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LLOYDS is going to FLY

lse:lloy

#3258

Today’s FT on bank stress tests -

Bank of England to set up tough climate stress tests…

UK banks and insurers will be under scrutiny in three scenarios that will last decades.

Can lloy withstand more than 3 days heavy rain lol :thinking: what happens if there’s fog?

What will they think of next??!!

ATB
K


#3259

Hi All, Well LLOY seems to have got it’s mojo back after a bad day on Tuesday ?. Back over 64p ATM.

Confess I’m a bit more focussed on what the pound is doing ATM given that I now have more of my money overseas than in the UK.

@swamp_rat I see Tesla closed at 393 yesterday, hope that you didn’t sell at 360 !.

ATB

Pref


#3260

@PrefInvestor1

As we were all predicting GBP peaking around 1.35 to the USD and concentrating on UK stocks rallying, did you use the fleeting strength to add to any holdings abroad? Or funds that hold mostly foreign stocks (E.g SMT, although I know you’re not a fan of that particular one).

We seem to be in a somewhat binary situation with the FTSE 100 and foreign earners, just the same as we have been for … well, I’m not sure how long it is now. 3 years or more? I know it took me a while to become completely aware of it and longer still to start thinking about playing it.

It’d be interesting to see which companies are most reactive to rises and falls in GBP, although its always hard to tell how much weighting to give to which exchange rates and any other background noise when it comes to specific companies… which is why I was interested in your positions as I know they are mostly (all?) funds when it comes to foreign companies.


#3261

Hi @Eadwig, Yes indeed I did do exactly that. On the day of the election result the Friday morning I put ALL my remaining cash, about £10,000 in all, into two overseas ETFs IAPD (asia/australian holdings) and SEDY (emerging markets holdings), about half each. The pound was close to 1.35 when I bought.
These ETFs are up by just under 3% and 4% now, mostly down to the falling pound I think - though I have watchlists set up for the holdings and they have been doing OK. Getting close to 30% invested overseas now.

I expect the pound will likely rally at times which might be painful but TBH I am expecting (hoping) for a long term return to the low 1.20s. If it looks like reversing substantially above 1.35 I may have to re-think my strategy !. Just have to wait and see, for the moment everything is going well…

ATB

Pref


#3262

Hi Again @Eadwig, Sorry you asked about my specific holdings, see below:-

Investment Trusts
AAIF - singapore
BRNA - US
HFEL - asia
JEMI - asia
STS - global

ETFs
GBDV - US/Canada/Europe
IAPD - australia/asia
IDVY - europe
SEDY - emerging markets
VHYL - mainly US
VWRL - about 50% US, rest global

Stocks
Microsoft

ATB

Pref


#3263

No but did sell at 373. Not to worry, she made circa 36% from memory and you can’t rule out a January dip.

I see the US/China trade deal had a preliminary date in January.
Personally I think china are just playing for time, when d-day comes the tariffs will return.


#3264

Yes, there is indeed, although my understanding is it is in February.

In fact, its pretty much all reversible at any time should Trump decide to reverse it, or if China blatantly break any part of it. I don’t think they will while the specific food crisis is occurring there (and elsewhere in Asia), but who can predict what trump will do at any given moment?

Especially as he is squealing like a pig with swine fever himself right now … at least until you listen to him, then what you hear is a whingeing, vindictive hate-monger pouring out invective at >50% of his own electorate.

Can’t rule anything out on that side of the deal, but China need these U.S. imports right now, and want to be first in the Asian queue which is growing by the day as I understand it. I don’t believe any other country on earth is capable of supplying China’s needs at this time, so was an easy deal for them to make in many ways.

But yes, it is all up for continuous review so far as I can make out, with potential cliffs every couple of months. So that will be fun!


#3265

@PrefInvestor1,

was just wondering if you had any specific companies, was all. I see you have MSFT.

It’s a funny old world. I remember, not so long ago, being loathe to buy US companies when GBP was under $1.55 and for years would never have bought under $1.50. Now we’re feeling good if we catch a window of just a few hours where we got $1.35.

I just had a divi payment from RDSB appear in my SIPP paid in GBP. Was expecting a message to choose the desired currency… I shall have to look into that… I was hoping for USD as you know, and same with HSBA when the time comes.


