Innehållsförteckning för 1138 från MoneyWeek

“Tune out most of the financial news: it hypes us up and makes us trade too much” There is never just one cockroach; nasty surprises often come in pairs or packs. So after one of the worst years for investors in decades, which saw global stocks lose a fifth of their value and both US stocks and bonds fall by more than 10% for the first time since at least the 1870s, could we be in for another awful year? History, cockroaches notwithstanding, suggests not. US stocks, which set the tone for world markets, have only slipped for two successive years on four occasions since 1928: in the Great Depression, World War II, the 1970s oil crisis, and the bursting of the dotcom bubble. To gauge what might lie ahead,…

“Economic downturns are usually horrible for poor people... and an inconvenience for the rich. But if the [US] economy enters a recession in 2023… it might be the well-heeled who take a bigger hit… for many poorer people, the years since [Covid-19] have been a bit easier financially than the years that preceded it. Several rounds of government relief helped them weather the early stages of the pandemic… now a tight job market is providing them with wage gains… the net worth of households in the bottom fifth by income was 42% higher in the third quarter than at the end of 2019, and up 17% from the end of 2021… [By contrast] household net worth for the top fifth was… down 7.1% from the end of 2021 – a…

Shares in Standard Chartered surged by 20% last week when news broke that First Abu Dhabi Bank had recently hired Citigroup and Moelis to explore potential takeovers, with the 169 year-old British bank considered a “prime target”, say Stephen Morris and Emma Dunkley in the Financial Times. While First Abu Dhabi Bank ultimately decided against making a bid, StanChart’s shares remained 7% higher as the story seems to have “awakened animal spirits” around the company. Many analysts consider StanChart to be “one of Europe’s most undervalued banks” on a 60% discount to book value. First Abu Dhabi, partly owned by the emirate’s wealth fund, may try again sometime in the near future, says Karen Kwok on Breakingviews. Buying StanChart would not only be cheap, but it would also have “strategic…

Ocado was the FTSE 100’s worst-performing stock last year as an easing of Covid-19 rules reacquainted shoppers with “the joys of trolleys... and orders to remove items from the bagging area”. But with few competitors in the field of robotic warehouses and scope to keep selling its technology to new overseas partners, the shares still have “huge potential” (718p). Microsoft took a 4% stake in London Stock Exchange Group last year as it seeks to diversify its cloud tech offering. Investors would be well advised to follow this vote of confidence (7,214p). Caught between China and the West, shares in HSBC trade on just six times forward earnings. Yet with interest rates rising and early 2023 set to deliver a boost from China’s reopening, this year at least could be…

Politics & economics Prince Harry’s memoir, Spare, with its “intensely personal recollections”, is far more than a “celebrity knockabout story” and could “mark the beginning of the end of the monarchy”, says Catherine Mayer, a biographer of King Charles. It is about the “status of a significant institution of state, with significant powers and significant taxpayers’ funding”. Talking to The Guardian, she adds that the members of the royal family have become our “proxies for anger” about racism, misogyny, wealth and inequality, and unless these issues are properly addressed, they could “undermine the basis of the consent” by which the royal family rule. Mayer isn’t the only expert warning that this is the “gravest crisis” facing the monarchy since Princess Diana’s death in 1997, when the Queen was criticised for…

During the pandemic the election for London mayor ended up being postponed by a year from 2020 to 2021. The date for the next election wasn’t put back, however, so in less than 18 months Londoners will be returning to the polls. Having served two terms in office, there was some speculation that Sadiq Khan might return to Westminster politics, instead of running for a third term. But at the end of last year he confirmed he would run again, and was officially selected as Labour’s candidate. Punters seem convinced Khan will be re-elected. With £4,394 matched on Smarkets he is favourite at 1.27 (78.7%) . Surprisingly, Jeremy Corbyn is in second place at 11.5, with Brent MP Dawn Butler at 12.5 (8.7%). Fellow Labour MPs David Lammy and Sam…

It was probably only a matter of time. Last Tuesday, with its shares under pressure amid reports of slowing sales in China, and production snags along its supply chain, Apple’s market value fell back below $2trn for the first time since breaking through that barrier back in 2020. It had already dropped out of the “three trillion club”, a select group it joined this time last year, and now it is out of the “two trillion” one as well. It may bounce back above that level from time to time when the market rallies. But with little innovation left in smartphones, with its app store under regulatory scrutiny, and with little sign of new products emerging, it is hard to see Apple staying in the club for long. It is…

