I hear you, especially re Bailey, about whom I expressed my doubts on here at the time. And to some extent I was just venting my exasperation at a 15% capital loss on Kwarteng (whom I nevertheless still believe should never have been near the job). But I don't think you have really addressed this specific FT line:
"And its UK range is also especially interesting because Vanguard includes a “home-bias” in the funds, which otherwise take market exposure based simply on market cap. The 35 per cent tilt towards UK bonds has made matters worse as gilts have been hammered by political turmoil."
So to be a bit more precise, I'm saying that without Kwarteng my losses on this fund would be perhaps 10% rather than 15%. Why am I wrong to assert that?
I hear you, especially re Bailey, about whom I expressed my doubts on here at the time. And to some extent I was just venting my exasperation at a 15% capital loss on Kwarteng (whom I nevertheless still believe should never have been near the job). But I don't think you have really addressed this specific FT line:
"And its UK range is also especially interesting because Vanguard includes a “home-bias” in the funds, which otherwise take market exposure based simply on market cap. The 35 per cent tilt towards UK bonds has made matters worse as gilts have been hammered by political turmoil."
I have no clue about this but it wouldn't surprise me if the UK bias is because they are marketing these funds in the UK to UK investors. They are a US Company.....do you think they have a UK bias in their US funds?
I get invited onto the Vanguard quarterly fund updates. I dont generally join up to listen/watch them but I may do in the future to see what they are saying about their exposure to UK Bonds. As I've said before, I dont use them for my clients money so don't really know their view on their Bond positions, but being overweight in UK Bonds / Gilts this year has not been good for any fund management company. Since the start of the year I've tried moving clients out of Bonds and into Absolute Return funds. Problem is this year has seen almost everything decline, Equities, Bonds, Property, Commodities. I saw a chart last week (up to the end of September) and only one sector (Oli & Gas) was in positive territory. You just have had to be the least worst asset(s).
I hear you, especially re Bailey, about whom I expressed my doubts on here at the time. And to some extent I was just venting my exasperation at a 15% capital loss on Kwarteng (whom I nevertheless still believe should never have been near the job). But I don't think you have really addressed this specific FT line:
"And its UK range is also especially interesting because Vanguard includes a “home-bias” in the funds, which otherwise take market exposure based simply on market cap. The 35 per cent tilt towards UK bonds has made matters worse as gilts have been hammered by political turmoil."
I have no clue about this but it wouldn't surprise me if the UK bias is because they are marketing these funds in the UK to UK investors. They are a US Company.....do you think they have a UK bias in their US funds?
I get invited onto the Vanguard quarterly fund updates. I dont generally join up to listen/watch them but I may do in the future to see what they are saying about their exposure to UK Bonds. As I've said before, I dont use them for my clients money so don't really know their view on their Bond positions, but being overweight in UK Bonds / Gilts this year has not been good for any fund management company. Since the start of the year I've tried moving clients out of Bonds and into Absolute Return funds. Problem is this year has seen almost everything decline, Equities, Bonds, Property, Commodities. I saw a chart last week (up to the end of September) and only one sector (Oli & Gas) was in positive territory. You just have had to be the least worst asset(s).
@ Prague, if you were going to put a positive spin on it, you'd say you have to take the long-term view. But personally, I've had issues with the official line - and one that IFAs have to take from a regulatory perspective - that as people reach 50 there needs to be an in reading skew towards bonds. I think that's nonsense when nowadays some people can be retired for as long as they're working.
As for the skew - that would make sense, having exposure to your local market and currency, as long as it's transparent and you are aware of your exposure. Sounds like not the case in this example and doesn't work for you as it's not your local market!
If I were going to invest in bonds at all (and I may well in the depth of this crisis when everything is bombed out), then I might be as inclined to go for high quality corporate issuers like BAT as much as govies! They might be seen as safer bets than governments by the middle of next year.
I was going to take @TelMc32's Vanguard fund and compare it, graphically, with Life Strategy 20% but I could not finda platform that has both, (least of all Vanguard UK's own site which is very low rent). I'm not sure whether anyway it's the closest Vanguard fund to LS which would strip out the "British factor", - which I suppose is objectively what we want to do (well i do, anyway, for decision-making purposes)
Trustnet shows Life Strategy 20% is down 16.2% on YTD.
Trustnet only lists the Hedged version of Tel's fund, but that too is down 15.4%
On the other hand, for example the Vanguard US Treasury bond fund is actually up 1.4% while its US corporate bond fund is down 4.3%.
