The Beginners' Portfolio Is Up 32% in Its First Year!

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LONDON -- The Beginners' Portfolio made its first buy, of Vodafone (LSE: VOD  ) shares, on May 18, 2012 -- and the first anniversary of the fateful day will be here on Saturday. So how has the first year gone? Here's a snapshot at market close on May 15, accounting for all spreads and charges:

Company

Shares

Buy Price

Total Cost

Bid Price

Gain/Loss

Change

Vodafone

289

168.5 p

£499.51

193 p

£48.26

9.7%

Tesco

159

305.5 p

£498.23

375.3 p

£88.50

17.8%

GlaxoSmithKline

34

1,440.5 p

£502.22

1,717 p

£71.56

14.2%

Persimmon

79

617.9 p

£500.55

1,146 p

£394.79

78.9%

Blinkx

1,319

36.9 p

£499.68

108.8 p

£925.39

185%

BP

112

434.5 p

£499.01

467.5 p

£14.59

2.9%

Rio Tinto

16

3,048.4 p

£500.18

2,913 p

(£44.02)

(8.8%)

BAE Systems

146

332.3 p

£497.59

400.8 p

£77.58

15.6%

Apple

2

$458.4

£605.98

$427.3

(£72.13)

(11.9%)

Aviva

146

321.4 p

£499.71

323 p

(£36.13)

(7.3%)

Dividends

       

£164.31

 

Total

   

£5,100.66

 

£1,632.70

32%

p = pence.

It is not a real-money portfolio, but it's run in exactly the same way -- I account for actual bid/offer spreads, commissions, etc., and include dividends in these occasional performance updates.

What has changed?
Since our last update on Feb. 26, Vodafone shares are in the black again with an overall gain of 9.7%. Further simmering rumors of a merger with Verizon Communications or a buyout of Vodafone's 45% stake in Verizon Wireless have helped push the shares up as the two companies play a game of brinkmanship. Then this week we heard that Vodafone is to receive £2.1 billion in dividends from Verizon Wireless -- we'll hear what Vodafone intends to do with it when the company releases preliminary results on May 21.

GlaxoSmithKline (LSE: GSK  ) shares have swung into profit as well, up 14.2% now (they were down 2.2% in February). We heard first-quarter results on April 24 telling us to expect full-year sales to be up about 1%, with core earnings per share up 3% to 4%. Current forecasts suggest a full-year dividend yield of about 4.7%, which would suit me just fine.

Persimmon (LSE: PSN  ) shares have soared and are now up 78.9% since purchase (against a 39.7% rise at Feb. 26). The whole homebuilding sector, in fact, has been on a recent surge -- and there are clear signs that the government's "Help to Buy" scheme is having an impact.

BP (LSE: BP  ) has moved slightly into profit, while Rio Tinto (LSE: RIO  ) has slipped into a loss as the mining sector has taken a pummeling recently on weaker Chinese economic figures, and BAE Systems shares have started their anticipated rise (anticipated by me, at least).

But the star of the show is still video technologist Blinkx, with our stake almost three-bagging -- in fact, ignoring spreads and costs, the share price has indeed more than tripled. The latest boost came from full-year results released on May 13, which revealed an expectation-busting 73% rise in revenue, with pre-tax profit up 129% and basic earnings per share up 336%.

Dividends
You'll see the dividend figure nicely improved since last time, too, as we've had quite a few ex-dividend dates from our companies since then:

Company

Date

Type

Per Share (pence)

Total

Rio Tinto

March 6

Final

60.3

£9.65

Aviva

March 20

Final

9

£13.14

BAE Systems

April 17

Final

11.7

£17.09

Tesco

April 24

Final

10.13

£16.11

GlaxoSmithKline

May 8

Q1

18

£6.12

BP

May 8

Q1

5.93

£6.64

Apple

May 9

Q2

197

£3.94

Total

     

£72.69

The bottom line
Overall, then, our portfolio is up 32%, including dividends and all costs, since the start -- even though we were not even fully invested until as recently as March 19. Over the same period, the FTSE 100 has risen 23%.

I think I'm happy with our first year's performance.

Finally, my idea of shares that should make up the core of a beginner's portfolio is the same as my choice for an ISA or a retirement portfolio -- or, in fact, any portfolio. I'd start with good strong companies that should stand the test of time and potentially reward you for decades.

Not surprisingly, the Fool's top analysts think similarly, and they have put together a special report detailing five blue-chip shares that I think would be ideal for anyone at the start of their investing career. But it will only be available for a limited period, so click here to get your hands on these great ideas that could start you on the road to long-term riches.


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