Its Not Harry

Comment and opinion for retail investors in the UK

Mark Potter

Deep Dive – April 2024

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To kick off this new series of articles, I am going to express some opinions that are not rooted in traditional book learning or any specific academic research or publications, but my own observations of what actually happens in equity markets, taken over the last 4 decades and mixed in with my personal rather eclectic reading about human behaviour in the context of decision making – not specifically related to financial decisions.

You might call this ‘behavioural insights in equity market valuations’ but I suspect that is rather too grandiose!

NotHarry says….

The main points

I will be exploring 4 less obvious ways in which market valuations are created and sustained (or not):

  • Possible ‘invisible’ supply side variations and/or sudden excess demand

  • The ‘the majority view is safest’ syndrome

  • The Government interference problem

  • The ice break risk

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YAP – Easter bunnies/white rabbits

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Happy Easter everyone!

I am working on a Deep Dive article for April which will take a tangental look at drivers of market pricing based on my lifetime observations, as opposed to investment theory and analyst cash flow pricing models.

I’m late, I’m late for my copy deadline!

What with this weekend being a gorgeous sunny one in Lithuania and the article turning out to be rather tricky to present in an understandable way without running to 5000 words (I am sure you don’t want that), I am not yet ready to publish it.

Lewis Carroll wrote that his unpunctual rabbit was elderly, timid and feeble – perhaps I should not have chosen him to symbolise my tardiness?

My apologies. The piece will be out in a few days.

YAP – how about Wellingtons?

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I hear it’s been a very wet Winter in the UK, so no doubt you have needed your rubber boots when out walking. Here the water tends to come down ready frozen from Decemeber to February!

I am actually posting this note to highlight a fund, something I rarely do because of the risk that readers will take my comments as a recommendation and I don’t ever offer personalised fund selection advice because I have no authority to do that.

However, one of my subscribers asked my what I knew about Wellington Asset Management not long ago, because he had spotted their Global Stewards Fund in the Interactive Investor Ace 40 pick list. This fund is I think likely to interest many of my subscribers who like to invest sustainably without sacrificing above average returns. So this post is a ‘heads up’ on that subject.

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Watching Brief – March 2024

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Reflections

I have been thinking about making some changes and below I outline my plans.

Time flies….

This web site has now been fully up and running for 6 years.  For subscribers, it includes 101 permanent articles and 447 blog posts.   It now represents a fairly significant reference resource and although it is essentially updated now by a rolling blog, the WordPress search facility is usually good enough to access several articles on a range of topics that might be of interest to retail investors. 

Time for a ponder

A small element of the content is not 100% up to date and at some stage I will do some weeding and a bit of update editing, but I don’t think there is anything that could be misleading. 

I myself often refer back to posts I wrote 12 months or 24 months ago and am proud to say that I get more right than wrong when looking forward and I am also satisfied that I regularly repeat the ‘golden rules’ that investors ought to always bear in mind. 

Here are just a couple of examples of content that I think is ‘evergreen’.  Some newer subscribers may come to these posts for the first time.

  • The article on the site ‘10+ top tips for investors’ (under the Real World tab/menu) might even be worth copying to a document file and printing as an aide-memoire!

  • If you like fables with a little satirical humour, you might find my story about market timing called ‘A fable for investors’ which I wrote in March 2020 to be an amusing if slightly testing read over a cup of coffee.  Those of you who were able to buy assets from cash reserves in the dark days of 2022 will recognise who you are in the family of 6 very different people featured in the tale.

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The Magnificent 7 ride again – but how many sequels can we expect?

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The table which will download if you click the link below demonstrates well how shares in the mega sized tech firms (branded the Magnificent 7 after possible acronyms got to be absurd and named in the downloaded document) have generated most of the main US market returns in 2023, and for those of us with funds that have a specific thematic bias, some excellent results too.

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