Innehållsförteckning för 1039 från MoneyWeek

“The level of distortion in global markets is getting a bit too weird for comfort” You know something odd is going on in global markets (see page 4). But do you know quite how odd? Here’s a hint that the level of distortion is getting a bit too weird for comfort. In the US, the number of loss-making mid-and small-cap companies as a percentage of the total is at an all-time high (29%). We can forgive a lot of losses right now (lockdown, etc) and this number often peaks towards the end of a recession. But how’s this for nuts: investors are currently paying a premium for those loss-making companies. They’ll pay more for “no money”, than they will for “some money” (see page 22 for how to avoid doing…

Koo Stark (pictured), faces a £285,000 court bill after an appeal court judge dismissed her claim to a£50,000-a-year allowance from US financier Warren Walker, with whom she has a daughter, says Rory Tingle on MailOnline. The actress said that Walker promised her the money in a letter in 1997. The High Court rejected the initial claim last year, saying it was not a “legally-binding” deal. A pub landlady has ended up with a legal bill of £54,000, after she opened her ex-husband’s post in a bid to prove he was having an affair, says Claudia Aoraha in The Sun. Karen and Lawrence Santi, who had run a chain of pubs together, split up last year. He sued her for breach of privacy, and she was ordered to pay 60% of…

On 12 February 2020 the FTSE 100 hit a pre-pandemic peak of 7,534, says Tom Howard in The Times. One year and a “vaccine-fuelled” rally later and it is still more than 12% short of that level. That compares unfavourably with other major stock markets, with the MSCI World index regaining its pre-Covid levels by August. The key issue for the FTSE is its sectoral composition, says James Coney in the same paper. The FTSE 100 is full of out-of-fashion energy businesses, banks and high street retailers. In this age of frenetic digital innovation, it has just three tech firms that comprise 0.7% of the index. Tech accounts for 30% of America’s S&P 500. Ocado is the FTSE 100’s only real tech star, adds Howard, but London’s junior market, Aim,…

Japan’s Nikkei 225 stock index has broken through 30,000 to hit its highest level since August 1990. The index has soared by 10% since the start of the year as investors have gone bargain-hunting in cyclical sectors such as “steel, mining”, vehicles and retail, reports Jada Nagumo for Nikkei Asia. Robust corporate earnings, meanwhile, suggest that former prime minister Shinzo Abe’s corporate governance reforms are bearing fruit. The Nikkei remains short of its December 1989 all-time high when it reached 38,915 at the apex of the country’s stockmarket bubble. The alternative Topix index, which is a more accurate (if less famous) stockmarket benchmark, has also reached a new 30-year high following an 8% rise since the start of the month.…

Online dating business Bumble “received a warm welcome from Wall Street”, say Miles Kruppa and Hannah Murphy in the Financial Times. The shares opened at $76 on the Nasdaq last Thursday, a77% jump from the initial public offering (IPO) price of $43. The company, which operates match-making service Badoo and the eponymous app where women make the first move by messaging matches, was valued at $13bn after its successful flotation. Social distancing and lockdown measures have prevented people from getting together, prompting a boom in the online dating market. It faces fierce competition from rival Match, which operates Match.com and Tinder.…

Mitchells & Butlers (M&B), the owner of Harvester restaurants and Nicholson’s pubs, plans to raise £350m from a group of tycoons by selling shares at a third of the current price, says Jasper Jolly in The Guardian. The tycoons will also offer the company a £150m loan facility, bringing the total value of the package up to £500m. Currency trader Joe Lewis, Irish billionaires John Magnier and JP McManus, and businessman Derrick Smith (collectively known as the “Sandy Lane set”) will merge their investment vehicles into one entity, called Odyzean, giving them majority control of the company. The refinancing will “strengthen their hand”, says Bryce Elder in the Financial Times. Existing shareholders can’t sell the rights to buy the discounted shares on to third parties, as would be the case…

We learned last week that the British economy shrank by the most of any major country in the world during 2020 in a recession that was the deepest in 300 years. It is a slump of historic proportions – with shops and restaurants locked down, gyms and bars closed, and travel restricted, output was 9.9% lower in 2020 than in 2019. You have to go all the way back to the Great Frost of 1709 for a bigger fall in output than the one we have just witnessed. And yet Chancellor Rishi Sunak has been oddly quiet recently. Surely a historic slump demands an equally historic response? Over the course of the last year Sunak has stepped in with one scheme after another. Employers have been allowed to furlough their…

