Investments

Lucy Warwick-Ching

We have launched a brand new interactive personal finance page, where you can find top tips, beginners’ guides and advice across the whole sector. From tips on the best way to sell your home, to guides to help you check and improve your credit scores, Money Matters will cover the topics from your perspective.

We’ll also have live Q&As with experts and audio interview podcasts linked to the latest news stories.

You can read and comment on the latest Money Matters blog posts, and we are also adding the newspaper columns to this page so you can also comment on these columns each week. Don’t worry – you will still be able to view or search for previous posts on this page.

Alice Ross

All this talk of raising capital gains tax is ominous news for zeros.

By ‘zeros’ I mean of course zero dividend preference shares – that class of investment trust shares that lost investors millions back in 2002 and were responsible for the biggest scandal to hit the industry.

The zeros have recently been experiencing something of a comeback – despite their dodgy history – thanks to the fact they are taxed as capital gains not income. A lot of the zero shares launched in the past year have been in response to private client wealth managers, who in turn were responding to pressure from their investors.

Now, it looks like the brief resurgence could be already thwarted. Analysts at Numis Securities said today a rise in CGT ‘appears negative’ for zero dividend preference shares – a view that was also expressed by analysts at Oriel last week.

Of course, there has to be an investment case for the zeros too – with some, such as those from Ecofin, attached to attractive, stable companies. It is early days – but it will be interesting to see how strong the demand for zeros is after the emergency Budget on 22 June.

Jonathan Eley

I might be sitting more than 3,000 miles from Washington DC, but even from here I can detect the rank stench of hypocrisy. President Obama, not content with bashing banks, has now started on Big Oil. He wants to make BP pay every cent of claims arising from the Deepwater Horizon disaster, and has intimated that he will back a bill that raises – retrospectively – the liability limit for claims from $75m to $10bn.

Now, it’s entirely possible that BP may have been negligent, or cut corners. Memories of the blast at its Texas City refinery in 2005, where its safety standards did fall short, are still fresh. But it’s also plausible that one of its subcontractors – rig operator Transocean, or well casing contractor Halliburton – was to blame. Or that the blast was simply bad luck on a spectacular scale. But Congress has, it seems, already tried and convicted the British company and is now working out the punishment.

Jonathan Eley

“UK markets have slumped as the uncertain outcome of the general election unsettles investors”. That’s the general tenor of mainstream press commentary today.

It’s wrong. As our economics writer points out today, gilts are no lower today than they were a month ago. Yes, shares are down – but not by as much as they are in other countries. Sterling might have fallen against the dollar, but it’s still comparatively high against the euro. Much as it might irk our self-important politicians to hear it, the rest of the investing world isn’t that interested in their partisan bickering.

Lucy Warwick-Ching

The value of sterling has nosedived after reports suggested that no main political party had been able to establish a sufficient majority in the election.

The pound hit a 12 month low against the dollar (falling as low as $1.4597) and fell 3 per cent against the euro to 1.1547. But why has it fallen so far? 

Lucy Warwick-Ching

It’s been the key phrase of the last week of the campaign. But while the possibility of ‘a hung parliament’ has only ever had a very remote chance of happening, now it is moving slowly closer towards reality.  Whilst hung parliaments are very rare, the opinion polls are suggesting that this is the closest run election in a generation. 

And everyone has an opinion about it. From the Sun’s blunt headline on the prospect of a coalition government, “Well Hung…and Shafted” to the FT’s own thoughts on why the third placed party, which most polls suggest is currently Labour could still dominate the Commons.

Private investors themselves are becoming increasingly concerned about the potential impact on their investments of a hung parliament after the election. Markets do not like uncertainty and can become more volatile ahead of any general election.

Jonathan Eley

 

No, not the 1986 falsetto hit by Prince, nor the ludicrously over-theatrical American stadium rockers. Kiss is an acronym beloved of web programmers and sundry other Californian software nerds – and one that investors would do well to take on board. It stands for Keep It Simple, Stoopid.

 

And the benefits of keeping things simple are plain to see. In last week’s Investors Chronicle, we saw that John Baron’s two investment trust portfolios, each comprising just 16 holdings, have comfortably beaten their benchmarks over the past year.

Ellen Kelleher

John Maynard Keynes once compared the exercise of picking stocks to a beauty contest. The relative attractions of both stocks and catwalk models are subjective, he argued, but to a degree, their value is determined by their popularity with the audience.

Here, Andrew Bell, chief executive of the investment trust Witan, offers an analysis of how Keynsian theories apply to today’s markets. Here’s an extract from his blog.

The process of abstraction can go on and on, as the selection moves further away from making your own judgments of beauty towards an assessment of popular fashion or psychology. In the process, your face would lose its sun tan.

Lucy Warwick-Ching

The end of the tax year is almost upon us which means the deadline for investing in an equity Isa for 2009/2010 is also close. But before you invest your allowance, here are a few key questions you should ask yourself*:

Jonathan Eley

“The grannies lose their blouses…it’s the American investors we have to worry about.” This remark was widely attributed to Shriti Vadera, a Treasury adviser, as the government prepared to push Railtrack into railway administration in 2001. The disparaging reference to private shareholders as “grannies” whose interests could safely be ignored, irritated many at the time. But shareholders in Railtrack did at least receive recompense for the effective nationalisation of the company.



The FT’s Money blog is a forum for the latest news and insights from the UK’s personal finance scene. Matthew Vincent, the editor of FT Money and his team of reporters will upload their views and insights on what’s happening in the industry and how this affects people’s finances.

This blog is no longer active but it remains open as an archive.

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About our bloggers

Lucy Warwick-Ching is the FT’s new Money Online Editor and has been a UK Companies reporter covering tobacco, pubs and leisure companies as well as the deputy editor on House and Home.

Matthew Vincent is the FT’s Personal Finance Editor and was previously the editor of Investors Chronicle, where he also devised the award-winning online video The Market Programme, and produced the BBC-FT standalone magazine ‘How to be Better Off’. He presents the weekly FT Money Show audio podcast, and previously worked on the BBC TV programmes Short Change and Pound for Pound.

Alice Ross is deputy personal finance editor of FT Money. She specialises in pensions, investments and investment trusts. Alice joined FT Money in April 2008 - prior to that she was deputy editor at Money Management magazine.

Ellen Kelleher has been a personal finance reporter in the UK for close to four years. Before arriving in London, she worked in the FT's New York bureau where she covered the insurance sector.

Steve Lodge is a personal finance reporter on FT Money specialising in savings.


Josephine Cumbo has written about all aspects of personal finance but currently specialises in insurance. She also covered company news for FT.com. Prior to working at the FT she was a news reporter for the ABC.

Tanya Powley is a personal finance reporter on FT Money specialising in mortgages and the housing market. Tanya joined FT Money in November 2009 after working in Australia covering personal finance for the Australian Financial Review and its sister magazine Asset. Prior to that, Tanya wrote about mortgages for UK trade newspaper Money Marketing.

Jonathan Eley is editor of Investors Chronicle, and has been with the title for ten years. Before that he worked for newswires and trade journals in London, New York and Hong Kong.

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