Attendees: Richard Albon (Chair), Geoff Floyd, Alan Martin, Dave Johnston, Andrew Watkins, Don Parker, Wez Davey
Apologies: Les Watson, Robin Rynhart and Andy Davies
Guest: Lisa Hansell-Wright
The minutes were reviewed in advance and agreed to represent the meeting.
Action 2.1 (GF): To read the investment club manual to review the tax implications for the group and draw up an opinion which could be explained to the group at or before the next meeting.
There is a form to complete to register the club with the tax office. We have to decide how to split dividends between capital growth and income. The decision was made to reinvest all income in the club to increase our capital growth. Club members can cash units if they wish to withdraw some money. Partial withdrawals are allowed.
Action 3.1 (GF) To contact the tax office and take necessary steps to register the club.
Action 2.2 (All): Review Declaration of trust, constitution and rules by 22nd June.
Must be done because everyone has signed the club constitution.
Action 2.3 (GF): To set up a club account with Lloyds.
The address of our branch is:
Lloyds TSB Bank
Royal Parade
Plymouth
Devon
PL1 1HB
Sort code: 30 96 68
Account Number: 1705986
Account Name: Roborough Investment Club
Action 2.4 (All): Review the areas identified and make recommendations of companies to watch.
|
Don |
Bio-technology |
See reports later in the minutes.
Action 2.5 (LW): To contact Lisa Hansell-Wright to see if she would be happy to come and talk to us about her experiences with investment clubs.
See report later in minutes
As Geoff has purchased the Proshare Manual our first year of membership is free. The decision was taken to join as we have nothing to lose.
Action 3.2 (GF) Complete forms to register RIC with Proshare.
Lisa's club was started because one of the group was writing a thesis on investment clubs for her accounting course. The where 12 in the club including a bank manager for Barclays Bank (they used Barclays for their bank account and stockbroker). The Barclays broker offered very limited advice (must have been an execution only service). The starting fee was £50 with a £20 contribution per month. The club was set up to run for a year. They found their companies in the FT and Investors Chronicle. They chose companies to invest in based on the company description plus their own thoughts and feelings and back ground knowledge. They used a Penny Share magazine but this was not so helpful. They selected different sectors for each of their investments. Electrical companies did well. Retailing and food where slow moving and declined slightly. They decided to limit purchased to shares with a value of £5 or less. They invested every other month to allow sufficient funds to build up. They had meeting by ringing round on the phone when quick decisions where required. Some people did not turn up to meetings. The same people moaned about not knowing what was going one. They met in peoples houses and some information was obtained from teletext. Overall they made a slight loss. Meetings where held monthly for an hour. It would have been a good idea to set a change in share value to automatically trigger their sale, for example after a 20% gain or loss. This would help avoid indecision which in their case resulted in them missing a profit and making a loss on one share sale.
Companies: Heweton (building supplies), Video Logic (Electronic), Shani (Textiles), Daniels (Food Processing), Columbus (Media).
It was decided to use Charles Schwab as our stock broker.
Action 3.3 (GF). To open an account with Charles Schwab
Wez has obtained European performance leagues for the chemical and oil and gas sectors.
The chemical sector grew by 95% over 5 years and -17.5% over 1 year. ICI was ranked 24th over 5 years and 18th over 1 year.
The oil and gas sector grew by 106% over 5 years and -13.3% over 1 year. BP was ranked 1st over 5 years and 2nd over 1 year.
Both sectors are on the up.
There are many small prospecting companies in the oil field.
Selling fertiliser to China is hot.
Investors Chronicle tip a few weeks ago was Cambridge Antibody Technology. It has not moved since. Another contact indicated that this company was the safest of the high risk biotech companies.
British Biotech has gone up 21% this week. There was an article in last Sunday's paper about a take-over. The share price is low compared to 2 years ago.
Fizal going to challenge the government over Viagra on the NHS. If they win they will go up. (joke?)
Lisa noted that it is important to look for a broad range of inputs for example is the company subject to animal rights protests.
There are lots of start-up companies spinning off from universities. It is a very volatile sector dominated by SmithKline Beecham and Glaxo. The larger companies tend to purchase successful smaller companies.
Compared prices over the last month.
Water sector grew by 2.6% with Yorkshire up 16% as they had a good report from OffWat regarding their improved pipe network.
The Gas sector up 7.6% Santos did best. Centrica grew by 10.4% due to AA purchase.
Electricity sector up 1% with Hafslund up 24% and National Grid down -4.5%
Oil and Gas are a higher risk area. British Bornio up 41.2%. The latest Opec agrement is expected to stick which may lead to increased oil and gas prices.
Next Meeting : 10 August 1999 (To be confirmed)
Actions
3.1 (GF) To contact the tax office and take necessary steps to register the club.
3.2 (GF) Complete forms to register RIC with Proshare.
3.3 (GF) To open an account with Charles Schwab
3.4 (All) Email round useful web sites and information.
3.5 (All) To set up standing orders starting on the 1 August.