Inflation is the rise in the general level of prices in an economy (or a sector of an economy) over a given period of time. Alternatively, it is sometimes defined as the decline in the purchasing power of each unit of money, which amounts to the same thing. Inflation is usually measured by looking at the change in a price index that is based on the average prices of a basket of goods and services. Typically we look at the year-on-year inflation rate (eg, the change in the price index between May this year and May last year), or the annualised rate over longer periods (eg, if the price index is up by 9.3% over three years, that’s an annualised inflation rate of 3%). When we talk about inflation in…

“I’m a spender and my wife’s a saver. She’s the financial brain – or the financial worrier. I leave it all to Kath. I get bored of it, and I get told off for being bored. I have pocket money that I spend on watches.” Cricketer Ian Botham (pictured), quoted in The Sunday Times “There are too many boards who sit pretty on ridiculously high salaries of which they are not worthy… That is prevailing in the big companies in Britain. There are very few boards that seem to be worth the… big bucks paid out to them.” Peter Hargreaves, founder of broker Hargreaves Lansdown calling for his old firm to slash costs and change its strategy, quoted in the Financial Times “Spend it now, enjoy life. Mostly I’ve spent…

nber.org/digest As of 2020, nearly 20% of the world’s airports had been privatised. That has been a boon for the owners – particularly when they are private-equity funds – and for customers too, says Laurent Belsie. A new working paper by economists Sabrina Howell, Yeejin Jang and co-authors shows that, between 1996 and 2019, airports owned by private-equity funds improved performance in many areas. A key metric of efficiency is passengers per flight. The more customers an airport can serve with existing runways and gates, the more services it can deliver and the more earnings it can generate. When private-equity funds buy government-owned airports, this measure rises by an average of 20%. Overall passenger traffic, freight volumes and the number of flights show a similar pattern. A private-equity acquisition is…

US theme-park operator Six Flags Entertainment has been targeted by activist investor Land & Buildings, which wants it to sell and lease back its real-estate portfolio, says Barron’s. Land & Buildings, which has built up a 3% stake, argues that selling off the firm’s real estate could boost its share price by as much as $11 from the current level of around $24. Six Flag’s shares fell by almost half last year as it struggled to implement a turnaround programme that involves raising admission prices and shifting away from being “cheap daycare centres for teenagers”, as CEO Selim Bassoul told investors in August. Six Flags’s largest investor is H Partners, another activist hedge fund, which has also increased its stake in recent months and now holds around 13.7%.…

Governments haven’t always looked kindly on the Institute for Fiscal Studies (IFS), the economic think-tank. Its frequent brutal assessments of budgets and spending plans have left ministers reeling. Pension experts will therefore hope that this government does not feel inclined to act on the IFS’s assessment of the rules relating to inheritance tax (IHT). The “overly generous tax treatment of pension pots at death needs to be swiftly ended”, the think-tank argues in a new report. There is certainly no denying the generosity the IFS refers to. When you die, any money left in your pension can usually be bequeathed to your heirs entirely free of IHT; the money sits outside of your estate for the purposes of calculating any tax that’s potentially due. Moreover, if you die before reaching…

UK equities are universally hated by fund managers and investors around the world. However, in every crisis, there are always opportunities. Real-estate investment trusts (Reits) seem to have borne the brunt of investors’ pessimism. Indeed, some are now trading at discounts of 50% to their reported net asset values (NAV). In some cases, these discounts seem warranted, but in others it looks as if the market has overreacted. Don’t take the numbers at face value Supermarket Income REIT (LSE: SUPR) reported a NAV of 115p per share at the end of its fiscal year in June 2022. With the shares trading around 101p at the time of writing, the stock is trading at a discount of around 12% to this figure. Now, relying on a company’s reported NAV without considering…

