FTSE Real Estate Investment Trusts

If you’re interested in investing in property, you could buy some property. However, buying and selling property comes with some significant admin and stress overheads. If you’re only looking to invest a few pounds, and don’t fancy having to arrange mortgages, business loans, insurance, and managing tenants then another way to do this is via property businesses listed on the stock market. A Real Estate Investment Trust (REIT) is one type of property business into which an investment can be made.

A REIT will have a portfolio of property assets, and shares in the business managing these assets can be bought and sold. As they are traded on the stock market there is the potential for shares to be bought and sold for a different price to the underlying value of the assets. So when looking at REITs, like other investment trusts, there will be a premium/ discount displayed to illustrate whether shares in the trust are priced at more or less that the value of the assets in the trust.

Categorising a business as a REIT has some advantages – they are exempt from certain taxes on their income and capital gains. But to qualify they need to meet certain criteria:

• Shares must be trading on a recognised stock exchange
• Must be a closed end publicly traded company - investors buy and sell shares in that company in the market, rather than an open ended fund where units are redeemed by the fund
• Must publish an investment policy that sets out approach to asset allocation, risk diversification and gearing, including maximum exposures
• In it’s annual report it has to state how investment risk has been aligned to investment policy. The report must also include a valuation of portfolio, which must be conducted by an external body
• Required to distribute at least 90% of profits from property rents

Since a REIT is closed ended the trading of shares does not need to impact the strategy of the business if the stock market gets upset. Open ended property funds have encountered liquidity issues, such as after the UK referendum result of 2016, when many investors wanted to sell their investments. Since property sales tend to take a while to complete funds were gated to allow fund managers to sell assets which could then enable investors to redeem their investments.

As 90% of rental income is returned to investors, REITs tend to raise funds for further property purchases through either borrowing or issuing shares. So worth keeping an eye on the level of debt, as if it is approaching the ceiling articulated in the investment policy it’s likely that expanding the property portfolio will be done through a share issue.

The longer term income predictability of some of these businesses appeals. There is a list below of (most) of the REIT listed in the UK with a few numbers in case it’s of interest:

REIT Name	Share Price	Market Cap (£m)	Dividend Yield (trailing)	NAV per share	Premium/ Discount	sectors
AEW UK REIT (AEWU)	94.20	139	8.5%	98.61	-4%	Commercial
Assura (AGR)	72.20	1624	3.7%	53.3	35%	Healthcare
Big Yellow Group (BYG)	1034.00	1729	3.2%	724.4	43%	Storage
British Land Company (BLND)	565.00	4887	5.5%	905	-38%	Commercial, Retail
Capital & Regional (CAL)	19.24	119	12.6%	52	-63%	Industrial, Retail, Commercial
Custodian REIT (CREI)	117.00	475	5.6%	107.10	9%	Industrial, Retail, Commercial
Civitas Social Housing (CSH)	88.30	526	5.7%	107.10	-18%	Social Housing
Derwent London (DLN)	3250.00	3435	2.0%	3852.00	-16%	Commercial
Drum Income Plus REIT (DRIP)	80.50	31	7.5%	93.80	-14%	Industrial, Retail, Commercial
Ediston Property Investment Company (EPIC)	85.40	184	6.7%	111.03	-23%	Commercial, Retail
Empiric Student Property (ESP)	93.00	557	5.4%	108.50	-14%	Student Accomodation
GCP Student Living (DIGS)	170.80	673	3.6%	165.52	3%	Student Accomodation
Great Portland Estates (GPOR)	719.20	1812	1.7%	853.00	-16%	Commercial, Retail
Ground Rents Income Fund (GRIO)	83.00	79	4.8%	113.20	-27%	Ground Rents
Hammerson (HMSO)	273.00	1981	9.5%	685.00	-60%	Retail
Hansteen Holdings (HSTN)	91.30	409	6.8%	104.40	-13%	Industrial
Highcroft Investments (HCFT)	890.00	48	5.9%	1195.00	-26%	Industrial, Retail, Commercial
Impact Healthcare REIT (IHR)	111.00	318	5.4%	104.67	6%	Healthcare
Intu Properties (INTU)	38.66	566	11.9%	252.00	-85%	Retail
KCR Residential REIT (KCR)	49.00	14	0.0%	70.97	-31%	Residential
Land Securities Group (LAND)	846.80	5849	5.4%	1339.00	-37%	Retail, Commercial
Local Shopping REIT (LSR)	31.50	25	0.0%	31.33	1%	Retail, Distribution
Londonmetric Property (LMP)	214.40	1740	3.8%	174.90	23%	Industrial, Retail, Commercial, Student
LXi REIT (LXI)	128.60	680	4.5%	114.60	12%	Industrial, Retail, Commercial, Student
McKay Securities (MCKS)	228.00	213	4.5%	326.00	-30%	Commercial
Newriver Reit (NRR)	189.00	528	11.4%	261.00	-28%	Retail
Picton Property Income (PCTN)	88.10	476	4.0%	93.00	-5%	Industrial, Retail, Commercial
Primary Health Properties (PHP)	138.00	1533	3.9%	105.20	31%	Healthcare
PRS Reit (PRSR)	86.20	435	5.8%	96.30	-10%	Residential
Real Estate Investors (RLE)	54.00	98	6.6%	68.80	-22%	Commercial, Residential
RDI Reit (RDI)	104.00	401	2.6%	190.20	-45%	Retail, Commercial
Regional REIT (RGL)	102.80	445	7.8%	114.30	-10%	Commercial
SEGRO (SGRO)	784.80	8451	2.4%	637.00	23%	Industrial
Safestore Holdings (SAFE)	651.50	1364	2.5%	402.00	62%	Storage
Secure Income REIT (SIR)	439.00	1420	3.6%	420.50	4%	Healthcare, Leisure
Schroder REIT (SREI)	53.90	285	4.7%	68.70	-22%	Commercial
Shaftesbury (SHB)	893.00	2582	1.9%	987.00	-10%	Retail, Leisure, Commercial
Standard Life Investments Property (SLI)	87.50	354	5.4%	91.00	-4%	Industrial, Retail, Commercial
Triple Point Social Housing REIT (SOHO)	95.00	312	5.3%	103.96	-9%	Social Housing
Supermarket Income REIT (SUPR)	105.00	258	5.3%	97.00	8%	Retail
Target Healthcare REIT (THRL)	110.60	434	5.8%	107.80	3%	Healthcare
Town Centre Securities (TOWN)	184.00	98	6.4%	384.00	-52%	Commercial, Residential, Retail
Tritax Big Box Reit (BBOX)	149.20	2404	4.5%	150.80	-1%	Distribution
Tritax EuroBox (EBOX)	94.00	399	0.4%	95.92	-2%	Distribution
Unite Group (UTG)	1061.00	2967	2.7%	820.00	29%	Student Accomodation
Warehouse REIT (WHR)	104.00	250	5.8%	109.70	-5%	Distribution
Workspace Group (WKP)	965.00	1590	3.4%	1086.00	-11%	Commercial

August 2019 portfolio update

Plenty of things pushing the markets around over the last month, Trumpy tariffs, Bojo's Brexit plans, Iran, Hong Kong...as a consequence we've seen plenty of volatility. Some of this is going to start hitting business performance, so it's no surprise to see investors getting nervous. Since I'm looking to buy, this is not a wholly bad state of affairs from my point of view. If Mr Market has a few tantrums over the next few months that will hopefully provide a few discounts, and the chance to lock in some higher dividend yields.

However, I'm remaining cautious particularly since Brexit feels somewhat binary: a softer version is likely to cause Sterling to spike, and drop the prices of the big international firms; whereas a harder Brexit is likely to cause a bit of a sell off of UK facing businesses. I'm not too concerned about the long term, but would be nice to be able to capitalise on cheaper prices and bigger dividends. I have plenty of interesting businesses and trusts to research, anything looking relatively Brexit-proof may well make it onto the shopping list.

Portfolio
The portfolio was beaten up a bit during August, like the wider markets, but just sneaked in ahead of my benchmark. The portfolio was down -3.2% compared to my chosen benchmark the Vanguard FTSE All Share Accumulation fund which was down -3.9% over the same period.

Sprinting ahead this month was old timer Unilever (ULVR), +5%. It's not often ULVR gets up above walking pace, but managed it this month. I suspect it's a result of people diving into defensive stocks to escape the volatility.

AG Barr (BAG) wasn't so steady on it's feet and took a tumble this month, -13%. Not too concerning just bouncing around after the big price drop last month from what I can tell. Nice to see the firm capitalising on the price and indulging in buy back activity, tick in the box for BAG.

