Investment Strategies

Bogle Death, Patisserie and Diploma AGM

The death of John Bogle has been announced at the age of 89. He wrote several very informative books on investment and was the founder of Vanguard which has grown into one of the largest mutual fund managers by promoting index fund management. He also promoted the idea that the investors should own the fund manager. He suffered from heart attacks from a young age, the first at age 31, and actually had a heart transplant in 1990. So in some ...

Market Bouncing Up or Down – Sophos, Greggs, Apple and Fundsmith

After a dire market performance before Xmas, we seem to be back to the good times in the last 3 days. Is it time to get back into the market for those who moved into cash as the market fell down and down and down in the autumn? Rather early to generalise I suggest although I have been picking up some shares recently. One which I purchased a small holding in was Softcat (SCT). Yesterday it issued a trading update simply saying ...

IC Share Tips, National Grid, Brexit and the Audit Market

This week’s Investors Chronicle edition (dated 28/12/2018) provides lots of food for thought. One of the most educational is their review of the share tips they published as “tips of the week” in 2018. Unlike some investment publications, who simply forget about their past tips that go nowhere, while lauding their hits, the IC is open about their performance. They issued 173 “BUY” tips and 24 “SELL” tips in the year. That is quite some achievement by itself as I rarely have ...

Market Trends, Interest Rates, Glaxo and Yu Group Accounts

Yesterday was another dismal day in the markets. The US fell significantly allegedly caused by the rise in interest rates announced by the Federal Reserve and the UK market followed it down this morning. The US rate rise was widely expected although perhaps slightly lower estimates for US economic growth had an impact. But when the markets are in a bear mood, excuses for selling abound. Meanwhile the Bank of England has announced today that their base rate will remain at ...

Should You Give Up Fags and Booze, plus Coverage of Babcock and Babylon

The title of this article refers not to your personal habits, but whether investors should give up on holdings in tobacco and drinks companies. Yesterday British American Tobacco (BATS) dropped 10% after the Wall Street journal reported that the US Food and Drug Administration was planning a ban on the sale of menthol cigarettes. They contribute a significant proportion of BATS profits. Aside from this possible temporary issue, the key question for investors is whether to hold tobacco stocks at all. Apart ...

Standard Life UK Smaller Companies AGM, WPP and Tesla

For those folks who invest in smaller companies, it’s always educational to attend the Annual General Meeting of Standard Life UK Smaller Companies (SLS) which I did today. This investment trust has been managed by Harry Nimmo and his team for many years and he has consistently beaten the company’s benchmark (currently Numis Smaller Companies Plus AIM index). Harry’s presentation highlighted that smaller companies were a “great place to be until the last 4 weeks”. He said that we often see sharp ...

IPOs, Platforms, Growth Stocks and Shareholder Rights

I agreed with FT writer Neil Collins in a previous article when discussing the prospective IPO of Aston Martin (AML) – “never buy a share in an initial public offering” he suggested because those who are selling know more about the stock than you do. We were certainly right about that company because the share price is now 24% below the IPO price. Smithson Investment Trust (SSON) did rather better on its first day of trading on Friday, moving to a 2% premium. ...

Frying in Hell and Investing in Oil Companies

Last night and this morning, the national media were dominated by the news from the Intergovernmental Panel on Climate Change that we are all going to fry in a rapidly rising world temperature unless we change our ways. CO2 emissions continue to rise and even to limit temperature rises to 1.5 degrees Celsius requires unprecedented changes to many aspects of our lives. The suggested solutions are changes to transport to cut emissions, e.g. electric cars, eating less meat, growing more trees, ceasing ...

Time to Consider your Cash Holdings?

It was obvious from a recent FCA review of “platforms” (i.e. stockbrokers), that many retail investors held large amounts of cash in their portfolios. When folks are feeling the stock market has had a rather long bull run, perhaps they feel it is wise to keep a high level of cash. Or perhaps it’s because they simply can’t be bothered to move it when their high-street bank is offering such trivial rates as 0.2% per annum on deposit accounts. Needless to ...

The Market, Dunedin and Standard Life Smaller Companies Merger, and Aston Martin IPO

Is it not depressing when you go away for a week’s holiday and your portfolio falls every day in that time? I do monitor any exceptional movements while on vacation but try to avoid trading. It just seemed to be a general downward trend and reviewing the movement over that week my portfolio is down 1.73% while the FTSE All-Share is down 1.72%. So that is what I had already surmised. Those stocks that seemed to have become overblown did fall and ...

Return Versus Risk and Tips from Terry Smith

There was an interesting article by Fundsmith founder Terry Smith in the Financial Times on Saturday under the heading “Think globally and add a dash of small caps”. His articles are usually full of wisdom. In this case he first tackled the issue that the Capital Asset Pricing Model (CAPM) tells you that your returns relate to how much investment risk you are willing to take on. This might be seen as common sense – why would anyone take more risks if ...

Hedging Against Brexit

As we edge towards an abrupt Brexit as agreement with the EU has turned into a game of chicken, it’s worth considering some options. Or as my M.P. Bob Neill said about divorce on Twitter “the current system of divorce creates unnecessary antagonism in an already difficult situation” (he was talking about personal divorce in the UK as head of the Justice Committee but our EU divorce is looking very similar – acrimony is the word for it). Perhaps the Prime Minister ...