With the London stock market closing for a half-day on Friday, 29 December, this year is officially over for UK shares. Alas, the FTSE 100 index has had a weak year, lagging well behind its global rivals.
The Footsie ended this year at 7,733.24 points, rising less than 3% in 2023 (excluding cash dividends). Meanwhile, the US S&P 500 index has leapt by 24.6% in 12 months, with one trading session to go.
For the record, these were the three worst-performing stocks in the index this year:
1. Anglo American
The index’s biggest flop was British-South African mining company Anglo American (LSE: AAL). Anglo is the world’s leading supplier of platinum and a big player in digging up diamonds, copper and iron ore.
The group’s shares have fallen 39.6% since 30 December 2022, driven down by lower prices for various base and precious metals. However, its share price is up 15.8% over five years, excluding the hefty cash dividends it pays to shareholders.
My wife and I bought this stock in August for 2,202.4p a share. Anglo’s share price has been on a roller coaster ever since, initially rising before crashing to a 52-week low of 1,630p on 8 December. It ended 2023 at 1,970.6p, down 10.5% from our buy price.
I have no intention of selling my family’s holding at anything like current price levels. Indeed, I intend to hold on to Anglo tightly, collecting the dividend yield of 5.1% a year while I wait for this stock to recover.
2. St James’s Place
St James’s Place is one of the leading providers of investment management and financial advice to UK investors. However, I’ve long been a critic of this firm, which charges individuals high fees for its active funds and other services.
With UK regulator the Financial Conduct Authority (FCA) now looking into the group’s business model, its share price has crashed by 37.9% this year. This also leaves it 25.5% lower over five years. With such regulatory uncertainty hanging over the business, I’m steering clear of this stock.
Then again, some investors may be drawn to this stock’s high dividend yield of 7.8% a year. And if the FCA review goes SJP’s way, then this share might bounce back.
3. Fresnillo
Silver miner Fresnillo (LSE: FRES) is based in Mexico City, but its shares are listed both in London and on the Mexican Stock Exchange (Bolsa). Founded in 2008, Fresnillo is the world’s biggest producer of primary silver (silver from ore) and Mexico’s second-largest gold miner.
With the price of silver falling in 2023, Fresnillo’s earnings, profits and cash flow have declined. As a result, its shares have dived 33.8% this year. They have also lost 31.9% of their value over five years, lagging far behind the wider FTSE 100 (+13.1% over this period).
With the share price currently 19% above its 52-week low of 499.3p, I have added this stock to my list of shares to watch in 2024. For me, it could be a recovery play on higher prices for silver.
Lastly, I should point out that the above returns all exclude dividends, which can add several percentage points a year to these figures. Indeed, as a veteran value/income/dividend investor, I welcome this ‘free money’ rolling in each quarter!