#3266

Last few days feel really weird to be honest

90 % in cash

I have started to not even look at the share price


#3267

Hi @Eadwig, Well you know my feelings about direct investment in US stocks. I don’t like the lack of dividends (or even if there ARE dividends then 15% withholding tax is a big headwind). Also my broker charges 1% on ANYTHING which involves an FX conversion. So 1% on buying, 1% on selling, 1% on any dividends - really rubbish !. I really need an account with another broker if I’m going to do this stuff - but that would have to wait till April and the next tax year AND I’m not that keen to do it anyway……

Many of the stocks themselves present problems. Amazon and Google are just too expensive. Others too volatile and unpredictable. I have followed Microsoft for a very long time, it’s share price has gone solidly upward except for a small dip at the end of 2018. It has won a lot of big new contracts in the last few months and has a wide range of successful product lines. I feel confident that it will continue to just progress upwards, so I am giving it a go. I have similar but less strong feelings about Apple, but am not inclined to Invest there at this time. I have had several bad experiences investing in Facebook, have twice had a go at investing there but always came away with a loss. There will be no third attempt. At least these three are semi affordable at sort of $150 to $300 a share !.

Investment Trusts and ETFs are a more cost effective way for me to access the US market while adding the diversity of investing in a basket of stocks instead of just one, which I greatly prefer. I have previously invested in the likes of SMT, PCT and JUSC and that is a perfectly valid route. But the portfolios are pretty concentrated and the dividends are nil. I am trying investing in the likes of VWRL and VHYL ETFs which hold a wide range of stocks, a high US percentage (including many of the usual names) but a lot of other global stocks as well. Both these pay some dividends (sort of 2-3.5% but no WHT or currency charges) and are very low cost, both of which are attractive features.

I googled this issue and found the following web page which implies that this should indeed be possible, but will probably involve your broker making some application to the company on your behalf (assuming you can persuade them to do so). So probably too late for any dividends that you have already received but potentially worth contacting your broker about for future dividends.

https://www.investegate.co.uk/royal-dutch-shell-plc--rdsa-/gnw/shell-introduces-option-to-receive-dividend-in-us-dollars-and-moves-to-full-electronic-settlement-of-its-dividends/20191218070000H9799/

ATB

Pref


#3268

Hi @regardless, You have obviously gone into Xmas holiday mode !. If you really plan to buyback in I guess I am surprised that you haven’t set a buy limit order at a good price and just let it ride to see whether it gets filled. You could have bought at 62.75 on 18/12 which is about 4.8p better than the price you said you sold at. You said when you sold that you were looking for a a 2p price improvement and last time you sold you bought back almost straightaway.

Not saying that you should you understand, TBH I still find your strategy ultra scary, I wouldn’t (couldn’t) do it. Hey here is a radical thought, why not consider buying some other things to go with your LLOY ?. Yield is only a fraction over 5% now, not 6% plus the way it was when the price was lower. Though not a great time maybe as prices are high ATM after the Boris bounce…?. No easy decisions are there…

Anyway take care and enjoy your current investing holiday !.

ATB

Pref


#3269

SMT does pay a small dividend, in fact, it works out about 0.5% yield at yesterday’s closing price, at which I sold the major remaining part of my holding. I currently hold a quarter of a tranche average @286p. Obviously that will rise next time I add.

It is all part of my cautious approach to building a position in a fund that is hit hard every time the market becomes risk averse again and will suffer greatly, initially, in a general downturn.

It could be still going to rally until the end of the year though, but better to be disciplined in these things than trying for a few pence extra per share when you’re looking at building a long-term (10 year) position. It does mean that I’m poorly positioned in Tencent holdings again, I’m regretting selling my direct holding in that on the Hong kong exchange.

When Google first reached over $1000 per share it did a 2:1 split to make them more affordable. It is looking like it might be time to do that again. High U.S. share prices make it harder to take profits and are a pain generally but its part of their culture. If stock drops below $10 its pretty much expected to go to zero.

I see Berkshire Hathaway were down a whopping $9 yesterday closing @$337,491.00 !!

I shall message ii about the RDSB situation. I bought the tranche that was paid out right on the ex-div date so there may be some issue surrounding the record.


#3270

The mistake I made there was I expected the $HK to be badly hit by the protests, but didn’t realise until after I sold that the $HK is tied to the USD, so the risk didn’t exist.

There hasn’t been a chance to re-buy at a lower price than i sold at as yet.

By the way, things may seem more cheaply priced on the HK exchange compared to USA, but E.g. Tencent has to be bought as a minimum tranche of 100 and then in multiples of 100, so far as I understand it. That means a minimum buy in Tencent at current prices and fx rates is approx £3,700.

I don’t have much experience with the HK exchange, I imagine this tranche figure differs depending on the price of the stock, but this again makes it difficult to take a percentage of profits or trade a position.

ii don’t do ADRs anymore (if they ever did) and so that isn’t an option. ADRs are a good example of the USA exchanges being set up to deal with larger values and are used to lump together ‘cheaper’ European stocks.