“I’m very sorry for what I did wrong,” former star fund manager Neil Woodford tells The Sunday Telegraph’s Lucy Burton. It’s less than two years since his fund management business collapsed. That happened because a) he was underperforming and b) when investors got fed up with that, and jittery about some of his other holdings, and went to withdraw their money, it turned out that he was too heavily invested in stocks that couldn’t be sold in a hurry. As aresult, his funds were frozen. The ensuing firesale of illiquid (defined below) assets compounded the losses investors had already suffered. Many are still waiting for money to be returned (see page 20). Now he hopes to make a comeback – hence the “tearful and defiant” broadsheet interview. “It was literally…

Activist investor Ancora Holdings is upping the ante at trucking and logistics firm Forward Air, says Cara Lombardo in The Wall Street Journal. Ancora holds a 6.3% stake in the company, and is to nominate four directors to Forward Air’s ten-person board. Like other freight companies, Forward Air has struggled during Covid-19, but Ancora says Forward Air has lagged behind its peers because it has diversified “instead of staying focused on its core expedited [freight] business”. The activist recently rejected a proposal by Forward Air involving adding three new directors to its board, two of them chosen by activists. The group wants its four director candidates to focus on “strengthening management and improving margins”.…

“There are only two kinds of people in the world—the kind of people who think there’s such a thing as enough money, and the kind of people who have money.” US author Fran Lebowitz (pictured), quoted in The New Yorker “I’ve been getting rid of my BTC [bitcoin]. Why? A currency is never supposed to be more volatile than what you buy and sell with it. You can’t price goods in BTC.” Financial writer Nassim Nicholas Taleb on Twitter “Have you ever met someone of great wealth who didn’t think they were a terrific judge of character?” Professor William LaPiana of New York Law School, quoted in The Times “I can’t deny being a rich guy with an opinion.” Bill Gates in his new book How to Avoid a Climate…

bloomberg.com The “Pomodoro technique” of breaking work into short intervals is widely promoted as helping combat “procrastination and inefficiency”, says Arianne Cohen. Here’s how it works. 1. Pick your task. “Where do your focus and efficiency dependably flounder?” Use the technique primarily for jobs you’re unexcited about or work you’ve been putting off. moneyweek.com 2. Choose a time and an interval. Pick the hours of the day when you tend to be most alert, and then give yourself 25 minute sprints of concentrated activity with five-minute breaks. Fifty minutes might be better – it’s the time that correlates with the highest productivity gains. 3. Get active in your break. Create energy while resting from your work by dancing, skipping or doing yoga. You can just “dance like a fool… it’s…

Regulators struggling to persuade people to take independent financial advice when choosing apension drawdown provider hope a new price-comparison service might help. The new tool, managed by the government-funded Money Advice Service, went live earlier this month. It enables savers considering drawdown plans to compare the cost of such schemes. The Financial Conduct Authority (FCA), the City regulator, asked the service to set up the tool amid concern that large numbers of pension savers who take out drawdown plans on reaching retirement are not receiving any financial advice. Its work suggests the typical saver could increase their retirement income by as much as 13% ayear simply by shopping around for a better deal. However, the new tool currently features drawdown plans from only eight providers. Another ten or so are…

The word “packaging” calls to mind a commoditised industry and visions of Amazon’s cheap cardboard boxes. But specialised forms of packaging require sophisticated packaging machinery and provide much more value. A good example is the pharmaceuticals industry, where packaging requires sterile conditions and accurate dosing. Britain’s Mpac Group (Aim: MPAC) is a key player in the field of specialised packaging. It designs and makes the automated packaging machines needed for the healthcare and food industries. Approximately 50% of its revenue comes from the healthcare sector, with another 45% from food and beverages. A global footprint Mpac has installed more than 10,000 of its packaging machines in 80 countries and has many blue-chip customers, including 3M, Abbott, CooperVision (a leading manufacturer of contact lenses), Diageo, GSK, Johnson &Johnson, Kraft and Smith…

