SMSF: FY18, Q1 Performance

Thanks largely to Kogan, my first full quarter running my SMSF was an absolute cracker.  The portfolio finished up 21.6%* against the benchmark (The Vanguard ASX300 index) of 0.77%.  Without Kogan, performance still would have been a respectable 4.52%.


I don’t have any big plans to add anything new, but will add to my portfolio if stocks I already hold become cheaper, or if something well-priced appears on my radar.


Here is my current portfolio breakdown:

KGN 28.6%

JIN 3.7%

AVJ 18.9%

REH 15.5%

DTL 1.8%

DDR 4.1%

FMG 4.1%

ST1 6.6%

Cash 16.7%


I’m aware that almost 2/3 of my total portfolio is concentrated on 3 stocks.  Here is Warren Buffett’s take on diversification.

His business partner Charlie Munger says that the surest way to succeed is to avoid doing dumb things, rather than attempt brilliance.


Some of my dumbest moves this quarter:

Buying FMG because it was so cheap on a P/E basis, without modelling forward P/E based on current IOP (Would not have affected my decision which is why I still hold).

Buying DMP the day before it dropped 20% on earnings release, then tripling the size of my position, before coming to my senses and exiting at a small loss 2 days later, because I realised I should never have bought them in the first place, because they are overpriced based on earnings growth and are borrowing $300m to buy back shares at these prices.

Overloading my JIN position blithely ignorant of the fact that they lacked any significant moat.  I still hold, but it’s now a smaller percentage of my portfolio.


I have high hopes that the mistakes I make over the next 3 months will be better than the previous 3.
*Originally reported as 17.7% in error.  17.7% is the percentage of current portfolio value at quarter end which was profit.  The percentage return on start of quarter portfolio value was 21.6%

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