This might be a naive question, @PragueAddick, but as someone who seems pretty clued-up on his investments, what do you see as the advantage in investing for dividends rather than in shares with low/no dividend? In the latter case if you want a 5% income you can just sell 5% of your holding each year. This gives you control of your income stream and (under UK tax rules at least) the ability potentially to use your CGT allowance each year. I'm starting to give consideration to such matters as retirement looms large on my horizon (and I'm not actually working while I languish on an NHS waiting list), so orhers' perspectives are very welcome and helpful.
This might be a naive question, @PragueAddick, but as someone who seems pretty clued-up on his investments, what do you see as the advantage in investing for dividends rather than in shares with low/no dividend? In the latter case if you want a 5% income you can just sell 5% of your holding each year. This gives you control of your income stream and (under UK tax rules at least) the ability potentially to use your CGT allowance each year. I'm starting to give consideration to such matters as retirement looms large on my horizon (and I'm not actually working while I languish on an NHS waiting list), so orhers' perspectives are very welcome and helpful.
Which savings account would you put your cash in, the one paying 0% interest or the one paying 5% interest? Especially if you don't draw and therefore get the compounding effect.
My point is really if you take two otherwise identical companies making the same amount of profit and with identical asset bases, except company A pays a 5% dividend and company B pays no dividend, instead retaining and reinvesting the profits, the share price of B should theoretically increase by 5% more than that of A. This then gives you the choice of either selling a % of your holding in company B or benefitting from increased capital growth. I do appreciate that real world comparisons are difficult as so many factors come into play.
The interest bearing account comparison doesn't hold water as interest is the only benefit - there is no opportunity for capital growth in a savings account.
It's an interesting point & something I know @PragueAddick has had many sleepless night over 😄.
Let's look at it from a mutual fund perspective. In the UK we have both income and accumulation units. Lots of investors in the past have chosen income based funds for the dividends, especially if they are looking to boost their retirement income. Many years ago I worked for a fund management company that combined 3 income funds that paid quarterly dividend payments, into a "mini" portfolio, and structured it so that you would get a dividend every month (fund A pays out in January, fund B in February, fund C in March, fund A again in April, B in May and so on). This was back in the mid 80's so things were a lot different then in relation to pensions & (non) tax efficiency of investments.
However, instead of this you could simply invest into a range of "accumulation" funds and, like you say, (hopefully) skim of the increased fund value as a monthly payment. This is basically what Flexi-access Drawdown pensions are. The art is to make sure you are achieving a constant 6%-8% return every year so that you can take 4%-5% "income" and still have a bit of growth in your fund. The Prudential launched a Distribution Bond around 30 years ago, which invested in 2 funds - 1 was for income & the other growth, with the aim to acheive a rising income & a bit of capital growth to make sure your original investment didnt stagnate or fall in real terms due to inflation. It worked rather well but The Prudential withdrew it some years later and so now us advisers have to think of other ways to achieve income for clients without having to see their capital fall because you are taking out more than it is growing by or risking the capital (usually by investing too much in income bearing equities but recently by investing too much in income bearing Bonds !).
There really isnt a perfect solution. Like most investment strategies, a lot if it depends on attitude to risk & how much income/growth you are looking for.
@IdleHans others more clued-up than me have answered your question well. In my personal case, I have always been wary of individual shares ( as opposed to funds) so this is a newish area for me. I’ve decided to buy relatively small amounts with the intention to hold, rather than trade ( for this reason I probably won’t take profits on DL @Rob7Lee as I only bought £2k worth) . I’m still on the lookout to broaden the portfolio, and I’m keeping an eye on Volvo Trucks ( which is another one best bought outside a UK platform). The trouble with selling shares or fund holdings to support income is, you never know when its a good time to sell. If you can build up a steady of flow of income you don’t have to make that decision. For big personal expenditures ( and I have made or committed to them in the last year, with money from the UK house sale) I’m well covered with cash in instsnt access accounts which pay 2.5% or more. That happy state of affairs likely won’t last too long, but at least for another year, IMO, so plenty of time to adjust. That’s how I see it anyway.!
Thanks @golfaddick. It almost sounds as if you know what you're talking about. Your thoughts are much appreciated.
