In this first part of my 2021 review I look at the different measures of stock picking / trading performance through the year, before comparing them and then doing a deep dive into what were my initial top 5 positions at the start of the year as well as a couple I didn’t carry forward from 2020 to 2021.
This is a company that I mostly sold out of in late 2019 when the P/E hit 20x. During 2020 I sold the remainder when it was clear that both their pub and vending machine businesses would be severely hit by the covid response for a year or more. Today’s results (and annual report) are worse than I could have imagined at that time (specifically, revenue is 25% worse than I then forecast) yet I see the share price is higher.
Nightclubs have been in long term decline in the UK, much of Europe and presumably worldwide for many years as documented in this article from 2018. Within this market, Revolution Bars has underperformed, with bars closed, leases surrendered and the share price losing two thirds of its value even prior to Covid.
I have written more about Wey Education than any other subject here and it was my number one holding for the majority of the last three years. The combination of a high portfolio weighting and strong share price performance means that it made me more money than any other investment during the period. I hope readers did well too.
For those who like their investing to be more Hygge than Scandi-thriller, the Danish expression “It is difficult to make predictions, especially about the future” can provide some useful insight. Wouldn’t it be easier and safer to be able to accurately predict company performance based on what has already publicly happened rather than what may or may not be disclosed in the future?
At the end of 2019 Stockopedia set up an open Stock Picking Challenge to last the length of 2020 based on a five-stock equally-weighted portfolio. No trading is allowed and dividends are ignored. The main purpose of this was presumably to confirm that Stockopedia subscribers outperform non-subscribers (which I don’t doubt) and imply a causal relationship between paying your fees and getting better returns.