Good News

Dear Friend


What can I say?  Each week plays a different hand though we move inexorably closer to ‘D Day’ as we go and in fact, there is a surprising calm generally and even within the share and currency markets.  I am still prepared to stand by my prediction that as soon as ‘uncertainty’ is replaced with a dose of ‘certainty’ (‘good or bad’ and even if that signifies myriad smaller and unexpected uncertainties into the future but we could say just the same but different as would arise if we stayed ‘in’), that business will return to some semblance of ‘normal’ and deferred decisions will be taken by private individuals through to businesses, multinationals and organisations generally.  In the face of economic wobbles elsewhere, the hiatus we have endured and then the short-term explosion should prove to be a useful domestic boost to our own figures, no doubt somewhat confounding the pessimists short-term at least.


It is a pleasure to share some good news for a change.  Yes, the markets have stabilised and indeed moved forward usefully and it seems that the opposite of ‘death by a thousand cuts’ has been happening – a virtuous circle of regular and gradual upticks in valuations but what a difference just a few weeks make.  Yes, we read that institutions have the highest levels of cash since 2009 when the global financial uncertainties hit home and indeed, private investors have been sucking cash out of the markets and especially the domestic one so of course prices have fallen.  We have been increasing our exposure, the cheaper things appeared to be but yes, it was uncomfortable at the time too and don’t forget at some point this same cash will chase better opportunities.  We are contrarian – meaning independently minded and not ‘opposite’ just for the sake of it but we need patience and sometimes even more than we anticipated. More crucially though, secondary UK-centric stocks have done much better indeed since December and that is where we saw most value and were adding as things worsened.  You will recall that I was brave to ‘call the market’ at those times?  I didn’t see many financial advisers and investment managers doing the same and the consensus of most was that it was ‘wise’ to increase one’s cash reserves and sell some more – at those prices?

The FTSE100 has bounced from the December low and has been up 11% since.  The FTSE250 is up 12%.  I mentioned the Premier Infrastructure Trust several times because it had a daft technical opportunity but caught-up at the same time – if you took my suggestion, it is up 28% but that means that one of our clients’ largest holdings too – but it is still good value!  Another collective Trust which was oversold was Aberdeen Smaller Companies and that has risen by 22% and in all respects, the figures ignore dividend payments received over that time which are on top.  Anyway, never forget, it is the future which counts – not yesterday.

Curiously and to confound contemporary thinking but some of the best performing companies too have been the oil giants on stellar results and dividends declared.  Our own Royal Dutch Shell and BP both surprised the market and for all those investors who have decided to divest from carbon producers, as they stand at the pumps filling their car or the oil tank to their central heating they may stand to remember that we still need the old for the moment but they won’t have enjoyed the same recovery on their investments and natural resources still count for a big chunk of the value of global stocks so it is a big call to be totally devoid of them.  Even the oil-created £1trillion Norwegian Sovereign Wealth Fund has decided to divest of carbon assets as it continues to grow by the same carbon generation which founded it in the first place….  I’m not trying to share a ‘view’ but simply saying, that’s all!  And of course, too many investors are full of ‘tech’ now and thus the indices themselves and these in my view remain seriously over-valued whilst more of the fundamental stocks are the exact opposite.


What is advice worth?  We saved many people from making the wrong decision at the wrong time (or perhaps for them the right decision but at the wrong time).  We always try to offer that sort of advice when a client might need access to some funds – if they can defer for example rather than simply ‘deal’ despite.  Just think if you had pushed to sell your investments in December.  Today, in average terms your holdings from a ‘balanced’ portfolio (whatever one of those may be) is likely to be 10% or more higher.  Could you afford that loss that once sales had been instructed is never regained?  I met a friend (T) casually in December and he was sharing how he was fed-up with the poor results from his general investment with Aegon that he had bought and he had asked for the encashment forms.  Whilst it made me vulnerable to some extent, I suggested gently that even if that was the right thing to do as he didn’t need the money perhaps it was probably not the right thing at that time – and he was prepared to listen.  No, he’s not a client but have I saved him £8,000 or more simply because he had someone with whom to talk whereas too few ‘think they can do it themselves’ but when the time comes, have no-one to rely upon to make a rational judgement and share learned counsel or decide for them or even to talk to at all and so they simply instruct the sale and that’s that?  You may be one of these people who believes that our financial advice is too expensive but is it really – how valuable is that to clients who know that we are there – even if there is no way we are perfect?


Yes, I am pleased to report too that for our clients who were with Organic, there is good news there as well.  We have again saved many of them who had been encouraged by ‘others’ to transfer their assets away and regardless of the costs which may be involved or indeed with no thought for the awful market backdrop at the time.  Again, for some of them that might be the right thing but just imagine if they encashed (as some did sadly despite our counsel) at the depths of December and the money has been sent across to their new adviser but no reinvestment has happened yet – that’s a whopping extra 10% cost being the value they could have enjoyed simply by biding their time.