Like you @PragueAddick I am wary of individual shares but I do hold a handful, more for amusement to see if I can beat the funds that I also hold, mainly Vanguard life strategy 80% and 100% equity. Theyre all in either a SIPP or ISAs so the tax aspects of dividends are at least are mitigated. The worst funds I've held in the last two years have been a couple of Baillie Gifford's and I recently dumped them both as they were relentlessly downward. Their Positive Change fund could not have been more inappropriately named. It always rankles when youre paying city wankers fund managers to erode your savings faster than you could do it yourself. For the same reason I've also transferred out of an abysmal Aegon Retiready pension too, down 20% more in the last year than any of my other little pension funds.
As you say, knowing when to sell is an impossible task, so my philosophy is not to be too clever, and leave a bit of profit for the next bloke. Easier to sell winners than to admit defeat and sell losers, I have found.
@IdleHans I’m in the same boat as you with Baillie Gifford - got some Positive Change, and in my SIPP too. I sold most off, but kept some, just in case they come good. About as likely as that happening to Charlie Kirk. @golfaddick was a fan too, mind. Of BG, not Kirk 🤣
@IdleHans I’m in the same boat as you with Baillie Gifford - got some Positive Change, and in my SIPP too. I sold most off, but kept some, just in case they come good. About as likely as that happening to Charlie Kirk. @golfaddick was a fan too, mind. Of BG, not Kirk 🤣
I was indeed a big fan of BG funds. Unfortunately they seem to be one of these groups that have decided that they are right & so have stuck with their principles even though the market has now changed. 2 years ago is was all about growth funds.....now its value. BG don't like to admit that they are now wrong & are clinging onto the idea that the market will turn & when it does the tech companies they are investing in will once again power ahead.
I got out of BG funds in late 2021 & have advised others to do so ever since.
@IdleHans I’m in the same boat as you with Baillie Gifford - got some Positive Change, and in my SIPP too. I sold most off, but kept some, just in case they come good. About as likely as that happening to Charlie Kirk. @golfaddick was a fan too, mind. Of BG, not Kirk 🤣
I was indeed a big fan of BG funds. Unfortunately they seem to be one of these groups that have decided that they are right & so have stuck with their principles even though the market has now changed. 2 years ago is was all about growth funds.....now its value. BG don't like to admit that they are now wrong & are clinging onto the idea that the market will turn & when it does the tech companies they are investing in will once again power ahead.
I got out of BG funds in late 2021 & have advised others to do so ever since.
Are they still as tech dominated as before? If so I'd better get out completely.
I kept some cash on instant access as the markets were expected to fall this winter. So far the FTSE has gone up considerably. So is the FTSE/S&P 500 likely to fall in the next 6 months & recover quickly thereafter?
Alternatively, have I missed the bottom of the equity markets already.
Looking for the few experts opinions on here please, as I'm reasonably knowledgeable myself.
I kept some cash on instant access as the markets were expected to fall this winter. So far the FTSE has gone up considerably. So is the FTSE/S&P 500 likely to fall in the next 6 months & recover quickly thereafter?
Alternatively, have I missed the bottom of the equity markets already.
Looking for the few experts opinions on here please, as I'm reasonably knowledgeable myself.
If we knew the answer to that we would all be rich. Sadly I'm not.
I kept some cash on instant access as the markets were expected to fall this winter. So far the FTSE has gone up considerably. So is the FTSE/S&P 500 likely to fall in the next 6 months & recover quickly thereafter?
Alternatively, have I missed the bottom of the equity markets already.
Looking for the few experts opinions on here please, as I'm reasonably knowledgeable myself.
I'm about as far from being an expert as it's possible to be but I try to keep up with things.
Sentiment in general seems to be that the first part of 2023 will be rough as higher interest rates and cost of living rises fully kick in, affecting corporate earnings negatively and depressing markets. The second half of the year is expected to pick up as inflation finally starts to fall, relieving the pressure on central banks to raise rates further.
On that basis I would be slightly surprised if we have yet seen the bottom, and if the recent Santa rally and last week's rise dont reverse over the next few weeks at least to some extent.
That said, its impossible to time buying and selling perfectly, and you risk missing gains as much as avoiding falls if youre out of the market. As blackpool says, if we knew how to do that we'd be rich. And NOBODY really knows, its all opinions.
