After a year’s patience with HNG I’ve decided to sever my relationship with the holding and my book is already thanking me for it. It had a big margin of safety which was unfortunately eroded by multiple businesses losing money, particularly Biante. If the business had stayed profitable, I could have justified maintaining my holding, but with the group currently booking losses, I’ve decided to exit my position to tally up the lessons learned.
This is not before taking a 60% haircut from what was a fairly large position. Looking back at what I could have done better, the main thing I could have done to improve the final outcome would have been to take a smaller position so it would have had a smaller impact on my portfolio.
The original purchase had a decent margin of safety, but with the businesses losing money (and only a few small pieces of good news such as from the Mountcastle brand) it was time to SUMO (Shut Up and Move On).