So I don't know whether I can isolate the British specific element in the UK Life Strategy fund's fall, from the above, even though the FT obviously believes it exists, irrespective of whether it was caused by Kwarteng, Bailey, or Jayden Stockley. The question is, what to do about it, which I will post separately below, as I will certainly appreciate the thoughts of those who understand this part of the market better than I do...
To be fair to Vanguard, I also have their US Equity Index fund, they are both positive unlike pretty much anything from any fund (whether bonds or equities) elsewhere (predominantly UK) over the last 12 months. One property (abrdn Global Real Estate) and one UK (Schroeder Recovery) being the other positive exceptions.
So Vanguard's position is, hold, on the basis that the year long phenomenon of Equities and bonds moving in lock-step and thus defying years of convention, will end. Worryingly however they do not explain why they think it will end and give any guidance about the time frame for this. Further, if it ends soon, and equities move up on the back of lower inflation/end of war etc, this implies that the bond sector would move down, thus increasing the losses in Life Strategy, which is 80% weighted in bonds. Correct (in principle) ?
So there is a safe alternative in cash deposits. Unfortunately I have a chunk of this fund in my SIPP, so there the best I can do is in a money market fund, which in the next 12 months might do maybe 1.5-2.0%. However the other holding is in the Vanguard platform and could be pulled out and put in a 1 year fixed account yielding maybe 4.5%.
So the question is, in the next 12 months will the Life Strategy 20 pick up more than 4.5% ? If so, then I should hold. The charts covering the period of recent turmoil send mixed messages. The red line is the LS20, and the grey one, LS100. The three-month period covering the chaotic week of Kwarteng and the aftermath is not encouraging however in the most recent 4 weeks the performances inverted and LS20 was the best performer, and LS 100 the worst. What has caused this uplift...gilt market stabilising?
I have some Vanguard LS 100% equity. Yesterday despite Monday's good rise in the US they managed to fall 0.43%, as coincidentally did all their LS funds. I wonder if they'll repeat that feat again today...
(I appreciate that it's an international fund, but everything else was pretty flat)
I'm inclining more to picking up some highish (5%+) yielding big co shares while prices are lowish - theyre for the longer term so short term movements dont trouble me as long as the dividends hold up.
So Vanguard's position is, hold, on the basis that the year long phenomenon of Equities and bonds moving in lock-step and thus defying years of convention, will end. Worryingly however they do not explain why they think it will end and give any guidance about the time frame for this. Further, if it ends soon, and equities move up on the back of lower inflation/end of war etc, this implies that the bond sector would move down, thus increasing the losses in Life Strategy, which is 80% weighted in bonds. Correct (in principle) ?
So there is a safe alternative in cash deposits. Unfortunately I have a chunk of this fund in my SIPP, so there the best I can do is in a money market fund, which in the next 12 months might do maybe 1.5-2.0%. However the other holding is in the Vanguard platform and could be pulled out and put in a 1 year fixed account yielding maybe 4.5%.
So the question is, in the next 12 months will the Life Strategy 20 pick up more than 4.5% ? If so, then I should hold. The charts covering the period of recent turmoil send mixed messages. The red line is the LS20, and the grey one, LS100. The three-month period covering the chaotic week of Kwarteng and the aftermath is not encouraging however in the most recent 4 weeks the performances inverted and LS20 was the best performer, and LS 100 the worst. What has caused this uplift...gilt market stabilising?
The short answer is 'yes'. The interest rate curve has flattened, i.e. expecting lower terminal rates, hence why mortgage rates are coming down and bonds are rising again.
But inflation is the killer of bonds, so if inflation comes down, rates should follow further and bonds will rise. If the geopolitical situation improves, ditto.
I wouldn't get too concerned about equity-bond correlations, as that's more complicated and can change depending on the circumstances. It's not that unusual for equites and bonds to move in the same direction. In fact, it always happens when bond markets crash, it's just that we haven't had a big bond market sell off for a very long time (2015 was the nearest and there are parallels to today). I'm pretty sure it usually happens coming out of a recession, as all ships rise. A stable market may switch between bonds and equities to reflect relative risk reward trade-offs. But after a recession, there is cash on the side, whilst at the top of the market, it's the opposite problem, most of the cash is on the table and people panic sell, particularly those on margin who have to raise liquidity.
Margin trading is doubly affected by rising interest rates. There are some interesting graphs showing large retail liquidations to cash and reducing leverage - that's all sucking liquidity out of this market.
