S&P500 at record highs - time to stay in or pull out?

[TVRBRZ]

Blue_star said:

Not sure if the right thread but does anyone reccomend any ways i can invest in utility companies tracker or energy companies tracker through vanguard, fidelity or hl?

Edited by Blue_star on Saturday 7th March 14:45

Not exactly Utilities, but through Fidelity I have the WS Guiness Global Energy Fund which has done quite well. Mainly oil rather than energy infrastructure

[Panamax]

Blue_star said:

Not sure if the right thread but does anyone reccomend any ways i can invest in utility companies tracker or energy companies tracker through vanguard, fidelity or hl?

Utilities are just one flavour of so-called "value" investments. In other words, stuff which produces a reliable income rather than punting on future growth. Two examples below. Examples, not recommendations.

M&G Global Strategic Value Fund Sterling I Inc (5* Morningstar)
https://www.fidelity.co.uk/factsheet-data/factshee...

Fidelity Dimensional Global Value Fund GBP Accumulation (4* Morningstar)
https://www.fidelity.co.uk/factsheet-data/factshee...

[Blue_star]

Thank you kindly both

[NowWatchThisDrive]

Panamax said:

Utilities are just one flavour of so-called "value" investments. In other words, stuff which produces a reliable income rather than punting on future growth. Two examples below. Examples, not recommendations.

M&G Global Strategic Value Fund Sterling I Inc (5* Morningstar)
https://www.fidelity.co.uk/factsheet-data/factshee...

Fidelity Dimensional Global Value Fund GBP Accumulation (4* Morningstar)
https://www.fidelity.co.uk/factsheet-data/factshee...

Not quite - certainly utilities can be value investments, but "stuff which produces a reliable income" isn't really what value means. It's really about things that look cheap relative to fundamentals (price to earnings/book/FCF etc). Plenty of value stocks have patchy and even nonexistent dividends, they're just unloved and underpriced.

[ooid]

Blue_star said:

Not sure if the right thread but does anyone reccomend any ways i can invest in utility companies tracker or energy companies tracker through vanguard, fidelity or hl?

Edited by Blue_star on Saturday 7th March 14:45

Xtrackers MSCI World Utilities

https://markets.ft.com/data/etfs/tearsheet/summary...

I think it is available on HL but you have to double check.

[Panamax]

NowWatchThisDrive said:

they're just unloved and underpriced.

In theory, nothing should ever be underpriced in a functioning market so we should find some better language. IMO so-called value stocks are generally mature businesses that aren't promising rapid future growth but do produce a reliable income stream. Like utilities. Sure, there's other stuff in there as well and all of it should tick the box for an investor in search of income and/or lower volatility.

IMO the word "underpriced" can be filed away with "overbought", "correction" and other slippery language.

[NowWatchThisDrive]

Panamax said:

NowWatchThisDrive said:

they're just unloved and underpriced.

In theory, nothing should ever be underpriced in a functioning market so we should find some better language. IMO so-called value stocks are generally mature businesses that aren't promising rapid future growth but do produce a reliable income stream. Like utilities. Sure, there's other stuff in there as well and all of it should tick the box for an investor in search of income and/or lower volatility.

IMO the word "underpriced" can be filed away with "overbought", "correction" and other slippery language.

The bit of my post you stripped from your quote (as you seem fond of doing) explains what I meant, and what's pretty widely understood in this context, by underpriced - it's in terms of price multiples vs accounting metrics like those I listed. You can call income or whatever else "value" if you like but it's not how the rest of the world defines it.

[Jon39]

Panamax said:

In theory, nothing should ever be underpriced in a functioning market so we should find some better language. ...

... IMO the word "underpriced" can be filed away with "overbought", "correction" and other slippery language.

What do you think of this example?
Towards the end of 2023, I considered this business to be underpriced.





There was not an expected sudden surge in revenue or profits for BAT, it just seemed to be out of favour with investors and therefore either cheap, or underpriced.
I presume that gradually people must have realised, that a PE of (think it was) 8 and a dividend yield over 10%, pre-tax £3 billion, might be a business worth holding. Subsequent demand moved the share price steadily up from low £20s to over £40.

