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Shares Thread for the next Gordon Gekko's

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  • smiffyboy said:

    Also heavy into XRP on crypto currency this is a long play set to speed up the banking process instead of 5 days for banking transfers between countries XRP can do it in 5 seconds via block chain payments.

    5 days?
    Don’t know what payment provider you use.
  • just going to have to ride Carillion out I think also read a report yesterday that said they are too big for the government to let them go under. Re Walmart seems they are fighting back on the e-commerce with Amazon, my missus works for Asda so gets the share save which we take the maximum we can each month, and re invest dividends in shares, which has worked very nicely over past 7 years.
  • MrOneLung said:

    smiffyboy said:

    Also heavy into XRP on crypto currency this is a long play set to speed up the banking process instead of 5 days for banking transfers between countries XRP can do it in 5 seconds via block chain payments.

    5 days?
    Don’t know what payment provider you use.
    Not personal accounts business to business, bank to bank.
  • smiffyboy said:

    MrOneLung said:

    smiffyboy said:

    Also heavy into XRP on crypto currency this is a long play set to speed up the banking process instead of 5 days for banking transfers between countries XRP can do it in 5 seconds via block chain payments.

    5 days?
    Don’t know what payment provider you use.
    Not personal accounts business to business, bank to bank.
    Thanks bonkers mate. I bought something on-line from a German company last Friday. They won't dispatch until they get the funds; reasonably enough. I got my bank to do a SEPA payment (for free) and got a confirmation from the supplier that they'd had the money in their bank account in Essen that same afternoon. Goods at my door on Tuesday morning.
  • just going to have to ride Carillion out I think also read a report yesterday that said they are too big for the government to let them go under. Re Walmart seems they are fighting back on the e-commerce with Amazon, my missus works for Asda so gets the share save which we take the maximum we can each month, and re invest dividends in shares, which has worked very nicely over past 7 years.

    I took a punt on Carillion earlier in the year after the last profits warning. They saw an uptick after that and I got out shortly after.

    I just don't understand why this company keeps winning government contracts. They've created a monster & they're finally (almost) waking up to what they've done.

    The banks have backed off for the moment, with covenants not being tested (because they know the answer), but they can't wait too long for this restructure/sell off.

    I can see the whole thing being broken up, rather than a wholesale bail out. Lots of 50-50 joint ventures they have will either be lost to the other firm or another partner brought in.

    You might see some short term gain after this latest crash, but if lenders do end up swapping debt for equity, I can see a long downward phase...if they survive in their current form.
  • Report in The Sunday Times today suggesting that the Carillion Pension fund may end up taking a stake in the business as part of any rescue. Any debt for equity deal will almost certainly wipe out current shareholders.

    The pension fund has a £587m deficit, with Carillion now worth just £92m against debt 10x that at £925m. Can't see this surviving in its' current form.
  • Carillon have lost their contract for facility management of RBS / Nateest branches.
  • edited January 10
    Any 2018 tips then?

    On AIM I reckon

    - Hurricane Energy (HUR 33p),

    - Bluejay Mining (Jay 22.45p) and a punt on

    - Great Western Mining (GWMO 1.03p)

    That said I am a complete novice at all this so please don’t take any advice from me, I also use an account that only charges £1.75 per trade so my bets (which is all they are) are small amounts and if I lose the lot it really would not be the end of the world !!
  • Any 2018 tips then?

    On AIM I reckon Hurricane Energy, Bluejay Mining and a punt on Great Western.

    That said I am a complete novice at all this so please don’t take any advice from me!!

    Don't worry I wont. I'm an IFA so I would do an ISA first. £20k allowance before April 5th & then another £20k from April 6th onwards. Once you've filled these to the max & you have money left over then feel free to punt elsewhere, otherwise don't.
  • edited January 10
    Not quite sure how to edit the title of this thread. maybe someone can advise?
    Anyway, bit of a recap regarding 2017.

    I am still sticking with Sirius Minerals (SXX).
    Into the FTSE 250 as expected. Additional shares put into circulation to achieve additional funding, yet still up 25% on their start of 2017 figure (currently 24.39p - was 19.25p).

