Unlike the common view that May is a bad month for stock markets, leading to the abridged phrase – sell in May and go away – this year May bucked the trend with the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) gaining 0.06%.
This year however it looks like May might have arrived in June, with the S&P/ASX 200 Index down 1.7% already this month.
For investors with a long-term investment horizon, the ebbs and flows of the market can largely be ignored. Instead a focus on buying good quality companies with the ability to earn significantly more profit per share in the future, need be their one and only objective.
Last month, the Wilson HTM Priority Funds which are managed by listed stock broker Wilson HTM Investment Group Ltd. (ASX: WIG) was busy buying some high quality stocks. Since inception the Core and Growth Funds have outperformed their benchmarks by 6.1% and 13.4% respectively.
Here are some of the stocks purchased by the two funds in May.
The Core Fund added further to its holding in Amcor Limited (ASX: AMC). The shares are currently trading within a whisker of their May low. The company's clearer focus and international growth orientation since demerging the Orora Ltd (ASX: ORA) business has increased the appeal of Amcor to many investors.
The Core Fund's holding in Brambles Limited (ASX: BXB) was also topped up. The share price has fallen 6% in June and is trading below its May low. The pooling operator's long-term outlook is very good; as such its weak share price performance could be viewed as a buying opportunity.
The Core Fund established a new position in Santos Ltd (ASX: STO) which certainly suggests that at the May price level the fund's portfolio managers saw value. The share price has been steadily gaining altitude since it was announced that the PNG LNG project had entered the production phase ahead of schedule. Given the positive long-term outlook for energy demand and Santos' appealing asset base, the 5.5% appreciation since the start of May could still have further to run.
The Growth Fund also topped up its holding in agribusiness Tandou Limited (ASX: TAN) stating that it was "as opportune time to buy more stock in the company as they had some positive developments regarding their crop sales, and had managed to increase the size of their water portfolio." The share price has traded lower in June and is below its May lows.
