Turbulent times continue but I’m sticking with the short term plan as my cash reserves are otherwise getting too large. Therefore I bough additional 120 shares of Kemira for 11,75 EUR per share and additional 100 shares of CapMan for 2,59 EUR per share. Both of these positions are almost full but few additional purchases are still likely. Once remaining USD dividends for September are paid, I’ll probably add on Abbvie, Johnson & Johnson or Pfizer.
Recent Buy: Kemira Oyj
Energy crisis is escalating and European markets are feeling the pain. Euro as a currency reached new lows when compared against US dollar. I decided to buy additional 80 shares of Kemira Oyj for 11,75 EUR per share. This is not really related to the recent turmoil even though Kemira is not immune to it. Valuation seems to be decent, second dividend of the year is still coming and my main thesis (water) for building a full long term position is intact. Let’s see if I manage to complete the position during Q4.
Recent Buy: CapMan Oyj
My cash reserves are above my hard limit so I bought additional 400 shares of CapMan Oyj for 2,81 EUR per share. I find this valuation to be acceptable even though the overall situation if full of risks. This is mainly dividend play but the sector has some serious M&A potential as a bonus. It’s extremely difficult to say anything about the likelihood of CapMan being part of such activity and if it would be, it would be difficult to know on which side of the table it would be sitting on. I see significant risks on the market but will follow strategy as follows: re-invest dividends, try to limit cash reserves to current level and focus on primary DGI strategy.
Recent Swaps: Fortum for Capman and Kemira & Warner Bros. Discovery and Orion Office REIT for Gilead Sciences
Streamlining portfolios towards original primary strategy started or continued. I sold my modest Fortum position consisting of 270 shares for 10,225 EUR per share. This is hopefully a short to mid term exit. I still see Fortum as relevant company to own in 2025-2035 timeframe but current mess with Uniper and energy crisis is such that I expect to to easily buy these shares back in period between Q4/22 to Q1/23. Meanwhile I record minor loss here to offset some taxes. I used these funds to increase my positions in Kemira (70 shares bought for 12,32 EUR per share) and Capman (100 shares bought for 2,82 EUR per share).
While at it, I decided to also sell my Warner Bros. Discovery (79 shares sold for 13,55 USD per share) and Orion Office REIT (50 shares sold for 10,08 USD per share) and buy additional 25 shares of Gilead Sciences for 63,59 USD per share. These transactions also record minor losses to offset some taxes but are likely exited permanently or at least it’s difficult to come up with reasoning for re-entry.
Sold: NexGen Energy
This is quite likely short term exit and bored attempt in trading but I sold 300 shares of NexGen Energy for 5,40 CAD per share. These shares were bought in 2,07-2,21 CAD range. Uranium sector is likely to provide plenty of volatility but mid and long term vision is still intact. Therefore I might buy back these shares later. Then again I’m interested in simplifying the portfolio by focusing more on the main strategy. Let’s see how coming months play out.
Recent Buy: Kemira Oyj
Once again maintenance purchase with 20 Kemira shares bought for 12,19 EUR per share. Nothing special here as this is one addition to the long list of similar purchases. However, my cash reserves have reached my soft limit so I should really make bigger moves but gut feeling has prevented it lately. I’ll have to keep an eye on this topic but if my gut keeps complaining I’ll just make these maintenance purchases and re-invest dividends. In general holding cash might be a bit bad idea but my personal inflation level is very different. Therefore inflation does not hurt me quite as much as most people.
Sold: UEX Corporation
I decided to sell my tiny UEX position of 1500 shares. I never got around building a bigger position on it and therefore decided to sell now since the position is way too small to motivate tracking buyout offers from Uranium Energy Corp and Denison Mines Corp. I bought these shares for 0,220 CAD per share and sold now for 0,47 CAD per share. Nice enough gain of 139% but somewhat insignificant amount of dollars.
Recent Buy: 3M Co.
Dividend re-investment in lack of better ideas: 10 shares of 3M for 129,90 USD per share. Sure, company is facing all kinds of issues ranging for legal problems to overall inflation environment. I don’t really focus a lot on those with these huge companies. These kind of issues will come and go. Sometimes they might end up being fatal or close to it but most of the time companies will adapt and move on.
Recent Buy: Kemira Oyj
Just a tiny maintenance purchase of 10 shares of Kemira bought for 11,77 EUR per share. Nothing new here as this is just a maintenance purchase done for two reasons: consistently buying something and to avoid fees.
Q2/2022 Results
Another wild quarter has passed. Global economy is still facing pretty much same issues: COVID-19 tails, war in Ukraine and inflation/interest rate issues. On the positive side Finland and Sweden were finally invited to become NATO members but I’m sure Turkey will have additional tricks to use when the process moves forward. I personally don’t see huge risks in this as long as critical member states ratify the membership. This is very positive development in otherwise dire situation. Pandemic can of course take new directions and there’s also the monkeypox situation going on but probably this is something than will keep on fading into the background noise. War in Ukraine seems to be evolving in a positive way, or at least West and rest of the world has been providing enough resources for Ukraine to defend themselves. Russia is bleeding but probably this will take a long time to truly play out. Then there’s the inflation and interest rate issue where ECB seems to be late – as usual – on everything. FED seems to be doing a bit better but I guess situation is far from ideal in US as well.
On personal side this quarter was solid bounce year over year. Market overall has been taking a beating but my portfolio has performed reasonably well as main portfolio only dropped 1.45% during the quarter. Compared to to overall market this is partially explained by the fact that my portfolio bounced back from COVID-19 impact way slower in general. Bounce back was even more visible with received dividends. Q2 dividends before taxes were 5715,66 EUR compared to 2684.31 EUR year before.
What’s next then? I have allowed my cash buffer to grow lately and done some purchases, mainly as dividend re-investments and smaller maintenance purchases. This is likely to continue while waiting for for bigger opportunities. I still have pharma and medical sectors on my radar so I might still add on Abbvie and Gilead Sciences but I might also open a position in Medtronic. Let’s see how things evolve.