I bought 199 shares in Catlin Group in August 2014 at a price of 515.35p. The investment cost me £1,037.49 (including commission and charges). I've received £64.68 in dividends from them to date, and they're due to pay out a final Special dividend - 11.70p per share - later this month (£23.28 for 199 shares). All in all, at the end of this month I would have received £87.96 in dividends from Catlin in 8 months. This is a 8.5% ROI for income alone.
As a share holder I received an electronic message asking what action I wanted to take with the proposed takeover from XL Group. The default option was to have approx half your money back from the investment and the other half would be invested in XL Group on the New York Stock Exchange. I had the right to change this option and request 'maximum shares' or 'maximum cash'.
I've just sent through my request asking for maximum cash as I'd prefer to keep my investments in my old ISA as UK only. Not that I have anything against US stocks, but I'd like the opportunity to select which company I want rather than be given one. I've also made a nice profit from the takeover too, so I'm hoping to reinvest the profit into another stock which could grow in the future.
In the middle of May, I'll receive the cash for my 199 shares based on the agreed price of 710.61p per share. For me this will come to £1,414.11. This will result in a £376.62 profit on my initial investment.
If I add the capital gains and dividends together it comes to £464. 58, which is a 44.8% return on investment in 8 months. Cha-ching!
I won't be contributing any new cash to my old ISA with H&L, as I've opened a new one with iWeb for this financial year instead. The trading fees with iWeb are £5 + stamp duty as apposed to H&L's £11.95 + stamp duty. I plan on reinvesting all of the dividends I receive from the H&L account into more shares when it reaches a figure around £1,100-£1,300 mark.
I will use the profits from the dividends and the stock sale, with the rest of the dividends I've received so far to make a new purchase in my old account as it won't count towards any ISA allocation. I'm also considering selling my old income fund which I had when I first opened this account. It's worth around £500, and I think I can make better use of that money in another company instead. The capital I raise from selling this fund should put me at around £2,300 capital, so I'm in a position to buy two companies next month in this ISA alone.
I was very fortunate to get such a great ROI in such a short time. To be honest, if Catlin were trading on the London Stock Exchange, I would have arguably gone for the maximum share option. As I'm now losing a non-life insurance company, which have performed very well for me so far, I've made the decision to make up for that and purchase shares in Amlin for this month. I was close to purchasing Amlin in August, but I thought Catlin was a slightly better option at the time. It turns out that with the dividend payments and capital gains from Catlin, I made the right decision this time around, and I'm just in time to receive the bumper dividends from Amlin too. It doesn't always work out like that though!
This extra capital is going to go a long way to help me meet my dividend income goal of £2,000 this year.
I hope you all have a fantastic weekend!
Does anyone else own shares in Catlin Group? Have you decided what you're going to do with the takeover?
Labels: Stock Sold