Interactive Investor

Winter Portfolio 2015 - winners revealed

30th October 2015 11:03

Lee Wild from interactive investor

Following the success last year of the first pair of seasonal portfolios, Interactive Investor confirmed last week it would launch two new 2015-16 winter portfolios, the constituents of which would have delivered significant double-digit growth during the winter months over the past ten years.

Data supplied by The UK Stock Market Almanac, published by Harriman House, shows that £100 invested continuously in the FTSE All-Share index since 1995 would have doubled to £200 (excluding dividends). However, investing in the market only between 1 November and 30 April every year would have turned that £100 into £316. Even over 10 years, investors would have made twice as much profit by using this seasonal strategy.

Apart from the performance, we love the simplicity of this six-month strategy, with clearly defined entry and exit points solving the problem of timing. It only requires that investors buy a portfolio of stocks on 1 November (or the first trading day of the month) and sell it on 30 April.

Both of last year's exclusive winter portfolios made a healthy profit, significantly outperforming the FTSE 350 benchmark index. This year's duo has been picked using the same principles.

To buy the Interactive Investor Winter Portfolios, click here

One boasts consistency of growth over the past decade, while the more aggressive high-risk portfolio has delivered even better returns - had you been invested in the underlying shares during the winter months alone, you would have been rewarded with an average annual return of over 35% since 2005.

Using data supplied by Almanac author and mathematician, Stephen Eckett, we screened all the stocks in the FTSE 350 during the winter months for the past ten years. For the consistent portfolio, stocks were selected which had delivered the most consistent positive annual returns over the past 10 years. We then picked the best five performers from that list.

Interactive Investor Consistent Winter Portfolio 2015/16

CompanyTickerActivityTrack record (years)Positive returns (years)Average returns (%)
Ashtead GroupAHTEquipment rental10934.7
CRHCRHIrish building materials 101024.9
Croda CRDASpeciality chemicals101017.5
Johnson MattheyJMATMakes catalytic converters101015.8
RegusRGUWorkspace provider10929.0

The eagle-eyed will spot some familiar names in this year's Interactive Investor Consistent Winter Portfolio. Three of the constituents - Ashtead, Croda and Regus - were in the basket of five shares which did so well last year, making a 14% profit compared with 8.7% for the FTSE 350.

Irish building materials firm CRH and automotive catalysts giant Johnson Matthey have also been included, replacing fund manager Henderson and struggling oil services provider Hunting. Investing in this basket of shares over the six months each year since 2005 would have returned an average profit of 24%.

For the aggressive portfolio, stocks were selected which had delivered the highest average positive annual returns during the winter months. While average returns are our primary criterion, we restricted our selection to those stocks which delivered positive winter returns at least 75% of the time. We use more judgement with this portfolio. While we have a preference for stocks with at least ten years of performance data, stocks with exceptional performance over a shorter time frame were also considered.

Interactive Investor Aggressive Winter Portfolio 2015/16

CompanyTickerActivityTrack record (years)Positive returns (years)Average returns (%)
Ashtead GroupAHTEquipment rental10934.7
JD SportsJD.Sportswear chain10828.6
PlaytechPTECGaming software9729
RegusRGUWorkspace provider10929
Taylor WimpeyTW.Housebuilder10856.6

There's just one change in this year's Interactive Investor Aggressive Winter Portfolio: High-flying tracksuits-to-trainers chain JD Sports Fashion replaces take-over target Bwin.Party Digital Entertainment. 

Like last year, this portfolio also includes the two best performers in the Consistent Winter Portfolio - Ashtead and Regus. It is clearly more aggressive, but still very credible. The basket of five stocks would have generated a historic average annual return of almost 36%.

Interactive Investor's Head of Investment Rebecca O'Keeffe reckons the two packets of stocks each promised a solid risk/reward ratio. "These portfolios are not for the faint-hearted, but do provide an opportunity to invest in higher risk stocks over the winter months when equities have historically generated greater return," she said.

"There are, of course, no guarantees and investors need to be aware that these portfolios are high-risk options. These portfolios will not outperform every year, but history suggests that over the long-term this seasonal investment strategy will pay dividends."

For more information and to buy the Interactive Investor Winter Portfolios, click here.

Please be aware of the risks involved. Past performance of the underlying constituents is not a guarantee of future performance. The value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. These portfolios are designed for a short trading period so market fluctuations may be more pronounced. If in any doubt, please seek advice. If you buy the portfolio the holdings will not be automatically sold on 29 April.

Receive 25% off the retail price when purchasing The UK Stock Market Almanac 2016. That's £18.75 + P&P (RRP £25) for the hardback or £15 (RRP: £10) for the ebook*. Order at Harriman House, entering promotion code II_ALMANAC2016. 

Find out more at http://stockmarketalmanac.co.uk/

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.