For the three months to March 31, 2025, my taxable portfolio gained 6.04%, while my SMSF gained 3.46%. This is a good result considering that markets generally performed poorly in Q1. My long-term benchmark is the S&P/ASX 200 Franking Credit Adjusted Annual Total Return Index (Tax-Exempt), which is down 2.8% year to date.
The table below shows the returns of my portfolio since inception in August 2017.
My luck continued in early 2025. I had some positions work out nicely, such as CRGX, a short-term busted biotech trade. I bought CRGX in late January after the company announced it was discontinuing a Phase 2 program and reducing its workforce while evaluating strategic options. I was able to buy CRGX as low as $3, which was the intraday bottom. At those prices, I felt CRGX was attractive enough to warrant a large position. I trimmed the stock shortly afterwards at around $3.60 and sold my position at $4. CRGX has since announced a further 80% reduction in force and appears headed for a reverse merger. It currently trades at $4.07, which still seems interesting. However, reverse mergers have a binary outcome. Biotech seems to be particularly troubled at the moment due to changes in the US administration and the FDA. I'm not sure if this will have any impact on reverse merger activity and the market's response.
In less positive news, I made some mistakes which cost me money. For one, I decided to hold on to IKNA after the reverse merger was announced, which hasn't turned out to be a wise decision. The stock is currently down about 22.4% year to date. I also panic sold my Achilles Therapeutics stock at $1.01 in late December. This happened after reading an update from the company with the headline "conclusion of strategic review." Despite positive news in the announcement (the sale of data and assets to AstraZeneca for $12MM), I misread the filing. I assumed the company had finished its strategic process and could continue development or buy another early-stage biotech program. Almost immediately, I realized I was wrong. I bought back my stake at $1.14, but not as much as I sold. Shortly after all of this, ACHL announced it would liquidate and the stock rose to around $1.40. I've since sold my stake at $1.41.
In other bad news, Merchant House International (MHI.AX) announced that it had sold its equipment at a deep discount to book value. While I considered this a possibility, I was expecting a better outcome. MHI is currently halted due to a lack of an Australian director. It still needs to sell its US property before it winds up. It seems likely that I will lose money on the position. It's unclear how long the wind-up process will take. I should have been more careful considering the type of assets involved in the liquidation.
Outside of the busted biotechs, my Japanese positions performed strongly in the three months to the end of March. I have three positions in Japan, which collectively make up 40.2% of the portfolio: CEL Corp (5078.T), Mitachi (3321.T) and another company which I haven't disclosed as yet. Overall, I'm very comfortable with these positions, even though they are more expensive lately.
Finally, I had a large cash position due to some special situations (including CRGX) winding up. This helped reduce volatility in the portfolio during recent weeks due to Trump's tariffs announcements. This was not due to any special foresight on my part; I simply got lucky. My belief is that, at the size of my asset base, I should always be able to find things to do. Therefore, I should almost always be fully invested (or close to it). However, if I don't have things to do, experience has made me realise that it's OK to wait. I'll find opportunities eventually. At the moment, I have about 33% of the portfolio in cash, which is the highest level I can remember. I'm hoping I can find good ideas soon, but I'm still not finding extremely compelling valuations on my watchlist (at least for now).