Once again, we find ourselves standing knee deep in Friday; wading through the final throes of the working week so we can clamber upon the banks of the sunny weekend and recharge our batteries. Flamboyant enough? I’d give it a solid 6.5…
Anyway, what has caught my eye this week? Settle back, get your ears ready for our first Guest DJ playlist selection and hopefully enjoy my review of the week.
First up, is Neil Woodford a screaming buy? If you haven’t heard, the UK’s most famous fund manager is looking to write the sequel to “2017: My annus horribilis” with “2018: Quite possibly another shocker”, after one of his major holdings, Capita PLC, fell more than 40% on Wednesday after it announced a profit warning. Its plan to raise around £700m in a rights issue this year was received by the market in a similar way to Carillion last week and by the end of the day was down 44% at 204p, more than 60% from the 500p the group was trading at last year.
As you can guess, Neil Woodford was the highest profile shareholder in the fund and the press have been all over it like a tarpaulin. Bad news sells, and after last year when his Equity Income fund returned 0.8% against the FTSE All Shares index’s return of 13.8%, the news of Capita’s fall is fuelling the fire. In the effort to provide full transparency, Three Counties have 0.11% exposure to Capita at this point, an amount which causes us no concern.
“But you are doing just the same, revelling in the poor man’s suffering.” Firstly, hardly suffering. Secondly, no. What is most difficult for the vast majority of retail investors is to ultimately ignore past performance. The FCA state that past performance is no guide to the future, however as humans we find comfort in basing our decisions, investment or otherwise, on previous outcomes. Hence the reason why you find ZERO articles on the interwebs about buying Woodford at this point in time.
Yet, with such a recent fall in value and the fact that Neil (I assume I can call him Neil, is that ok Neil?) has vast experience of managing UK equities over numerous market cycles, surely he should not be considered as a busted flush? Either way, what it does show is the ultimate importance of diversification; it is simply the most important consideration in managing your investments, to ensure that if one of your funds does go off the boil (and they will, they always do) the portfolio as a whole does not suffer. Naturally if you want a chat, give me a bell. I’m like this is real life too!
Moving on, sometimes I come across pieces of news that genuinely make me stop and think; think how wonderful the human being can truly be.
This week, Mr D-to-the-onald Trump, the 45th President and King of ‘Murica, held his State of the Union address. This is an annual even where the incumbent gives a speech on the economic state of the States alongwith outlining their legislative agenda. Riveting stuff…
However, easily the biggest highlight of this speech was the introduction of a North Korean defector, Ji Seong-ho and his personal story.
Today he runs a group called Now Action and Unity for Human Rights, helping other North Koreans to escape from the regime, becoming a powerful advocate for the North Koreans left behind. The world can be a harsh place, but things like this get me right in the feels. Take some time to think about your loved ones and give them a hug from me. Not actually from me, because that would be weird, but you know what I mean. Unless they know me and then it’s all cool.
And finally… let’s be honest the only thing you lot tune in for. This week we have a Guest DJ for our playlist, namely Natalie Palmer, superstar DJ, Director and Solicitor at Latimer Hinks.Have a great weekend; keep on shining!