Perhaps if you don't like the word underpriced, should we instead say 'out of favour', or perhaps 'unpopular'.
If you spot any other 'unpopulars', making steadily growing profits, then I am always interested to research them.
Shares that double money in two years, are certainly not easy to find.

Edited by Jon39 on Saturday 7th March 22:27

[Panamax]

NowWatchThisDrive said:

The bit of my post you stripped from your quote (as you seem fond of doing) explains what I meant, and what's pretty widely understood in this context, by underpriced - it's in terms of price multiples vs accounting metrics like those I listed. You can call income or whatever else "value" if you like but it's not how the rest of the world defines it.

What matters in my world is the concepts and maximising clarity. It seems to me that a lot of language kicking around in the financial world is almost deliberately designed to make things confusing for "ordinary people".

Picking up Jon39s point as well, I have never been able to grasp why the two labels for stocks are not simply "growth" and "income".

Similarly it seems weird to me that stocks are assessed in terms of "price" while bonds are assessed in terms of "yield". The man in the street must find it very odd that,
Share prices rising = share prices going up
Bond yields rising = bond prices going down

[Phooey]

Panamax said:

Similarly it seems weird to me that stocks are assessed in terms of "price" while bonds are assessed in terms of "yield".

Because equity and debt are total opposites. Equity is ownership and a bond is lending.

[NowWatchThisDrive]

Panamax said:

What matters in my world is the concepts and maximising clarity. It seems to me that a lot of language kicking around in the financial world is almost deliberately designed to make things confusing for "ordinary people".

Picking up Jon39s point as well, I have never been able to grasp why the two labels for stocks are not simply "growth" and "income".

Because those aren't the only two things a stock can be. Value investing is fundamentally about what you are paying right now for each unit of what already exists within the business, not how future profits accrue to you.

Panamax said:

Similarly it seems weird to me that stocks are assessed in terms of "price" while bonds are assessed in terms of "yield". The man in the street must find it very odd that,
Share prices rising = share prices going up
Bond yields rising = bond prices going down

Because a bond is a contractual set of cashflows so the useful number is the return those cashflows imply given the price you pay for it. Equity is a residual claim on a business's uncertain future cashflows, so the useful number is what that claim is worth.

[gotoPzero]

Oil is screaming up on the open.

$100+ now

[732NM]

I wonder why?

What a mess this is going to be.

[Panamax]

Strange, isn't it, that Donald and Bibi are "bombing their way to peace" and yet nobody believes them.

Meanwhile, Mr & Mrs Average American face higher fuel prices and persistent inflation. I'm sure they're absolutely delighted.

[g4ry13]

gotoPzero said:

Oil is screaming up on the open.

$100+ now

And to think a few months back when I mentioned buying oil and someone said Oil was dead

Wouldn't be at all surprised if Oil drops back into the low 90s this week.

[asfault]

Everything is going to be down tomorrow. S&P futures are near 2% down.
bye bye interest rate cuts with the inflation this will cause.
At least the UK government will gain lots of taxes from exporting the oil and gas we have.... Oh wait yeah they fked that up....

[Good Plan Ted]

Oil is up 18% on the Asian market this morning, hope nobody panic buys or we will have nothing left, I imagine there’s a possibility of $200 by Friday and the inflation will go skyrocket so won’t be good for the stock markets.

Edited by Good Plan Ted on Monday 9th March 01:56

[Mr E]

I need to make an investment shortly.
This is hugely outside of my understanding. Accepting that time in the market beats timing the market, but should I hang on 7 days for turbulence to play out?

[g4ry13]

Mr E said:

I need to make an investment shortly.
This is hugely outside of my understanding. Accepting that time in the market beats timing the market, but should I hang on 7 days for turbulence to play out?

In my opinion, last night was probably a great opportunity.

Why not do some today and then some next week when the dust settles if you're feeling a bit risk averse?

[Philvrs]

Mr E said:

I need to make an investment shortly.
This is hugely outside of my understanding. Accepting that time in the market beats timing the market, but should I hang on 7 days for turbulence to play out?

Curious why you “need” to invest?