LM portfolio as at 10/02/2023:
| Code | Sector | Date Bought | Cost | Value | Gain/Loss |
|---|---|---|---|---|---|
| LM051 | ETC | 07/11/2022 | £1270 | £1330 | 4.44% |
| LM053 | ETF | 09/01/2023 | £1280 | £1300 | 1.35% |
| LM054 | Banks | 09/01/2023 | £1270 | £1370 | 8.33% |
| LM055 | General Financial | 11/01/2023 | £1280 | £1410 | 10.81% |
| LM056 | Media | 11/01/2023 | £1270 | £1280 | 0.52% |
| LM057 | Gas, Water & Multiutilities | 12/01/2023 | £1270 | £1260 | (0.85%) |
| LM058 | Support Services | 17/01/2023 | £1270 | £1150 | (9.30%) |
| LM059 | Industrial Transportation | 30/01/2023 | £1260 | £1240 | (1.38%) |
| LM060 | General Retailers | 06/02/2023 | £1270 | £1210 | (4.34%) |
With just a few weeks to go it looking very likely that I won't be able to make any contribution to the LISA this year. Obviously this is very disappointing as my ambitions of becoming a tax-free millionaire depend upon taking every advantage I can.
The plan all along was to maximise the return of the LM fund by paying in £4,000 per year as that would mean £1,000 in bonus being credited to the account - a 25% return on the 4 grand straightaway.
Personal circumstances just mean this probably won't be possible. Oh well, not to worry. I still have around 6 years to get the bonus each year so it isn't the end of the world.
One possible answer would be to get a loan and perhaps pay it off over 2 or 3 years. Much as I hate having debt, this loan would result in a positive return provided I don't pay 25% in interest.
A loan at 5 or 6% interest is likely a good idea. I pay a little for the interest yet earn several times the interest cost in bonus.
However, banks don't appear to like small loans as I just checked First Direct and they want to charge me 18.9% in interest for a £4k loan taken over 3 years.
If I were to change it to an £8k loan then the interest rate drops to 4.9%!
It's something to consider as losing the chance at the £1k bonus would rile me more than having to pay £600 in interest over 3 years.
The portfolio
Looking at the above table showing the state of the LM portfolio after market close last Friday, two things stick out:
(1) It's nice to have a decent chunk of investments to report on. My share trading account has been very empty for the past year or so and, don't get me wrong, it's nice to miss out on losses from a falling market but investing is better when you feel like your money is working for you.
Aside from a cursory glance once a day, I do very little "work" on this portfolio in the hope that being "in the market" will pay off. I don't want to make too many investments or mess around with things - just leave it to do its job and trust that over time Mr Market will reward me for the risk I took and the patience in waiting.
(2) The second thing that sticks out like a sore thumb is how investments need time to come good. The older trades are in profit, the newer ones sit at a loss.
A much wiser person than me once pointed out that the first thing that happens every time you make a new investment is that it shows in your brokerage account as a losing position. With the spread, dealing costs and stamp duty unless you are very lucky, you new shiny investment will start out with a minus number in the P and L column. Then the hope is that it rises...