    Bellzone Mining had a mad spell around September, reaching the dizzy heights of 3p (0.32p at start of 2017) after getting parliament backing for mining (currently 0.841p).
    Very volatile and I only have a small holding now. might have the minerals, but 200 miles away from the port.
    Talk of a lot of Chinese money going into Guinea for transportation/rail. We will see.

    Ortac (OTC) is my final share (currently 2.5p). Looking forward to seeing this one fly as they have been getting above expected results with recent test drills.

    Anyway, how about the rest;

    Lancashire Lad - RRL @ 0.3575p - Now 0.24p

    Blackpool 72 - RM2 international @ 30p - Now 2.25p

    Stop shouting - SKY @ 998p - Now 1019p
    - New river retail @316p - now 313p
    - GSK @ 1594p - now 1329p
    - Associated british foods @ 2664p - now 2842p
    -Gem Diamonds @ 107p - now 80p

    RalphMilne - Eden Research @ 11.52 - now 8.98p

    Boom - BNY Mellon - no idea in yank shares.
    kier @ 1382p - now 1068p

    Survivalofthefittest - Worldpay @ 284p - Now 447p

    Smiffyboy - UKOG @2.7p - now 3.15p

    Lot of people on Lloyds @ 66.5p - now 68.5p. Not sure if any dividends paid out?

    Nice work regarding Worldpay SOTF, and appreciate that UKOG could have seen a decent return if sold a few months back.
    Hop you never had too much invested Blackpool.

    So who's having what for 2018? You have my three above.
    Should you want to list a share, could you add the ticker and current share price.
    Oh, and can we leave those crypto things to another thread?

    Just to add, Bob Monro mentioned about E-sports being a big thing. Perhaps therefore a main broadcaster of these sports may be worth a look? Gfinity PLC (GFIN) currently 22.85p.

    Sorry if I missed anyone.

    Onwards and upwards, Robbo.


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  • If you invested in every stock in the 250 Index you would have earned a 12.5% return. Choosing a handful of those 250 and hoping to do better than the average is not a risk that will be rewarded long term, but is much more fun as long as you can afford to lose money.

    If you want penny shares then invest in all of them, the AIM Index showed a return of 20%. The chances of beating the average with a handful of selections is even more riskier than the 250 index. The additional risk taken by holding one stock that returned 5% more than the average makes no statistical sense.

    Just some comments on Carillion and questions why the same failing companies keep getting government contracts. The large infrastructure contracts require significant funding and the likes of Carillion make a turn on the funding costs by doing deals with the banks. Not naming names, but am aware of contracts having been acquired by undercutting competitors with unrealistic tenders because they are so desperate to get the contract and earn a turn on the finance costs. No profit is actually factored into the contract at all, and the input of the people who know what the project entails and the likely risks do not have a material input. It means that contract delivery cost can far exceed the unrealistic budget factored into the price paid by government. If the profit on the finance has already been paid out in dividends it is not available to subsidise the operating losses.

    The FCA are investigating Carillion, presumably to establish how it could continue to pay generous dividends when it was actually bleeding cash and why those losses were not reflected in the accounts. When directors have huge share options and incentives based on share price performance, and even transfer out of the pension scheme early, it's not difficult to see possible conflicts of interest outweighing everyone else's interests.

    The tender process for a government contract can cost upwards of £10m just to make a tender as the process requires the whole project to be specced and documented and all the legal aspects covered off by the lawyers. The hoops put in place by government ensure that only a few companies ever get the contracts, especially as one of the criteria will be evidence of delivering similar projects for a public body. Hence we have GS4/Capita etc with appalling records still winning government contracts.
  • edited January 10

    If you invested in every stock in the 250 Index you would have earned a 12.5% return. Choosing a handful of those 250 and hoping to do better than the average is not a risk that will be rewarded long term, but is much more fun as long as you can afford to lose money.

    If you want penny shares then invest in all of them, the AIM Index showed a return of 20%. The chances of beating the average with a handful of selections is even more riskier than the 250 index. The additional risk taken by holding one stock that returned 5% more than the average makes no statistical sense.

