Moving to the Next Stage

This year marks the 110th edition of the Tour de France, the most prestigious bicycle race in the world. And like the markets, the Tour is always challenging—and evolving. The three-week, grueling 2,200+ mile route changes every year and, surprisingly, starts in different countries—this year in Spain versus the UK, the Netherlands, Germany, Belgium, and Denmark over the previous five years! The point is, just like the Tour, economic and market cycles have different starting points, and no two routes are alike.

Market madness – Be selective, advises Paul Gavaghan of Raymond James

Market madness – Be selective, advises Paul Gavaghan of Raymond James

Whilst there are still pockets of great opportunity across the globe, the past few weeks have also seen crazy price rises of some stocks as investors have rushed to join the herds buying certain technology stocks indiscriminately. Given the backdrop of a Western World with low interest rates and a pandemic that is highly disrupting many sectors, the relatively less affected technology sector is an attractive place to park money. It seems many investors taken this view but have forgotten the importance of valuations. The herd buying has pushed prices up which then reaffirms investors reasoning so they buy more again and so on which spirals share prices upwards.

Which way next for markets?

Which way next for markets?

After global markets stumbled to their worst quarter since 1987 in Q1, we have now seen a meaningful bounce in many equity markets from March lows and there are now good arguments for both sides which way they will turn next.

Ethical Investing – Bespoke portfolios tailored around you

At Raymond James, Ribble Valley we have a highly bespoke investment proposition and state of the art tools. This allows us to cater for clients’ ethical preferences, however specific they are. Many people only want to profit from companies with certain characteristics and they want to make sure that their views are reflected.

We start with a specifically tailored questionnaire that really helps us to explore what is important to clients.

The first element of this is ‘negative’ screening where we look at what people don’t want to invest in. This might be armaments, tobacco, alcohol, animal testing, gambling etc…we can also drill down to the next level to allow a percentage of revenues. So, for example, someone might not want to invest in an alcohol company per see but wouldn’t mind investing in a hotel chain that makes a small percentage of its revenues from alcohol sales.

We then look at positive screening. What do people want to make a profit from? This can be broad-based suchas wanting to invest in innovative companies that are solving the World’s problems. We incorporate ESG (Environmental, Social and Governance) in all of our research as there is good reason to believe that the most sustainable and well-governed companies will offer shareholders the best long-term results.

We can also offer positive screening very specifically. Do people only want to invest in companies with excellent human rights track records for example? Or in renewable energy? Or those that contribute positively to their community?

The level of how bespoke we can make it is endless. There are over forty thousand listed companies and we have an enormous amount of research available to us. This allows us to build diversified portfolios for people with even the most specific views and preferences without necessarily sacrificing performance.

Most ‘ethical’ funds exclude certain companies and these are an option for broad-based ethical investing. They cater for the views of the masses though. Only through investing directly in a portfolio of shares designed specifically for a client can all people’s views be best accommodated.

If you are interested in learning more about the opportunities we are finding and options for investing, please call or email (01772 780300, to arrange a complimentary chat over the phone or Zoom.

Risk warning: With investing your capital is at risk.

Making wise investment decisions in perilous times

Making wise investment decisions in perilous times

As the virus spreads through the World, fear has reigned, global stock markets have plummeted and the UK’s leading market stumbled its worst quarter since 1987. We pride ourselves that in times of volatility and crashes, when many advisers head for the hills, we are there to support and reassure our clients every step of the way until markets recover and beyond. Our key message to clients, and anyone invested in the markets is, don’t solve a short-term problem by creating a long-term disaster. Instead, stay the course and capitalise on the opportunities.

The Power of Dividends

The Power of Dividends

Where can I double my money this week?’ and ‘Are there any ten baggers around?’ are common questions aimed at anyone working in investment. I hate to be a bore, but I explain such returns mean taking levels of risk similar to those in bookies. So, if not trying to shoot the lights out in a week, how can an investor expect to increase their wealth?