The problem is if inflation keeps rising. Whilst governments who borrow in their own currency will never default (because they can always print more) as even lunatics like Paul Krugman, a strong advocate of MMT*, have had to admit, governments achieve this by inflation. The reason this has only just started to happen is because the Great China Deflation and (aggregate) benefits from globalisation are now over and in fact are now in reverse. 2015 was a warning and was seen as a dress rehearsal because that was the first time China took a wobble. Now it seems intent on continuing to do itself and us economic harm with its Covid lock down policy. If that reverses, markets will surge, but they doubled down at the weekend.
In the continued pain scenario, we have some way to go before the bottom in equities but some bonds traders I know are buying bonds on the basis that inflation should at least start to come down, even if company earnings start to fail. As long as you want to hold them to maturity, any dips in between won't hurt you but the income just may not match inflation.
FYI, I'm still part way through switching my accounts over to Interactive Brokers. They are offering 2.444 and 3.333% respectively on GBP and USD cash balances sitting in the SIPP. I'll dip in and out of this market for the next 6-12 months and earn some interest along the way.
* Modern Monetary Theory or Magic Money Tree, take your pick.
Right, so my brain is hurting a bit, but my takeout from your post is that if we get to a point where I believe inflation has peaked in many countries (and I think we may be quite near that point) then I might reasonably take the view that bonds will start to move up, even if we remain in an equity bear market. In which case I'd be better advised to stick with the Vanguard fund.
I'm having trouble believing that the recovery would be as swift as the fall (15% in 8 months...) but then it need not be that strong to beat 4.5% over 1 year.
Your remark re Interactive Brokers gave me an idea, Hargreaves Lansdowne have this thing called Active Savings which operates like Raisin, and is free for the customer. But guess what, it can only be opened within their normal Fund and Share Account, not within a SIPP...none of their offers are anything you can't get or beat elsewhere. And your deal is presumably effectively instant access. That's a very good benefit of the platform.
I have some Vanguard LS 100% equity. Yesterday despite Monday's good rise in the US they managed to fall 0.43%, as coincidentally did all their LS funds. I wonder if they'll repeat that feat again today...
(I appreciate that it's an international fund, but everything else was pretty flat)
I'm inclining more to picking up some highish (5%+) yielding big co shares while prices are lowish - theyre for the longer term so short term movements dont trouble me as long as the dividends hold up.
You may just find it's a pricing/timing issue (I know its something that annoys @PragueAddick). Vanguard might price their funds at 12 noon, and as they are forward pricing then the values used today (Tuesday) might be those calculated at noon yesterday (Monday)......when the US markets have not opened so probably using prices from close of business Friday. Even if they price at 5pm you will (at best) be getting prices a few hours after opening, and not the prices at close of business on the US on Monday.
Also, dont forget currency differences and if its hedged or not.
Right, so my brain is hurting a bit, but my takeout from your post is that if we get to a point where I believe inflation has peaked in many countries (and I think we may be quite near that point) then I might reasonably take the view that bonds will start to move up, even if we remain in an equity bear market. In which case I'd be better advised to stick with the Vanguard fund.
I'm having trouble believing that the recovery would be as swift as the fall (15% in 8 months...) but then it need not be that strong to beat 4.5% over 1 year.
Your remark re Interactive Brokers gave me an idea, Hargreaves Lansdowne have this thing called Active Savings which operates like Raisin, and is free for the customer. But guess what, it can only be opened within their normal Fund and Share Account, not within a SIPP...none of their offers are anything you can't get or beat elsewhere. And your deal is presumably effectively instant access. That's a very good benefit of the platform.
Sorry about the headache! Yes, I wouldn't sell, if you believe inflation is about to top (and I hope you're right).
Similarly, I bought infra and property (warehouse) ITs on the dip. I've taken a small loss but am just going to wait for them to recover and collect the 6% dividend in the interim. They price a bit like bonds, although the property ones have the risk of asset devaluations but both can increase prices and maintain dividends against inflation. They could go down with the equity market, but I have no intention of selling them and don't expect their dividend to need to reduce.
Have a look at this guy, who I know reasonably well, for more detail on bonds. https://www.crowknows.co.uk/investment-rules/ He's an ex-asset manager who retired in his forties, so was pretty successful, and knows the bond market inside out. He has some useful general tips on investing as well. I hadn't read him in a couple of months but am not surprised on his views on the market recently!
As for IB, yes, you get paid on any cash balances in your SIPP. So, as soon as you sell a stock, you're earning interest on that cash and that can be across multiple currencies. The transfer hasn't gone through yet, but the interest appears to be credited on a daily basis.