August share purchase:
Network International (NETW) are a digital payment provider operating across the Middle East and Africa. They listed on the FTSE earlier this year - their IPO was in April. This is an unusual one for me, as I would rather a company had been operating as a listed business for a while to make sure any skeletons in the cupboard from their private days had been appropriately dealt with. So, as with any purchase that I think is a little racy, to mitigate some of that risk I've taken a smaller position.

NETW are based out of Dubai, and following the IPO have a valuation over £2.8bn, so they are not exactly a minnow, comfortably nestled in the FTSE 250 amongst household names such as Cineworld. However, compared to the $43bn paid by FIS for Worldpay recently they have some much bigger firms to compete with. It is this sector consolidation and the defensive nature of the payments industry that drove the purchase. I was also encouraged to see Mastercard take a 10% stake at the IPO. I'm not keen on buying at IPOs simply because it's never clear if the price is going to shoot upwards or crash. NETW has been moving upwards and following a recent positive trading update I was convinced to put in a little money. If it continues it's good news I will put in a bit more.

Time in the market

Time in the market vs. Timing the market

A quick google of sensible places to invest one's excess cash quickly brings back article after article extolling the virtues of the stock market. The Barclays gilt study tells us that over the long term investing in the stock market provides the greatest return over other asset classes. That takes care of where to invest. But how should I do it?

This is usually presented as the need to decide on one of two approaches:

• Time in the market
• Timing the market

Time in the market

On one side there is the buy and hold camp – who suggest drip feeding a small amount regularly into your investments. Don’t look at the news. Come back in a few years to a (hopefully) healthy pile of profits. Time in the market is more important than trying to time the market, because people typically aren’t very good at it. And we’re told that missing the small number of best trading days have a massive impact on returns.

Timing the market 

In the other camp are those that advocate more activity, not necessarily trying to flip stocks over short time frames, but buying and holding for a while, then sell for a profit. In other words, not simply time in the market, but timing it. After all if you suspect that your investments have peaked, why sit there and watch those profits all disappear as Mr Market throws a tantrum?

A closer look

I’m a UK investor and my starting point is the London stock market, I'll take the FTSE100 as it's the driving force behind the UK indices – as I’ve noted here the UK indices have a few interesting characteristics. But it’s where the majority of my investments are, and will likely continue to be, so that's where I'll focus my attention.

I’ve taken monthly data for 10 years, the last 10 full years from 2009 – 2018. It turns out that across that period, the biggest monthly gains are between 6% and 8.5%. There are 11 months that fall into that size of gain, 7 of them in 2009 and 2010, perhaps reflecting the recovery from the financial crisis. (I’m ignoring dividends for this)

The gain from 2009 – 2018 was around 47%, a £10000 investment would have increased to £14749.

Missing those 11 months would indeed have a significant impact on the investment. It would have resulted in a loss, -30%. The same £10000 would have ended up being worth £7045.

FTSE100 2009 to 2018 missing the best months

So it would appear to be correct, using this data at least, missing the 11 months with the highest gains would indeed have made a real difference - turning a decent return into a loss. We never seem to hear a related question though: what if we missed the worst trading days?

The 11 months in my data that have the largest losses range from -5% to -9%. These are more evenly distributed across the years. What would happen to our £10000 if we manage to miss these 11 months? Now the £10000 increases to £31077 - that's a 211% return, more than doubling the result from leaving the money invested every day.

FTSE100 2009 to 2018 missing the worst months

The calamitous impact on one's investment should one be foolhardy enough to try to time the market now looks a little less clear cut. Miss some of those big dips and you could be looking at much better gains.

My activity is limited, partly through having a job and a family and therefore relatively limited time to dedicate to doing this. In part it’s fear and laziness. I feel I would need a scientific and systematic approach, and don’t really know where to start. So I’m more in the camp of simply leaving money invested in (hopefully) good companies, and just leaving those investments to do their thing. As I noted here, had I tried to time the market when we had a big market sell off towards the end of 2018, I'm not sure when I would have jumped back in once I'd sold. So I guess I'm a time in the market kind of chap, at least for the moment.

July 2019 portfolio update

Lots of companies giving updates during July, so some quite big price moves both up and down, but the markets were maintaining their overall upwards trend. A few of the price moves put some things on the shopping list into buying territory which was helpful. Many of the big cap stocks that I'd prefer to be buying are still looking expensive, helped in part by the devaluation of Sterling. But I shall keep an eye on them as one or two have wobbled over the last few weeks.

