Paul Hill's YTD returns.

Sun 3:43pm by Paul Hill

11 comments 605 reads

'In for a penny, in for a pound.'

Indeed as every stock picker knows, investing is not easy - especially if one runs a relatively concentrated portfolio of higher risk & idiosyncratic positions. There are occasions when things go well, and others when you frankly look like a fool.

Unfortunately H1'24 for me, has been one of those 'negative alpha' periods, where my portfolio has lost -4.8% vs a +5.2% gain from the FTSE All share.

Clearly not disastrous, but nonetheless painful and largely due to poor performances across a number of companies - such as #IHC, #AGFX, #ASTO, $BMY, etc.

That said, my returns (unlike professional asset managers) are not measured against quarterly, annual &/or 3-5 year benchmarks. Meaning I have the luxury of being able to underperform without any risk to job security.

Looking ahead, the plan is to stick closer to my GARP based stock picking process and keep all fingers/toes crossed. Hopefully H1'24 has simply been a case of 'darkest before the dawn'.

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andrewdb

Sun 5:20pm

Lastly my 24 year HIT RATE is only 62%. Meaning 385% of the time I lose money (ie often wrong) - albeit my winners are (on average) 1.5x larger than my losers. Please Do Your Own Research.

Think you meant 38.5% ?

TEIN

Sun 9:21pm

Hello Paul, well done for sharing, I hope H2 makes H1 pale into insignificance for you.

It's probably a good time to say thanks for all the video's. I've been repeat watching some from the period either side of the New Year, and it's interesting to look at the performance of stocks discussed between then and now. Please keep the coming.

jonno

Mon 6:45am

Tough times Paul, especially in the UK small and midcap arena. Hopefully things will pick up once the general election is out of the way. It very much looks like a Labour government, Irrespective of one's political views the country desperately need s change, in my view.

rmillaree

Mon 8:35am

Its refreshing to see postings where someone is underperforming temporarily despite picking what looks like very sensible selections (remnnds me the post the other day when someone was expecting to make a "monthly return of x%!!!" - strewth . thats the reality of variability right here - if one outperforms the market long term one will no doubt have bad patches at times due to having stocks that aint the market. Obviously having nigh on 50% invested in 3 stocks means its fairly obvious to me that the perfomance of those 3 main holdings will almost certainly set the tone for the period. With nearly 50% in 3 stocks its not anything like what most would say is a sensibly balanced portfolio - many do outfperform though with concentrated portfolios so thats not knocking the route taken here - 10% plus annual return over the long term will do more than very nicely thank you.

Paul Hill

Mon 10:36am

Yes unfortunately, I've been a magnet for 'value traps'.

Mon 11:28am

Hopefully that value will out - imho the long term results seem good enough that hopefully this is a "at some stage to be expected" blip.

I would say though statistically speaking for very concentrated portfolios there is a much higher risk of having a really bad event compared to more balanced portfolios - i think thats to do with the fact that if you lose 50% you need 100% return next time to get back where you started. so while 50% gain and 50% loss anywhere will be neutral - with few stock making up % of your portfolio your chances of having disaster due to unluckiness is hugely magnified - cant remember what the name for that is but its pretty agreed that this is the case. Note the flip side is that you winners if your large holdings outperform are super tubo charged . That can perhaps explain why some may have had riodiculpously good returns beyond any reasonable expectation - get lucky on a a few big uns and unlucky on none of the big uns and you will look like a genius. Hopefully those that go super concentrated will always warn others its really not to be recommended from statistical point of view !

Wolf of Small Street

Mon 11:43am

Thank you Paul, interesting read. Its good to see you posting results even when you have a temporary blip, so many go missing when things don't go their way, it says a lot about you as a person. You've a long term record that many funds can only dream of.

StrawberryDreams

Mon 12:16pm

Mon 12:22pm

I was just watching a video with Cliff Asness, who runs a more value based quant hedgefund, talking about his years of underperformance related to the indices.In fact his first year of his fund, his initial $1 billion 'turned into' $500 million briefly... Lucky for them some of his initial investors stuck with him.We all can see his record over time since then.And he currently manages circa $100 billion.We can't all change strategies volte-face ai style or run a pod shop hedgefund singlehanded with or without a day job.Keep up the great interviews.

unbelievablejeff

Mon 1:37pm

I was a little confused when I saw BMY in the list as under performing because I thought Bloomsbury had been performing well but then I saw that $ in front of it and realised it wasn't Bloomsbury!

Thanks for sharing though Paul as often many wouldn't if they are going through a bit of a tough patch. Could be worse you could have not sold YOU on it's recent profit warning like me.

Mon 4:19pm

After the recent profit warning, Yougov is definitely back on my watchlist as a potential GARP recovery stock.

Indeed, the brand is probably already in the cross-hairs of possible trade buyers and PE house rollups

Paul Hill's YTD returns. "Its been a tough H1'24 beset by poor stock selection".

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Paul Hill

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