Their FX charges are way lower than HL as well - very close to inter-bank rates. Their dealing rates are virtually zero. You do have to pay for market data, but it's pretty low and you get level two data in real time, so way above anything you get from HL. You can put trades directly into the market, so shave a few points off the spread too. Stop and limit orders on US shares too. All this would have saved me thousands over the last few years. Last, for me, it gives me the opportunity to trade options, which is a much safer way of off-setting risks than how I'm currently having to do it, via leveraged ETFs (which I think suspect be banned!). The fx and interest alone would have given me 0.8% on my portfolio this year. With better stops and executing inside the best bid and offer, it should easily add 1%. A lot of this you can do with IG, where I have my ISAs, but their FX charges are higher.
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
Are your friends really making money? Have any of them actually been able to get money out?
Seems to be a scam and there are so many similar ones out there at the moment.
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
One of the best bits of advice I was given is never invest in something you don't understand.
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
I left you a comment in the crypto thread - but can you link to what you’re talking about please? I said in the crypto thread you’ve just combined two terms together - is it the name of something?
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
One of the best bits of advice I was given is never invest in something you don't understand.
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
US inflation rate turns downwards, markets bounce.
@WishIdStayedinthePub the reason I expressed some confidence that inflation might be peaking was that I'd read something in the FT by somebody who had looked at a set of underlying figures (for the US) which gave him confidence that it was already lower than the headline rate. Wish I could remember which article, as he has been proved dead right.
It then seemed to me that the US seems to lead world economies into and out of inflationary spirals, but I was just thinking this morning that maybe that's too broad a view to be reliable, and perhaps especially not the UK. But it also looks to have peaked locally here, if not next-door in Germany -that might be the next one to look for.
Well, this all suddenly looks a lot better, doesn't it?
Not counting on keeping these levels mind. I've managed to execute sell orders at target price on my grossly underperforming Jupiter and Schroder shares, as both surged 7-8% just in the afternoon. It'll be interesting to see where that Life Strategy fund is tomorrow.
I know nothing about any of this and don’t understand it. BUT have been asked to put money into something called AMMdefi. It invests your money into various crypto things. Lots of my friends are making a lot of money on it. Anyone heard of it or is it a dodgy ponzu type thing?
One of the best bits of advice I was given is never invest in something you don't understand.
Well, this all suddenly looks a lot better, doesn't it?
Not counting on keeping these levels mind. I've managed to execute sell orders at target price on my grossly underperforming Jupiter and Schroder shares, as both surged 7-8% just in the afternoon. It'll be interesting to see where that Life Strategy fund is tomorrow.
I'm sticking with Jupiter but it has been a dog! I think the dividend is suspect.
I'm having a very good day today but the consensus was that this CPI release would be positive, the markets would rally and then eventually the FED would have to talk them back down again. Doesn't change the 'fixed income' view, just that in the coming days it may be worth taking some profits in stocks.
Well, this all suddenly looks a lot better, doesn't it?
Not counting on keeping these levels mind. I've managed to execute sell orders at target price on my grossly underperforming Jupiter and Schroder shares, as both surged 7-8% just in the afternoon. It'll be interesting to see where that Life Strategy fund is tomorrow.
Yes, it appears the US inflation news has really perked up the markets. The broader US ones are 5% up and most European markets are up around 3%. FTSE lagging behind a bit but still up over 1%. Will make our end of year predictions a lot different to where we were a few weeks back (I had 7050 😔).
In general, inflation is set to start falling & within 12 months will be between 3%-4%. Base rates will follow suit & by the time of the next GE will be 3% and looking to go lower.
Yes a good day, glad I stuck it out, especially my US.
I did say (to everyone not just you) to hang in there & wait for things to recover. By all accounts inflation should be peaking & on the way down next year. Likewise base rates, although they are likely to go up to 4%-4.5% by mid 2023 & then slowly come down again by end 2024/early 2025.
Well, this all suddenly looks a lot better, doesn't it?
Not counting on keeping these levels mind. I've managed to execute sell orders at target price on my grossly underperforming Jupiter and Schroder shares, as both surged 7-8% just in the afternoon. It'll be interesting to see where that Life Strategy fund is tomorrow.
Yes, it appears the US inflation news has really perked up the markets. The broader US ones are 5% up and most European markets are up around 3%. FTSE lagging behind a bit but still up over 1%. Will make our end of year predictions a lot different to where we were a few weeks back (I had 7050 😔).
