Its Not Harry

Comment and opinion for retail investors in the UK

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YAP – a geographical shift?

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Readers will know that serious investors do not shift their asset allocations around and trade in and out of funds frequently just because of a change in short term factors. In my training I suggest having a high level asset allocation target for each main investment sector that is of interest and relevant to your objectives and to then monitor, using some sort of recording system, how your actual portfolio compares with the targets.

This is not a strict science, but part of the ongoing process of diversification and risk control.

Something I have noted from the mass flow of media data that I see

I remind you of this because I want to call your attention to what I see as being subtle changes in the thinking of the professional investment community on the relative value of North American versus European and UK markets.

I am not suggesting that you are likely to react by making major changes to your asset mix, but that you might find this helpful context in making those minor course corrections that keep the portfolio supertanker heading smoothly for its long term destination.

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YAP – ESG is not woke!

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I read a news items recently that a collective of mainly Republican finance directors of large investing institutions in the USA was refusing to invest with and in fact withdrawing funds from any investment management business that adopted sustainability criteria.

Some people avoid looking at the evidence when it says the wrong thing

Now it has always seemed to me that a tendency to Republicanism in the US was inversely correlated with intelligence, but I had believed that Republicans still liked making money – in fact I assumed they had a version of the Bible that omitted that bit in the gospels about ‘storing up your treasures in heaven’!

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Deep Dive – May 2024

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Out of this world

This month I am going to address a subject that no-one really likes talking about but which I think I have a responsibility to address because I and my subscribers are all getting that little bit older.

As the Pink Floyd lyric goes ‘another day older, another day closer to death’, which is just a truism, but as we get into our 60s and 70s and beyond (and most of my subscribers are in that age group), the number of days is not so many as it was. 

All is going swimmingly, until it isn’t….

I know from you, my readers, that one of the principal concerns people have when they start running their own portfolios is that, although it is not so difficult when you have some training and have accumulated a bit of experience, it is unlikely (although not so in every case, I know) that a surviving partner would be comfortable taking over at short notice, especially as this would be an added responsibility during a period of grief and when other practical tasks of some complexity may need attention.

So, what would you want to happen to your portfolio management if you are still in charge when you die, or if you lose your mental capacity, which could be a slow and let’s face it, hard to accept or even recognise process?

Can we (I count myself in on this problem, naturally) do something now to prepare and make the situation easier for our loved ones? 

Most of my subscribers are couples and one partner (male or female) is ‘running the money’.  A small number of you are single, but there is still a problem that has to be resolved by someone else when you depart the scene.  Older age may imply that the problem will arise sooner rather than later, but experience has shown me that even the relatively young can be hit by serious or even fatal health issues.

I believe we ought to at least do some logical thinking about this real issue and this article is an attempt to get you started.  As always, I am happy to respond to feedback and suggestions and pass on good ideas and advice anonymously.

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YAP – bad news, or not?

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You will likely have noticed that the news on inflation is less positive than wished for by central banks and markets have modified their assumptions on when interest rates will start coming down. This has been reflected with direct impact for those renewing fixed rate mortgage contracts as at least in the UK, rates have actually gone up slightly.

So, is that just simply bad news?

It is certainly not good news for bonds and the FT headline today that the climate for fixed income investing is ‘unsettling’ is a good way of describing the situation.

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YAP – there’s gold in them thar central banks!

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You may have noticed a really significant increase in the price of gold bullion in recent months.

This is because something that we have known about for some time – continuous topping up of gold reserves by the Chinese central bank – is now seen as part of a more global pattern. With such large buyers active in the market, the price is bound to be well supported.

The reason for this anticipated expansion of central bank buying? Probably 2 main reasons, I think.

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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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