What it takes to succeed in the high street
Fashion retailer Next’s annual report is a lesson in how to run a business efficiently. It’s impossible not to think of struggling retailers while reading it.
The contrarian investor’s nightmare
Next, the clothing retailer, has tormented me for years. A model of success even in adversity, it’s so repulsive I’ve never even opened its annual report. But that’s about to change…
Here’s the chart. Next is at the top of its form. At nearly £30 the shares have risen 1,200% since Sharescope time began:
Monkey strategy
Pete Comley’s new book explains why private investors do so badly in aggregate, and how understanding why can help your investment decisions. I asked him how his research influenced his own investing strategy.
There is an old joke about how to make a small fortune on the stock market (by giving a large one to a stock broker). Having spent the best part of the last year researching and writing a book called Monkey with Pin, I think I might be able to rewrite this joke as:
"Suffering as defensiveness to kick in" is about the best description that can be applied to the ETF Portfolio right now. In the past month, gold has languished, the euro has been weak, and emerging markets have continued to be under a cloud. Since these are the main areas in which the portfolio is invested, its performance has been, to say the least, pretty second-rate.
I have been feeling cooped up. The rain of the past fortnight has felt relentless. Yes, I have managed occasionally to sally forth with the dogs for a breath of fresh air. But otherwise, I have been confined to barracks, perusing the papers, feeling increasingly grumpy about the state of the world - and, I admit, finding it something of a strain to spend virtually all my waking hours with no company except that of the Old Girl.
Call me a dinosaur if you like but I really can't be bothered to set up a Facebook account. As for Twitter... don't get me started. So the news that Facebook's IPO is coming along in a couple of weeks leaves me as cold as a pickled egg.
The Memsahib is currently purring like a Cheshire cat, as she has just received her invitation to the Chelsea Flower Show early next month. It arrived whilst I was venting my spleen on the ridiculous Leveson Enquiry. I am bored to tears with the bleating of Tom Watson MP and Chris Bryant MP. I'm fed up with all the jealous hypocrisy from the 'hacks' who have been on this relentless quest to bury the Murdochs; as if butter wouldn't melt in their mouths.
Announcing a stock consolidation to boost a flagging share price - as Royal Bank of Scotland has just done - has a sort of other-worldly quality to it. After all, nothing really changes. Shareholders end up with, say, a 10th the number of shares they held in a company whose share price, theoretically at least, should be 10 times its previous level.
A lot of investors have been bearish for so long, they have forgotten how to be bulls. Or else the habit of trading, selling the FTSE 100 whenever it risks moving above 6000, is simply too ingrained a habit to be abandoned.
Once upon a time, more years ago than I care to remember, there was a technical analyst called Brian Marber. Today he is probably more famous for being the father of comedian and playwright Patrick Marber, but when I was a young subaltern and a nascent investor, he was someone to watch and listen to.
One of the most awkward moments of my career in the city came many years ago when I asked an American fund manager why she did not invest in tobacco stocks. The reason was that her husband had recently died from smoking-induced lung cancer. There is not much you can say to that.
As a teetotal non-smoker for the last 23 years, I have no axe to grind for the cigarette companies, nor for brewers and distillers. Both were industries that I covered as an analyst for more than a decade.
It's at times like these that I feel my age. The papers are full of stories about gung-ho companies - young, vigorous and fashionable - that are changing hands for astronomical sums. Their founders are lauded as brilliant pioneers. We are told these enterprises - often tiny and just as often losing money - are (cue booming voice over) 'The Future'.
Obstinacy seems to be the main characteristic of the ETF Portfolio at present. It stubbornly refuses to perform. One reason is perhaps the determinedly defensive stance we have pursued for the last few months. This may pay off eventually, but it is turning into quite a long wait.
If or when policymakers finally decide Greece should leave the euro, the exit could happen so quickly that "new drachma" currency notes might not be printed in time.
Shares in Facebook may have a hard time in the coming week if its lead underwriter stops supporting the stock and managers lower down in the IPO book decide to get out.
Luxury handbag group Mulberry is rapidly turning itself into a highly desirable global brand, finds Jim Levi. See which other stocks he'll be keeping an eye on in June.