My seven long tips have fared well over the past few weeks: six have risen. Construction firm Ashtead rose from 4,906p to 5,058p, retailer Dunelm increased from 947p to 1,020p and luxury clothing-retailer Burberry advanced from 2,147p to 2,216p. Builder DR Horton also appreciated, from $86.80 to $93.33, telecoms operator Gamma Communications increased from 1,038p to 1,097p, while Savills advanced from 814p to 824.5p. The only exception was streaming service Netflix ,which dipped from $320 to $315. My long tips are making collective net profits of £2,798, up from £2,127. My short tips also did well, with three out of four moving in my favour. Digital currency exchange Coinbase fell from $40.24 to $38.20, while electric-vehicle charging station maker EVgo declined from $5.57 to $3.87. Realestate investment trust Digital Realty…

Video-streaming television box-maker Roku (Nasdaq: ROKU ) has seen its share price plummet amid the slowing pace of growth in streaming subscriptions following the end of pandemic-induced lockdowns, says Forbes. Rising interest rates and a deteriorating macroeconomic environment, meanwhile, have dented both demand from consumers and advertising revenue. Supply-chain difficulties in its streaming hardware pipeline haven’t helped either. Roku expects sales in the fourth quarter of 2022 to have dropped by 7.5%, while costs are soaring. The stock has slumped by 79% in a year.…

We recently rearranged a cross-Channel trip to avoid a storm. Steering around the coming storms in markets will prove trickier. Reading the news, we find many “predictions for 2023”. The consensus is that inflation will relent, the US Federal Reserve will “pivot”, or at least swing around to less of a “tightening” programme, and stocks will end the year higher. A couple of caveats. US stocks were down about 20% for the year, but Turkish ones rose 110%. What made the Istanbul market suddenly worth twice its value? A return to the free market? New inventions? A booming economy? None of the above. Instead, an inflation rate of 85% caused Turks to seek shelter in equities. “There is a lack of alternatives,” said a sage in Istanbul. In other words,…

Heavy metal group Iron Maiden is joining the select list of musicians to appear on British postage stamps, says BBC News. Royal Mail has released a collection of 12 stamps, four of which show Eddie, the band’s iconic monster mascot. Eddie, who has appeared on all Iron Maiden’s album covers, features in various guises, including one (pictured) as a soldier during the Charge of the Light Brigade in the Crimean War for the 1983 single The Trooper. The other stamps feature pictures of the band on tour between 1980 and 2018. The set of four Eddie stamps will cost £5.60, while the set of eight is priced at £11.70. Iron Maiden has sold more than 100 million records, including Bring Your Daughter to the Slaughter, which was the number-one single…

The FTSE 100 has hit a four-year high as global financial markets enjoy a strong start to the year, says August Graham in the Evening Standard. “Fresh optimism has flowed into the index after the dismantling of Covid restrictions in China”, as Susannah Streeter of Hargreaves Lansdown points out. This has given airline stocks a welcome tailwind. “Expectations of higher demand for commodities in China have [also] helped lift mining and energy” shares. Meanwhile, “the tech-light nature of the FTSE 100 means it’s more immune to the uncertainty still hovering around the prospects for the tech sector”. The London bluechip index is up about 2% since January 1. Despite the FTSE 100’s relative strength of late, UK equities still “look cheap”, says Ben Russon of fund manager Martin Currie. The…

The Bank of Japan doubled the upper limit on its target band for the ten-year Japanese government bond from 0.25% to 0.5% late last year. Japan had been the last major holdout against tighter monetary policy, but the yield adjustment has been compared to an interest-rate hike, with local bond yields rising in response. Tokyo’s retreat from easy money draws a line under the era of negative-yielding bonds, says Tommy Stubbington in the Financial Times. Sub-zero yields occur when bond prices are bid up so high that “buyers holding them to maturity are guaranteed” a loss. The global stock of such bonds peaked above $18trn in 2020 – equivalent to more than a quarter of global fixed income. It has now fallen to zero for the first time since 2010.…

At the end of last week, retailer Next “helped to reinvigorate the embattled retail sector with a strong Christmas trading update”, says Isabella Fish in the Times. The bellwether of the high street said full-price sales had risen by 4.8% year on year in the nine weeks to 20 December, resulting in projected pre-tax profits for the full year of £860m. The good news was much more encouraging than CEO Simon Wolfson’s previous prediction, made in August, that the cost-of-living crisis would mean that “shoppers were likely to rein in their festive spending”. The shares jumped by almost 8%. Next may have benefited from the fact that “customers turned out in droves for warm weather gear after a December cold snap”, but if you look closely the update wasn’t all…

