Greed

[stonerblue]

It's "an" office. Not "a".

Pfft. Chavs.

I deliberately left the 'n' out to re-inforce the comedy genius.

 

[metalblue]

I don't have many investors (less than 2% of my client book) that look for double digit returns on an annual basis and I don't invest for clients that are looking at short term investment strategies (less than 12 months). I simply don't countenance investments of less than 5 years for the very reasons you state above. If clients are looking at double digit returns returns coupled with a turnover of capital in less time than 12 months, then I would say that they are not investing, but making a punt.

Oi, cheeky bugger, don't you listen? it's an educated guess!!!!!

As for historic P/E ratios and their link to inflation, I would say that the resultant bull markets very much agree that stocks were undervalued (with the main indicies in the UK trebling in the decade following 7-10% inflation at the start of the 90's).

disagree, low inflation was one factor that led to bull run not low p/e ratio's, but one mans junk is another's treasure (or some other more relevant saying) so we can agree to disagree if you like.

A well diversified portfolio (suited to a client's appetite to risk) and managed by long standing fund managers with a proven track record such as Neil Woodford at Invesco Perpetual or the guys at THSP still offers a great opportunity for growth over the medium to long term (industry standard and FSA definition of that timescale being 5 years plus) and this is where we may confusing ourselves if you are looking at time horizons around 12 months as it is impossible to state that a profit can be made (even if your well diversified during this time) as a volitile market is hard to beat due to its very nature. Although volatility does create opportunities for astute managers. Neil Woodford said last week “We believe the current returns on offer from UK equities look very attractive. In our view, there currently exists an unusual opportunity to invest in such companies, representing some of the biggest and best businesses, at valuations which do not appear to reflect the quality characteristics that they offer.” and I am not placed to argue against him and this isn't deferring to someone elses argument but a very real fact that a time proven manager feels there are opportunities in the marketplace.

These are the "punters" looking for double digit returns I'll have you know ;-)

In terms of my first post that you commented on, which was aimed by me and reassuring some of the guys on here that are already invested or trying to work out what to do to beat inflation with cash already losing out on deposit, it is worth nopting that figures from Fidelity show that someone invested in the FTSE All-Share Index over the past 15 years would have seen returns of 168% or 6.8% p.a. However, if they had panicked, sold and missed just the 10 best days performance, their returns would have shrunk to 45% or 2.5% p.a. Market volatility is something that is always with us. As such, reassurance is better than worrying investors to a point where they sell up, hold in cash then re-enter the market in 12 months time, missing the start (which is always the most profitable time) of the upturn and a short term paper loss is nothing compared with potential returns using a "time in" the market strategy as opposed to "timing" the market.

Agreed, I also said I wouldn't exit an investment at this point (but will caveat that with we can't be certain that the next significant move, whenever that may be, is likely to be to the upside rather than downside, there are plenty of risks out there).

Despite the current uncertainty, investors can use the many, many lessons from history to support and inform their strategy. A portfolio that is well diversified across different asset classes has over time, proven to be the right strategy for investors to reduce risk and achieve their investment goals.

Would you disagree with any of that? Especially for the 95% of standard UK investors looking to acheive most returns (6-9% pa) over the medium to long term? Given different time horizons and target returns then the advice would be different but I was not talking about specialist needs in a rather mundane thread when I was asked for my reading of the current climate.

For many stocks have historically proven an excellent investment over time (average of 5% pa real-terms IIRC) but as we all know history means nothing although sometimes it's all we have to go on (that and imagination according to the great Winston Churchill), but if we take what we know from the past the question is certainly more about when they move upwards again rather than if (I am referring to indices rather than individual stocks here). You talk about significant upward movement in the next 5 + years...you don't say what a significant movement up is so I could neither agree or disagree with that, but assuming you have relatively low expectations, excluding any further shocks to the system, if you said 15-20% over that time is achieveable I'd not disagree (and maybe more as time is on your side).

I will conclude by saying that there is a great deal that can still go wrong, as always you should hope for the best and prepare for the worst.

Now we have been told, we need to get an office!

 

[bluetoo]

It's "an" office. Not "a".

Pfft. Chavs.

I deliberately left the 'n' out to re-inforce the comedy genius.

*applauds*

 

[SWP's back]

I would take issue with some of your points here but, to be honest, I think the majority of it would be lost on all but you and me.

I will stand by my my first comment in relation to Skashion however.

:-)

 

[metalblue]

I would take issue with some of your points here but, to be honest, I think the majority of it would be lost on all but you and me.

I will stand by my my first comment in relation to Skashion however.

:-)

I was just reading a piece on the "Nixon/Kissinger solution" and it reminded me of your earlier post in this thread about the US economy. Basically centres around the idea that when the Arab nations and Chinese realise they have given he US oil and goods in return for worthless paper the US better make sure it had the biggest military! I'll ping you the website if you like, its is over bearish on a lot of things but well articulated in many places and gives food for thought even if, like me, you don't agree with much of it

 

[SWP's back]

I would take issue with some of your points here but, to be honest, I think the majority of it would be lost on all but you and me.

I will stand by my my first comment in relation to Skashion however.

:-)

I was just reading a piece on the "Nixon/Kissinger solution" and it reminded me of your earlier post in this thread about the US economy. Basically centres around the idea that when the Arab nations and Chinese realise they have given he US oil and goods in return for worthless paper the US better make sure it had the biggest military! I'll ping you the website if you like, its is over bearish on a lot of things but well articulated in many places and gives food for thought even if, like me, you don't agree with much of it

Please do mate.

 

[stonerblue]

It's "an" office. Not "a".

Pfft. Chavs.

I deliberately left the 'n' out to re-inforce the comedy genius.

*applauds*

thankyouverrymush. I'm here all week