Kirkland’s (Nasdaq: KIRK) is a home-decor and furnishing retailer with shops across the US. The pandemic has made “potential home-furnishings customers take a long look at their living quarters”, says Michael Marcus on Nasdaq. Its latest third-quarter results revealed revenue of $146.6m, above analysts’ forecasts. Investors have also noted that the group has managed to improve its margins. The shares have gained a “whopping 1,500%” over the last year, which also “reflects the company’s success in adapting to the increased importance of online sales”.…

Helmut Kiener (pictured) was born in the German town of Wernberg in 1959. After studying statistics at a local technical college, and doing his national service, he studied at various universities, eventually graduating with a diploma in psychology. After briefly working as a social researcher, in 1988 he set up an investment fund, Kiener Company (later named K1 Group), with his friend Dieter Frerichs. This “fund of funds” used money raised from institutional and private investors to invest in other hedge funds, based on their past performance. What was the scam? Kiener claimed that his investment criteria would enable K1 to select funds that would continue to beat the market. In reality, most of the funds that he selected were shell companies, with the money either returning to the main…

2019 Jules Taylor, Pinot Noir, Marlborough, New Zealand £19.50, reduced to £17 each when bought asa case of 12 bottles, decvin.com. Jules Taylor is a prodigiously talented winemaker and she has just celebrated her 20th year making her eponymous portfolio of wines. I have followed her every step of the way, yet she has never released a set of bottles like the quartet featured in this article, which have just arrived on our shores. Leading with the remarkable pinot noir (details above), which is so keenly priced it makes all but a handful of pinots in the world look embarrassed, this is a dark-hued and extraordinarily resonant wine. The nose is sensational, with Auxey-Duresses and Monthélie allure, and this sonorous call to arms is followed by admirable restraint on the…

This Sovereign Isle Britain In and Out of Europe Robert Tombs Allen Lane, £16.99 It has been more than a year since Britain left the EU, and more than a month since the transition period ended. Perhaps, then, it’s time for the whole issue of Brexit “to pass from the hands of journalists into those of historians”, says Andrew Roberts in The Daily Telegraph. In This Sovereign Isle, Robert Tombs, emeritus professor of French history at Cambridge, attempts to provide an “objective historical” account of “how Brexit happened, and why”. He argues that Britain, as a series of islands dependent on trade and defended by a sea border, has always had an “instinctively different” attitude from the rest of the world and a less troubled history than those of the…

• What is going on with celebrity fashion lines, asks Jan Moir in the Daily Mail – those “launched by image-conscious stars amid a great hullabaloo, only to turn to bargain-rail dust a few seasons later”? Fenty, by singer Rihanna (pictured), has just been suspended by Louis Vuitton after only two years – not surprising when she charges £600 for a khaki cotton dress and £250 for a “silly old shirt”. Fans might love Rihanna’s music, “but that does not mean they are completely stupid”. Beyoncé, too, has posed in some “eyeball-razing” outfits for her Adidas x Ivy Park range, “most of which seem to be fashioned from toffee-coloured patent leather”. We may all be going mad in lockdown, but “not so mad that women want to take to the…

“Janet Yellen is our Treasury secretary. She knows a little something about inflationary risks,” Jared Bernstein, a member of America’s Council of Economic Advisers, reassures us. But relying on Yellen, a former head of the US central bank, to protect us from inflation is asking for trouble. August 2020 could turn out to be an important date. Since then, bond yields – an important early warning of incoming consumer-price inflation – have been going up. The yield on the ten-year Treasury, for example, has more than doubled from its August 2020 rate of 0.52%. After 40 years of lowering inflation and bond yields, the tide may have turned. “After 40 years of lowering inflation and bond yields, the tide may have turned” According to the classic Quantity Theory of Money,…

735m The cost in Emirati dirham (£148m) of the United Arab Emirates’ mission to send the first interplanetary probe from an Arab nation to Mars. Named al-Amal (Hope), it successfully entered orbit around the red planet last week. £117m The shortfall in funding that the BBC is facing this year. A “hardcore” of around 750,000 television viewers aged over 75 are refusing to pay £157.50 for an annual TV licence, says the Sunday Mirror. Free licences for over-75s were scrapped last August. $860bn The total value of all bitcoins in circulation last week, according to data firm CoinMarketCap. That is more than the value of all 58.6 trillion Russian roubles in the world, worth around $792bn, and of Mexican pesos, worth $530bn, says The Daily Telegraph. £6,248.20 How much an…