Barron’s Costco’s shares have had a bumpy 12 months owing to fears about lower consumer spending, but the warehouse-store giant has long shown itself able to “zig when the rest of retail zags”. Membership fees provide a “steady source of revenue” and the group’s loyal customers will continue coming back for its “bargain-priced goods”. On a price/earnings (p/e) ratio of about 36, the shares trade at a significant premium to retail rivals, but that is justified by Costco’s excellent record of earnings growth and robust returns on equity. Buy ($462). Interactive Investor The shares in high-street retailers may have bottomed out in October, but the jury is still out on what lies ahead for the sector after the traditional Christmas splurge. B&M European Value Retail’s cost-conscious positioning means it shouldn’t…

● Conditions for insurers “are going from bad to worse”, says Russ Mould of AJ Bell. This week, Direct Line scrapped its dividend, even after CEO Penny James said in August that she was “confident in the sustainability of our regular dividends”. The shares plunged by a quarter in response, sparking a wider sector sell-off. An increase in subsidence claims from the hot summer has been followed by higher road-accident and burst-pipe claims from the icy winter. “This is all beginning to sound like the train operators who complain about the weather either being too hot and the sun bending the rails or too rainy or windy which puts leaves on the line. Where’s Goldilocks when you need her?” ● Asos looks “as squeezed as one of its bustier dresses”,…

This will be “the decade of the roller-coaster market”, says Felix Zulauf, a former hedge-fund manager who specialises in global macroeconomic trends. “It will be horrible for passive investors with a 60/40 portfolio [of stocks and bonds], which was so good to them for the past 15 years. If you don’t want to end up with very poor returns, you have to time the cycle.” The next ten years will be characterised by high volatility, driven in part by shifts in geopolitics, Zulauf tells Barron’s. We can expect the world to evolve into two major blocs, led by the US and China respectively, with huge consequences for trade between them. “I think we deglobalise for… the next 10 years. That means the world will get less efficient and more inflationary.…

idlewords.com There was a time when getting to Mars, a current goal of US space agency Nasa, made sense, says Maciej Cegłowski –back when astronauts were a “cheap and lightweight alternative to costly machinery”. But 50 years of progress have changed that. Despite the presence of a $250bn laboratory on the International Space Station (ISS), every major discovery made in space this century has come from robotic spacecraft. Whether you consider the project from the point of view of the cost (something north of half a trillion dollars), the hostile environment for human life (the ISS crew spend most of their time fixing the machinery that keeps them alive), or the risk of microbial contamination (which Nasa is required by treaty to avoid), the bottom line is that even if…

■ Private investors who use the Fidelity fund platform have been blocked from making new investments in Jupiter’s struggling UK Mid Cap fund “amid industry concerns over the proportion of unlisted companies it holds”, says The Telegraph. The £1.2bn fund, which invests in mid-sized UK firms, holds both listed and unlisted shares, but since it is an open-ended fund, holdings of unlisted stocks must not exceed 10% under Financial Conduct authority rules. Over the past three years the fund has dropped by almost 30%; since these declines have mostly been driven by falls in the value of listed stocks, unlisted shares have become a greater proportion of its total value. The most significant of these is an investment in Starling Bank, which was 5% of the portfolio at end November,…

Monday 9 January was Divorce Day: the first post-holiday Monday, when divorce lawyers see a jump in enquiries as couples end their relationship after a stressful Christmas. The first thing to consider is the cost of the process. There is a £593 fee for filing for divorce, as well as a £232 fee if arrangements for children need to be put in place. If you go to court, hourly lawyers’ fees can be as high as £410. Going through mediation may be cheaper and faster. You can find a mediator to discuss the options with you through the Family Mediation Council (FMC). FMC-registered mediators charge an average of £140 per person per hour. Another alternative is arbitration, where an independent arbiter is appointed to make a binding decision on the…

A decade after it introduced the “auto-enrolment” pensions system, the government is proud of its success. Now that all employers must offer an occupational pension scheme, and automatically enrol all employees other than those who deliberately opt out, ten million extra Britons are putting cash by for retirement. But pension experts worry that auto-enrolment’s biggest success will also be its biggest failure. Millions of savers now contributing to pension schemes think they are heading for a comfortable retirement. But they are likely to be wrong. The minimum auto-enrolment contribution is 8% of salary, with 5% and 3% of that coming from employers and employees respectively. That simply isn’t enough. Figures from pension provider Aegon suggest that the average 22-year-old saving until age 68 at a rate of 8% a year…

Last year was one to forget for many investors, especially for those who bought shares that had soared during Covid-19. One formerly high-flying company that has seen its stock clobbered over the past 12 months is Live Nation (NYSE: LVY). Live Nation was formed from the merger of two ticketing companies a decade ago and makes its money organising box-office sales for live events. As you might expect, its shares collapsed in March 2020, only gradually recovering towards the end of the pandemic. The shares regained their pre-Covid level by late 2020. The firm benefited from a surge in sales as normal life resumed, so the stock kept rising and peaked at 60% above its pre-pandemic level last February. Since then the shares have fallen back by 40% from their…

The Aberdeen Diversified Income and Growth Trust (ADIG) is dynamic, disciplined and, of course, diversified. Our mandate provides significant opportunities: the public capital market includes equities, fixed income and credit across developed and emerging markets. We also invest in private capital markets, which include private equity, venture capital, real estate, infrastructure, private credit and natural resources worldwide. We seek to invest for five years or more. Having a broad mandate comes with the requirement to be disciplined. Understanding the risk associated with each asset class and investment idea is essential. The process involves macroeconomic research into sectors and markets and picking what we believe are longer-term resilient business models, particularly in private markets, where we use a thematic approach based on technology, demography and sustainability. Finally, being genuinely diversified is…

The new GranTurismo Folgore, meaning “lightning” in Italian, is the crucial next step in Maserati’s electric future, says Steve Sutcliffe in AutoExpress. That’s because the powertrain that sits beneath its “elegant new nose”, and from there runs the length of its aluminium floor, will come to be the only one available in Maseratis once petrol-powered cars have “left the building sometime within the next decade”. Until then, the electric Folgore will go on sale alongside V6-engine versions of the all-new GranTurismo. “So, Maserati needs to get this right, no excuses.” Inside, it’s so far so good. The leather is soft and looks “well stitched together”, says Matt Prior in Autocar. “It feels very luxurious.” From a knob on the steering wheel you can choose to drive in either “max range”…

Another DAO (decentralised autonomous organisation, see last story, left) had rather more success in February. AssangeDAO, made up of around 10,000 supporters of Julien Assange, the Wikileaks founder, raised $54m to buy anonymous crypto artist Pak’s Clock – an non-fungible token (NFT) digital artwork that counts the number of days since Assange was arrested in 2019. The DAO’s winning bid of 16,593 ether (a cryptocurrency then worth $52m) made Clock the second-most expensive-ever NFT after Beeple’s $69.3m The First 5,000 Days, sold in 2021. The proceeds went towards funding Assange’s legal fees. Alas, Spice DAO was far less fortunate. In November 2021, the collective of fans of Frank Herbert’s 1965 sci-fi novel Dune paid €2.7m – 100 times the low estimate – for a copy of Alejandro Jodorowsky’s Dune –…

£4.5bn The total value of customers’ credit that energy firms are sitting on, up from £1.4bn last spring as utilities firms have sought to increase their financial buffers amid the energy and cost-of-living crises, says The Mail on Sunday. Two-thirds of households are in credit. ¥36m How much in Japanese yen (£224,000) a single bluefin tuna fetched at a New Year’s fish market auction in Tokyo, doubling last year’s highest bid. Tuna prices are considered a barometer for the health of the Japanese restaurant sector, says The Times. £1,023 The average cost per household of running baths over the course of 2022, up from £303 in 2021, according to Yorkshire Water. Boiling the kettle for tea was 80% dearer last year, equivalent to an extra £8.32 a year, and it…

So much for the “roaring Twenties”, says Larry Elliott in The Guardian. This decade started with bold predictions that the global economy would throw off its post-2008 torpor to usher in “a flowering of new technologies and a colossal boom”. Instead, we face the second recession in three years, with “just about every” economic indicator flashing red. The US can borrow money more cheaply for ten years than for one year, a phenomenon known as an “inverted yield curve” that has been a reliable omen of recession for decades. A short decline so far Bulls are hoping that markets, at least, are already over the worst, says Tom Stevenson in The Telegraph. Stocks have bounced since hitting a recent bottom in October. The argument runs that because stocks run ahead…

