The Tugboat portfolio: an update
Saltydog Investor aims to boost fund investors’ returns via a simple strategy: buy what’s rising, avoid what’s falling. Here, Saltydog’s Richard Webb updates us on its cautious portfolio, the ‘Tugboat’.
Saltydog Investor aims to boost fund investors' returns via a simple strategy: buy what's rising, avoid what's falling. Here, Saltydog's Richard Webb updates us on its cautious portfolio, the Tugboat'.
Equity markets around the world fell for a second week in a row with the FTSE 100 giving up 1.1%. It was a struggle to find any of the sectors we consider in our weekly analysis making gains. In our Slow Ahead' low-risk grouping, the only sector that saw the leading funds make gains was the Absolute Return sector. The CF Odey UK Absolute Return fund, which we are currently holding, has made 6% in the last four weeks.
In the higher-risk Full Steam Ahead' grouping, some sectors, including the North American, European, and UK smaller companies funds, have continued to make profits, but we wonder how long they can buck the trend. With volatility increasing, and stock markets trending down, we have increased our cash holding to more than 45% by selling the Neptune Japan Opportunities and the Cazenove UK Equity Income funds.
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Markets are becoming worried about the end of quantitative easing (QE). Last week's US employment figures came in a little ahead of expectations, which was probably ideal good enough to suggest that the economy was improving, but not strong enough to indicate that the recovery was capable of surviving without further support from QE. But it does feel as though the economic climate has changed, and at some point we will have to move from an environment of QE to quantitative squeezing'. So we would expect the increased volatility to continue.
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Safe Haven | Cash | 46% | 30% |
Slow Ahead | CF Odey UK Absolute Return | 21% | 21% |
Steady As She Goes | PFS Chelverton UK Equity Inc | 7% | 7% |
Steady SOLD | Cazenove UK Equity Inc | 0% | 10% |
Steady As She Goes | Baillie Gifford Global Disc. | 20% | 20% |
Full Steam SOLD | Neptune Japan Opportunities | 0% | 6% |
Full Steam Ahead | Neptune US Opportunities | 6% | 6% |
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