Portfolio
The portfolio followed the markets upwards during July, just about getting it's nose in front. The portfolio was up 3% compared to my chosen benchmark the Vanguard FTSE All Share Accumulation fund which was up 2.3% over the same period.

Keen bean this month was Fulcrum Utilities (FCRM), +16%. I suspect this is partly due to over-enthusiastic selling last month when preliminary results were delayed, but an update stating that they were trading in line with expectations was welcomed.

Dignity (DTY) was showing a distinct lack of enthusiasm this month, -17% due mainly to a poor trading update and withdrawing their interim dividend. Not enough people dying apparently.

July share purchase 1: CRW
Craneware (CRW) develop software to help US hospitals and healthcare providers to understand their costs, maintain regulatory compliance, avoid pricing errors and streamline their administration. They were founded in 1999 and listed on the AIM in 2007, and have been a bit of an investor darling ever since, now with a market cap around £530m.

Despite deriving it's revenues from the US, the business is based in Edinburgh and have some great
 operating numbers, including ROCE and net margins averaging over 20% across the last 10 years, and zero debt. Customers typically enter 5 year contracts and provide nice predictable revenues. As a consequence of Craneware providing such an attractive investment proposition, the price has been chased ever higher. So when the company announced it's sales were off course at the end of June, the price took a nosedive of over 35%.

The price basically reversed out it's gains over the last year in a matter of hours on publication of the trading announcement. I'd be quite happy to see a slow recovery, if the price gains 10% in each of the next 5 years it will have got back to where it started before announcing the slow sales. Craneware has a sticky customer base and operates at the intersection of technology and healthcare which are sectors in which I'm comfortable investing, however the price is still high in my view (at least in PE terms, less so if you're looking at price to cash flow). Given the high price, I've kept the investment small, recycling a chunk of dividend payments into this one.

July share purchase 2: BAG
AG Barr sell soft drinks - and have since 1875 built their business of adding sugar and flavourings to water, and in some cases some carbon dioxide for a little fizz. They have a number of brands, the most famous of which is Irn Bru, but they have also branched out into juices, waters, cocktail mixers, and partnerships with other soft drinks sellers including (my favourite) Bundaberg ginger beer.

The Barr family ran the business for over 100 years, and still have family members in senior management. Robin Barr serves as a non-executive director and owns around 5% of the business. It is also a favourite of a number of funds, including Lindsell Train who own around 14% of the business.

It's not difficult to see why it has proven an attractive investment, it is a simple business, which has been successfully and conservatively run for quite some time. Over the last decade it has averaged double digit ROCE and net margins, and has no debt. It also has a proud track record of dividend increases, which again over the last decade have averaged 5% increase per year.

Food and drink businesses are typically seen as defensive investments, steady earners that can rely on many small repeat transactions. AG Barr's share price has indeed been increasing steadily, and from October 2016 until June 2019, more or less doubled. Much like Craneware above, with the valuation getting into nosebleed territory (at least for BAG), there was little room for error. So when AG Barr released a profit warning in the middle of the month, the sell off sliced 30% from the share price, to a level it was selling for in 2014. The reasons given included a couple of poor performers in their portfolio, the sugar tax, and a subsequent change in strategy to focus on volumes. And the weather. I'm not impressed by any business that relies on the UK weather for it's sales. However, having a couple of underperforming products is forgivable, and driving volumes and increasing marketing spend at the expense of margins is understandable given the altered recipes to accommodate the sugar tax.

I don't think the price drop put it into bargain territory, but shifted it from overvalued to reasonably priced, which is good enough for me.

Dividends vs. drawdowns

Dividends vs. drawdowns
I read this Terry Smith article some time ago (also available on the FT site here), and thought I should finally get around to digging into it a bit more. I think you can question the merits of using price to book as an appropriate metric, particularly with low capital companies who generate cash with few physical assets. I’m sure you could also disappear down a rabbit hole attempting to analyse retained earnings for a bunch of companies, particularly a disparate collection such as those in Fundsmith. But I am most interested in the distinction between using dividends for an income stream versus selling fund units (or one’s shares) as a means to generate income - to quote the article:

"The need to get spending money from your investments once you've retired is obvious. But why does it have to come from dividends?"

If I had an investment that paid out 4%, something like a FTSE 100 tracker, how would taking the 4% dividend compare to selling units to generate the same income? The FTSE 100 hasn't performed particularly well over recent years compared to other indices, whereas in terms of capital growth Fundsmith has been one of the better places to park your cash. It's only a small sample, but comparing these two investments, let's see how Mr Smith's assertion stacks up.

