More SEDY.L

Bought some more SEDY.L.  Now about 12% of my portfolio.  Wanted to get rid of some cash, didn't see anything better to do with it.  That is all.

NWBD tender offer

Natwest are offering 175p (plus accrued dividends) for NWBD.L: https://investegate.co.uk/nat.westminster-bk--natn-/rns/tender-offer/202106071556180760B/

This is a small premium to the pre-announcement market price, and higher than these have ever traded.  However, I'm minded not to accept, since:

• I don't need the cash - I have no good place to put it.
• I'm sitting on a large capital gain so would have a hefty tax bill.
• The running yield at 175p is about 5.1%.  This is not far off that of e.g. AV-A, which I also hold.  Trading one for the other just crystallises a tax bill which I could otherwise defer indefinitely (with its real cost diminishing each year due to inflation).
• I don't see any increased risk of Natwest attempting to redeem these by underhand means.  All shares repurchased will be cancelled, so couldn't be used to vote them out of existence.

I anticipate:

• This will be the only tender offer for some time.  Maybe there'll be another in 2026, around the time these stop qualifying as capital.  I'm not holding out for a better offer.
• Trading these will become even harder.  But that's fine, I have no plans to sell.  I'm happy to hold and reap the dividends indefinitely.
• There's obviously an ongoing risk that Natwest attempt to disappear these shares at par somehow.  This tender offer just makes it obvious they would rather these shares no longer existed.  I don't see the risk as that huge - even pre-tender-off these are only £140m-worth - surely not worth the legal/reputational impact of going down the Aviva route.

2020 review

My portfolio returned 8.3% over the course of 2020 in sterling terms, or about 10% in NOK.  At the start of the year I held Berkshire Hathway, Plus 500 and Natwest Prefs.  I didn't sell anything, but bought Aviva Prefs and Barclays in the summer and then late in the year iShares Emerging Markets Dividend ETF (SEDY).

Plus 500 are the standout performer with a 67% return, Barclays are up 32% on the price I paid.  BRK-B and SEDY are the laggards, each down about 1%.

In comparison the FTSE 100 lost about 11% and the S&P 500 gained about 14%, both factoring in dividends and converting the S&P 500 return from dollars to sterling.

Obviously that doesn't tell the whole story, at one point things weren't looking nearly so rosy, but I took that as my cue to buy some bank shares since they looked particularly cheap.  Of course I could have done enormously better by buying earlier in the year, or sticking all my cash into Tesla, but you can't win 'em all.  The latter in particular would have been stupendously out of character.