This website and my investment newsletter are built around a virtual but extremely realistic model portfolio of dividend-paying UK shares.
The portfolio’s main goal is to show investors how my Defensive Value Investing approach can be applied in the real world.
And by ‘real world’ I do mean the real world, as almost all of my family’s retirement savings are invested in the same stocks as the model portfolio.
In terms of performance, the portfolio’s goal is to generate more income and more growth than the FTSE All-Share while being less volatile and less risky.
Historic performance
The model portfolio was launched in March 2011 with a starting value of £50,000. All dividends are reinvested and all expenses such as broker commissions, stamp duty and a subscription to the UK Value Investor newsletter are taken into account.
| Performance to 01/10/18 | Model Portfolio (A) | FTSE All-Share Benchmark (B) | Difference (A - B) |
|---|---|---|---|
| Value at inception (01/03/2011) | £50,000 | £50,000 | £0 |
| Current value | £101,821 | £89,230 | £12,591 |
| Dividend yield | 4.0% | 3.4% | 0.6% |
| 5-Year total return | 53.9% | 43.0% | 10.9% |
| 5-Year annualised return | 9.0% | 7.4% | 1.6% |
| 5-Year maximum decline | - 4.4% | - 11.4% | 6.9% |
| Total return from inception | 103.6% | 78.5% | 25.2% |
| Annualised return from inception | 9.8% | 7.9% | 1.9% |
| Maximum decline from inception | - 8.1% | - 13.5% | 5.5% |
For more detailed performance data, here’s a spreadsheet (Google Sheet) containing monthly values for the model portfolio and its index-tracker benchmark.
Quarterly performance reviews
Detailed reviews of the portfolio and its performance are published on a regular basis. You can read through the most recent reviews on the Portfolio Reviews page.
Reviews of past investments
To continually improve the portfolio, the weakest holding (in terms of quality and/or value) is sold and replaced on a regular but infrequent basis (one sale occurs every other month).
Each sell decision is accompanied by a full post-sale review explaining why that particular holding was sold.
You can read post-sale reviews for all of the portfolio’s past investments below.
| Company (click to read review) | Date sold | Holding period | Total return |
|---|---|---|---|
| Senior | September 2018 | 2 years 3 months | 48.2% |
| BHP Billiton | July 2018 | 6 years 10 months | 12.5% |
| Beazley | May 2018 | 2 years 8 months | 98.9% |
| AstraZeneca | March 2018 | 2 years 8 months | 29.7% |
| BP | January 2018 | 6 years 10 months | 41.1% |
| Rio Tinto | November 2017 | 5 years 2 months | 47% |
| Braemar Shipping | September 2017 | 6 years 4 months | - 4.7% |
| Wm Morrison | July 2017 | 4 years 2 months | - 2% |
| BAE Systems | May 2017 | 5 years 10 months | 142% |
| Standard Chartered | March 2017 | 2 years 8 months | - 33% |
| TP ICAP | January 2017 | 5 years 4 months | 57% |
| Homeserve | November 2016 | 3 years 3 months | 134% |
| Chemring Group | September 2016 | 5 years 5 months | - 73% |
| Reckitt Benckiser | July 2016 | 2 years 5 months | 63% |
| Tesco | May 2016 | 4 years 11 months | - 38% |
| Hill & Smith | March 2016 | 2 years 9 months | 83% |
| Amlin | February 2016 | 3 years | 85% |
| JD Sports | December 2015 | 4 years 9 months | 234% |
| Cranswick | October 2015 | 2 years 11 months | 135% |
| RSA Insurance Group | August 2015 | 3 years 6 months | 19% |
| Serco | June 2015 | 1 year 1 month | - 50% |
| Balfour Beatty | April 2015 | 3 years 8 months | 9% |
| ICAP | February 2015 | 2 years 10 months | 42% |
| Imperial Tobacco | December 2014 | 1 year 9 months | 28% |
| Greggs | October 2014 | 1 year 10 months | 30% |
| Royal Dutch Shell | August 2014 | 8 months | 18% |
| AstraZeneca | June 2014 | 3 years | 55% |
| Mears | April 2014 | 3 years | 89% |
| Aviva | January 2014 | 1 year 9 months | 32% |
| Go-Ahead | October 2013 | 1 year 8 months | 36% |
| Interserve | July 2013 | 2 years 4 months | 117% |
| Reckitt Benckiser | April 2013 | 2 years | 47% |
| N Brown | January 2013 | 8 months | 50% |
| UK Mail | October 2012 | 1 year | 34% |
| UTV Media | July 2012 | 7 months | 45% |
| Robert Wiseman Dairies | January 2012 | 9 months | 25% |
Broad diversity to reduce risk
To reduce risk, the portfolio is invested in a diverse range of around 30 companies operating in many different sectors and countries. The charts below show just how diverse this portfolio is.
Important notice: The model portfolio, its holdings and any related buy or sell decisions are not recommendations to invest or not to invest. The portfolio should be seen as a source of information and education only. You must always do your own research, make your own investment decisions and seek a regulated financial adviser if you are unsure of any investment. Please see the full disclaimer.