    Just some comments on Carillion and questions why the same failing companies keep getting government contracts. The large infrastructure contracts require significant funding and the likes of Carillion make a turn on the funding costs by doing deals with the banks. Not naming names, but am aware of contracts having been acquired by undercutting competitors with unrealistic tenders because they are so desperate to get the contract and earn a turn on the finance costs. No profit is actually factored into the contract at all, and the input of the people who know what the project entails and the likely risks do not have a material input. It means that contract delivery cost can far exceed the unrealistic budget factored into the price paid by government. If the profit on the finance has already been paid out in dividends it is not available to subsidise the operating losses.

    The FCA are investigating Carillion, presumably to establish how it could continue to pay generous dividends when it was actually bleeding cash and why those losses were not reflected in the accounts. When directors have huge share options and incentives based on share price performance, and even transfer out of the pension scheme early, it's not difficult to see possible conflicts of interest outweighing everyone else's interests.

    The tender process for a government contract can cost upwards of £10m just to make a tender as the process requires the whole project to be specced and documented and all the legal aspects covered off by the lawyers. The hoops put in place by government ensure that only a few companies ever get the contracts, especially as one of the criteria will be evidence of delivering similar projects for a public body. Hence we have GS4/Capita etc with appalling records still winning government contracts.

    My understanding is that the FCA investigation is centred on the “timeliness and content” of the company's RNS releases. Presumably whether they told the market of their woes in a timely fashion or delayed the news and whether the releases were accurate. (What would also be interesting is whether there were any share dealings (sales) by directors in the interim).

    Edited to add: a quick browse suggests there have been no such share transactions.
  • @Robbo on the wing - have updated my post above with prices as of close yesterday when I posted and tickers.
  • Artificial Intelligence companies surely? CES in Las Vegas is full of AI innovation and is the big talking point. I've put a few hundred into Man GLG Japan Core Alpha Fund and it's up about 7.6% this year. It's a Japanese AI fund. Anyone any thoughts?
  • cafc-west said:

    Artificial Intelligence companies surely? CES in Las Vegas is full of AI innovation and is the big talking point. I've put a few hundred into Man GLG Japan Core Alpha Fund and it's up about 7.6% this year. It's a Japanese AI fund. Anyone any thoughts?

    What makes you say this ??? Do you know the companies it invests in ??
  • One of the problems with just buying an index is that most are market capitalization-weighted (ie. size-weighted) so you are implicitly taking a bet that the largest companies will outperform.

    For example if you buy the FTSE 100, you not as diversified as you think (50% represented by just 12 companies) and these companies are the stodgiest (by virtue of their size) and thus highly unlikely to deliver above average earnings/cashflow growth (the ultimate driver of share prices in the long run).

    However whilst broadly advocating sensible individual stock-picking, I would politely note that many of the stock tips mentioned on this thread are highly speculative with meaningful risk of substantial capital loss - these types of bets (even a basket of them) really should only be a small % of anyone's portfolio.
  • edited January 10
    Well in 2017 I put lloyds at 62.71p price quoted above for EOY is 68.5p with a dividend total of 3.2p giving a 14.3% return. I although healthy this is disappointing on what I expected. I will hold and say Lloyds still has an upside and healthy dividend in 2018.

    Eden research 11.52p down to 8.98p unfortunately revenues are still not flowing for Eden. I will hold , but not top up for 2018.

    However, Fevertree is now well established, offered at £1.34p in 2014, highs of over £25 have been seen. I bought in at £8, £13, and £20. Currently £21.37.
    People are saying that this is now overdone and there has been profit taking holding the share down. I am confident that it's got farther to go. In the last year Fevertree products have become even more available in UK. An American drive is now on and new products for dark spirits appear to be selling well. This could be a takeover target, as many bigger players are failing in pushing their own product.

    So my two for this year are Lloyds and Fevertree. With a hold on Eden and hope for better income streams in 2018.

