Thought I might try and pool a bit of knowledge and see if there are any finance types here. If people are happy to share, I'd be interested to know what companies (ideally UK listed, or funds) you are putting your cash into and why. I'd like to say first, that I am not a financial advisor, I have no relationship with any of these companies, and I have no inside information on any of them obviously! This is just TZ-gossip, and if you act on any advice in here the consequences are all on you, not the posters! I'll start us off!
Abcam PLC
ABC:LSE
Current prise: £5.80
Is a biotech company, produces proteins for practically everything, sells stuff to the big pharma companies for them to produce antibodies, sells chemicals and tools to help in medical imaging, diagnosis and similar. I think medical advancements are progressing around the world, particularly developing nations which are catching up with the developed world and demand for the basic materials Abcam make will be on the up. Revenue has increased constantly over the last 5 years, net income in the same way too, dividends have been growing but they are spending a lot of cash at the moment, they also have absolutely no corporate debt, which I like a lot! The shareprice recently retraced down to £5.80 from £6.90 or so, but is still on a big upward trend since 2014 when it was about £4.00, hoping to pick some up next week around 5.70-5.80.
Inmarsat PLC
ISAT:LSE
Current price: 9.245
Tech company, runs satellites which can get data connections to any satellite data receiver in the world, especially if you're out of mobile range. Can give consumers the ability to get wifi onboard air planes, cruise ships, in the wild, but also used by businesses in the shipping and freight industry, oil rigs, and military and government for non-important communication. I like it because everyone wants wifi wherever they are in the world now! They are planning yet another satellite launch which will hit near term cash flow, but pay out substantially in the short term future. shareprice recently retraced from 11.50 to where it is now, hoping to buy some next week in the 9.10-9.20 range.
National grid
NG:LSE
Current price 9.742
Missed the opportunity to buy some of these at 9.00 at the end of last year, kicking myself now, and waiting for it to come off a bit again. Everyone needs decent electricity services going to their house, and the system needs to be maintained doing it! Once they come back off to a sensible level, am tempted to make them one of the core holdings in my pension.
Interesting thread. If it was about BTL there would be several responses by now I think - just shows how unpopular equity investment is with so many folk these days, even those affluent enough to own watches worth many thousands of pounds. I'm actually a fan as a way of generating income in retirement, but don't buy any individual stocks at all, just ITs, ETFs and the odd OEIC.
I'm not surprised there are few responses. While I do manage my own portfolio and have above average financial knowledge, I don't stock pick. I go for open and closed end funds and make selections based on a target asset allocation, geographic split and sector mix. I also favour individual fund managers. I try to manage to this asset allocation holistically across all of my tax wrappers/products - ISAs, SIPP, company pension and property. I know and work with many financially astute folks (pension company) and none I have spoken to stock pick - too risky, tax inefficient and expensive trading costs.
I am invested in BP and Shell as they are well priced at the moment and pay very good dividends which can of course get reinvested. Next move will be to diversify into Pharma where again Glaxo look good value and they also pay a good dividend. I am a long run investor and I am prepared to leave my money alone for five plus years. Do your own research and spread your risk across different stocks and verticals. Diversification is key.
Originally Posted by PipPip
Which is pretty much my position and why I don't bother - I use to do a little but it was a lot of hassle and I was frankly crap at picking.
I'm with you. I invested about 3k about 18 months ago on some "red hot tips", stock is now worth about £1100! I'm useless.
I agree. Low cost trackers are a better way to go than stock picking. But I wouldn't be buying the US or UK markets right now...
I agree with this, it is not so much the relative strength of the companies listed but deep concerns of equity bubbles and the global marco-economic outlook.
Having just got back from a week's business trip in China (Commodity Trading) and met with several Chinese government economists and officials, even they recognise huge 'challenges' for the World's second biggest economy. Europe (the biggest global trading block) and Japan, the third biggest economy are all in long term stagnation.
I am always surprised that equity markets prices suggest everything is well with the World.
Perhaps what they indicate is that equity markets represent a least-worst option, in a world where most asset prices have been pumped up by QE and ZIRP. And, arguably, there are still pockets of (relative) value about - I think so, anyway, and am investing new money accordingly.
The point behind my earlier post is that a whole generation of potential investors (and I'm talking UK here, not US) have abandoned equity markets in the broadest sense, and instead is pinning its hopes on property. That may turn out to be a great call (as it has for most of the past twenty years), but I have some confidence in mean reversion, and also think that the BoE will cool the housing market quite aggressively, especially the BTL sector, if it feels that it has to.
