Introduction & Market Background

May turned out to be another positive month for global stock markets. The UK was no exception with a total return of 2.4% for the FTSE All Share Index which I use as a benchmark for the Compound Income Scores Portfolio (CISP), which delviered 2.7% in May.

This continues a run of outperformance by the CISP since markets turned in November 2023 after the US Federal Reserve pivoted towards a more neutral stance on interest rates. So that extends the run to 7 months in a row now - the beat goes on la di da di da.

 

performance review

This months performance was aided by Hargreaves Lansdowne (HL.) annoucing a bid approach, which they rejected as they felt the 985p offered by a consortium undervalued them and their future prospects. Other significant contributions came from Renew Holdings (RNWH) and Gamma Communications (GAMA) on the back of decent results and a trading update respectively.

 

On the downside offsetting those positives to a certain extent were TBC Bank (TBCG) which fell on the back of nervousness surrounding the passing of an unpopular law in Georgia, which was seen as potentially moving the country closer to Russia and their leaders roots and away from closer ties to the EU. Their Q1 trading update may have also disappointed slightly as the Scores show their estimate revisions to be in the bottom decile of stocks in the CIS universe. Meanwhile in a more mundane areas Ultimate Products (ULTP) also disappointed with a profits warning. Finally Kitwave (KITW) also succumbed to some profit taking after a slightly disappointing trading update where their hospitaility customers had been hit by the recent soggy weather and downbeat consumer sentiment.

 

summary & conclusion

So another strong month for markets and the CISP continuing a run of positive returns since Novermber 2023. With an election having been called in the UK for July and of course the US election due in November, some poiltical risks may have more of an impact going forwards. Having said that though markets often seem to shrug off elections unless something very unexpected happens.

Meanwhile the old seaosonality argument for selling in May and going away for the summer could perhaps be more sensible adice this year given the run we have had. Personally I'm not convinced it is something that works consistenty to be worth the bother, although I certainly like the idea of getting away for the summer!

 

If you like that idea too and would like to have help with your investing from the various Scores we offer, then do have a look a our subscription options. Otherwise may I thank you for reading and wish you a decent summer wherever you find your self. Hopefully markets will not sweat it too much and the beat will go on for the CISP. Here's a bit of music on that theme for you but not from the original pair. Or if you prefer here is the original pairing of Sonny & Cher - ta ta - la di da di da.

 

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