I attach a link to a financial planner who does shortish YT videos which I have found worth watching. There's as much about psychology in these as there is financial education and I have found them relevant and interesting.
@IdleHans I’m in the same boat as you with Baillie Gifford - got some Positive Change, and in my SIPP too. I sold most off, but kept some, just in case they come good. About as likely as that happening to Charlie Kirk. @golfaddick was a fan too, mind. Of BG, not Kirk 🤣
I was indeed a big fan of BG funds. Unfortunately they seem to be one of these groups that have decided that they are right & so have stuck with their principles even though the market has now changed. 2 years ago is was all about growth funds.....now its value. BG don't like to admit that they are now wrong & are clinging onto the idea that the market will turn & when it does the tech companies they are investing in will once again power ahead.
I got out of BG funds in late 2021 & have advised others to do so ever since.
Are they still as tech dominated as before? If so I'd better get out completely.
Looking at their fund "factsheet" that was produced at the end of November they still have large holdings in Amazon, Netflix & Tesla - but then almost 7% in Modena. The factsheet shows almost 25% in IT shares, so take that for what it is.
One thing that I loved amongst the blurb in the fact sheet is that they state that although you can lose 100% of any investment the gains are limitless. Yes, they actually say that don't worry if we lose ALL your money because just think of the gains you COULD make.
I kept some cash on instant access as the markets were expected to fall this winter. So far the FTSE has gone up considerably. So is the FTSE/S&P 500 likely to fall in the next 6 months & recover quickly thereafter?
Alternatively, have I missed the bottom of the equity markets already.
Looking for the few experts opinions on here please, as I'm reasonably knowledgeable myself.
Definitely not an expert. My banking career was on the corporate side, but even then on the (mostly) owner owned private businesses (law, accountancy firms) who we dealt with differently to PLCs.
But, as @PragueAddick notes, the FTSE 100 is dominated by just a couple of sectors (oil & gas 18.7%, financials 18.6%, consumer goods 17.1%). Just 8 companies gives you exposure to 41% of the 100. Miners tend to be more volatile - I hold Glencore, which is as high as it has been for years, but regularly falls & rises by a £1 or so over short periods of time. Most of these companies also earn most of their earnings outside the UK, so the FX rate also matters.
With continued war in Ukraine, energy prices are expected to remain high and with further interest rate hikes, banks should start to benefit. So the two biggest sectors of the FTSE could benefit in the short term, despite the recession in the UK.
All that said, and the fact that I punted on 8,000, means that the FTSE 100 will almost certainly plummet and prove I know nothing at all 🤷🏻♂️😂
Meanwhile at the boring end, Charter Savings Bank today lifted their savings rate on their Easy Acess (immediate unlimited withdrawals allowed) to 3.0%. It's possible it's only for existing savers, of which fortunately I'm one, but it's quite an aggressive move. I wonder if it has wider significance.
By the by as a long time critic of banks, and their regulators, I should concede that this is a nice competitive sector the UK has built up here in savings accounts. You have to hope all the little players are secure enough, but you are protected so long as you don't go above 85k with any one bank (albeit you have to watch out for hidden ownership of more than one bank brand, as I readon the Money Savings Expert forum, which I recommend if you want to join the 'rate-catchers". Now excuse me while I take particular pleasure in moving money out of Marcus By Goldman Sachs
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
Thanks for that redman. I read that fidelity article prior to my post. It basically confirms what I thought. The markets are expected to fall and yet some are already on the up. I'm still no closer to knowing what to do. I'm usually very good at calling the bottom of markets, but I'm struggling this time.
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
Thanks for that redman. I read that fidelity article prior to my post. It basically confirms what I thought. The markets are expected to fall and yet some are already on the up. I'm still no closer to knowing what to do. I'm usually very good at calling the bottom of markets, but I'm struggling this time.
An obvious option would be to drip feed your investment cash into equities in instalments over a period of months to smooth out any bumps. It wont make you the most profit but nor will it make you the greatest loss. (I suspect you've considered this already, but just in case...)
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
Thanks for that redman. I read that fidelity article prior to my post. It basically confirms what I thought. The markets are expected to fall and yet some are already on the up. I'm still no closer to knowing what to do. I'm usually very good at calling the bottom of markets, but I'm struggling this time.