Hollywood resident Aaron Epstein had spent hours on the phone to customer services regarding his slow internet service, says Jamie Johnson in The Daily Telegraph. After internet provider AT&T did nothing to help, the 90-year-old – whose service was so bad that trying to stream a film on Netflix was “like watching a slideshow”, he said – decided to pay $10,000 for an advertisement in The Wall Street Journal. It was an open letter to John Stankey (pictured), CEO at AT&T, condemning AT&T’s service “for the people who live in N. Hollywood, CA 91607”. Epstein pointed out the fastest speed offered in his neighbourhood was only 3MBS, compared with the 100MBS the firm offered for other neighbourhoods and the 200MBS rivals offer. Epstein is “not a frivolous spender”, but the…

Inflation or deflation? Investors have spent the last few months piling into assets that stand to gain from a vaccine-enabled global recovery. “Frothing” commodity prices should bring higher inflation, but signs remain scant in official figures, says Albert Edwards of Société Générale. US core consumer price index (CPI) inflation, which strips out volatile food and energy prices, came in at 0% in January compared to a month before. In China, year-on-year core CPI slipped into outright deflation for the first time since 2009. “The global reflation trade may well have got ahead of itself.” Inflation is coming “The only way is up” for prices in America, says James Knightley of ING. Figures over the next few months will come in much higher because of base effects – the comparison period…

“The Fed… has limited ability to influence long-term interest rates. Quantitative easing is one way around this limitation… A more direct method is outright ‘yield curve control’, or YCC…Under YCC, the Fed would announce it wants, say, the ten-year Treasury yield... to be x% and then use its unlimited buying power to purchase as many bonds as necessary to achieve this… Several central banks are already using it and... the Fed [may well] join them… I can’t imagine how this ends well. US Treasury yields are the benchmark for all kinds of other financial asset prices. If they aren’t floating freely, the entire global economy is basically one giant price control. The result… will be widespread resource misallocation and asset mispricing. And eventually a ‘repricing event’ that will make the…

Five to buy Unilever Shares Magazine Shares in Unilever have been “out of favour” since November, when the market began to prefer value stocks to “expensive defensive” companies such as the consumer-goods giant. Disappointing full-year results released in early February have also dampened sentiment, but this dip presents the best buying opportunity in a year. Over the past decade the stock has delivered a 204% return compared with 71% from the FTSE All-Share index. Its products are in demand “in both good and bad economic conditions”; and “it is delivering on positive environmental, social and governance factors”. Buy. 3,974p DS Smith Mail on Sunday One of the largest listed companies in the UK, paper and packaging group DS Smith’s half-year figures were affected by the pandemic. Sales declined, costs rose…

• Virgin Wines has decided to take advantage of the “relatively buoyant stockmarket” to list on Aim, says Ben Martin in The Times. The move looks well timed: “the closure of pubs, bars and restaurants” means that people “have to drink at home”. The company, which could be valued at around £100m when it floats, claims that it had 169,000 customers and delivered more than one million cases in 2020 . Still, it faces stiff competition from Naked Wines, another subscription-based London-listed operator. • Thanks to a battle between retail investors and short-selling hedge funds, shares in retailer GameStop began 2021 at $18 and peaked at $483 in January, says Lex in the Financial Times. They have since fallen back to $50, but this still looks too high. GameStop “has…

An “unprecedented cold snap” in the US has transformed the “once dull” US electricity model into a political “live wire”, says Lex in the Financial Times. The state of Texas’s laissez-faire approach is under scrutiny after a “spate of blackouts” cut power to millions of homes and businesses even as temperatures plunged to –18˚C. Consumers in most states buy power from a regulated monopoly, but Texas allows citizens to readily switch among “retail” providers, which buy power from producers. This system has generally worked well, but is being blamed for the current chaos. Providers, faced with soaring prices for what little electricity isavailable, have simply decided to cut supplies. Texas’s market-driven approach has resulted in the past in a smaller margin of safety when demand has peaked compared with states…