In general, inflation is set to start falling & within 12 months will be between 3%-4%. Base rates will follow suit & by the time of the next GE will be 3% and looking to go lower.
Spoke with another fund manager who says that Bonds have been oversold & that they are now buying back in. Good quality Corporate Bonds (AA & AAA's) & short dated Gilts. If you are buying funds rather than direct then might be best to look at Strategic Bond funds.
Comments
I hear you, especially re Bailey, about whom I expressed my doubts on here at the time. And to some extent I was just venting my exasperation at a 15% capital loss on Kwarteng (whom I nevertheless still believe should never have been near the job). But I don't think you have really addressed this specific FT line:
"And its UK range is also especially interesting because Vanguard includes a “home-bias” in the funds, which otherwise take market exposure based simply on market cap. The 35 per cent tilt towards UK bonds has made matters worse as gilts have been hammered by political turmoil."
I get invited onto the Vanguard quarterly fund updates. I dont generally join up to listen/watch them but I may do in the future to see what they are saying about their exposure to UK Bonds. As I've said before, I dont use them for my clients money so don't really know their view on their Bond positions, but being overweight in UK Bonds / Gilts this year has not been good for any fund management company. Since the start of the year I've tried moving clients out of Bonds and into Absolute Return funds. Problem is this year has seen almost everything decline, Equities, Bonds, Property, Commodities. I saw a chart last week (up to the end of September) and only one sector (Oli & Gas) was in positive territory. You just have had to be the least worst asset(s).
As for the skew - that would make sense, having exposure to your local market and currency, as long as it's transparent and you are aware of your exposure. Sounds like not the case in this example and doesn't work for you as it's not your local market!
If I were going to invest in bonds at all (and I may well in the depth of this crisis when everything is bombed out), then I might be as inclined to go for high quality corporate issuers like BAT as much as govies! They might be seen as safer bets than governments by the middle of next year.
Trustnet shows Life Strategy 20% is down 16.2% on YTD.
Trustnet only lists the Hedged version of Tel's fund, but that too is down 15.4%
On the other hand, for example the Vanguard US Treasury bond fund is actually up 1.4% while its US corporate bond fund is down 4.3%.
So I don't know whether I can isolate the British specific element in the UK Life Strategy fund's fall, from the above, even though the FT obviously believes it exists, irrespective of whether it was caused by Kwarteng, Bailey, or Jayden Stockley. The question is, what to do about it, which I will post separately below, as I will certainly appreciate the thoughts of those who understand this part of the market better than I do...
So there is a safe alternative in cash deposits. Unfortunately I have a chunk of this fund in my SIPP, so there the best I can do is in a money market fund, which in the next 12 months might do maybe 1.5-2.0%. However the other holding is in the Vanguard platform and could be pulled out and put in a 1 year fixed account yielding maybe 4.5%.
So the question is, in the next 12 months will the Life Strategy 20 pick up more than 4.5% ? If so, then I should hold. The charts covering the period of recent turmoil send mixed messages. The red line is the LS20, and the grey one, LS100. The three-month period covering the chaotic week of Kwarteng and the aftermath is not encouraging
But inflation is the killer of bonds, so if inflation comes down, rates should follow further and bonds will rise. If the geopolitical situation improves, ditto.
I wouldn't get too concerned about equity-bond correlations, as that's more complicated and can change depending on the circumstances. It's not that unusual for equites and bonds to move in the same direction. In fact, it always happens when bond markets crash, it's just that we haven't had a big bond market sell off for a very long time (2015 was the nearest and there are parallels to today). I'm pretty sure it usually happens coming out of a recession, as all ships rise. A stable market may switch between bonds and equities to reflect relative risk reward trade-offs. But after a recession, there is cash on the side, whilst at the top of the market, it's the opposite problem, most of the cash is on the table and people panic sell, particularly those on margin who have to raise liquidity.
Margin trading is doubly affected by rising interest rates. There are some interesting graphs showing large retail liquidations to cash and reducing leverage - that's all sucking liquidity out of this market.
The problem is if inflation keeps rising. Whilst governments who borrow in their own currency will never default (because they can always print more) as even lunatics like Paul Krugman, a strong advocate of MMT*, have had to admit, governments achieve this by inflation. The reason this has only just started to happen is because the Great China Deflation and (aggregate) benefits from globalisation are now over and in fact are now in reverse. 2015 was a warning and was seen as a dress rehearsal because that was the first time China took a wobble. Now it seems intent on continuing to do itself and us economic harm with its Covid lock down policy. If that reverses, markets will surge, but they doubled down at the weekend.
