DIY-Investors Portfolios (Transactions)

Portfolio Changes

I've recently made some changes to the actively managed portfolios and so I thought I'd post a mid-month update.

UK Coal

The first change was the sale of UK Coal (UKC) from both the 5 stock and 10 stock actively managed portfolios. I've shown the chart below...

The red arrows, marked on the graph, serve to illustrate the following points:

• The 50 day moving average is in a decline, with the price seemingly unable to break above it (apart from a day or two at the beginning of May).
• The OBV has been moving steadily downwards since the Spring.
• The AD indicators are still registering a downtrend and this is increasing (solid line rising).

Results

The recent UKC H1 results (released Friday 10th August 2012), showed a return to form for the Company (a loss!). Notwithstanding the apparent tangible book value, the news on re-structuring gives little hope for an early resolution or indeed that there will be much left for shareholders. Either way, the likely delay and regulatory approval made me decide that there are better places to invest our funds (albeit virtual funds in this case). The lesson here is clear - don't ignore the Technical Analysis! I sold both holdings at 6.3p

Purchases

I have recently started to become increasingly bullish in my views about the automotive retailers/distributors, as you probably gathered from my recent broadcasts and Blog posts. I have therefore re-invested the proceeds into Pendragon (LSE:PDG) and Vertu Motors (AIM: VTU) - the mystery company that I posed the question about during the TV Broadcast on 7th August. Full details of the purchases will follow in the next internet TV Broadcast on 5th September at 8pm.

Webbed Feet!

Like any of you that have been on holiday in the UK for the past fortnight, I have returned home with Webbed Feet! We spent most of the time picking our way through puddles or "squidging" up and down the sodden South-West Coastal Path around Cornwall's Lizard Peninsula!

Just occasionally, the sun popped out through the clouds, to remind us what summer could be like and how picturesque the Cornish coastline is...

Coverack (at low tide)

Our holiday spanned the end of June but I was able to record the DIY-Investors Portfolio Performances, which produced some very interesting results as can be seen in the full report here: DIY-Investors Portfolio Performance (6 months to 30th June 2012)

I'd be interested to hear about your views on whether I'm right to hang on to UK Coal.

British Polythene Industries (BPI, SP=349.5p) - Resuming Uptrend?

BPI closed tonight at 349.5p which, although not in itself a significant rise, does seem to confirm the possible resumption of the uptrend that had been in place from February 2011 to March 2012. BPI has been in a short term (against the trend) drop, indicated by the blue dotted lines on the annotated Sharescope chart (below)...

Note that the OBV has increased significantly this Spring and the Key Metrics (below), show a strong position...

I've underlined some key points, namely:

• Reducing Debt
• Reduction in Net Gearing
• Increasing Profit
• Increasing eps (47.66p in year to 31.12.2011)

The other factor that interests me is the low PSR (0.18), which seems to be low for a Company that has an operating margin consistently 3 to 4% of turnover.
 
As you know, this is one of our Share-Picks for 2012, contained in both the DIY-Investors Passive Portfolios and my Actively Managed Portfolios. It will be interesting to watch BPI's progress over the next few months.

What you think of BPI's prospects?

As usual, my recommendation is to check it out for yourself and make up your own mind as a "DIY-Investor".

Mick.