Shares in China’s e-commerce giant Alibaba surged by 8.7% early this week on hopes that “the page has finally turned” for Chinese technology stocks, says Bloomberg’s Jeanny Yu. A top central bank official said a multi-year regulatory clampdown that has made the industry “uninvestable” is “drawing to a close”. While the entire Hang Seng jumped on the news, Alibaba enjoyed an additional fillip after its founder Jack Ma “agreed to give up controlling rights of Alibaba’s affiliate Ant, whose scuttled initial public offering in 2020 marked the start of a sweeping crackdown on the sector”. Analysts now believe that “the worst is behind” Alibaba. Alibaba’s shares have now rocketed by 80% from a multi-year low in October, propelling the company’s market value back to $300bn, says Weilun Soon in The…

Five to buy Bunzl The Sunday Times This distributor is “one of those mega-companies that few people have ever heard of”. The FTSE 100 group does the boring but important work of getting “paper cups to cafes, swabs to hospitals and packaging to supermarkets” across 31 countries. The firm is doing a good job of passing price rises on to customers and maintaining margins amid inflationary pressures. On a 2023 price/earnings (p/e) ratio of 15.5 the shares trade at a discount to the five-year average, while a “healthy balance sheet” means Bunzl has “more than £1bn to spare for acquisitions if needed”. This stock is a “boring but reliable” buy. 2,839p WPP The Telegraph The shares in this advertising and communication play have tumbled 26% over the past year, an…

In a scene with striking similarities to the US Capitol riots two years ago, a “mob” of far-right protesters in Brazil stormed congress, the presidential palace and the supreme court, trashing the buildings, before finally being evicted, says the Financial Times. The riots grew out of weeks of protests by extremist supporters of the ousted former president, Jair Bolsonaro (pictured). The “key institutions stood firm and the rule of law was upheld”, with the military reaffirming their support for the constitution and president Luiz Inácio Lula da Silva, but “the loyalties of the Brasília governor, a Bolsonaro ally, and some of the capital’s police, have been questioned”. The “shocking” riots are a “rude awakening” for Lula, but they are also an opportunity, says Andrew Downie in The Spectator. Even many…

The sharp rise in inflation over the past two years caught many people by surprise. Policymakers continually said it would be “transitory”. Each time they published new forecasts showing prices were up by more than expected, they reassured us it was still on track to drop back very soon. At the end of 2021, for example, the Bank of England reckoned that inflation, then at 4.9%, would be down to 3.4% by the end of 2022 and 2% by the end of 2023. Six months later, when inflation was at 9.2%, the Bank said that it would be 10.2% at the end of 2022 and 3.6% at the close of 2023, but still tumble to 2% by December 2024. I’m not singling out the Bank of England: other central banks…

Living the American Dream Phil Gramm and John Early The Wall Street Journal Those who say rising income inequality is proof that the American Dream is dead fail to grasp that equality of outcomes is “alien to the American ethos”, say Phil Gramm and John Early. In the words of Abraham Lincoln, America is committed to “an open field with a fair chance for your industry, enterprise and intelligence”. The aim is “individual upward mobility”, not uniformity. Three independent studies covering the past 50 years have measured the “relative mobility” (ie, whether children move into a different income quintile from their parents) and the findings were “extraordinarily similar”. Averaging the results, only 22.6%-24.4% of children remain in their parents’ quintile; 39% rose to a higher quintile and 37% fell to…

fullstackeconomics.com After a week driving taxis for the ride-hailing app Lyft, I got just 52% of what my passengers had paid, says Timothy Lee. Yet despite taking such a big cut, Lyft still fails to turn a profit (it lost almost $1bn in the first nine months of 2022). In the pre-Lyft world, only about 15% of fares went on dispatching and other “back-office” functions, the rest went to the driver. This implies that the old taxi business model worked better than the disruptive technology-driven one. Lyft doesn’t publish the numbers needed to check if my own experience is more general, but Uber’s suggest that it too is taking a much larger cut than traditional taxi dispatchers. Like other Silicon Valley tech upstarts, the ride-hailing apps face a reckoning as…