    Not recommending anybody put their life savings into these. I have them as part of a far more diverse portfolio, with assets spread across cash and markets.
  • One of the problems with just buying an index is that most are market capitalization-weighted (ie. size-weighted) so you are implicitly taking a bet that the largest companies will outperform.

    For example if you buy the FTSE 100, you not as diversified as you think (50% represented by just 12 companies) and these companies are the stodgiest (by virtue of their size) and thus highly unlikely to deliver above average earnings/cashflow growth (the ultimate driver of share prices in the long run).

    However whilst broadly advocating sensible individual stock-picking, I would politely note that many of the stock tips mentioned on this thread are highly speculative with meaningful risk of substantial capital loss - these types of bets (even a basket of them) really should only be a small % of anyone's portfolio.

    It means that for a given increase in share price a large cap company moves the index more than a small cap company that's all. You are just as diversified stock wise, as if you had bought each individual stock in the same proportions as they make up the index. Your argument really is that if you allocate more to small cap companies than is constituted in the index you will likely beat the index. That is why active managers will create a fund with a higher weighting of small cap companies than the index they are attempting to beat.

    As an individual investor you could invest say 60% in an equity tracker and 40% in a small cap tracker for example to get 100% equity exposure and benefit from a higher return if small cap companies outperform, compared to everything in the 100 or 250 index.

    It doesn't negate the effectiveness and efficiency of using of trackers as the cheapest and most effective means of achieving diversification. But highlights that you can modify the risk/reward profile of your equity exposure by diversifying across multiple equity indices.

    Individual stock picking is fun, and you can get lucky, but its not how you accumulate stable rewards. And remember, anything you get to hear about a stock has already been priced in days if not weeks before you read what has been written, and written mainly by those who have already got their sale or buy orders in depending on where they want the price to go. You are better off picking stocks with a pin so that you can guarantee a 50:50 win percentage over time. If you do not diversify, one way the professionals generate positive returns is by using statistical analysis to filter out potential dogs and reduce diversification but improve the the odds to 51:49 in their favour and back their judgement. But that's how small the margins are, it's about winning lots of small bets on better than even odds rather than trying to shoot the lights out identifying the outliers who will make the biggest gains and risk losing the lot.

    I realise this is mainly a fun thread, so apologies for farting in Church.
  • So Dippenhall are you going to put your cock on the block and give us a couple of 2018 gems :-)
  • How about you Golf, as this is your game?
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  • Happy with the sharesave my missus gets for walmart shares trading at just under $100 a share, re invest dividends each year of approx $1000.
  • I would only expose my cock to choosing asset classes, I have no knowledge of individual stocks and am only exposing the first six inches.

    The consensus view is that Emerging Markets are most likely to show the highest growth compared to other markets and South East Asia is likely to prosper the most. India, Taiwan and Hong Kong are the biggest bets in the SE Asia portfolios. A manager of a diversified portfolio I like has, in this sector, diversified across 5 different funds with his three biggest bets being 15% of his overall fund allocation as follows:

    First State Global Emerg Mkts Ldrs B GBP
    Fidelity Emerging Markets W Acc
    Stewart Investors Asa Pac Ldrs B Acc GB
  • edited January 10

    One of the problems with just buying an index is that most are market capitalization-weighted (ie. size-weighted) so you are implicitly taking a bet that the largest companies will outperform.

    For example if you buy the FTSE 100, you not as diversified as you think (50% represented by just 12 companies) and these companies are the stodgiest (by virtue of their size) and thus highly unlikely to deliver above average earnings/cashflow growth (the ultimate driver of share prices in the long run).

    However whilst broadly advocating sensible individual stock-picking, I would politely note that many of the stock tips mentioned on this thread are highly speculative with meaningful risk of substantial capital loss - these types of bets (even a basket of them) really should only be a small % of anyone's portfolio.

    It means that for a given increase in share price a large cap company moves the index more than a small cap company that's all. You are just as diversified stock wise, as if you had bought each individual stock in the same proportions as they make up the index. Your argument really is that if you allocate more to small cap companies than is constituted in the index you will likely beat the index. That is why active managers will create a fund with a higher weighting of small cap companies than the index they are attempting to beat.

