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.
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Stock |
Reportee |
“High”
Price |
Stop
Loss (based on the “high”) |
Exit
Criteria |
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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). |
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MTC |
Dave |
340 |
289p |
15% trailing stop loss |
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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 |
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CAPE |
N/A (speculative) |
68 |
54.4p |
20% trailing stop loss |
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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)” |
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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) |
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TEMA |
N/A (speculative) |
57 |
14.25p |
Look for opportunities to sell (though currently not worth selling) as the warrants expire within a year. |
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LCI |
N/A (speculative) |
84.75 |
72.0375 |
15% trailing stop loss |
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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) |
Richard W sent out a buy proposal for WH Smith. As WH Smith was the stock being sold out of the mechanical portfolio, the proposal was to simply transfer it into the Fundamental portfolio. All agreed with the proposal but revised the exit criteria from those suggested in the buy proposal form. New exit criteria were to have a mandatory vote on reaching 250p on the downside and on reaching 350p on the upside.
No transaction would be necessary to purchase these shares for the Fundamental portfolio but the Mechanical portfolio still needs to be managed as though the stock had been sold. Richard W would calculate the proceeds that would have arisen from a sale of WH Smith and purchase the appropriate amount of Countryside Properties as a result. In effect, this simply means that the ‘saved’ commission fees will be transferred from the mechanical portfolio to the non-mechanical cash.
Simon wins this month with a 4.5% rise in the month. Current standings after three months are now…..
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Simon |
£121,819.45 |
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Dave |
£114,152.44 |
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Richard |
£111,785.25 |
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Kit |
£100,000.00 |
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Chris |
£93,238.40 |
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Adrian |
£92,699.15 |
New selections put forward by Simon, Richard, Dave and Adrian.
Dave missed the entry again for December. It was suggested that the Mirror competition details may well be posted up on the Mirror website. All to look to see whether this is indeed the case.
[Post Meeting Note: Adrian T has identified that
the competition details are on the “Mirror Money” section of the Mirror’s
website which has the following link:-
http://www.mirror.co.uk/money/mirrormoney/page.cfm?objectid=13709499&method=full&siteid=50143
]
Actions carried forward to next meeting
|
Ref. |
Description & Progress |
Target Date |
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SB/0716/01 |
Issue chairman’s annual statement via email 0820: No progress 0919: No progress 1022: No progress 1121: No progress 1219: No progress |
23/01/2004 |
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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 1219: Still needs consideration |
23/01/2004 |
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DG&KP/0716/06 |
Contact Adrian B about the tape of the Radio Stoke appearance 0820: No progress 0919: DG has just sent mail to Adrian 1022: Adrian B has the tape – he has said that he will pass it on to
Chris or Kit (though Dave has given him his home address so he could post it
there) 1121: No progress – Dave to remind Adrian 1219: Kit thinks that Adrian may have given the tape to him – he will check |
23/01/2004 |