Tag Archives: money

End of April finance

End of month finance review time.

What’s happened on the finance and investment side of things? Redrow has done rather nicely but star performer has been JD sports, up neatly 15% over the last month. On the downside, Burberry recently announced a reduction in sales and so suffered a sudden fall in price but looks to be recovering a little. Rio Tinto seems to be on a bit of a downer, but it’s GlaxoSmithKline that’s going to be sold out of the portfolio. So on Tuesday (Monday being a bank holiday) Glaxo will go and be replaced with Persimmon (PSN).
Overall the portfolio is up over 2% and is nicely outperforming the FTSE 100 index. It is generally targeting capital growth, any dividends will be seen as a bonus.

Income.

As for setting up an income virtual portfolio I’m doing something a little non-standard. I’ve sorted out 10 high income type investment trusts (Brunner (BUT), City of London (CTY), F&C Capital and Income (FCI), JPMorgan Claverhouse(JCH), Merchants (MRCH), Murray Income (MUT), Schroder Income Growth (SCF), Scottish American (SCAM), Temple Bar (TMPL), Value & Income (VIN)), and have, in my simulation, bought £1,000 of each of them.

The slightly non-standard thing is that having decided on what to buy (based on long term dividend stability / growth) I back-dated the purchase to the start of last December. This does immediately give me an idea of how the income side is performing in respect to dividend generation. The start of December is also an important date regarding some pension stuff I have, so having this income portfolio running parallel to my pension stuff will be useful to me. This straight away lets me see that it’s currently paying out dividends at an equivalent interest rate of 3.5% a year, but if I add this to overall capital growth then since December it’s showing a 10% gain. This compares to an 8% gain in the FTSE100 Total Return Index over the same period.

I’m happy enough with things at the moment. It is a learning experience and will be useful later in life when I’m no longer having a wage as an income but am relying on other investment sources.

Cinema super-hero watching

Found myself down in the cinema a fair bit recently watching a few super-heros such as Avengers Assemble, The Amazing Spider-man, and also Ice Age: Continental Drift.
Enjoyed them all, but…when I say enjoy, I did enjoy them, but only ’enjoy’, not ’wow that was amazing’. All this got me wondering what’s going on with the big film studios these days.

This Ice Age is now the 4th in the series. I really liked the interplay between Sid, Manny, and Diego in the original. Now there are so many other characters (and sub-plots) demanding your attention that the original sparkle has been lost in a sea of indifference.

Another reinvention of Spider-man (I assume the numerous sub-plots were left open to enable plenty of sequel opportunities). However I’m not too sure how really different this version was compared to the start of the previous series (except perhaps for the college students who looked far more mid-20s than late teenage guys).

A pulling together of Iron Man, Thor, The Incredible Hulk, Capt. America, Black Widow, and Hawkeye into the Avengers. I thought a chance for some amazing interplay between these characters, but it seemed more a case of throw in as many impressive special effects as you can even if they’re not very original (how many times can New York get trashed in how many different films), and just let the plot look after itself without too much thought required.

As mentioned at the start (and despite my other comments) I enjoyed watching these films, but is it just me in that I do find myself getting a bit tired of the big film studios relying too much on the re-hashing of existing franchise and going for known safe numbers rather exciting us with something new. (We made money with this before so let’s just re-do it again and we’ll make even more money.)

Then I read that the film studios are splashing out over $200 million on making some of these action films, or around $2,000,000 per screen minute. That’s one hell of a lot, and considering the cost of a cinema ticket, I really expect more for that sort of outlay than just another repeat.

Wagamama; first impressions.

Glasgow has it’s fair share of noodle style restaurants, and my usual one is Ichiban. However, as a bit of a change myself and a friend headed off to the local Wagamama outlet. Not been before so curious about what my first impressions would be.

I guess it was around half full, though they had got most people all squashed together. We were duly slotted into a gap between two other groups of people. (Not a place for conversation unless you want everybody else to be able to listen in.)

We had hardly sat down and picked up the menus when a waitress came up and asked us what we wanted to drink. Because I showed a slight hesitation in saying what I wanted the waitress grabbed the menu from me, turned it round so the drinks page was uppermost, then thrust it back at me (rather rude, and certainly no thought of ‘customer service’). Our drinks were quick to arrive and food order taken. The menu was rather dominated by either prawn type seafood or chicken dishes, so I went for some spicy chicken. It arrived reasonably quickly. The food itself was nice but had been put onto a very cold plate. This meant that the main part of the food was reasonably hot, but the food towards the edge was tepid at best.

