December 2017 Update

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General Comment

I will not comment Year End results in this post, this stays a monthly update just like any other update.

December kept positive momentum, there was a definite slowdown in market growth, but there is still positive numbers out there and record smashing activities all around the place.

Unlike last december, when I found out a major flaw with my accounting procedures and thus reporting, this December was dedicated at revamping my reporting system, to give better graphs and stats that are more “understandable”.

 

LH FUND

Explanation of terminology and graphs is HERE.

Change in reporting, changes many things… Let’s comment the obvious numbers:

Month TR YTER NYYoC Forex
11.15 0.00% 0.00% 0.00% 0.00%
12.15 -3.33% 1.22% -0.13% 0.00%
12.16 7.06% 1.14% 1.16% 0.00%
1.17 4.76% 1.11% 1.18% 0.00%
2.17 7.26% 1.14% 1.23% 0.00%
3.17 8.15% 1.11% 1.39% 0.00%
4.17 7.82% 1.11% 1.52% 0.00%
5.17 7.59% 1.14% 1.73% 0.00%
6.17 6.96% 1.13% 2.14% 0.00%
7.17 6.62% 1.12% 2.28% 0.00%
8.17 5.99% 1.10% 2.38% -6.51%
9.17 7.36% 1.08% 2.49% -5.33%
10.17 9.10% 1.07% 2.56% -4.40%
11.17 9.19% 1.06% 2.59% -5.79%
12.17 9.94% 1.04% 2.62% -6.60%

TR grows to 9.94%, it did pass 10% in previous weeks but retraced on year end cool off from the major markets.

TER is free falling (veeeeeery slowly) to 1%, no complaints there of course but 2017 tax returns are coming in June 2018 so this figure is going to be on the rise like it happened this year.

NYYoC is growing steadily on the contrary, for the second month in a row it grew by 0.01% (accounting also for the reduction in TER which affects this number clearly).

Forex – Currency Effect is worth -6.60%, which means that if tomorrow currencies go the the average price to which I bought them TR will increase by this amount. So here we are losing quite a bit thanks to the strength of the Euro.

Dividends and Options

December scored a 1307 Euro turnover.

Dividends were 668 Euro (+10% vs.2016) and Options counted for 639 Euro (-56% vs 2016). Dividends showed some decent growth, if I can keep that up in 2018 I would be happy, Options on the other side show a massive loss, this is because the problems I have had with my excel reporting last year got me to have a terrible November and a far too beautiful December, nothing to worry anyhow. The result was affected by STX rolls in 2018 which costed me 450 Euros in December, coming out of this trade is proving to be hard but we are getting there little by little…

Some long calls were bought back exploiting movements of the underlying stocks, but generally I have a lot of money tied up in January on 4 puts and this stopped me from investing more in December.

List of Options closed in December
Screen Shot 2017-12-30 at 17.26.30.png
DCA/Increased Positions

Bought 50 EBR:ABI @ 94.97 Euro

AB Inbev gets to the “Option Trading Threshold” of 100 shares, becoming the biggest european holding in the portfolio. Technicals show a good resistance in area 94 Euro, and I do believe that the megamerger with SAB Miller will start showing some good signs in 2018. Will start selling Covered Calls when price goes up to 98/100.

New Positions – Sold Positions

Bought 100 VTR @ 60 USD

I had them on my radar for many months, 60 was a good point to start positioning and of course as soon as the stock recovers a little I will place my long Covered Call as per trading strategy. It’s a “core” stock for me so I might have to consider selling ITM CCs on MPW to get the stock out of the portfolio. Will assess situation over January, I need to refresh my due diligence on MPW to be honest.

Options Plays

Nothing to report


Conclusions

December was a positive month for the Long Haul Portfolio, defensive stocks suffered in the past months and gave me the opportunity to move onto some of them, but generally the positive trend is there and of course it’s good to ride it. Economy fundamentals appear pretty solid all over the world, major concerns are elections (Italy), QE might stop (Europe), Interest Rates in USA around March/April might get 10Y T-bills over 3% and that could create a major shift in investment stance from some investors. But as usual the crisis that we will all get tomorrow will be on something that today is not evident at all…

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4 thoughts on “December 2017 Update

    1. Ciao DG!
      First comment of the new year! :)Thanks for stopping by, please give me more details on what it’s not so clear so that I can work on it. I did not follow any standard reporting while making these and there is a very good chance that what is evident anc clear to me it’s not so evident and clear for others… Thanks for the help!
      Ciao ciao
      Stal

      Like

    1. Ciao SR,
      ACtually the issue of hedging is something that I have always thought about but in the end, as the timeframe for investing is the “long period” I believe that currency effects are going to be mitigated over time. If I see opportunities in the market I will act and buy dollars, regardless of their value. Right now currencies are dragging total returns down, but it’s part of the risk that I am taking by “flying naked” (I also see this as a potential opportunity of course, if the Euro gets weaker…).

      Ciao ciao
      Stal

      Like

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