• AstraZeneca’s French chief executive Pascal Soriot (pictured) received a base salary of £1.29m, an annual bonus of £2.3m and payouts under a long-term incentive scheme worth £11.1m for 2020, says the Financial Times . Future payouts could swell his £15.4m package even further after a year in which he oversaw the launch of one of the world’s most promising coronavirus vaccines. His total pay is197 times that of the Cambridge-based company’s median worker, and rose by £140,000 from 2019. Soriot is also due to receive a 3% salary rise for this year. • Ocado boss and co-founder Tim Steiner will be granted 2.45 million shares in the online supermarket, worth around £66.2m. His will be the biggest share of a bonus scheme that will award a total of £116m…

Put simply, liquidity refers to how easy it is to buy or sell an asset without moving the price against you. For example, property – both residential and commercial – is an illiquid asset. It takes a long time to buy or sell, trading costs (from stamp duty to surveys) are high, you can never be quite sure of the price you’ll get (or pay) until the deal has closed, and if you want to sell in a hurry, you’ll have to cut your price to well below the theoretical “market value”. On the other hand, shares in big, listed companies (“blue chips”) on the FTSE 100, for example, are very liquid. They are also “fungible” –ie, one share is the same as another, whereas each property is unique –…

The most lucrative part of the hearing-care market is cochlear implants, a subsector currently dominated by Cochlear Limited (Sydney: COH), which accounts for half the market. Cochlear has not only been a “good performer over the last 20 years”, but is also likely to remain “an attractive longer-term growth investment”, says Alex Hunter, global-equity analyst at Sarasin & Partners. While it trades at 41 times 2021 earnings, this multiple is justified by the strong growth rate of the underlying market for cochlear implants as well as the “annuity-style business” from the servicing and maintenance of past implants. Another major player in the hearing-aid market is GN Store Nord A/S (Copenhagen: GN). The company has two major subsidiaries: GN Hearing, which deals with hearing aids, and GN Audio, which makes money…

■ Disgraced fund manager Neil Woodford is back with a new firm, Woodford Capital Management Partners, says Lucy Burton in The Sunday Telegraph (see page 16). He has “vowed” not to repeat the errors he made at Woodford Investment Management. At its peak, the firm oversaw £10.2bn. But Woodford’s main open-ended fund had invested heavily in illiquid stocks and in June 2019, after poor returns had triggered an investor exodus, it was forced to stop withdrawals due to an inability to sell assets quickly enough to raise the money. In October, Woodford was sacked by fund administrator Link Fund Solutions, and the process of winding the fund down to return investors’ cash began. But his original investors lost more than 25% of their money, and around £200m is still tied…

fee.org Hyperinflation, US sanctions and rising unemployment have led to a “surge” in emigration from Venezuela, says Toni Allen. This in turn has increased flows of remittances – in 2019 around $4bn flowed back into Venezuela from abroad. However, these often lose value if sent using traditional means. “In the face of these troubles, Venezuelans have turned to bitcoin.” Venezuela is now one of the “most rapid adopters” of cryptocurrency in the world. Venezuelans use them to buy food, medical supplies and everyday purchases. There are around 20,000 point-of-sale terminals accepting bitcoin as payment. The government too has seen their value as they help it circumvent sanctions –it plans to hold cryptocurrency reserves rather than oil and has launched its own state-backed versions of digital money. Such acceptance by the…

■ The choice for savers at retirement is usually presented asbinary: they either use their pension funds to buy an annuity offering a guaranteed income for life, or they take out a drawdown plan, leaving their savings invested and drawing a pension income directly from it. Increasingly, however, financial advisers are arguing in favour of a hybrid approach that combines the two, something that is entirely in line with pension rules. The idea is simply that savers use part of their pension funds to buy an annuity income that covers their basic living expenses in retirement; this guarantees their financial security. The rest of the fund is then moved into a drawdown arrangement and invested as the saver sees fit. They can draw income as and when they need it…

Norwegian Cruise Line Holdings (NYSE: NCLH) is the third-largest cruise line in the world by passenger numbers. Its brands offer itineraries to over 490 destinations worldwide. The pandemic has almost sunk the industry. Norwegian announced its third-quarter results in November, reporting an increase in debt from $6.8bn at the end of 2019 to nearly $11bn, says Jonathan Heller on Real Money. The company is likely to have to borrow even more now that it is not clear when things will return to normal. The stock has slumped by 56.2% in 12 months.…

