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The Isa millionaire next door

Cover of Free Capital by Guy Thomas January was great for shares. Several of my holdings that had suffered declines have now almost or fully recovered.

Mining stocks had a particularly good run ? and my recently purchased shares in Kazakhmys have risen 20 per cent in the past month alone. Another recent buy, broker Brewin Dolphin, has enjoyed a ten per cent uplift, while my shares in gaming group Las Vegas Sands are up 17 per cent to a 52-week high.

But the most miraculous recovery was in the shares of Robert Wiseman Dairies, which had seemed to be in a downward spiral of terminal decline. They jumped 60 per cent in price over two days on the announcement of a takeover approach from German yoghurt maker Müller. It looks as if I am in for a decent pay-off for my patience with the company.

In fact, a glance at the share price chart for the past 12 months gives a textbook example of the uplift an acquisition approach can give.

But all these uplifting stories aside, the most important investing experience for me in the past month has not been linked to my holdings. Rather, it has been reading Free Capital, by Guy Thomas ? a valuable collection of interviews with successful UK private investors. It contains knowledge of a kind that I have found in short supply.

Based on conversations with 12 successful present-day investors ? including my fellow My Portfolio columnist John Lee ? this elegantly composed volume brings the practice of investing to life. It gives concise portrayals of a variety of characters, each of whom has an individual investing style.

They display some shared characteristics. They are all male and have amassed significant fortunes ? which have given them the freedom to drop full-time jobs and focus primarily on investing. Deep down, they are all individuals who have not only recognised the power contained in this character quirk but have also capitalised on it.

Beyond that, though, they represent a fairly diverse group. They live all over, from Kent to Yorkshire to Sheffield to Switzerland ? and not necessarily in posh mansions. Some are educated to PhD level, while some left school at 16 and are autodidacts. Some have backgrounds in banking and finance while others have never been involved with the City.

Some of them are from ethnic minorities and some have suffered a confining illness.
They have made their money at differing rates, too. Some had success with ?ten-baggers? whereas others capitalised on boom periods and sold off in time. Some have held stocks for many years, but one jumps in during the unruly first hour of trading and sells just hours later. Some seek ?value moats? ? as in Warren Buffett?s phrase to describe an unassailable competitive advantage ? whereas others analyse ?candlestick? charts of share prices. Some mainly trade in blue-chips while others rely on microcaps. Some use derivatives for short selling, whereas others spend time on shareholder activism.

What resonated with me is the feeling of proximity: these people live in Britain, today. They use the same information sources like most of us, the same brokers and research tools. They read and post to the same bulletin boards and are subject to the same individual savings account (Isa) limits

Learning of their path was educational and uplifting. Next door, living within the same conditions and facing the same constrains, there are investors who thrive!

Dina Iordanova is an active private investor, writing about her own investments. She may have a financial interest in any of the companies, securities and trading strategies mentioned.


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