2023 overview
2023 was a in absolute phrases fairly good, in relative phrases nonetheless under benchmark. The Worth & Alternative portfolio gained 14,3 % (together with dividends, no taxes, AOC fund as of 30.09.2023) in opposition to +16,2% for the Benchmark (Eurostoxx50 (25%), Eurostoxx small 200 (25%), DAX (30%), MDAX (20%), all efficiency indices together with Dividends). Hyperlinks to earlier Efficiency critiques could be discovered on the Efficiency Web page of the weblog.
Another funds that I comply with have carried out as follows in 2023:
Companions Fund TGV: 19,6%
Profitlich/Schmidlin: +23,2%
Squad European Convictions +9,9%
Frankfurter Aktienfonds für Stiftungen +7,4%
Squad Aguja Particular State of affairs +4,4%
Paladin One -5,2%
Alphastars Europe +13,7%
The efficiency of the friends displays to a big extent the weak point esp. in European/German small caps, particularly these exterior indices. For those who missed out on the few shiny spots, you underperformed considerably.
Over the 13 years from 12/31/2010 to 12/31/2023, the portfolio gained +398% in opposition to +120% for the Benchmark (earlier than taxes). In CAGR numbers this interprets into 13,2% p.a. for the portfolio vs. 6,2% p.a. for the Benchmark. The portfolio ended 2023 additionally with a brand new All-time-high. As a graph this appears as follows:
I’ve to confess that I’m nonetheless shocked by the extent of the compounding impact. The ~13% p.a. have now resulted in 5 EUR out of 1 EUR invested again in December 2010. As talked about earlier than, I anticipate a decrease charge going ahead, however over time, compounding is extremely highly effective.
Present portfolio / Portfolio transactions & New positions:
In 2023, portfolio exercise was medium busy as already talked about within the 22 (+1) Investments for 2024 submit.
New positions had been: SFS Group, Logistec, Energiekontor, Italmobiliare, Laurent Perrier, DEME and SAMSE.
Bought positions: In 2023, I bought Meier Tobler, VEF, Rockwool, Recticel, Schaffner and Nabaltec. Short-term members had been Scor and Broedr. Hartman (Particular Sit). The present portfolio per 31.12.2023 could be seen as all the time on the portfolio web page.
Some Portfolio statistics
The weighted holding interval as of 31.12.2023 has been 4,2 years and is inside my goal of 3-5 years. The 10 largest positions account for round 52% (56%) of the portfolio, the largest 20 for round 86% (87%). The decrease focus within the high 10 is the results of both promoting (Meier Tobler) or getting purchased out (Schaffner) two of the biggest positions.
“Lively share” vs “do nothing”
The “Do nothing” strategy, i.e. simply letting the Portfolio run from 31.12.2022 and gather dividends would have solely resulted in a efficiency of 8%, so my “lively contribution” in 2023 was once more fairly vital. The principle cause for this had been some timing resolution, e.g. promoting Meier Tobler just about on the high, new positions (Logistec, DEME), however most significantly, rising the Schaffner place earlier than the take-over supply to a full place. That enhance alone was resposble for a 400 bps “uplift” vs. do nothing.
Month-to-month returns 2023
In relative phrases, 2023 began fairly badly, because the portfolio underperformed the benchmark within the loopy January by virtually -7%. The relative underperformance elevated to virtually -12% in July. Solely in October, after 3 sturdy months and with the assistance of the Schaffner takeover, the portfolio matched the Benchmark:
Annual returns 2011-2013
2023 was solely the second 12 months in 13 years wherein I underperformed the benchmark. This was clearly pushed by the numerous underperformce of small caps as talked about above. My benchmark consists out of fifty% German/European Giant caps, in distinction, my solely giant cap is ACT with a 5% weight. The second cause is the distribution of returns with very sturdy returnslat within the 12 months, the place my “low beta” portfolio requires time to catch up.
Errors made in 2023
As all the time, I made a variety of errors, amongst them promoting Nabaltec a little bit to early (or too late truly) which created fairly a number of feedback on the weblog. In addtion, I clearly entered too early into building/renovation associated shares like Sto and Photo voltaic.
One other mistake was to not transfer extra agressively into out of favor shares in October. Sure, I purchased DEME, however I might have finished extra. I do maintain my ~10% money place to leap on alternatives like this, however I didn’t. I had a number of top quality shares on my watchlist (Tomra, Righmove), however I did set the boundaries too low.
As well as, I missed out on a extremely good 12 months for banking and insurance coverage. I added SCOR to start with of the 12 months however obtained scared when the CEO out of the blue resigned. Though I’m nonetheless one way or the other sceptical on the basics for a lot of insurers and banks, the narrative “increased rates of interest are nice for insurers” was fairly apparent and I might have piggybacked on this.
What went properly in 2023
Promoting Meier Tobler at what I believed was a “full valuation” turned out to be good timing. Additionally rising Schaffner when fundamentals improved and the inventory did nothing was clearly good. Lastly, investing into DEME and the underside of the cycle for Offshore wind to date turned out to be an honest concept.
Classes discovered 2023
I believe the most important lesson discovered (once more) was that persistence is the important thing. Even with the numerous underperformance over the 12 months, not altering the technique was importent. If nothing vital adjustments from the elemental aspect, my portfolio often “recovers” with a time lag of some months.
In addtion, I believe it is sensible to examine in into “very out of favor” sectors occasionally to see if there’s a sentiment shift occurring.
Technique & Outlook 2024
Final 12 months, I cautioned in opposition to Tech shares and that they possibly received’t rebound rapidly. That was clearly not name. In order a lesson, I received’t make any such calls this 12 months. To be sincere, I’ve no clue what 2024 will maintain for the inventory markets. It could possibly be good, dangerous or completely uneventful.
For me, in 2024, (Renewable) Power continues to be an enormous subject, in addition to “bricks and machines”. Infrastructure is one other setor that I discover fascinating. I assume we haven’t seen the underside of the cycle particularly in Europe, however as shares often “look ahead” at the least 6-12 months, I’m optimistic that we might see higher efficiency in these sectors in 2024 (in relative phrases). However once more, I is perhaps completely fallacious. For me an important half is to concentrate on “high quality corporations”. In the long term, they provide sufficient returns and let me sleep properly. I go away the tremendous low-cost stuff to others. With high quality, I imply an honest enterprise with decet returns and succesful administration, ideally with fairness stakes.
And naturally, I’ll proceed to show a variety of stones and hopefully will discover one thing precious right here and there, possibly in Belgium ?
Bonus monitor:
So as to benefit from the fruits of long run compounding, an important recommendation is to “Journey on” no matter occurs:
