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Simon Thompson's Bargain Portfolio


The idea behind our annual Bargain Shares Portfolio is very simple. It’s to invest in companies where the true worth of the assets is not reflected in the share price, usually for some temporary reason, but where we can reasonably expect that it will be in due course.

Our portfolios are based on the investment ideas of Benjamin Graham (see box ‘Rules of Engagement’) and they have beaten the FTSE All-Share index in 13 out of the 16 years in which we have run them. During that time, they’ve generated an average return of 22.7 per cent in the first 12-month holding period compared with an average increase of 4 per cent for the FTSE All-Share.


Latest Updates

  1. Bargain shares 2016

    Bargain shares 2016

    By Simon Thompson | 04 February 2016

    Simon Thompson presents his 2016 Bargain Shares Portfolio, based on the stock-picking logic of guru Benjamin Graham

  2. Exploiting market anomalies

    Exploiting market anomalies

    By Simon Thompson | 01 February 2016

    Simon Thompson sees values in a trio of lowly-rated small-cap plays all of which are trading on single-digit earnings multiples

    'Analysts believe that the share price decline in the second half of last year is most likely down to a misguided perception amongst investors that the company is reliant on China to drive the success of its integrated high-tech product offering. In fact, the company has little domestic China revenue and a pre-close trading update confirmed that the profit surge I had anticipated at the time of those interim results has been delivered.'

  3. Stanley Gibbons fundraise

    Stanley Gibbons fundraise

    By Simon Thompson | 14 January 2016

    Shares in the stamp and coin dealer have been truly stamped on, but it’s worth waiting for news of a fundraise as a dilutive share issue is the least likely option being considered

    ‘Of course, the reason why the shares are trading on a 65 per cent discount to book value of 171p is because trading has deteriorated and the company is sitting on stocks worth £55m, or almost double its market value of £28m. These inventories are made up of rare coins worth £8m, other collectibles including antiques worth £8m, and £39m of stamps. The fact that a fundraising is even being considered reflects the important point that borrowings are funding high levels of stock that have to be shifted to generate the much needed cash flow to pay down borrowings.’

  4. Stock check

    Stock check

    By Simon Thompson | 05 January 2016

    Our small-cap stockpicking expert assesses the merits of no fewer than seven companies

    ‘On a modest 11 times prospective earnings, a deep discount to the speciality finance sector average, and rated on 1.4 times book value, and a conservatively calculated one at that, the shares are attractively priced. Interestingly, they have a beta of zero, reinforcing the point that the returns derived from successfully backing commercial litigation cases is uncorrelated with the economic back drop and general stock market moves.’

  5. Specialty finance plays

    Specialty finance plays

    By Simon Thompson | 09 December 2015

    A trio of companies in the specialty finance sector have made announcements and Simon Thompson sees potential in all of them

    ‘The disposal is good news for Arbuthnot Banking’s shareholders as shares in Secure Trust re-rated sharply post the announcement. That reflects the fact that Secure Trust will bank a £115m gain on the sale and the capital raised will enable the company to invest more in its fast growing motor finance, retail finance and SME lending activities.’

Our portfolios

Mr Bearbull's Global Fund Portfolio

A portfolio of instruments designed to capture the rise of emerging markets

Mr Bearbull's Income Fund Portfolio

A collection of high-yielding shares that's beaten the market since 1998

Chris Dillow's Benchmark Portfolio

Simple portfolios picked using simple rules that often beat the market

John Baron's Investment Trust Portfolios

A portfolio of investment trusts designed to generate growth and income

David Stevenson's SIPP Portfolio

Our columnist describes how he manages his pension fund and what he puts in it

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