We have also found that some practices by claims management companies are atrocious.  Some have been given lists of clients who hold the assets with losses and have been badgering the poor clients when we have been trying to ensure they steer clear of these charlatans till more information is known and where the culpability lies.  There is nothing they can do till events unravel but these people have their eye on up to 40% of the compensation rightly due to the afflicted clients!  Forget GDPR – some of the original people from defunct firms who recommended the bad outcomes for these poor clients are the ones now peddling the lists to claims’ companies in exchange for a share of the compensation – can you believe it!  We have been threatened with libel suits by some of them too and that we’ll be reported to the regulators ourselves for what we are saying about them.  They don’t seem to recognise either that yes, we too are regulated to assist in the management of claims but we rarely do so for a fee, it’s usually goodwill unless it becomes very embroiled for an individual client and the free services by the FOS or FSCS need technical help but we have NEVER taken a percentage of any compensation.   Others in this pernicious food chain from which they have all done rather well are doing their hardest to push culpability down the line to ‘others’ whereas frankly far too often they should never have recommended what they did in the first place.

We have also found a series of incestuous links with Resort Group Plc and investments and loans for Cape Verde Holiday Property development.  It is not good and rarely has that been the right investment for the clients whose details we have seen so far – if it was ever right for anyone. Then of course, guess what, yes, bonds connected to that same Gibraltar-based entity are some of the biggest investments in the suspended Dublin Funds which most of the Organic investors held.

There is some more good news I am pleased to say.  I am in very regular contact with the regulators and also the administrator of the Dublin funds and it is hoped that soon, the Trusts will be split so that the saleable parts will become tradeable again and only the illiquid portion of dubious investment will remain in the suspended funds for the future.  Some will not be realisable at all and we do not know the value but we continue to work with the administrator.  I have been speaking regularly with him to discern progress and he plans to visit me from Milan next week.  All we are trying to do is to achieve the best outcome we can for all these unfortunate clients and to hand-hold into the future and perhaps importantly now, to help them avoid doing the even worse thing now regardless of what some personable individual may have suggested to them recently.  And no, we are not charging a penny for all this work and nor do we expect to share in any compensation which is due to clients.  We are trying our hardest and of course we hope that we can demonstrate that we have their best interests at heart so they may choose to stay but it is not an obligation.


Who else could not believe Mr David Dunckley, the boss of Grant Thornton in front of the Parliamentary Select Committee when quizzed about what had happened at Patisserie Valerie. Quite rightly this is indeed a ‘fraudian slip’ by him.  Of course auditors are expected to look for the odd missing £40/80million or so.  Do people really think they are only there to check when the packet of polos was erroneously added to the petrol receipt perchance?  Let us trust there is a rather big investigation and some culpability there.  Auditors are also expected to notice gross negligence and indeed basic failings with the accounts – locally I raised the concerns I had for the North Devon Theatres Trust’s accounts which had a heathy audit only a couple of months before it went bust but totally disturbing.  That too is wholly unacceptable.


An interesting report was published recently about the pension constraints on the higher earners (which I now believe have gone far too far).  The author of the report noted an interesting dimension which was that by being sharp with the better-off then inadvertently you afflicted all the poorer too as the rich had less interest in their well-being.   Professor Joanne Horton, who completed the Warwick Business School study, was asked about this and she said: ‘Due to the changes in the tax threshold for pensions the incentives of these executives is likely to change, as they will probably have hit their lifetime allowance so the incentive generated from the DB plan is not likely to be very strong and therefore we predict that more DB plans will close as the executive self-interest incentives have reduced.’  She argues that getting executives into the same schemes as workers could be the most effective way of protecting salary-related pensions and preventing Carillion or BHS-style collapses.  Logically it follows that having bosses in the same scheme will also benefit workers.  Taking away high earner’s pension breaks may sound like aiding the rich but this new policy has backfired and so the majority’s retirement prospects suffer.  Indeed, the threshold is now so ‘low’ that we know many doctors who work short weeks (or have retired early) because they will be pension penalised and even Helen and I cannot enjoy Company’s contributions (up to 7% for all employees) any more simply because of the cap and because we prudently contributed to pensions over the years and have enjoyed excellent investment performance from our choices.   Yes of course as the business owners we gain in other ways but that is not the point. It is a funny old world.


Stock market investments can offer income through the payment of dividends and interest and good opportunities for capital appreciation over the longer term. By this, generally we mean periods in excess of five years, preferably much longer. However, we can never promise you particular returns, especially in the short-term. At any point in time but especially in the short term, your capital could be worth less than the original amount invested as some of the selected holdings may fall in value, regardless of expectations at the time of acquisition. We may also invest in funds that hold overseas securities. The value of these investments may increase or decrease as a result of changes in currency exchange rates. Returns achieved in the past cannot be relied upon to be repeated.

To remind you, why do I send out occasional emails? Because everyone can save money. We have no connection with any companies mentioned and you have to make your own contacts and satisfy your own enquiries. What is in it for us? If we can prove that we are knowledgeable and that our service and advice have good value, then you might contact us for professional financial planning and investment help. You don’t have to do that though and there’s no charge for emails. If simply they save you money, then accept them with our compliments! However, you’ll know where we are!

If you have any queries of any form or indeed any subjects you think I could include, please contact me. I also refer you to our website We celebrated our thirtieth anniversary in 2015 and have been publishing a well-respected independent column in the local Paper for most of that time and free client newsletters as well.

Do not forget however the usual caveats – this is not ‘advice’ and you are encouraged to seek that before embarking upon any financial route involving investments, etc.

My best wishes

Philip J Milton DipFS CFPCM Chartered MCSI FPFS FCIB
Chartered Wealth Manager
Fellow Of The Personal Finance Society, Fellow Of The Chartered Institute Of Bankers