Attract the wildlife Take up bird watching from the comfort of your home with this stylish bird table. The Glendale is constructed from high-quality timber and has a large feeding area to allow many birds to feed at the same time. The overhanging roof protects the food in wet weather. Just put some food out and get your binoculars ready. £89.99, birdfood.co.uk A dash of colour on the patio Treat your plants to a luxe new home this spring. These terracotta flower pots from Arket come with a matching saucer and built in drainage. They’re glazed to prevent dampness on the surface where the pot is placed, and are available in different colours and sizes. £45 for 22cm pot, arket.com An elegant water feature Add a touch of flair to…

The luxury watch market has more than doubled in size to £17bn since 2000, and the pandemic hasn’t hurt demand, says Richard Godwin in The Sunday Times. Apparently the rise of “revenge spending” – “impulse buys to make up for the loss of other pleasures” – amid lockdown has turned into a huge driver of online sales for Swiss manufacturers. An eight-year-old border collie named Lulu has become “a newly minted millionaire” after her 83-year-old owner left her $5m in trust, says Cole Higgins on CNN. Businessman Bill Dorris, who died late last year, specified in his will that the trust is to provide for all of Lulu’s needs. His friend Martha Burton will be reimbursed for “reasonable monthly expenses” to care for the dog.…

Medical-diagnostic group Hologic has been a “Covid-19 beneficiary”, but it stands to benefit from the post-pandemic environment too, says Evie Liu in Barron’s. Its molecular-diagnostic equipment for Covid-19 tests largely explains why overall sales are set to reach $5.8bn in the year to October 2021, a 53% jump on last year. Investors fear that the boost from Covid-19 testing will fade with the pandemic. Yet now that Hologic has expanded its presence in labs and hospitals it is “likely to stay there... its automated testing is simpler than mixing and matching products from different companies”. The group also specialises in products for breast health and osteoporosis.…

The City has been dealt a “symbolic blow” after the latest data revealed that Amsterdam eclipsed London as Europe’s largest share-trading centre in January, says Kalyeena Makortoff in The Guardian. Amsterdam, “previously the sixth-largest exchange centre in Europe”, saw average daily trading surge from €2.6bn to €9.2bn in January as exchanges “shifted order books abroad after Brexit”. London is now in second place, “with average daily trading halving from €17.5bn to €8.6bn last month”, according to the Chicago Board Options Exchange. The figures aren’t as bad as they look for the LSE Group (which owns the London Stock Exchange), says Jill Treanor in The Sunday Times. After all, much of the additional volume hasn’t gone to Amsterdam’s main exchange, but to the Turquoise platform, which is part owned by the…

Support for Welsh independence is on the rise. A year ago, the pro-independence campaign YesCymru had 2,000 members; it now stands at more than 15,000, outstripping the membership of every Welsh political party. In 2020, Yes support grew from 27% in a poll for ITV Cymru and Cardiff University in January to 32% in the summer. “As the cost of Brexit rises,” damaging fishing and farming sectors, “support will surely increase,” says Simon Jenkins in The Guardian. Adam Price, the leader of nationalist party Plaid Cymru (pictured), points out that this mirrors the situation in Scotland ten years ago, where a majority now support independence. The devolution of lockdown policy has clearly emboldened Wales. Even if Welsh first minister Mark Drakeford’s performance has been deemed poor, it at least shows…

With Donald Trump’s impeachment trial over, the focus is now very much now on the current president, Joe Biden (pictured). At the moment he is experiencing something of a honeymoon, at least relative to his predecessor. Trump spent virtually all of his presidency with an approval rating below 50%; Biden currently has an average approval rating of 54.8%, and an average disapproval rating of 37.4%, according to Nate Silver’s FiveThirtyEight website. The question is how long this will last. Smarkets is running a market on Biden’s approval rating, as measured by FiveThirtyEight, on day 100 of his presidency (29 April). With £2,073 matched, punters are expecting the approval rating to be in the range 50%-54.99%, which is the favourite at 2.74 (36.4%).  An approval rating of 55%- 59.99% is in…

The 15 highest-earning hedge-fund managers in the Bloomberg Billionaires index collectively made an estimated $23.2bn in fees in 2020, “a year that will loom large in the annals of Wall Street”, say Tom Maloney and Hema Parmar on Bloomberg. That’s “more than enough money… to buy GameStop, two AMC Entertainments and four Bed Bath & Beyonds. Not shares –those darlings of the r/wallstreetbets crowd – but the entire companies.” Chase Coleman of Tiger Global was the biggest winner, personally gaining $3bn in 2020, followed by Jim Simons of Renaissance with $2.6bn, and Izzy Englander of Millennium with $2.2bn. “That 15 people – all of them men – could earn so much so quickly starkly illustrates the widening rift between the ultra-rich and everyone else at a time of heightened unemployment…