The consensus view is that markets will have a bumpy 2023 as we grapple with a slowdown or recession. I think that whatever your view about the outlook, even the most optimistic of us would see plenty that could go wrong. The grounds for a big bull-market surge are unconvincing. In these circumstances, funds that benefit from increased volatility might continue to have a strong 2023. Top of my list would be BH Macro (LSE: BHMG) and Ruffer Investment Company (LSE: RICA), both of which outperformed last year. Beyond that, what’s an investor to do amid all this uncertainty? One tactic is to look to well-managed funds that invest in quality assets and trade at big discounts to net asset value. This is a theme I will revisit soon. However,…

● Be careful if you need to call HMRC. There are an increasing number of online adverts “from companies that put callers through to HMRC at hugely inflated costs,” says Charlotte Gifford in The Telegraph. These connection services charge a premium rate – typically around £3.60 a minute – to direct you to another company or government department. Research by the Low Incomes Tax Reform Group found one taxpayer had been charged £140 to contact HMRC. “Another was put off calling the taxman to get their PAYE code sorted because an online advert had made them think it would cost £3.60 a minute. Don’t ring HMRC on any number starting with 09, 087 and 084. Stick to HMRC’s own self-assessment helpline number, 0300 200 3310. ● Broadband and mobile phone…

● The Financial Services Compensation Scheme (FSCS) could be given powers to award larger compensation payments in cases related to pensions under plans being discussed by the main City regulator. The Financial Conduct Authority is consulting on whether the FSCS, currently limited to a maximum compensation award of £85,000 in most cases, should be allowed to pay out more when savers suffer pension losses. The current limit means a disproportionate number of savers have not been fully compensated for losses in cases related to pensions, compared with other types of investment. ● The much-delayed pensions dashboard initiative may be introduced even later than expected amid problems with testing. The scheme, through which all Britons should be able to see details of all their private pension savings in one digital location,…

Most investors are reluctant to get involved with the way that a company is managed, and will simply sell their shares if they are unhappy. Exceptions to this rule are “activist” investors, who buy shares in a company they think is being badly run with the aim of trying to pressure a company’s management into making changes. However, while these investors argue that they are acting as a check on poor or incompetent management, some people say that they force firms to focus on short-term measures to boost returns to shareholders rather than on the company’s long-term growth, especially when encouraging firms to sell assets. The evidence suggests that activists can indeed add value for shareholders. A US study in 2008 found that traders can make money in the short…

Data management firm WANdisco (Aim: WAND) has impressed investors by securing contracts for the use of its software throughout 2022, says Shares. WANdisco helps companies gather all the information from their systems and transfer it to the cloud, where it can be analysed more efficiently. In December, WANdisco announced that revenue for 2022 is likely to reach £19m, thereby exceeding expectations “significantly”. The firm’s $12.7m deal with an unnamed European car-parts manufacturing business has provided a key fillip. WANdisco’s share price has soared by 139% in 12 months.…

Joel Tillinghast was born in Wakefield, Rhode Island, and bought his first shares at the age of ten. He studied economics at Wesleyan University and gained an MBA from the Kellogg School of Management at Northwestern University, then worked at research service Value Line before moving into investment banking. In 1986 he was hired on the basis of a five-minute conversation by legendary fund manager Peter Lynch to work at Fidelity and by 1989 was in charge of the Fidelity Low-Priced Stock Fund. What was the trade? In 2001, Tillinghast became aware of Hansen (now Monster Drinks) at a corporate event. He liked its drinks and was impressed by the intensity of the company’s management, and noted that the shares were trading at only ten times earnings. The US economy…

£28.68, justerinis.com This week has been “2021 Burgundy En Primeur” week in London. Wine writers, buyers and private clients have visited and tasted with UK-based Burgundy specialists to assess the vintage and put their names down for their preferred wines. However, this year’s campaign has not been the usual vinous bunfight, because allocations are tiny. The 2021 vintage was challenging, with minuscule quantities of white wines. Reds are a little uneven, too. While I have published my usual nightly bulletins this week, picking out the very best bottles for my followers, it is clear that stocks are thin on the ground, so here is a wine that is in stock, drinking perfectly now and utterly mesmerising. The value alone should make you want to load up without delay. Twentyeighteen was…