It is now a year since I have been following the Discount Investing strategy; or, more accurately, since I have been consistently measuring the investment returns from it. In the past 12 months, my portfolio has returned nearly 25% (in pounds sterling), more than 5 percentage points ahead of the benchmark, the FTSE All-World Total Return Index (also in pounds sterling), which has returned just over 19%.
With many long-anticipated deals, it is often better to travel hopefully than to arrive. This was certainly the case with the recently announced sale of Vodafone’s shareholding in Verizon Wireless. After many months of speculation, and a rising Vodafone share price, when the deal was actually announced Vodafone’s share price immediately dropped 5%, although it has recovered somewhat since. I suspect the reaction was largely technical: a large number of shareholders had probably decided to wait until the deal was actually announced before selling their shares. Certainly, whilst there were a few aspects of the deal with which investors could quibble, there were no major surprises. I have a small position in Vodafone (around 2% of my portfolio), which I bought a couple of years ago. In light of the deal, I thought it was a good opportunity reassess whether I should sell my shares or continue to hold them, or possibly buy more.
Aurora Russia (ticker: AURR) is an AIM-listed investment company, launched in 2006. It is a private equity fund investing in small Russian companies. (Note it is completely unrelated to Aurora Investment Trust, which I have also recently invested in.)