I thought this was meant to be an oriental style noodle bar (chop sticks were provided) but the way the food had been prepared and cut meant that using chop sticks a was not really a practical option.

I had hardly finished my last mouthful (my friend was still eating) when my plate was whisked away from me. The thought ‘conveyor belt’ sprung to mind, no proper customer service, we were there to be processed as quickly (and as indifferently) as possible.

The bill was presented and money handed over, and then we waited, and waited, and waited, and I noticed all the money trays at the counter had long been cleared, and we waited (for longer than it took us to eat the meal) and waited and I noticed our waitress occasionally glancing at us till eventually she went to the computer terminal, tapped quickly, and shortly after our change arrived! Quite obviously she had no intention of giving this to us.

Looking around, for what was meant to be an oriental style food bar there were no ‘oriental style’ people eating there, and likewise not an oriental person visible behind the relatively open plan kitchen area. This thing of no local oriental people willing to eat in this style of place was for me an interesting reflection on it’s actual quality and authenticity.

Compare this to my local Ichiban; similar rice or noodle based dishes, similar price range, but a place where hardly an English word is audible from behind its kitchen area, and a customer base that’s very oriental biased.
Would possibly be willing to give the place a second try (though not in any rush). However from my first impressions I know which restaurant I prefer to be spending my money in!

Wagamama  and Ichiban

Money and Things.

Money and things finance related.

An unexpected thing happened recently. Without warning or giving reason my credit card company lowered my credit limit by about 80%. I’ve not been near my limit in ages, so in that respect it was not a problem. Where it was a problem was that suddenly, and without warning, I’d lost an important source of instantly available emergency money. That ‘comfort blanket’ where you know that if something happened and you needed money *right now*, not in a few days, not tomorrow, but instantly (and if it is that sort of situation, then it probably is instantly), that supply had gone. Oh crap.

I suppose the proverbial silver lining to it was that got me looking at my whole money position, and especially to my pension situation. I’m sure most people are aware of all the fuss there has been in the press over the last few years over pension deficits and how a large proportion of the population are going to have very limited income when they retire. At the moment the basic state pension is just under £100 a week, or a bit below £5,500 a year. Not a lot to live off!

I do have a bit of money put to one side for my old age, but this did highlight that I do need to increase this, however I don’t have a great deal of free income coming in to add to this fund, so I must make it grow by itself.

So off to see a pension / financial advisor and see what he had to say. To cut a long story short, the final outcome was that we would put the money into a SIPP (Self Invested Personal Pension) and within that SIPP he would look after half and I would control the other half.
So I have put my half into a range of Investment Trust. Investment trusts are companies who invest their money in other companies! This is not as silly as it sounds. Let’s say you think that the countries of S. E. Asia or perhaps of Eastern Europe show growth potential. You could go off to their individual stock markets and buy into specific companies based in S. E. Asia or Eastern Europe (not always very easy to do), or you could find a U.K. based company listed on the London stock exchange which does just that, invest in these places, and then buy the shares of that U.K. based company (quite easy). So that’s what I’ve done; a selection of investment trust funds that look to S. E. Asia, to Europe, and to mining companies.

My advisor has gone in to European based Unit Trusts. Unit trusts perform a similar function to investment trusts, are often run by the same people, are far more popular, but are set up in quite a different manner. (Do an internet search yourself on something like ‘difference between investment and unit trusts’ if you want to know more about them.)

I’m quite happy with the idea that at times the stock market will go up, but it will also have it’s down periods. We had a down period with the recent banking crisis though the stock market has done a considerable recovery since then. There have been other fall periods in the past, there will be other fall periods in the future (tough, that’s the way things go). However what I’m looking for is say, if I average out the ups and downs over a period of 10 years, to grow by an equivalent of at least 10% a year. That is my minimum personal target. In good years this will not be too difficult to do, however the bad years will pull this figure down. So in reality I must look to at least 20% ‘good year’ growth to balance the bad years out.

What I’m also expecting is that my advisor should out-perform me. Professional advice does not come cheap, they have the financial training, knowledge of the market and access to far more financial information than me. So if I do out-perform him I may feel clever at having out done the professional, but also disappointed in that I will not have got value for money for the fees that I have paid.

Only time will tell.