Strong Balance Sheets

Strong Balance Sheets

Issue 22: Venture Portfolio Update;

Having not updated you since Jupiter (JUP), I felt it was time. There are plenty of new ideas in the pipeline, i.e. dirt-cheap stocks, but the market has rallied, and it’s not (yet) their time. Who knows what will change next week? The recent K+S AG (SDF Germany) had been planned for Venture, but as I dug in, and with a solid balance sheet, it was fit for the Whisky Portfolio. It is hard to say how many ideas will flow, but it will vary.

I spent time on oil exploration stocks but couldn’t find what I would describe as a free lunch. The North Sea stocks are dirt cheap but need regulatory/tax changes to unlock value. Energean (ENOG) is interesting but highly indebted. Serica (SQZ) is dirt cheap, but the trend is weak. I am also looking at Saipem (SPM Italy), but I need to better understand the business and await a pullback. I could go on.

Venture was born last September. It is still early days, but I am pleased to see the winners building as the weeks and months pass, which is how it is supposed to be. Of the 21 ideas, most stocks have been UK-based, with two outside. Expect non-UK to grow. The split between mid- and small-cap has been roughly 50/50, with just one large cap. Financials and industrials dominate the table, with three trades in gold miners and some in growth and technology.

The original plan for Venture was to publish the ideas that were left behind because the Whisky portfolio, while dynamic and adventurous, rejected lower liquidity and higher volatility situations. That said, this area is also rich picking for investors seeking higher returns.

Looking at the list, I am pleased with the progress, with some standout winners.

Venture is issued by ByteTree Asset Management Ltd, an appointed representative of Strata Global which is authorised and regulated by the Financial Conduct Authority. ByteTree Asset Management is a wholly owned subsidiary of CryptoComposite Ltd.

General - Your capital is at risk when you invest, never risk more than you can afford to lose. Past performance and forecasts are not reliable indicators of future results. Bid/offer spreads, commissions, fees and other charges can reduce returns from investments. There is no guarantee dividends will be paid. Overseas shares - Some recommendations may be denominated in a currency other than sterling. The return from these may increase or decrease as a result of currency fluctuations. Any dividends will be taxed at source in the country of issue.

Funds - Fund performance relies on the performance of the underlying investments, and there is counterparty default risk which could result in a loss not represented by the underlying investment. Exchange Traded Funds (ETFs) with derivative exposure (leveraged or inverted ETFs) are highly speculative and are not suitable for risk-averse investors.

Bonds - Investing in bonds carries interest rate risk. A bondholder has committed to receiving a fixed rate of return for a fixed period. If the market interest rate rises from the date of the bond's purchase, the bond's price will fall. There is also the risk that the bond issuer could default on their obligations to pay interest as scheduled, or to repay capital at the maturity of the bond.

Taxation - Profits from investments, and any profits from converting cryptocurrency back into fiat currency is subject to capital gains tax. Tax treatment depends on individual circumstances and may be subject to change.

Investment Director: Charlie Morris. Editors or contributors may have an interest in recommendations. Information and opinions expressed do not necessarily reflect the views of other editors/contributors of CryptoComposite Ltd. ByteTree Asset Management (FRN 933150) is an Appointed Representative of Strata Global Ltd (FRN 563834), which is regulated by the Financial Conduct Authority.

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