And I just have a feeling that, sometime in the next few years, you could see private punters returning to the equities fray in numbers as the BTL bubble burts/deflates because of govt policy and low yields, and - if we throw in equities friendly inflation in the 2-4% range - then markets at this level could start to look quite cheap. I don't know of course, so meantime I'm taking the yield from my widely diversified, funds only investments and reinvesting. the one thing i've learned in my twenty five years of investing is that it's a long game, and that the consensus is an unreiable guide to the future.
I've been in OEICs for quite a long time, but the costs of those, when compounded over a pensionable time period are quite high, so thought I would dabble in individuals as well. It's not my first time, and i did get burnt a few years ago by individual shares as a lot of your eggs are in one basket, though not too badly, and didn't sell out and they came back fortunately but it's still a lesson learnt! My issues with trackers are that they normally don't give you exposure to re-invested dividends, and the cheaper ones which generally follow the FSTE 100 or similar i don't want to be exposed to due to their large weighting to Banks and Commodities which i am not particularly bullish on.
The funds I've sold out of to dabble in equities are these:
Architas MA Active Reserve Fund Class A Net Acc
GB00B84QFC61
General cross asset fund of funds, performed reasonably well, but as it is fund of funds I don't know actually where my cash is invested, so got out.
BlackRock Gold and General D Acc
GB00B5ZNJ896
invests in gold miners, quite good at times of uncertainty, recently rallied a lot obviously, unfortunately sold out before the rally!
Henderson UK Property OEIC I Acc Net
GB00BP46GF57
Commercial property, very low volatility in the fund, very stable growth, only got out as I moved house and got a much bigger mortgage, didn't really want to be doubled down on UK property prices.
HSBC FTSE 250 Index Accumulation C
GB00B80QG052
Better exposure to 'real' uk companies as opposed to ones just head quartered in the uk with earnings in foreign commodities!
Pictet-Digital Communication I dy GBP
LU0448836279
Invests in ebay, paypal, facebook, linkedin, twitter and the big global tech firms. I think they're a little over extended though
Threadneedle Specialist Investment Funds - Threadneedle UK Absolute Alpha ZNA
GB00B8BX5538
This is actually the only fund i'm left invested in, they long equities they like and short a beta adjusted amount of the index, profiting from relative moves if their basket outperforms the index, rather than just an outright up or down move.
Proby - What commodities are you in? I actually work in the oil industry! I have no information on oil firms to share, but while I like the BPs and Shells of this world as they are very well managed (like a previous poster said) they have no control over the actual price of oil which accounts for a lot of their upstream revenue, and is currently very depressed. Their retail, marketing, and midstream refining and trading operations are highly rated though. If i thought the oil price was definitely on its way up i'd be a buyer, but that's a bit of a gamble, rather than an investment in my view!
You do know that you could get the same exposure as many of those funds if you used ETFs, and probably at a much lower cost? There are plenty with AMCs of .5% or less, and since they tend to rebalance relatively infrequently and be large in size their intrernal costs are often quite low. I think they're a good way of gaining those core holdings, the ones you buy and forget, just reinvesting divis or using ACC versions, which are often available. Just watch out that they're physical, and don't use derivatives, because that introduces counterparty risk etc.
Having said that I also like ITs. Discounts aren't as juicy as they were, following the RDR, but I still buy some on quite tasty discounts, and they can smooth divis over time - so some, like CTY and others, have paid increasing divis for around 50 years IIRC. Also in property there's lots to be said for ITs, because they don't have to close when (and it may well happen again) the market crashes. Sure, the price plummets - which I try to take as a buy signal.
But I do agree that management charges and internal dealing costs do hurt overall returns from collective investments - so in each market area I tend to mix some passive ETFs (especially smart beta funds oriented towards value/income because that's my long term goal) with active management in terms of ITs.
BTW hope you sold out of Gold and General very recently - it's had a pretty big run up in the last month or so, I imagine... (Which is buy I just buy, hold and rebalance, trying to maximise divis and minimise costs. I simply don't have a clue what's going to happen.)
But the real reason I don't hold individual stocks is that I'd be tempted to over-trade, and I think that would kill my (already modest) returns. But of course we're all different, and I can see the attraction of your approach - it's just not for me.
Last edited by simoscribbler; 21st March 2016 at 09:58.
I think back to the late 90's/ early. 00's when 'everyone' seemed pack their jobs in to be day traders, then the stats came out: 90% of day traders lost money. You don't really hear much of them now.
When I first trained as an IFA, a few of the older ones in the 90's used to invest in the worst performing shares of the ftse of the previous year and did very well on the whole. They used to call them th dogs of the ftse. Some fund managers even set up funds based on a similar idea for underperforming funds that that's fundamentals were generally sound.
Loads of those around nowadays I reckon, with oilies and commodities heading the field.
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