    As an individual investor you could invest say 60% in an equity tracker and 40% in a small cap tracker for example to get 100% equity exposure and benefit from a higher return if small cap companies outperform, compared to everything in the 100 or 250 index.

    It doesn't negate the effectiveness and efficiency of using of trackers as the cheapest and most effective means of achieving diversification. But highlights that you can modify the risk/reward profile of your equity exposure by diversifying across multiple equity indices.

    Individual stock picking is fun, and you can get lucky, but its not how you accumulate stable rewards. And remember, anything you get to hear about a stock has already been priced in days if not weeks before you read what has been written, and written mainly by those who have already got their sale or buy orders in depending on where they want the price to go. You are better off picking stocks with a pin so that you can guarantee a 50:50 win percentage over time. If you do not diversify, one way the professionals generate positive returns is by using statistical analysis to filter out potential dogs and reduce diversification but improve the the odds to 51:49 in their favour and back their judgement. But that's how small the margins are, it's about winning lots of small bets on better than even odds rather than trying to shoot the lights out identifying the outliers who will make the biggest gains and risk losing the lot.

    I realise this is mainly a fun thread, so apologies for farting in Church.
    I think my point more generally is that an index is nothing more than a particular index provider's benchmark and as such 'beating' or 'underperforming' is ultimately meaningless if divorced from an investor's ultimate return/risk targets.

    As well as the FTSE 100 Index (up 7.6% in 2017), one could just as readily look at the FTSE 100 Equally Weighted Index (up 9.8% in 2017), the FTSE All Share Index (up 9.0% in 2017) or the FTSE 350 Index (up 8.8% in 2017).

    If one's actively managed UK equity portfolio was up say 8.5% in 2017 then did it beat or underperform the market? In short who cares? They made 8.5% which may or may not be a satisfactory return to them for the risk they took.
  • edited January 10

    How about you Golf, as this is your game?

    Sorry, but as a regulated IFA I'm not allowed to recommend specific funds on a forum in case in gets construed as "advice". I'm also not regulated to give advice on individual shares (even if I wanted to) and so my "expertise" is concentrated around collectives(OEIC's Unit & Investment Trusts and ETF's)

    However, @Dipenhall has given 3 very good funds, if you want to invest in emerging markets & in Asia. All 3 are in my clients portfolios.

    As I've re-iterated many times, selecting individual shares (especially from the AIM) is very risky & for every one that does well there are 2 or 3 that don't.........your earlier posts proves that.

    Recent investment seminars that I've attended have said that if investing in the UK you may want to look at the large FTSE100 companies as they are less likely to be affected by Brexit & as a large proportion of the money is earned overseas they may benefit from a fall in Sterling. The US may be good for another 18 months, Europe looks steady & there could be gains to be made in Japan. China & the EM.

    Finally to @cafc-west. I'm still waiting to hear why you think the GLG Japan fund is an AI fund. My knowledge of it is that it invests in mainly large Japanese companies (some may be evolving AI technologies but not all do) so I just wonder whether you have read some literature and got it arse about face. It just so happens that when it is measured against its peers it is classified under the Japan IA sector.

    As I always say - its best to take advice.
  • Having just trashed investors' obsession with indices, I should point out that I personally do regularly use passive ETFs or index funds (whether by country, sector, region, etc.) to express views on certain themes where I have no particularly strong view on individual companies within that theme (thus a top down not a bottom up view). Whilst in an ideal world one would ask a broker to create a customized basket which stripped out some of the biases of the underlying index, this is not practical for an individual investor.

    The one type of fund that I always avoid are the typical actively managed funds offered by the large institutional firms (the ones advertised on the tube etc.) and typically run by mediocre salaried fund managers with virtually no 'skin in the game', and whose main focus is 'tracking error' to the aforementioned (flawed) benchmarks. There are some funds offered by smaller boutique firms which would not fit this description and are worth investigating.
  • cafc-west said:

    Artificial Intelligence companies surely? CES in Las Vegas is full of AI innovation and is the big talking point. I've put a few hundred into Man GLG Japan Core Alpha Fund and it's up about 7.6% this year. It's a Japanese AI fund. Anyone any thoughts?

