Clueless Imbecile

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  1. Some thoughts I'm wrestling with at the moment... 1) If we get the deflationary bust, then I guess that means that stockmarkets would crash quite severely (e.g. as a pure guess, maybe 50 to 60 percent?). However, I think someone said that the markets would take decades to recover (as opposed to the usual, say, 4 years). What is the rationale behind that idea that the stockmarkets would take far longer to recover this time? 2) I'm thinking that I should have some government bonds in my portfolio, for the sake of diversification, but they just seem poor value at the moment. If interest rates are likely to fall (much talk of negative yields recently) then am I better off holding cash and waiting until yields rise? One thing I did think is that I am safer buying gov bonds direct (e.g. UK gilts & US treasuries or TIPS) rather than investing in a bond fund (because a fund could be forced to sell bonds when the price is unfavourable if a lot of unit holders decided they wanted out of the fund, whereas with individual bonds I could hold until they mature if necessary and therefore not be forced to sell at less than the maturity value). 3) Do we have a list of what DurhamBorn calls "reflation stocks"? I tend to think I should have between 10 and 20 different stocks for the sake of diversification and not putting to much of my pot into any one company. Currently I have the following stocks: BT Vodafone Centrica SSE Stagecoach Royal Mail I think DurhamBorn mentioned Imperial Brands. I'm currently thinking of buying some of those shares but not sure whether to wait in the hope of the share price falling or dip my toe in now. Ideally I would find some good reflation stocks that are in different industry sectors to the ones I've mentioned above. How about: Pharmaceuticals Are there any more reflation stocks? As I understand it, the criteria that defines what is a reflaton stock is one that meets all of the following: a) Well established company with a track record of paying good dividends (e.g. yield of 5 percent or higher). b) Industry sector where there is a large capital investment needed in order to set up in business (e.g. in infrastructure, machinery) thus making it expensive for competitors to start up. c) The company's debt must either be quite low (such that they could easily pay it off) or be fixed at a low interest rate so that they are not at the mercy of rising rates in the next cycle. d) Price to earnings is low (e.g. less than 15). Is there anything I've missed? Thanks to spunko for this fantastic forum, thanks to DurhamBorn for this amazing thread, and thanks to all who've posted on here. This thread is usually the first thing I look at when I surf the web each day. Good luck guys, and DYOR! Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  2. I just thought... If we get stock market crash (possibly global), would that mean that companies that currently have a large pension liability would find it even harder to fund it? I've been looking at the juicy dividend yields quoted for some UK shares today but it just occurred to me that maybe some of those companies could really struggle due to this, for example if they suddenly had to divert a lot of money to prop up their pension fund (perhaps leading to a significant cut in the dividend). Another thought I've been wrestling with is: should I keep a chunk of cash in order to invest in shares if we do get a crash (e.g. buy in cheaper than todays price), or would that cash be undermined by inflation in the meantime? I don't really feel I've got enough knowledge to understand the pros & cons of keeping a chunk of my investment pot in cash (other than that I know that in the long run my cash savings are getting withered in real terms by inflation). Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  3. I'm considering investing in more silver mining stocks, but I just feel a bit nervous about the risk of them going bust before the silver price picks up enough to get me a decent profit. I was therefore thinking about maybe investing in a silver miners ETF or Fund (OEIC or Unit Trust). I haven't found many though, and from what I've seen they tend not to be available on ISA platforms. Here's one I did find (looks like it is Gold and Silver though; not just silver): https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/m/merian-gold-and-silver-r-gbp-accumulation/key-features Generally speaking, with an ETF or Fund, my main worry would be that the annual fee would eat into the investment if the silver price didn't rise enough over the years. Just wondering what peoples thoughts are on silver mining stock ETFs/Funds? Have you found any that are available on an ISA platform (if so, which ETF/Fund and which platform)? Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  4. Thanks. Does the book cover the apparently market-distorting effect that central banks policies seem to have had over the last 10 years? I've read Tim Hale's "Smarter Investing" (third edition) and really liked it. I'm familiar with passive investing and what I think of as traditional asset-allocation theory (bonds vs equities vs cash). However, I'm doubting whether the traditional wisdom about bond investing still applies in this QE & ZIRP distorted environment. I've read a lot of comments over the last few years where people have expressed an opinion that bonds are overpriced at the moment, hence my dilemma. Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  5. Thanks for all the comments in response to my previous post. It's great to hear the opinions of you guys on here. (It makes me realise just how little I know about financial markets & investing. Ha ha!). My investment pot right now is as follows: 1) 68% Equities (mostly tracker funds, plus a few "reflation stocks" and PM mining stocks). 2) 4% PMs (in BullionVault). 3) 28% Cash. I'm mid 40's so I'm probably overweight in equities based on traditional asset allocation strategies (e.g. "Subtract your age from 100 and the result is how much you should have invested in equities"). I'm comfortable with that though, particularly since the returns on cash savings have been so poor recently. I don't own a house (am living cheaply with parents at the moment), so my investment pot will probably one day need to buy me a house to live in. I'm quite happy living with parents so no plans to move out any time soon, but it is possible that at some point over the next 20 years I might decided I want to buy a house of my own (particularly if the UK finally gets a decent house-price-crash). My main goal in life is to achieve financial independence as soon as I can. My dilemma is what to do about the 28% Cash, most of which is getting zero return because it's sat in my ISA. I keep thinking about government bonds (corporate bonds are too risky at the moment in my opinion). I'm worried about the potential future runaway inflation over the next cycle (approx 10 years?) that has been talked about on this thread. This leads me to think about index-linked government bonds. I'm thinking maybe index-linked UK gilts and index-linked US treasury bonds ("TIPS"?). My understanding of index-linked gilts is as follows: 1) Government issues bonds with face value ("par value"?) of £100, which pay interest ("coupon") of say, 1 percent with index-linking to RPI. Investor buys a bond for £100. 2) After 1 year the government calculates what the original £100 would be if increased by RPI and then pays 1 percent coupon on that uprated value. For example, supposing that RPI was 5 percent, the figures would be: uprated value = £100 + ((5/100) * 100) = £105 index-linked coupon = (1/100) * 105 = £1.05 At end of year 2, the uprated bond value (£105) would itself then be uprated again by whatever RPI was in the second year, and the 1 percent coupon would be calculated on that second uprated value. The one thing I don't understand is: What happens when the bond matures? Does the government pay the investor his original £100 back and cancel the bond, or does the government pay the £100 plus RPI increase (compounded over the term of the bond)? Could someone please explain? The above is a simple case where the investor buys the bond direct from government. I guess things get more complex when the investor buys the bond on the secondary market (e.g. from another investor) for a price that is different from the original face value. That could mean that the interest they receive is different as a percentage of what they actually paid for the bond. I also don't really know how it works with index-linked bond funds (Unit Trusts, OEICs, ETFs). I'm in a bit of a muddle with this stuff. I keep thinking that I should be buying some index-linked bonds or units/shares in an index-linked bond fund (all government, because I've ruled out corporate bonds as stated earlier). However, I'm worried that they might be poor value despite the index-linking (because the bond price has been bid up on the secondary markets by people who are desperate to protect their capital from inflation) and I really don't know much about bond investment. The questions I'm wrestling with at the moment are as follows: Q1) Are index-linked government bonds a reasonable investment right now to protect my capital over the next 5 to 10 years? Q2) Should I buy the bonds direct (apparently this is possible in an online ISA platform, at least for UK Gilts; not sure about US TIPS), or should I buy units in a fund that invests in such bonds? DurhamBorn, I think I saw you mention US TIPS (or a TIPS fund) a few pages back. Would you mind sharing your opinion of whether/when to invest in TIPS or Gilts in the context of the above? (not advice, I know!). Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  6. Here is a quick update following on from my previous post... I phoned my online ISA provider (Lloyds Bank) yesterday and asked them to sell my holding of SIBANYE GOLD LTD SPON ADR EACH REP 4 ORD SHS. Whilst looking at my account online I saw that I was also unable to use the online facility to sell my HARMONY GOLD MNG SPON ADR REP 1 ORD ZAR0.50, so I asked them to sell my holding of that stock also. They sold my holding in both stocks in accordance with the instructions I gave over the telephone and only charged me the online trading fee (which is a lot cheaper than the telephone trading fee). Based on conversations I had with Lloyds Bank, it sounds like HMRC have decided that ADR ("American Depository Receipt") shares are not eligible to be traded in an ISA (even though I was allowed to buy both stocks in my online ISA last year). I don't know how accurate that information is, and I have not checked with HMRC. I made a decent profit on those two stocks, although unfortunately, the last time I looked I was seeing a paper loss on some of my other stocks which was slightly more than my profit on Sibanye and Harmony. I was given the option of holding the ADR stocks in an online trading account that is outside of an ISA, but I don't want the risk of having to pay capital gains tax, and I don't even want the obligation of having to keep records to prove that any profit I make is within the capital gains tax allowance. I don't know what to do now as regards PM mining shares. In the PM mining sector, Sibanye and Harmony were my favourites. I still hold YAMANA GOLD INC COM NPV in my ISA and my holding was down about 10 percent when I looked earlier today, although that doesn't include the dividends I received from Yamana (I've had several). I also still hold ENDEAVOUR SILVER C COM NPV and NEW GOLD INC COM NPV, although both my holdings were down when I checked today (my New Gold holding was down about 57 percent!). Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  7. Hi Guys. Thanks for your replies to my recent post. Just thought I'd tell you about an intensely annoying experience I have just had... I just tried to sell some of my SIBANYE GOLD LTD SPON ADR EACH REP 4 ORD SHS this evening whilst the NYSE was open. My holding was up about 55 percent at one point. However, my online share dealing ISA (Lloyds Bank) would not allow me to trade them. Long story short... after calling them and waiting on hold for a while they told me that the stock is no longer ISA eligible (you what?!!). That's even though I was able to buy them through my online ISA last year. They said I can phone them tomorrow and get them to carry out a trade for me over the phone, but obviously the share price could have moved by then. This has really given me cold feet. My current thinking (which could change) is that if the stock is still showing a good profit for me tomorrow then I might call them and ask them to sell all of my Sibanye Gold Ltd shares (rather than just top-slicing). It's not much good to me if I can't trade online as & when I want to. It's hard enough making money from the stock market as it is, without having my hands tied like that. I asked about my other NYSE listed stocks and they seemed to think that I would still be ok to trade them online in my ISA. I was all set to top-slice and make a decent profit tonight. Well pissed-off now...! Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  8. What to do... what to do...? My PM mining stocks are as follows when I checked recently: ENDEAVOUR SILVER C COM NPV -26.02% HARMONY GOLD MNG SPON ADR REP 1 ORD ZAR0.50 25.70% NEW GOLD INC COM NPV -57.35% (ouch!!) SIBANYE GOLD LTD SPON ADR EACH REP 4 ORD SHS 46.21% (cool!!) YAMANA GOLD INC COM NPV -12.01% I invested similar amounts in each stock. I haven't done the calculation but I guess it probably works out at a small loss. It crossed my mind to sell the Sibanye (and maybe also the Harmony) to get a decent profit while I can, and hold the others in the hope that they recover. However... if there was to be a bull market in PMs & PM miners, then what if Sibanye and Harmony ended up rising the most (after I'd sold them)? My current thinking is that I'll just hold for a while in the hope that a future bull market might lift at least one of the stocks enough to get me a decent profit overall. What does the panel think? (I know it's not advice!) Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  9. Does anyone know: Are GDX (VanEck Vectors Gold Miners ETF) and GDXJ (VANECK VECTORS/JR GOLD MINERS ETF) available to buy & sell within the Hargreaves Lansdown ISA platform? When I looked on their website recently it seemed to indicate that they are available within their ISA, but I thought someone on here had said that they could not buy them? I don't have an ISA with Hargreaves Lansdown and therefore cannot log in to check. Are they available on any other ISA platform? Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  10. Just wondering what people think about bonds & bond funds... I've dabbled in PMs, PM Mining stocks and "reflation" stocks with a small percentage of my investment pot, based in inspiration from what's been discussed on this thread. However... My main strategy is still similar to what Tim Hale describes in his book "Smarter Investing". I've got the low-cost equity index-tracker funds in my ISA, but the rest of my pot is in cash savings (earning little or no interest). If I'm following the strategy described in Tim Hale's book, then I guess I should be investing most of that cash in bond-funds (possibly some government bonds and some corporate bonds). The thing that's holding me back is that I've been reading comments (for a few years now) suggesting that bonds are currently in a bubble and offer poor value. If I've understood it correctly, ZIRP & QE have inflated bond-prices thus reducing the yield (at least for fixed-interest government bonds), therefore making bond markets in general relatively expensive. I suppose my options for bond investing are: 1) UK government bond fund 2) Overseas government bond fund (e.g. IBTL for US treasuries) 3) UK corporate bond fund 4) Overseas corporate bond fund Are bonds still suitable for balancing out an equity portfolio? I could just keep the rest of my pot in cash savings in the hope of investing it into the stock markets after a stockmarket crash, but the problem is; the crash might be a long time coming or might not be as severe as expected (or might not happen), and in the meantime my cash is being erroded by inflation. Not sure what to do? Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  11. Good evening all! I'm a bit worried about what's been said on here about stockmarket index tracker funds because I've still got a lot of my investable pot in a collection of trackers (mostly unit trusts and OEICs) that each cover a different region within global markets. I have tried to protect my wealth a little by investing (diversifying?) in some PM miners and a few (reflation?) stocks (Vodafone, Centrica, BT, SSE) and also a small amount of physical silver (stored in a vault, not at home). My strategy with the tracker funds was buy and long-term hold with dividends re-invested (accumulation units). I am about 20 years away from retirement. Obviously I can't predict the future but I think it's unlikely that I would need to sell my tracker funds Within the next 10 years (maybe 20 years). With the above in mind, I'm just wondering what people here think about trackers (as long term hold from now on)? If the great crash that we're talking about were to happen in the next few years, I would expect that tracker funds would fall in value accordingly (since they're designed to track the market). But... wouldn't we expect the stock markets (globally) to eventually recover and the tracker funds also recover? I imagine that trackers automatically trade (ie by software automation), but I guess that would be to periodically re-balance as the market-cap weightings of different stocks within the index fluctuate. I don't see why trackers should auto sell just because the market is falling as a whole? I think someone was talking about the risks of ETFs spiraling down in a falling market. Is that specifically ETFs (Exchange Traded Funds) or does the same risk apply to UTs (Unit Trusts) and OEICs (Open Ended Investment Companies)? There are subtle differences between ETFs (priced in real time like a stock) and UTs/OEICs (usually priced once per day and only orders placed before a cut-off time get executed at that day's price point). I have a lot of sympathy with the views expressed on here and a lot of respect for everyone who has taken the time to express their opinions. I have taken some action based on what I've learned here (the PM mining stocks and physical silver in a vault). However, at the same time I feel reluctant to completely abandon my buy-low-cost-tracker-funds-and-long-term-hold-with-dividends-reinvested strategy. I would be interested to hear peoples views on this. 1) Am I being foolish to think that I can simply hold my stock market index tracker funds long term (from now on for 10 years or more) and ride out the kind of crash that is being discussed on this thread? 