Income dilemma

I’m starting from a position that I need my investments to provide me with some income. There are two ways I can generate this:

• Have an investment that pays out a steady dividend
• Sell a slice of my investments at regular intervals

I’m going to take the FTSE 100 as my initial virtual investment – or more precisely a couple of iShares index funds to compare, one an accumulation fund that automatically reinvests dividends, one a distribution fund that pays out dividends quarterly.

I begin with an imaginary £100000 (just because it's a nice round number). I have wound back the clock to January 2010 when the accumulation fund I’ve chosen was started, and tracked performance forward from there until the end of June 2019. To make life easier I’m ignoring fees.

The capital of the distribution fund will remain untouched, and the dividends are not reinvested. For the accumulation fund I will sell as many units as I need to generate the same income provided by dividends from the distribution fund. I will also sell these units in the same months as the dividends are paid out.

Lets start with some stats showing how the trackers performed before I sell any units.

FTSE 100 accumulation tracker:

• Starting value January 2010: £100000
• End value June 2019: £200829
• Total return % change: 101% increase
• Total return: £100829

FTSE 100 distribution tracker:

• Starting value January 2010: £100000
• End value June 2019: £140647
• Capital % change: 41% increase
• Dividends paid: £43941
• Total difference (capital + dividends): 85% increase
• Total return: £84588

As might be expected, dividends being reinvested automatically into the accumulation fund, and the wonders of compounding provide for a much better performance. The additional 16% that the accumulation fund provides sounds a little abstract, but an additional £16k in the bank certainly isn’t.

But I need an income, so how does the accumulation tracker compare as an investment if I need to sell off quarterly slices in order to pay the bills?

Accumulation tracker:

• Starting value January 2010: £100000
• End value June 2019: £141389
• Capital % change: 41% increase
• Total value of units sold: £43941
• Total difference (capital + dividends): 85% increase
• Total return: £85330

In other words, generating an income through dividends, or taking a slice of the fund gives pretty much the same result. Changing the timing of unit sales would affect the returns, but if this was my income I wouldn’t necessarily be able to delay paying bills to wait for a favourable price at which to sell units.

This also doesn’t take into account fees, for the two funds I’ve chosen the ongoing charges are the same, but depending on the platform in which you choose to invest, transaction fees would nibble away at the small advantage that the accumulation fund offers. There is also the hassle of having to sell the units etc. not a big deal maybe, but compared to simply receiving a quarterly dividend in your bank account, it’s an effort that can be avoided.

So it doesn't look like the assertion from the article above holds much water in this particular example. At the time of writing the FTSE 100 ETF has a yield of 4.4%, and as can be seen here, aside from the financial crash years around 2009, the current yield is at the upper end of it's historic range. Fundsmith Income fund has a much lower yield of around 1.5%. Lets see how the Fundsmith accumulation fund would fare providing the same income as the FTSE 100 tracker, if I had to sell off units of Fundsmith.

Mr Smith vs the index
Fundsmith launched in November 2010, 10 months or so after the launch date of the iShares accumulation fund above, so I will adjust the unit sales to match. Basic stats as above to start with:

Fundsmith accumulation:

• Starting value November 2010: £100000
• End value June 2019: £453020
• Total return % change: 353% increase
• Total return: £353020

Now if I sell units to provide for the same dividend income as the FTSE 100 distribution tracker above we get the following:

• Starting value November 2010: £100000
• End value June 2019: £360616
• Capital % change: 261% increase
• Total value of units sold: £41444
• Total difference (capital + dividends): 302% increase
• Total return: £302060

Even when Fundsmith has to pay out an additional few percentage points in income to match the FTSE 100 ETF the differences are pretty stark. Selling the units would give the same income as the tracker, but the capital is up over 260% compared to the 41% of the tracker. Using this second example, the approach outlined in Mr Smith's article appears convincing.

2019 Mid-year review

As we’re past the half way point of 2019 I thought I should reflect on how the portfolio has performed and how I’ve progressed against my goals during the first 6 months of the year.

Portfolio performance
So far in 2019 the portfolio has increased in value by 15.1% (including all costs, and dividend payments). This compares to an increase of 13.4% in my benchmark (also including costs – as an accumulation fund dividends are reinvested automatically). I'm obviously pleased by this but a number of larger holdings, such as Unilever, have been performing very strongly of late and I would expect them to take a breather at some point soon.

