Rate my SIPP - ITV high conviction

noclaf

Well done on achieving a + £800k SIPP though I do think it's living a bit too close to the edge (for me anyway)....curious how you built it up and assume ITV has not been the main investment(s) that provided growth to get to this point.

Hoenir

Your biggest challenge may well be offloading your holding should the share price head south. 

Juno_Moneta

noclaf said:

Well done on achieving a + £800k SIPP though I do think it's living a bit too close to the edge (for me anyway)....curious how you built it up and assume ITV has not been the main investment(s) that provided growth to get to this point.

That’s a good question!

If I explained all the steps that got me here I would expect even more gasps of horror! 

I will say that I do have a particular interest in media investments. Eg timed Sky really well. 

Juno_Moneta

The main thing that attracts me to ITV is that they have a ‘hidden’ asset “ITV Studios” which is generally thought to have a value on its own of around £3bn and is on the brink of being carved up (eg article today below). 

However the value (market cap) of the entire ITV Group (which owns it) is just £2.9bn currently. So by hidden I mean ‘value not recognised’. 

It reminds me of Wall Street asset stripping!

Well I think it’s worth a punt. Watch this space. 

https://www.broadcastnow.co.uk/broadcast-international/potential-itvs-deal-supported-by-investors-report/5201770.article

For balance - there are plenty of reasons NOT to invest in ITV - eg some think ITV Studios isn’t worth that much. 

And with this position size, £30k up days are as common as £30k down days - so a strong stomach is needed. No share is up, up, up every day.

barnstar2077

Juno_Moneta said:

The main thing that attracts me to ITV is that they have a ‘hidden’ asset “ITV Studios” which is generally thought to have a value on its own of around £3bn and is on the brink of being carved up (eg article today below). 

However the value (market cap) of the entire ITV Group (which owns it) is just £2.9bn currently. So by hidden I mean ‘value not recognised’. 

It reminds me of Wall Street asset stripping!

Well I think it’s worth a punt. Watch this space. 

https://www.broadcastnow.co.uk/broadcast-international/potential-itvs-deal-supported-by-investors-report/5201770.article

For balance - there are plenty of reasons NOT to invest in ITV - eg some think ITV Studios isn’t worth that much. 

And with this position size, £30k up days are as common as £30k down days - so a strong stomach is needed. No share is up, up, up every day.

I'm not sure if having a hidden asset is really a bonus when it comes to company shares.  Perception is everything, and if one day people think they are in trouble then you will suffer.

Clearly you are somewhat of a contrarian, I wish you good luck, but hope others do not follow your example.  And that is from me, who plans on being 100% equities in retirement. 

Bostonerimus1

dunstonh said:

I remember all the bank staff with their SAYE and profit sharing.  Some of the millionaires who held the lot in a single share.   Decades of great performance until the credit crunch.

Single company holding is just silly.

I once worked with an old guy who had all his pension in Polaroid stock. He was semi-retired and had to come back to work full time when Polaroid went under and he lost most of his pension.

Bostonerimus1

OP is either a troll or someone not to emulate as a diversified portfolio can produce far higher balances with lower blood pressures. SIPP rating 0%. ITV might be paying dividends, but it's stock price has been heading south for quite a while now. Either way nothing worth commenting on further.

Juno_Moneta

Definitely not a troll - and nobody should emulate! 

A normal diversified portfolio is ideal for most people.

Just sharing that a tiny % of people do something different!

Bobziz

What changes would you need to make to your retirement if the share price sank 70% and never recovered ? Presumably you'd try to get out before that happened but as per Hoenir, that may not be possible.

incus432

Juno_Moneta said:

A note about diversification: 

I know it’s important. I’ve done it all my life. Had plenty of bits and pieces of ETFs like VWRL. But sometimes you have to just go for it. That’s what high conviction means to me. 

“Diversification may preserve wealth, but concentration builds wealth.

- Warren Buffett 

A note about dividends: 

No dividends are guaranteed- that’s clear. 

ITV currently pays 5p a year. 

That means I receive £52,566 py. 

Enough to retire on one day if it continues…!

My sister's only investments were shares in Natwest -she worked for them for 30 years., getting them cheap. She lost it all. 

Trusting in one company is insane