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Selftrade investor David's story

We caught up with...

Selftrade investor David, who shares an insight into what his portfolio looks like and why he choose Selftrade.

These are David's personal opinions and not advice from Selftrade.

What inspired you to start investing?

I was always interested in shares from an early age. My father had a small portfolio and I always was interested in the newspaper’s financial pages. I worked in financial services most of my life and when I got into a management position I encouraged my team to read the quality newspapers as well as the Financial Times. All that led me to start investing myself when I was in my early 20s.

 

What was your level of investing knowledge like before you started?

Well, at first it was very basic. I used to read the press avidly and listened to feedback from stockbroker comments but eventually I moved into doing my own research. I have read books by Warren Buffet and Ben Graham and taken on board some of that and websites such as Investors Chronicle weekly are very useful sources or information.

My main criteria nowadays is a company that has free cash flow, very little debts and pays a dividend, but not a dividend that’s about to creep or crack – a dividend that’s sustainable, and that’s been my mantra for the last 30 years. Generally, bar a few exceptions, it has held me in good stead.

 

What was your first investment?

An Australian mining company that was operating out of Western Australia.  I took a gamble and it paid off. Then I went into something else and lost it all! You have to take these knocks to learn…

 

What has been your best investment decision to date?

For many years my portfolio consisted of mostly individual equities as I found them to be a little more exciting, but about 15 years ago I decided that, as I approach retirement I should be a little bit more sensible with my investment choices. Therefore, my mixture nowadays, with a few exceptions, generally consist of exchange trade funds (ETFs) and investment trusts, with a few bonds/fixed income investments thrown in – that has been the most sensible decision I have made so far.

 

What has been your worst? and why?

In 2008 when I chose to invest in Lloyds and RBS! Very suddenly, I was faced with lots of rights issues and in order to avoid dilution I couldn’t afford to do RBS as well, so I took a punt to stick with Lloyds. I did every single rights issue and ended up with about 100,000 shares, which I’m now refusing to sell  until they hit 90p.

 

What are the biggest lessons you have learned?

No company is too big to fail.

A mantra I have followed right from the outset is to only purchase stocks that pay a dividend - every share I buy now, generally speaking, has a 3% or 4% yield.

 

What does your portfolio currently look like?

I have big holdings in Lloyds, BHP, and BP. With the exception of those, the rest of my portfolio is divided into thirds - a third ETFs, unit trusts and investment trusts; a third the main market and the last third is made up of eight other stocks, which is for a specific reason.

A good holding for me is the Euro Dividend Aristocrats UCITS ETF, which tracks the performance of certain high dividend-yielding equity securities issued by companies from within the Eurozone. I have had that three years and it’s doing very well indeed.

 

Thinking about your investment journey so far - where do you see it heading over the next 10 years?  

Well, even though I’m in retirement and I run a small business I am not going to do what all the pundits say you should do, which is to reduce your investment portfolio into partly bonds and partly cash. I am going to continue the deal with the Lloyds thing, the deal with the mining stocks and eventually end up two thirds investment trusts and ETFs and a third for aid stocks, which I am doing for inheritance tax purposes.

 

What made you choose Selftrade for your investments?

Selftrade were the first ones to have an online platform, so I found the facility quite refreshing for someone who can make their own financial decisions.

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