The dividend yield from my portfolio in 2019 has amounted to 1.84% so far. The dividend yield on my benchmark is 3.79%, if half of this had been paid out in the first 6 months of the year, that would amount to a yield of around 1.9%. So I’m not too far away, however, a larger proportion of dividends tend to get paid out in the first half of the year, so I may drift from this. I would prefer the portfolio yield to be higher, but not at the expense of quality.

The best performer in the portfolio so far this year has been Sage, but this possibly reflects an overdone sell off last year, rather than any stellar turnaround from the business. Worst performer has been Saga, presenting a dire set of results that gave the impression the management had been asleep at the wheel. Whilst there are a few laggards in the portfolio, Saga is the only one at the moment looking like getting the elbow.

Analysis
I’ve been adding to the toolset, but it’s too early to say if this is proving effective. I’ve added in cost of capital calculations, and started to analyse performance metrics in a similar way to Terry Smith in his annual letters to investors in Fundsmith. I now have some weighted average performance metrics, and the median for the same metrics for the portfolio. In this way I can get a view of the portfolio as if it was a business, and how it compares to other businesses and potential investments. So an additional consideration for adding to the portfolio is to invest in companies that have performance metrics that compare favourably to those already in the portfolio, and the portfolio as a whole. Some of the key portfolio performance metrics are below:

Weighted average
roce	gross margin	operating margin	net margin	cash conversion	debt: ebit	cash flow yield
18.7%	47.7%	17.0%	13.4%	46.5%	3.5	2.2%

Median
roce	gross margin	operating margin	net margin	cash conversion	debt: ebit	cash flow yield
17.6%	57.0%	21.0%	16.1%	96.7%	2.8	5.6%

Whilst the above stats are helpful in some respects, using them to evaluate a Real Estate Investment Trust (REIT) is a little tricky as REITs are structured differently to most businesses. So I have excluded BBOX from the above. Also the debt related stats are not necessarily a sound reflection of the distribution of the debt across the portfolio. A number of holdings have no borrowings, it is mostly concentrated in a small number of holdings. Going forward, debt will continue to be an important factor in deciding whether to add something to the portfolio, I will prefer any additions to have low levels of borrowings.

Buying and selling
So far this year I've made the following purchases:

• Tritax Big Box (January)
• Manx Telecom (January)
• Fulcrum Utilities (March)
• Abcam (April)
• Reckitt Benckiser (April)
• Somero Enterprises (June)

These are all new additions to the portfolio, I haven't topped up any existing holdings.

Manx Telecom was acquired shortly after I invested, leaving the portfolio for a 32% profit. I have not sold any other shares.

Goals
My initial investment goals were:

• Capital preservation
• Increase capital by more than the rate of inflation
• Invest in quality dividend paying stocks

And by careful selection of stocks and funds, to outperform the FTSE All Share Index. Ultimately I'd like to be in a position in 20 years to get a steady income from dividends to top up pensions, and a solid portfolio of investments to pass on to sleepy junior, to provide not just a lump of cash, but a revenue stream. So far I'm fairly pleased with performance against these goals, but it's very early days.

Personal finance
No need to access the emergency fund during the first half of the year, and we've added to it slightly. Getting this set up has proved a great foundation for the rest of our finances as we now know that any spare cash is genuinely surplus to requirements.

Mortgage overpayments have continued. Mortgage partA is on track to disappear in around 3 years thanks to maxing out the overpayments. This accounts for about 60% of our mortgage payments, so completing this would free up a nice extra chunk of disposable income. We could then decide whether to put this to work overpaying the remainder of Mortgage partB, to a large extent this will depend on interest rates at the time. We have a bit of cash from bonuses, some of which is going into some work on the house, if this comes in under budget then Mortgage partB might get a little extra too.

Arrival of sleepy junior 2 over the winter will likely take a slice out of the budget, but nothing too dramatic as an attic full of stuff used by sleepy junior 1 can get wheeled out.

Conclusion
Fairly pleased with the start to the year, with a decent performance from the portfolio. I don't expect it to continue throughout the second half the year, as the high performing stocks are going to ease off at some point, macro-economic conditions look wobbly, and Brexit will once again take centre stage in the Autumn.

I've noticed myself prevaricating quite a lot over a number of purchases, and tend to want to get a bit more data, crunch some more numbers. Whilst caution and care is a positive, I think there has been a little too much dithering at times. However, overall, I'm pretty comfortable with the investments in the portfolio.