A tale of two decades

A tale of two decades

It is fair to say that at the end of the decade the World is a very different place than it started. In terms of assets a dollar worth of bitcoin at the turn of the last decade is now worth over $90,000, whereas a dollar of the Myanmar Kyat is worth just $0.004 today. The Greek stock market is down 93% over the decade whereas the US market is up 246%. There were no negatively yielding global bonds in 2010 and at the peak in 2019 there were $17tn worth.

Megatrend Investing

Megatrend Investing

A megatrend is a driving force of the transformation and development of the human race.

Looking at past megatrends helps us understand our present, the identification of ongoing trends gives us the means to anticipate what our future might look like. From an investment perspective, this is extremely powerful.

We ask ourselves, in this future that we anticipate, which assets could perform well and which ones could perform poorly? We then use this to help shape our investment decisions.

Paul Gavaghan
Paul Gavaghan, Chartered Wealth Manager and Head of Branch Investment at Raymond James Ribble Valley

Investing In Tomorrows World

There is a lot of money to be made by investing today in tomorrow’s World. Some examples of megatrends include:

  • World population growth
  • Resource scarcity
  • Aging populations
  • The emergence of new economic powers and technological revolutions

Artificial Intelligence

One of these revolutions, Artificial Intelligence is the focus of this article.

AI is already entwining itself in our lives. Be it from simply asking Siri or Alexa the time, robots working in the warehouse to despatch Amazon purchases, facial recognition in airports or the remote parking of cars to name just a handful.

It is everywhere we look. In Dan Brown’s latest book there is a stark warning of the potential dangers of AI when a supercomputer manages to plot the murder of its owner. Less morbidly, people are fearing that their jobs will be lost to AI.

We agree with the latter somewhat, figures suggest that AI will replace 16% of all jobs in the next decade, but we believe it will create more jobs than it replaces in other areas.

We see AI more as a complement to human endeavour as opposed to a danger. A decent example of this is within healthcare.

AI In Healthcare

There is a shortage of radiographers within the NHS at the moment; some of that gap could be filled by AI as the evidence suggests that, on average, AI is better at reading scans than human radiographers.

Similarly, Google’s deep learning machine is now accurate 89% of the time in detecting breast cancer, compared to just 73% accuracy from a human pathologist.

As well as healthcare, AI is starting to transform security and defence, construction, manufacturing and the automotive industry (50% of new cars in 2030 are expected to be at least partially autonomous).

Another example I like is ‘intelligent’ food retailing platforms such as Ocado, which have negligible waste, with only 0.02% of the total food in the system ending up in landfills, whereas wastage rates at traditional supermarkets are huge relative to this figure.

The benefits of using AI to cut waste are undisputable and there for all to see. If the trends are in place for AI to thrive, and we think they are, then the cycles we are seeing now are only in their infancy.

Investing In AI Companies

Those companies best capturing the opportunities to ride this megatrend will enjoy competitive advantages over their peers. That is where the opportunity lies for us as stock pickers. So there’s no need to hide under the bed from robots any time soon but instead, consider there is an opportunity to benefit from the revolution if it goes as we have predicted. I encourage anyone to come in and see us if you are interested in the idea.

Please use the contact form on our website to get in touch with our team, or call us on 01772 780 300

The demise of Neil Woodford

The demise of Neil Woodford

Neil Woodford CBE was lauded by the BBC in 2015 as “The man who cannot stop making money”. Once Known as “Britain’s Warren Buffet”, his career now lies in tatters with his face strewn over the tabloids almost daily, accompanied by disparaging headlines.

The Tax Man cometh… and he’s quite interested in your pension!

The Tax Man cometh… and he’s quite interested in your pension!

When it was introduced in 2006, the Lifetime Allowance (LTA) limit was only supposed to affect a very small number of pension investors. That it now raises £110m a year for HMRC, affects over 2,400 people and is rising at an eyewatering rate may encourage you to check your own pension provision.