2014 Hotlist – Final Results

trophy Week 52 of 2014

Well – that’s that for 2014. The US Dow, S&P and far east markets seem to be celebrating another boom year courtesy of free QE hand outs. The FTSE 100 had a mixed year. Flirting with new highs but not quite managing to punch through the magical 7000 level. The Index finally closed out 2014 at 6566 down from 2013’s 6749. Netting a loss of 183pts on the year or circa 3%. In stark contrast, The S&P broke record after record as did the DOW. It was a year of record breaking highs for the US markets. Europe wobbled, not once but twice and with Greek elections due next month (Jan) it could be on its way to being booted out of the EU. Merkel and Mario may have to strike a new deal but that’s a story that can wait for next year.

A virtual portfolio has been set up using the 2013 final trading day close figures as a starting point and £1000 has been invested in each stock. This does not include buying fees or stamp duty and is purely intended to be used as a benchmark or summary for each week. Two newspaper top ten picks for 2014 have been included to help monitor/compare against.

Week 52 stock picks performance review:

The winner for a 3rd year on the trot is the Independent Newspapers 2014 top ten picks. A big well done to the Telegraph picks which despite ending in the red, notched up 5 out of ten positive stocks picks in 2014. Surprisingly, The Independent’s picks came in with only 4 out of ten positive performers but with the help of a near 1 bagger in Man group, the overall gain for the picks ended in the blue. The commodity focused Hotlist took a right good beating as OPEC delivered a hammer blow which even Santa couldn’t overturn. It brings a 4 year bear run in the sector to its lowest levels in over 5 years since the world was nigh post Lehmans. Is it really that bad? For some small minnows with large assets but no cash flow, it’s becoming a tough battle to hang onto equity value without having to give the lions share of interest away in exchange for debt/cash injections. Some 1P reserves (Xcite Energy) are priced at around $1.50pb (based on market cap) when they should be nearer $20pb. The latter number was perfectly acceptable back in 2012 when Oil was not a country mile away from where it is today.

Whilst the commodity heavy Hotlist 48.6% loss is heavy, it did outperform Schroder’s Global Small Cap Energy Fund which finished down 50%. The  International Oil & Gas Technology Investment Trust took a beating too, closing down a whopping 67%. Brutal stuff for the energy sector. Unlike the funds and trusts, the ShareHub’s Hotlist is not traded during the year. Getting rid of under performing stocks and bringing in new stocks can refresh and bolster a folio/fund.  A liberty the Hotlist cannot benefit from. What is picked in early Jan remains until end of Dec. This is in keeping with newspaper/press top ten picks for the year ahead.

Missing factors of note in 2014 was surprisingly M&A and major exploration discoveries. Too many dusters and too few major asset/farm in deals. If the commodity sector is to turn a corner next year, then M&A is going to be the most likely candidate. Unfortunately, with prices so low at present, many asset rich stocks like Afren and Xcite might end up with offers that are a long way from NAV’s or average industry value. That said, for any newbies entering stocks today, multibaggers could be aplenty while for many long term holders – searching for break evens would be a good result.

The ShareHub’s Hotlist picks for 2015 are complete and will be announced in the next 1 to 2 days.

Final 2014 standings / Week 52 Results

1. The Independent’s Top Ten 2014 +4.17% (Weekly gain of 1.27%)
2. The Telegraph’s Top Ten 2014 -2.69% (Weekly gain of 1.80%)
3. TheShareHub’s 2014 B-List -27.88% (Weekly loss of 0.08%)
4. TheShareHub’s 2014 Hotlist -48.68% (Weekly gain of 0.89%)

Click on Portfolio image to enlarge:Independent Final Winner!Telegraph FinalTSH B-list Final 2014TSH Final 2014