Looking back at a year of studies at the Open University

This will be a series of posts over a week or so.

I'm currently between courses and thought this would be a good time to reflect on the year that rushed past. As an adult student with business experience I felt that I could take on a fairly high amount of entry level coursework to start with, then reduce my study pace as needed at higher levels. My plan was to study 120 points with the Open University, including three 10 point 'starter' courses intended for people who haven't studied at uni before or haven't studied for a long time. This was in parallel to work commitments (37 hour week according to contract, in practise it's about 45 hours), commute (3 hours per day unless I can work from home) and maintaining somewhat normal social relationships with my girlfriend, family and friends. I also have some hobbies and investments to manage so there was always going to be a need for compromises.

So, how did it all turn out? It certainly wasn't according to plan! Probably the most disruptive moment was the panic call from my girlfriend that she was being evicted by her landlord with an hours notice. No contract, very shady business as it seems the landlord was cheating on benefits claims while making money on renting out rooms. While playing nasty with the landlord might have been satisfying, what was really needed was an urgent solution so that my girlfriend would have a place to sleep that night. A good friend of mine agreed to help and within 2 hours of the first call the move was complete and I was no longer living on my own.

Previously we had been seeing each other about 3 nights per week, leaving me with 4 nights for studies and other commitments. As soon as she moved in there was some level of disruption each night, ranging from having dinner together to trying to go to bed at the same time. Maintaining all of these things as much as possible was probably beneficial from a 'healthy living' point of view but anything that requires getting into a productive state of mind ('the zone') was far harder to complete. In the end I wrote most of my essays in the middle of the night while she was asleep. Reaching my academic targets was still possible, but I think it hurt the relationship more than if we had remained living apart. Up to 4 nights of dedicated study without interruptions was more productive than up to 7 nights with interruptions and pressure to finish by a certain time.

Please visit http://www.libelreform.org/ and sign the petition. The Singh case is a disgrace and UK libel law is becoming a tool to silence free speech by imposing legals costs 140 times the European average. Reform is needed immediately.

#libelreform twitter tag.

May already

Clearly blogging is not a priority for me ;-) University work is again taking precedence, three courses have now been completed and I'm starting three more.

BRW is up 20% and Severfield-Rowen is up 21.8%. IPO and RCG are both down, the gains in RCG were wiped out shortly after the Hong Kong introduction. Lloyds has increased to 111p, a 64p increase from the purchase at 47p.

Continuing to hold all shares, no selling planned. If RCG continues to fall I will top up, maybe double the holding, as long term prospects look excellent. Need to look into the option of buying shares in the UK and transferring to HK for disposal there.

Belated update

Been busy with studies so this blog dropped down in the priority list for a while. During the break I have made only one trade, buying 2000 shares in Lloyds Banking Group (LLOY) at 47 pence on the 23rd of January. Currently the share is trading at 91 pence but the intent is to hold it long term rather than cash in. I'll revisit this once results are published, but my expectation is that a sale in 2010 or 2011 would be much more profitable than a sale now.

One of my earlier purchases, RCG, has now been introduced on the Hong Kong exchange. This has been a long time coming and appears to have been a good move for the company, with the share price increasing rapidly to 23 HKD. The London listing is also climbing, with the price right now sitting at 77 pence. Clearly I started buying the share too early, but overall my holding of 5000 shares is up 27.8%. Those who bought in at the bottom will have more than doubled their money.

Thought for the future: what other Chinese companies on AIM might benefit from a Hong Kong listing?

Atheist Bus

A very worthy initiative by the British Humanist Association to create a counter-point to religious advertising in London set a 5000 pound donation target to fund the campaign. This was exceeded in just 10 hours, with Richard Dawkins matching the contributions. In the few days since then publicity has pulled in a great wave of public support and donations are now at more than 84.000 pounds with the campaign expected to go nation wide instead of being limited to London.

With recent advertising by religious groups using the usual 'you will burn in a lake of fire for all eternity' to scare vulnerable people into believing (and donating) to religious causes it is great to see a rationalist counter point getting massive support. I'm all for respecting the beliefs held by competent adults and don't object to any religious practise which causes no harm to others, but organised religion preying on people's fears, indoctrinating children in non-rational world views or otherwise trying to coerce through threats of eternal damnation should not go un-answered by those of us who hold to reason.

If you wish to support the campaign then donate here

Vacation

I've been overseas in Denmark for the last week, visiting a friend in Aarhus and spending a few days as a tourist in Copenhagen. While the trip was overall very enjoyable it was slightly disturbing to see the contrast between the UK and Denmark. Shopping malls, cafes and restaurants do not seem to have anywhere near as brisk business here in Scotland as they do in Denmark. My money did not go very far compared to previous trips to Scandinavia as I got less than 9 DKK per pound.

Trading activity was limited to three purchases

- 1000 RCG at 42.5p per share
- 1000 IPO at 64p per share
- 2200 BRW at 112.7p per share

BRW is a new entrant, this is a financial company doing wealth management, brokerage services etc. Reasonably cash rich, no debt and with 20 billion pounds under management I feel the company share price has been pushed down too far and offers both an excellent dividend (assuming this is maintained in the face of a potential recession) and potential for strong upside in the share price.

As with the other investments the time scale here is several years. I don't need the money and foresee no circumstance where I'd be a forced seller. Macro-economic indicators right now are pretty awful and while a recession will deservedly shake out a lot of 'bad' businesses it will also knock out some good companies or at least make their share prices suffer through guilt by association.

Looking at the portfolio right now there's no doubt that I would have been better off sitting on the cash and making all my purchases now rather than over the last few weeks, however there is no way to predict the exact moment the markets will turn and by waiting for the 'absolute bottom' I'd very likely find myself in cash during the recovery and thus missing out on the chance to buy in at very attractive price levels. To quote the Economist (vol 389, n 8602, page 107) there is $450 billion of cash held in private equity firms and more than $2 trillion owned by sovereign wealth funds currently 'idle' in American treasure bonds. When sentiment turns and this money is invested into the equity markets there will be some huge and very rapid gains.

Topping up

During the turbulent trading the last few days I've made several top-up purchases, averaging down for the three companies in the portfolio.

- 500 SFR on the 6th of October, then another 750 on the 8th
- 1000 RCG on the 7th of October, then another 1000 on the 8th
- 1000 IPO on the 6th of October, then another 1000 on the 8th

This brings me to a total of 10 trades for approximately 8000 pounds total, with 145 pounds in trading cost. Cash balance is just over 4000 pounds and I am now holding stock as follows.

- 4000 RCG at total cost 2590 pounds
- 3000 IPO at total cost 2446 pounds
- 1500 SFR at ttotal cost 2861 pounds

An additional 1000 RCG, 1000 IPO and 500 SFR may be on the cards if the shares fall farther.

All of these are showing significant loss so far which was to be expected. In an ideal world I would be able to predict the exact bottom of the market then purchase all the shares I want at that instant. In the real world, I'm working full time so may not have access to trade at key times, the limits on trade quantities may prevent large-scale purchases and a rally can happen extremely quickly once sentiment turns. It is also not unknown for online broker services to fail at key moments due to enormous demand.