Profit Taking by Investors Cuts THISDAY Model Portfolios Gains


By Goddy Egene 

THISDAY Model Portfolio (TMP) closed last week at 0.5 per cent lower following profit taking in some of the counters that made up the portfolio. The   cumulative gain that had risen to 17.2 per cent as the week ended October 13, fell to 16.7 per cent last week. But in all, the TMP has still delivered positive return within 17 weeks of its introduction.

TMP, an initiative of THISDAY Economic and Financial Intelligence Unit (TEFIU), is designed to enable leading stockbrokers and investment houses in the country share their trading skills and methodologies with ordinary investors.   The investment houses involved in the project are Afrinvest Limited, FSDH Securities Limited, Capital Assets Limited, Meristem Limited and Lead Advisory Limited .

 TMP consists of five different portfolio types constructed individually in conjunction with five leading stockbroking firms in the country with different investment objectives.

Since 17 weeks ago that the TMP was introduced, it has generated  a total return of N8.380 million on   a combined hypothetical portfolio value of N50 million.

The project involved asking each of the partner stock broking houses in the country to construct a portfolio of 10 stocks selected according to their individual best judgement and using their best and well tested stock selection and investment  strategies . They were then asked to each  deploy  an imaginary fund of N10 million to invest on the ten stocks in whatever proportions they considered best.

 It has been positive performance for all the portfolios until last week that Portfolio E slipped into the negative territory. Specifically, Portfolio E ended last week with a negative return of 0.4 per cent, indicating that  the N10 million deplored by Portfolio E at the beginning of the exercise,  has declined to N9,959,341.

Apart from Portfolio E that depreciated, Portfolio A also fell last week, bringing its gain to 12.5 per cent compared with 14 per cent as at the week ended October 13.Similarly, Portfolio B recorded a marginal decline from 20.6 per cent the previous week to 19.8 per cent last week.

However, Portfolios C and   D maintained upward trajectory. While a Portfolio A rose from 28.6 per cent to 28.9 per cent, Portfolio D grew from 22.2per cent to  22.8 per cent. This implies that the N10 million deployed by Portfolio  C has appreciated to N12,893,328 as at the week ended October 20. In the same vein, the N10 million deployed by D has improved to N12,287,483.

 Meanwhile, nine out of the10 stocks in Portfolio C  have delivered positive returns since the start of the TMP exercise. The only negative return is 0.6 per cent. On the other hand, the highest positive return is 58.6 per cent, trailed by 48.7 per cent. This was followed by 38 per cent and 33 per cent gains respectively. Others included: 26.7 per cent; 21.1 per cent; 19.3 per cent; 12 per cent; and 8.9 per cent.

In the Portfolio B, the stocks with negative performance reduced from two to one with 7.8 per cent. However, the highest price gainer among the stocks in this portfolio improved from 54 two weeks ago to 48.6 per cent. The second highest gainer stock recorded a gain of 41.9 per cent, followed by 33.2 per cent. Others are: 26.7 per cent; 21.1 per cent; 8.9 per cent; 8.3 per cent; 1.8 per cent; and 0.10 per cent.