An obvious option would be to drip feed your investment cash into equities in instalments over a period of months to smooth out any bumps. It wont make you the most profit but nor will it make you the greatest loss. (I suspect you've considered this already, but just in case...)
Quite. I'm invested in the FTSE already & am thinking do I withdraw, wait for another large fall and then get back in? Alternatively should I be investing not cashing in? I'm just thinking aloud tbh. I don't know whether to put it in or take it out
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
Thanks for that redman. I read that fidelity article prior to my post. It basically confirms what I thought. The markets are expected to fall and yet some are already on the up. I'm still no closer to knowing what to do. I'm usually very good at calling the bottom of markets, but I'm struggling this time.
An obvious option would be to drip feed your investment cash into equities in instalments over a period of months to smooth out any bumps. It wont make you the most profit but nor will it make you the greatest loss. (I suspect you've considered this already, but just in case...)
Quite. I'm invested in the FTSE already & am thinking do I withdraw, wait for another large fall and then get back in? Alternatively should I be investing not cashing in? I'm just thinking aloud tbh. I don't know whether to put it in or take it out
Likewise, I shifted quite a bit out of US funds when the FTSE was low into FTSE funds, I'm now toying with doing the reverse and putting it back into the US S&P! Decisions decisions.
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
Thanks for that redman. I read that fidelity article prior to my post. It basically confirms what I thought. The markets are expected to fall and yet some are already on the up. I'm still no closer to knowing what to do. I'm usually very good at calling the bottom of markets, but I'm struggling this time.
An obvious option would be to drip feed your investment cash into equities in instalments over a period of months to smooth out any bumps. It wont make you the most profit but nor will it make you the greatest loss. (I suspect you've considered this already, but just in case...)
Quite. I'm invested in the FTSE already & am thinking do I withdraw, wait for another large fall and then get back in? Alternatively should I be investing not cashing in? I'm just thinking aloud tbh. I don't know whether to put it in or take it out
Likewise, I shifted quite a bit out of US funds when the FTSE was low into FTSE funds, I'm now toying with doing the reverse and putting it back into the US S&P! Decisions decisions.
I have been meaning to follow up my moans about 2022 with a few remarks about the bright spots, which also call for some thanks to a few people on here. This was the year I discovered the joys of income. Of course this is partly thanks to the surge in interest rates which heralded savings account opps. which were unthinkable even at the beginning of the year, but the portfolio of funds my IFA put together with an eye on delivering income have done well, and I now have a decent portfolio of shares which deliver good dividends. Some of them I chose after suggestions from @Rob7Lee (aka Mr Direct Line) and @WishIdStayedinthePub. Of course neither were offering pro advice, and another suggestion from someone who normally makes good calls has gone a bit pear. But anyway you make your own bed investing, and you lie in it. Thanks for the tips that have done well guys. The one I'm most pleased with is a company I did some work for just before shutting up shop so I got to see them up close and personal. It's Novo Nordisk, a Danish pharma. Their core business is diabetes treatments, where they are a strong market leader, but this year, soon after I bought, they announced impressive trial results for an anti-obesity drug. They are now up 39% since I bought this year, and I was buying mainly for reliable dividends! (unfortunately it's not traded on the FTSE)
Income isn't a priority if you are half my age but I'm very happy with how this has gone, especially as the savings accounts look set to stay bouyant for most of this year. I opened a spreadsheet to log the income as it rolls in, and I include the Premium Bonds there, so generally I can enter a happy update each month, which is an excellent antidote to contemplating the wreckage of bloody Vanguard Life Strategy
You are most welcome, @PragueAddick. If I remember rightly, my suggestions were all about income with no debt or low risk of default, and were marked down at the time. So they should hopefully do okay! It was effectively a large part of what I chose for my wife's pension transfer in and I know that's done ok. I managed to get the same income for 40% of the value of the pot we transferred in.
A quick update on my transfer from HL to Interactive Brokers. I've done one account and there have been quite a few teething problems! Exec summary is:
customer service is a bit slow (can't work out if that's the broker or SIPP administrator) configuration is fiddly and clunky, (definitely due to the split of responsibilities between the broker and admin) the interface is not nearly as simple as HL - which suits me but wouldn't suit everyone the product and functionality is leagues ahead most importantly, it has saved me hundreds of pounds in fees just since 12/12.
