Comment and opinion for retail investors in the UK
I have nothing new to say this week and markets are see-sawing with the economic news. Previous posts are still relevant, I think.
I have instead spent my time recording some of the key mantras I find myself stressing in the training sessions I run. These have been added as a new page in the permanent site content under the Real World tab. Here is a link https://www.itsnotharry.com/10-top-tips-for-investors/
Following a request from a subscriber I have written a piece looking at the portfolio I built 2 years ago for training purposes (Alex Bright), looking at how it has coped with the recent market setback even after 2 years of neglect.
I have also explained how my thinking and understanding of portfolio component selection has been revised over that period and suggest what I would do to revise the holdings.
[Read more…] about New portfolio review article for membersOne of NotHarry’s readers has identified this project as both a source of information and a project in which anyone in the UK can participate.
As I understand the project, having just watched a webinar, the team has adapted their skills in food research using machine learning to getting a more comprehensive picture of Covid-19 across the UK. This is more sophisticated than the case count disclosed by the Department of Health.
To be useful, it requires large amounts of data from people who contribute information via an app.
Take a look!
I understand that the NHS will have a symptom tracker as well.
GDPR (data privacy) issues are dealt with appropriately, as far as I can tell but I am told that once you sign up to the app, they do say they might disclose your data to other places (anonymously) where GDPR does not apply (it is an EU based regulatory system). You need to take a view on that.
I have today finished and uploaded my thoughts on the subject of benchmarking for funds and portfolios, something that has popped up a couple of times in training sessions.
The subscriber only article is under the Real World menu https://www.itsnotharry.com/benchmarks-a-thorny-subject/
My experience is that investors think they ought to be looking at benchmarks but find the subject confusing and give up. That may not be a bad thing! I jest a little! Hopefully the article will throw some light on the subject. As always I am happy to give technical support to any subscriber who needs it.
I have added a number of short articles to the new site section Multi Asset Academy.
Data about fund flows shows that a large amount of money is moving from active managed funds into passive funds (index trackers) and from bespoke portfolios and specialist funds into ready made multi-asset funds. This trend is partly because the Vanguard range of funds looks like a ‘have your cake and eat it’ option!
Of course, I know that such fictions only exist in the minds of politicians and marketing men.
There is much in favour of Vanguard, especially their crusade for lower costs and I am in favour of investors using tracker funds in some markets.
But I am much more nervous about people buying unmanaged international multi asset funds (maybe only one) without understanding why, at this moment in time, they look so good and why that will not always be true.
Take a look at some of the articles and keep an eye out for new ones!
I will not comment on markets and investment matter in general today for two reasons: I can’t think if anything to say that will not be covered in my December Watching Brief in a few days time and apart from the local election in Hong Kong having proceeded peacefully (good news), nothing much new has happened.
The publication of the manifestos of the main political parties is fanciful as ever, with ‘commitments’ that make for good headlines. At least this time there is out and out socialism from Labour and therefore a contrast with the gently shifted Tory ‘almost more of the same’ offering. The polling data is now so clearly indicating a Tory victory that the media punters are covering their backs with pieces worrying about sudden changes in the last fortnight of the campaign!
We will just have to wait and see..
Following publication of a Long Read piece introducing passive investment concepts, I am researching the multi asset fund market, focusing on the low cost passive options as this is where retail investors’ money if flowing now, often on the advice of IFAs who want to shift all the investment work somewhere else and still maintain their own fees for doing very little of use!
I can see merit in such funds, if only in certain situations, but if you put your whole portfolio in a good selection of properly reviewed low cost passives in a risk adjusted mix, you would certainly not need to pay an adviser thousands of pounds a year. Even the IFA trade press is admitting that much now.