    What makes you say this ??? Do you know the companies it invests in ??
    Nope. Just used Google to research funds that are investing in AI companies in Japan. Picked Japan as they seem to be ahead of the curve in robotics and AI. This fund Looked a reasonable bet. I like to take the odd risk...not too much money but generally buy and hold.
  • edited January 10

    Having just trashed investors' obsession with indices, I should point out that I personally do regularly use passive ETFs or index funds (whether by country, sector, region, etc.) to express views on certain themes where I have no particularly strong view on individual companies within that theme (thus a top down not a bottom up view). Whilst in an ideal world one would ask a broker to create a customized basket which stripped out some of the biases of the underlying index, this is not practical for an individual investor.

    The one type of fund that I always avoid are the typical actively managed funds offered by the large institutional firms (the ones advertised on the tube etc.) and typically run by mediocre salaried fund managers with virtually no 'skin in the game', and whose main focus is 'tracking error' to the aforementioned (flawed) benchmarks. There are some funds offered by smaller boutique firms which would not fit this description and are worth investigating.

    I would mainly use passive or tracker funds for fixed interest or bond funds as the margin of growth between the index & the best/worst funds isn't always that great, whereas for equity funds there can be a great discrepancy between the best & the worst - Manek Growth & Woodford Income being just 2 that have been dogs for a couple of years. Agree that if you wanted to balance out a portfolio an equity tracker fund could give you a foundation before selecting specific funds. Core & satellite.

    Also agree about managed funds - go back 20 years & many people would have a bland managed fund in their pension. Nowdays companies are a bit smarter and at least they use multi asset or multi manager funds..............and don't get me started on restricted advice !!! The next mis-selling scandal if ever I've seen one, but all legitimately passed by the FCA.
  • An index is just a measure of averages. Its value is providing a benchmark for whatever you want to measure against it. Compare the success of your own stock selection or your managers skill in selecting the winners. The obsession is not in tracking the index it’s the ability to check if you are getting value from your active manager fees.

    I accept that the more you diversify, the less you are able to make use of induces as a benchmark and the more you rely on returns relative to inflation or cash.

    Trashing an index is like trashing a tape measure because it can’t tell you how much two feet weighs.
  • An index is just a measure of averages. Its value is providing a benchmark for whatever you want to measure against it. Compare the success of your own stock selection or your managers skill in selecting the winners. The obsession is not in tracking the index it’s the ability to check if you are getting value from your active manager fees.

    I accept that the more you diversify, the less you are able to make use of induces as a benchmark and the more you rely on returns relative to inflation or cash.

    Trashing an index is like trashing a tape measure because it can’t tell you how much two feet weighs.

    And there's the rub. There are 259 funds in the UK All Companies sector. The Vanguard UK All share tracker is ranked 116, so just above half way. It gained 13.3% last year whereas the best fund gained 41% and the worst lost 1.1%. Most fund managers charge around 1% pa, so if you can get the right fund (doesn't have to be the best - the 40th fund produced a 19.8% return) then you should be doing better than the market & better than 75% of fund managers.
  • edited January 11

    cafc-west said:

    Artificial Intelligence companies surely? CES in Las Vegas is full of AI innovation and is the big talking point. I've put a few hundred into Man GLG Japan Core Alpha Fund and it's up about 7.6% this year. It's a Japanese AI fund. Anyone any thoughts?

    What makes you say this ??? Do you know the companies it invests in ??
    I'm a (fairly) long-term holder of this fund bought £8k worth @ 76p a unit 5 years ago and topped up another £5k @ 91p 3 years ago. Current unit price is 179p. So it's done fine (but doesn't pay much by way of income). As the name suggests - core alpha - it tends to invest in large mainstream companies (it's two largest holdings are Toyota and Honda) with its sector weighting being 21% banks and 15% automotive and only 6% into tech companies. I bought it because I couldn't see the Japanese stock market continuing to be in the doldrums and indeed, it's now at a 20-year high - but still only around 50% of its 1980s peak!
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