Increase in equity quota – UK in demand

Of course, our real money account also has a share component. We always put these stocks to the test at the end of the year and throw out unsuitable candidates and replace them. At the end of 2020, we noticed that we did not want to remove any equities from our portfolio and that our share quota in our portfolio had melted sharply, as the account balance had risen sharply through other trades (50% in 2020).

This led to the idea of adding more stocks to the portfolio in order to come back close to our target rate of 30%.

Status quo at the end of the year

As of December 31, 2020, we had 4 titles in our depot:

Apple
Amazon
Gazprom
Microsoft

Each of these values is in the plus and has further price potential. Overall, these equities take up 17% of the portfolio value. However, we aim for around 30% and thus have enough cash for further purchases.

Shares with potential

In order to find shares for our real money account, we have so far followed a very clear scheme. Criteria such as:

Dividend
Dividend increase
Dividend continuity
Leverage
Rating
Share price
Market capitalization

Our new acquisitions are not based on these criteria, but rather on high expectations that are either driven by current undervaluation, future prospects, or takeover fantasies. At the end of 2020, the Brexit negotiations were well advanced and there was a certain sigh of relief. We have therefore decided to include 4 titles from the UK in our depot. We speculate on price increases that are justified by a current undervaluation or upcoming takeovers.

Our choice a lot on these 4 titles:

M&C Saatchi

M&C Saatchi is a creation-driven agency that is characterized by a lack of flexibility in the organizational processes. The latter is extremely unusual for an independent agency. Instead of working in a solution-oriented manner, everyone sticks to the well-kept Excel lists.

For us, M&C Saatchi is one of the hottest takeover candidates with very high growth potential, especially since they are currently considered undervalued.

Burberry

Under the name Burberry, in addition to high-priced clothing for women, men, and children, leather goods, shoes, accessories, watches, jewelry, perfume, and cosmetics are offered through its own boutiques and upscale retailers all over the world. Burberry is currently also considered a takeover candidate.

ITV

ITV is a network of several (formerly) independent commercial TV channels in the UK. ITV plc, based in London, is listed in the FTSE 100 share index on the London Stock Exchange.

Just eat Takeaway

Just Eat Takeaway (initially Citymeal) is an international online provider of delivery services for restaurants based in Amsterdam. The company, founded in 1999, organizes the ordering and delivery of meals offered by partner restaurants via its online portals and is in twelve European countries under various names. Just eat take away is one of the delivery services with the greatest experience worldwide.

But we also struck in the USA and decided on 2 very well-known titles:

Twitter

Twitter should be known to everyone and will soon be converted to be even more efficient and profit-oriented.

Fiverr

Vendors on Fiverr create listings selling digital services. These offers are called “gigs” (gig = appearance) on Fiverr. These gigs range from creating a business card to creating logos to programming with HTML, JavaScript, CSS and jQuery.

The position sizes are chosen to be relatively small because after our acquisitions we have 10 stocks in our depot, which is a lot. Basically, we never wanted more than 6 titles. Since we are currently swimming in cash and our equity allocation is too low, we are making an exception here.