2) Do people think that long standing principles such as (a) buy-and-long-term-hold of low cost index tracker funds, (b) pound-cost-averaging, (c) time-in-the-market-not-timing-the-market, are no longer applicable? My own answers to the above would be: 1) No I'm not being foolish. The markets may crash and my tracker fund holdings fall in value accordingly, but as long as I hold long enough for the market to recover and the tracker funds track that recovery, I should not lose out. Plus, while the market is down, the dividends should be getting re-invested to buy more shares whilst they are cheap. The effect of that should get amplified as the markets rise. 2) No. Those principles are still good. As you can see, I still believe in stockmarket index tracker funds. I do have a slight worry about what might happen if they become too popular (following the herd isn't always the best strategy), but even if trackers become the most popular investment going, I would guess that a lot of investors would not have the self-discipline to hold for the long term. Therefore, if I do hold for the long term, that could give me an edge. ...but that's just my opinion. Happy to hear other peoples opinions (even if you think I'm being a clueless imbecile, LOL!). Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  12. I suppose it depends on how much time I had to spend on it. I don't want to spend my precious leisure time working for a pittance. However, if I could make £10 per hour net (after tax and expenses), then I'd probably spend a few hours per week on it. I'm not talking about getting rich, just trying to find a way to make a few grand per year extra. If I could make £500 per month extra money I would be quite pleased with myself. If I could get paid for overtime at work I would probably put in a few hours per week (or maybe even at the weekend). Unfortunately though, in 20 years in the industry I've only ever had the opportunity to do paid overtime a handful of times. Paid overtime just doesn't seem to be a thing in IT. Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  13. I do business software development (pretty much always with a relational database backend) in C#, SQL Server and ASP.NET (although only just getting into the web frontend dev stuff). Affiliate marketing - is that where you have a website that has links to commercial websites, and if users of your website click on those links then the commercial website pays a comission if it leads to a sale? I once had my own website that was a sort of blog/diary about a hobby that I was interested in at the time. I wrote book reviews on my website and included links to those books on amazon (Amazon associates, if I remember correctly?). However, my website only got about one thousand views per month and I never made even a single penny from it. I think you need a lot of traffic to a website in order to make any money from it, probably hundreds of thousands (or even a few million) of page views per month, although that is just a guess). There will be very few hobbyist websites that receive that much traffic. I have thought about trying to write my own software product to sell. Years ago I used to think about developing a desktop Windows application, but I suppose nowadays it would probably need to be a web application or smartphone app. However, now, as then, the problem is coming up with an idea that I believe in. I know people who've done this and even though they were great developers who produced great software, I don't know if they made much money from it. Seems like starting a rock band; some people get rich from it but the vast majority don't. Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  14. Hi Frank. Regarding VCTs; I remember hearing about them years ago when I was contracting, but never really looked into them. I know they are tax efficient, but aren't they quite risky? It's all very well being tax efficient but only if the investment makes a decent profit. I remember a phrase from back then (90's / 2000), which was something like: "Don't let the tax tail wag the investment dog!". What percentage of VTCs available end up making a decent profit and what percentage ends up making a loss? Do they invest in (presumably several?) startup companies shares? Is there a good place to learn more about VCTs (website, book)? Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.
  15. Just to be clear... I'm already doing the FIRE thing (reduced my outgoings as much as I reasonably can, investing in low-cost stockmarket index-tracker funds with dividends reinvested). Seems like the guys who achieve FIRE are generally earning six figure salaries over a period of ten years or more. I'm only on a low five figure salary, which means the "retire early" part doesn't really work for me. The idea of the thread is how to earn "extra" money, not change careers or go contracting (already tried that - see above). Another idea I had was: 2) advertise a "PC doctor" type service going around the local area helping people with PC/Windows type problems. That would be suited to my IT skills. However, I don't really want to become known in the area for doing that sort of thing. I'm quite a private person and don't want to pestered about IT stuff when I go down the pub! Cheers, Clueless Imbecile Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.