There's interest on cleared cash (2-3.3%), plus ludicrously low fees for trading (0-2 pounds in most cases), plus ludicrously low fx charges (effectively cash is held in multi-currency accounts that trade at wholesale rates). e.g. one US purchase that would have cost £100 on HL, cost £1.05.
You have much more control over orders that means my entry and exit points have improved and are less stressful. It looks like they will also pay you for borrowing stock. You do have to pay for market data (pay for what you use) but then most of that is rebated with relatively low trading activity. On top of all that, I can trade (low risk) options strategies inside a SIPP.
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Please see my post of 6th Jan suggesting suggesting taking some profit!!
Not sure the management Fcuked up, not unless they control the weather they'll bounce back, shares back to around when you bought them?
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Please see my post of 6th Jan suggesting suggesting taking some profit!!
Not sure the management Fcuked up, not unless they control the weather they'll bounce back, shares back to around when you bought them?
Sounds as if I bought about the same number as you, @PragueAddick
I agree there's an element of management fuck up at best, duplicity at worst. If one week of frosty weather in DECEMBER FFS can lead to the dividend being cancelled then the business was extremely fragile. Yet only in November did the company provide reassurance regarding the safety of the dividend. In my book that is a shitshow, and the CEO belongs with the other snake oil salesmen on AIM. Happily, gains elsewhere will cover this 25% fall, but it has dragged down the prices of better run companies in the sector.
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Please see my post of 6th Jan suggesting suggesting taking some profit!!
Not sure the management Fcuked up, not unless they control the weather they'll bounce back, shares back to around when you bought them?
Sounds as if I bought about the same number as you, @PragueAddick
I agree there's an element of management fuck up at best, duplicity at worst. If one week of frosty weather in DECEMBER FFS can lead to the dividend being cancelled then the business was extremely fragile. Yet only in November did the company provide reassurance regarding the safety of the dividend. In my book that is a shitshow, and the CEO belongs with the other snake oil salesmen on AIM. Happily, gains elsewhere will cover this 25% fall, but it has dragged down the prices of better run companies in the sector.
Yes I bought the same amount of L&G at the same time. Grrrr.
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Please see my post of 6th Jan suggesting suggesting taking some profit!!
Not sure the management Fcuked up, not unless they control the weather they'll bounce back, shares back to around when you bought them?
Thats true, you did say that, but I didnt do that as I had bought it mainly for the income. It now turns out I wont get any sodding income.
They should headhunt Sergei the Meerkat to take over as CEO
Just when I thought this income lark was a nice calm way to invest, I get an alert from H-L that the Direct Line management has fessed up to fucking up, and the stock promptly sheds 20% - because among other things they have decided to cancel the dividend!!!!
Now I’m thankful that I only committed 2k to these cowboys. Will be selling as soon as I get near to parity with the price I paid.
What does Mr Direct Line @Rob7Lee think about this?😉
Please see my post of 6th Jan suggesting suggesting taking some profit!!
Not sure the management Fcuked up, not unless they control the weather they'll bounce back, shares back to around when you bought them?
Sounds as if I bought about the same number as you, @PragueAddick
I agree there's an element of management fuck up at best, duplicity at worst. If one week of frosty weather in DECEMBER FFS can lead to the dividend being cancelled then the business was extremely fragile. Yet only in November did the company provide reassurance regarding the safety of the dividend. In my book that is a shitshow, and the CEO belongs with the other snake oil salesmen on AIM. Happily, gains elsewhere will cover this 25% fall, but it has dragged down the prices of better run companies in the sector.
Your lucky the freeze period wasn't between Christmas and new year, losses would have doubled minimum.
Comments
Let's look at it from a mutual fund perspective. In the UK we have both income and accumulation units. Lots of investors in the past have chosen income based funds for the dividends, especially if they are looking to boost their retirement income. Many years ago I worked for a fund management company that combined 3 income funds that paid quarterly dividend payments, into a "mini" portfolio, and structured it so that you would get a dividend every month (fund A pays out in January, fund B in February, fund C in March, fund A again in April, B in May and so on). This was back in the mid 80's so things were a lot different then in relation to pensions & (non) tax efficiency of investments.