James Henderson, who (with Laura Foll) manages the Henderson Opportunities Trust and the Law Debenture investment trusts, as well as the open-ended Janus Henderson UK Equity Income & Growth fund, is a fan of UK banks. “I like all the UK domestics,” he tells Citywire’s Michelle McGagh. A management change at NatWest “has been really positive“, while “Lloyds has a great franchise and Barclays is a great business and broader than the other two”. Henderson plans to boost the share of the funds invested in the banking sector to more than 10%. Why? He expects that rising inflation expectations and the resulting increase in long-term bond yields should be good for the sector, particularly as the economy recovers. “Banks will lend to companies that will need more working capital... and…

The trebling of the S&P 500 index in the last ten years has left the US market accounting for 57% of the MSCI All Countries World index. Much of this outperformance is justified by strong domestic growth, international expansion, rising margins, lower taxes and, above all, America’s record of innovation – but, arguably, not all of it. The earnings multiple of the World index, based on forecast earnings for 2021, stands at nearly 20 but that of the S&P 500 is at 22.5, the highest since 2001. The rest of the world averages out at 16. Value in the wider market That has prompted many to conclude that the US market is overvalued. Priyesh Parmar of brokers Numis, however, points out that smaller companies have been left behind. Though the…

We must close the digital divide Gillian Tett Financial Times The pandemic has exposed the cruelty not only of economic and social divides, but also digital divides, says Gillian Tett. Children without access to “good Wi-Fi, innovative schools and reliable computing equipment” have struggled in ways that could “put them at a disadvantage for years”. The easiest solution is to provide equipment, but Western governments have been “lamentably slow” to respond. The idea isn’t even new. In 2005 the academic Nicholas Negroponte founded the One Laptop Per Child (OLPC) project, whose mission was to sell cheap, rugged, low-power devices for just $100 a device. The project foundered in 2014, but its ethos now seems “highly pertinent”. Even better, the cost of laptops has fallen to $50 – “if only the…

theguardian.com “An empty Debenhams”, a closed “Marks & Spencer, an abandoned New Look”: the town centre of Stockton-on-Tees looks much like high streets up and down the country, says Oliver Wainwright. But it has a bolder plan than most for how to cope with the “post-retail”, “Covid-19-stricken” era. It plans to demolish half the high street and replace it with a park. The government asked for a transformational proposal, says councillor Nigel Cooke. “If this is not transformational, I don’t know what is.” The plan is to knock down an ailing shopping arcade and multi-storey car park and replace them with a riverside park providing “ rowing, sailing and waterside promenading along the Tees”. The future “is not more shops”, says Cooke. “It’s about leisure, culture, events and recreation, and…

The last few months of the tax year are known as Isa (individual savings account) season thanks to the sheer volume of people who wait until the last minute to use up their tax-free allowance. Anyone over the age of 16 can deposit up to £20,000 into a cash, stocks-and-shares or investment Isa every tax year. Once the money is in an Isa it can grow free from any risk of having income tax or capital gains tax deducted. But, unlike other tax allowances, unused Isa allowances can’t be rolled over into the following tax year. Use it by midnight on 5 April or lose it. “Demand for cash Isas has fallen since the personal savings allowance arrived” In the last hour before midnight on 5 April 2020 a stocks-and-shares…

History may look back on 2020 as a transformational year for Aim, London’s junior stock exchange. Analysts were expecting a torrid year amid the pandemic and uncertainty over Brexit. Yet by the summer, Aim had fully recovered its initial losses and on 31 December it was far higher than where it began the year. Moreover, firms on Aim raised £5.76bn from investors last year, a 50% rise on 2019. Aim is also maturing. Today there are 23 companies valued at over £1bn; in 2015, there were just three. Free from IHT “Customers of Calnex Solutions include Vodafone, Google and Cisco” Note too that there are generous tax reliefs available on Aim. Certain stocks are inheritance-tax free if you hold them for two years and still hold them on your death.…