#3271

Hi Again @Eadwig, Sounds like you are taking your profits as you go with the likes of SMT, is that because it’s US and volatile / susceptible to rapid market movements ?. Are you doing the same with your UK stuff ?. I know you said that you were trying to keep 30% in cash in case of a major correction. But of course that may come next week or in 12 months plus time so makes decisions difficult…?

We are off to visit the grandkids in Cambridge today so no market watching or posts from me today, likely to be on the motorway for a couple of hours each way by the look of it.

ATB

Pref


#3272

When I decided to build a large position for the long term in my trading account I decided to go very cautiously as I trade around a core position because …

a) filled with high growth companies which are hit hard when the market gets risk averse
b) business cycle overdue a large correction, in which case many of these high growth companies will get hit very hard also … at least at first, though I believe many they hold will come back more quickly than most other companies.

So, when I first opened a position, I sold 90% of it after a 10% rise, waited for the volatility to give me a good re-entry point, added a couple of tranches, and have sold those again on similar rises.

That is how I’m left with approx 25% of a single tranche (average @286p, about half the current price). That will effectively mean when I add next the average will remain lower. This process will continue until I have a comfortable long term holding. I imagine that will not be until AFTER that major market correction we’re overdue, when I shall buy heavily because SMT will be one of my main strategies for a quick recovery via growth alongside certain select other high yielding shares such as RDSB, GLEN and possibly HSBA. Hence my largish cash position.

I will continue to play with my high risk AIM ventures because many of those are so small as to not really be affected by corrections and there is always the chance of doubling or tripling my money (or losing it all) at any time in those. They are a diversification that works very well for me.

I note GBP is still falling and may go below the 1.30 mark today. Bank of England new governor could be announced which may have some short term impact.

Have a nice day out. Drive safe!


#3273

Hi Regardless,

Probably not a bad idea following your own counsel again. It’s worked well enough for you in the past. Pref also makes some valid points re your comment.

FWIW, I’m also well in cash &, whilst still biding my time before buying back a 3rd tranche of LLOY, the only thing guaranteed & easily accepted by me is that I’ll again well miss the bottom of the current trend & have to sit tight as before. Par for the course with few exceptions.

With LLOY falling back easily today (just 63.22 as I write) in still rising markets, the omens for significantly higher here anytime soon don’t seem good. However, mindful that one of the tranches I sold recently was a buy at 62.48, should we see lower or close to that over coming days, I may well also follow my own counsel in re-adding a 3rd, with a 4th add again being contingent on falls significantly below 60. Latter quite possible with threats of a hard Brexit not gone away.

Either way, I’ll maintain the same mindset as before. No-one is wiser than the market, which is a vast, complex entity that can be swayed by any number of issues, some far less predictable than others. But self-knowledge at least helps one ride out any more extreme sentiment-driven volatility until profits can be booked yet again. - Regards.


#3274

Some Lloyds news…they are to pay £35000 to each of the 191 business accounts as part of the HBOS ‘fraud’ to help build ‘trust’.


#3275

Just an initial payment, I trust?


#3276

I thought they had already compensated them and an independent review said the bank needs to pay more.


#3277

There are several outstanding cases,so far as I’m aware. The original scam was for about quarter of a billion and LLOY have only paid out £100m in compensation so far and since attempted to mislead a select committee of M.P.s. They haven’t even addressed any indirect losses or damages, so far as I am aware.

I would think at least another £150m to come in compensation alone. If they can avoid any fines or paying damages it will be a typical miscarriage of justice.

They should also be landed with a load of victim’s legal bills after being caught out attempting to short change them. When in a hole, stop digging, springs to mind.

Sir Ross Cranston, a former high court judge who ran the independent inquiry into the scandal said the bank’s review of the fraud had “serious shortcomings” the most serious being Lloyds’ “approach to assessing direct and consequential loss caused by the criminal misconduct”. He also stated “This part of the customer review, both in structure and in implementation, was neither fair nor reasonable.”

Cranston also called for Lloyds to admit it gave MPs an inaccurate impression of the process used to settle claims back in 2018.

Lloyds said in a letter to the Treasury select committee that it apologised “unreservedly” for the mistake with the CEO saying , “Sir Ross has concluded that customers may not have received fair outcomes due to flaws in the review process. I am very sorry that this has happened. The group is committed to act on the recommendations made by Sir Ross, and will fully support giving customers the option of a voluntary re-review of direct and consequential losses.”

This was all last week. So far from over, I would suggest,