However, instead of this you could simply invest into a range of "accumulation" funds and, like you say, (hopefully) skim of the increased fund value as a monthly payment. This is basically what Flexi-access Drawdown pensions are. The art is to make sure you are achieving a constant 6%-8% return every year so that you can take 4%-5% "income" and still have a bit of growth in your fund. The Prudential launched a Distribution Bond around 30 years ago, which invested in 2 funds - 1 was for income & the other growth, with the aim to acheive a rising income & a bit of capital growth to make sure your original investment didnt stagnate or fall in real terms due to inflation. It worked rather well but The Prudential withdrew it some years later and so now us advisers have to think of other ways to achieve income for clients without having to see their capital fall because you are taking out more than it is growing by or risking the capital (usually by investing too much in income bearing equities but recently by investing too much in income bearing Bonds !).
There really isnt a perfect solution. Like most investment strategies, a lot if it depends on attitude to risk & how much income/growth you are looking for.
I got out of BG funds in late 2021 & have advised others to do so ever since.
So far the FTSE has gone up considerably.
So is the FTSE/S&P 500 likely to fall in the next 6 months & recover quickly thereafter?
Alternatively, have I missed the bottom of the equity markets already.
Looking for the few experts opinions on here please, as I'm reasonably knowledgeable myself.
Sadly I'm not.
In the last month the S&P 500 remains down 3.5%. Meanwhile the FTSE global fossil fuel index100 is up 5.6%.
One thing that I loved amongst the blurb in the fact sheet is that they state that although you can lose 100% of any investment the gains are limitless. Yes, they actually say that don't worry if we lose ALL your money because just think of the gains you COULD make.
All that said, and the fact that I punted on 8,000, means that the FTSE 100 will almost certainly plummet and prove I know nothing at all 🤷🏻♂️😂
By the by as a long time critic of banks, and their regulators, I should concede that this is a nice competitive sector the UK has built up here in savings accounts. You have to hope all the little players are secure enough, but you are protected so long as you don't go above 85k with any one bank (albeit you have to watch out for hidden ownership of more than one bank brand, as I readon the Money Savings Expert forum, which I recommend if you want to join the 'rate-catchers". Now excuse me while I take particular pleasure in moving money out of Marcus By Goldman Sachs
However thought this article worthy of passing on
https://www.fidelity.co.uk/markets-insights/markets/global/get-ready-for-market-lift-off-in-2023/
beware conclusion in taking too much from headline. Sounds like it would be better saying over next 3 or 4 years rather than 2023.
For further background MSCI low in October was 2362, now it is 2679, a gain of 13.4% from the low. In USD terms of course
It basically confirms what I thought.
The markets are expected to fall and yet some are already on the up.
I'm still no closer to knowing what to do.
I'm usually very good at calling the bottom of markets, but I'm struggling this time.
I'm just thinking aloud tbh.
I don't know whether to put it in or take it out
A quick update on my transfer from HL to Interactive Brokers. I've done one account and there have been quite a few teething problems! Exec summary is:
customer service is a bit slow (can't work out if that's the broker or SIPP administrator)
configuration is fiddly and clunky, (definitely due to the split of responsibilities between the broker and admin)
the interface is not nearly as simple as HL - which suits me but wouldn't suit everyone
the product and functionality is leagues ahead
most importantly, it has saved me hundreds of pounds in fees just since 12/12.
There's interest on cleared cash (2-3.3%), plus ludicrously low fees for trading (0-2 pounds in most cases), plus ludicrously low fx charges (effectively cash is held in multi-currency accounts that trade at wholesale rates). e.g. one US purchase that would have cost £100 on HL, cost £1.05.
You have much more control over orders that means my entry and exit points have improved and are less stressful. It looks like they will also pay you for borrowing stock. You do have to pay for market data (pay for what you use) but then most of that is rebated with relatively low trading activity. On top of all that, I can trade (low risk) options strategies inside a SIPP.
Not sure the management Fcuked up, not unless they control the weather
I agree there's an element of management fuck up at best, duplicity at worst.
If one week of frosty weather in DECEMBER FFS can lead to the dividend being cancelled then the business was extremely fragile. Yet only in November did the company provide reassurance regarding the safety of the dividend. In my book that is a shitshow, and the CEO belongs with the other snake oil salesmen on AIM.
Happily, gains elsewhere will cover this 25% fall, but it has dragged down the prices of better run companies in the sector.