In the continued pain scenario, we have some way to go before the bottom in equities but some bonds traders I know are buying bonds on the basis that inflation should at least start to come down, even if company earnings start to fail. As long as you want to hold them to maturity, any dips in between won't hurt you but the income just may not match inflation.
FYI, I'm still part way through switching my accounts over to Interactive Brokers. They are offering 2.444 and 3.333% respectively on GBP and USD cash balances sitting in the SIPP. I'll dip in and out of this market for the next 6-12 months and earn some interest along the way.
* Modern Monetary Theory or Magic Money Tree, take your pick.
Right, so my brain is hurting a bit, but my takeout from your post is that if we get to a point where I believe inflation has peaked in many countries (and I think we may be quite near that point) then I might reasonably take the view that bonds will start to move up, even if we remain in an equity bear market. In which case I'd be better advised to stick with the Vanguard fund.
I'm having trouble believing that the recovery would be as swift as the fall (15% in 8 months...) but then it need not be that strong to beat 4.5% over 1 year.
Your remark re Interactive Brokers gave me an idea, Hargreaves Lansdowne have this thing called Active Savings which operates like Raisin, and is free for the customer. But guess what, it can only be opened within their normal Fund and Share Account, not within a SIPP...none of their offers are anything you can't get or beat elsewhere. And your deal is presumably effectively instant access. That's a very good benefit of the platform.
Also, dont forget currency differences and if its hedged or not.
Similarly, I bought infra and property (warehouse) ITs on the dip. I've taken a small loss but am just going to wait for them to recover and collect the 6% dividend in the interim. They price a bit like bonds, although the property ones have the risk of asset devaluations but both can increase prices and maintain dividends against inflation. They could go down with the equity market, but I have no intention of selling them and don't expect their dividend to need to reduce.
Have a look at this guy, who I know reasonably well, for more detail on bonds. https://www.crowknows.co.uk/investment-rules/ He's an ex-asset manager who retired in his forties, so was pretty successful, and knows the bond market inside out. He has some useful general tips on investing as well. I hadn't read him in a couple of months but am not surprised on his views on the market recently!
As for IB, yes, you get paid on any cash balances in your SIPP. So, as soon as you sell a stock, you're earning interest on that cash and that can be across multiple currencies. The transfer hasn't gone through yet, but the interest appears to be credited on a daily basis.
Their FX charges are way lower than HL as well - very close to inter-bank rates. Their dealing rates are virtually zero. You do have to pay for market data, but it's pretty low and you get level two data in real time, so way above anything you get from HL. You can put trades directly into the market, so shave a few points off the spread too. Stop and limit orders on US shares too. All this would have saved me thousands over the last few years. Last, for me, it gives me the opportunity to trade options, which is a much safer way of off-setting risks than how I'm currently having to do it, via leveraged ETFs (which I think suspect be banned!). The fx and interest alone would have given me 0.8% on my portfolio this year. With better stops and executing inside the best bid and offer, it should easily add 1%. A lot of this you can do with IG, where I have my ISAs, but their FX charges are higher.
https://www.scamwatcher.com/scam/view/516369
It has stood me well over the years.
@WishIdStayedinthePub the reason I expressed some confidence that inflation might be peaking was that I'd read something in the FT by somebody who had looked at a set of underlying figures (for the US) which gave him confidence that it was already lower than the headline rate. Wish I could remember which article, as he has been proved dead right.
It then seemed to me that the US seems to lead world economies into and out of inflationary spirals, but I was just thinking this morning that maybe that's too broad a view to be reliable, and perhaps especially not the UK. But it also looks to have peaked locally here, if not next-door in Germany -that might be the next one to look for.
Not counting on keeping these levels mind. I've managed to execute sell orders at target price on my grossly underperforming Jupiter and Schroder shares, as both surged 7-8% just in the afternoon. It'll be interesting to see where that Life Strategy fund is tomorrow.
I'm having a very good day today but the consensus was that this CPI release would be positive, the markets would rally and then eventually the FED would have to talk them back down again. Doesn't change the 'fixed income' view, just that in the coming days it may be worth taking some profits in stocks.
In general, inflation is set to start falling & within 12 months will be between 3%-4%. Base rates will follow suit & by the time of the next GE will be 3% and looking to go lower.
Crisis.....what crisis.
As they say, its always darkest before the dawn.
Looking rosey @bobmunro