Fidelity Japan Trust (FJV.L FTSE Small Cap, Market capitalisation Â£222m, 164p, 2.0% of JIC Portfolio and 0.0% of JIC Top 10) Â Â
Yesterday I added this trust to the Portfolio and said that I expected to increase the position to 3.0% of the portfolio in the coming weeks.
I have taken the first step this morning by doubling the position to 2.0%.
I have funded it by selling Medica Group.Â Â
Medica Group (MGP.L, FTSE Small Cap Index, Market Cap 161m, 145p, 0.0% of JIC Portfolio and 0.0% of JIC Top 10)Â
On 12thSeptember, following its interim results I concluded: â€œThe bottom line is that I donâ€™t feel that the investment story is compelling enough to add to what, at 1.6%, is one of my smaller holdings. Watching and Holding for now!”
On further consideration, Iâ€™m concerned that earnings forecasts for the full year were trimmed slightly after it reminded shareholders that margins in H2 were likely to be lower than H1. I know that directors sell shares for all sorts of reasons but I noted that John Graham, the CEO, sold 37% of his holding on 21stSeptember. Lastly, valuation is not as attractive as it was when I bought in May; itâ€™s on 20.5x 2018 forecast earnings and is on a prospective yield of only 1.4%.Â Â I donâ€™t feel very strongly about it but on balance, I think, given theÂ Â risk/reward, I can do better elsewhere and am happy to book my 14% profit.
See JIC Portfolio tab above for updated portfolio and transaction details