Merry Xmas

Dear Friend  

Well, it is time to wish everyone the very best for Christmas, despite the backdrop of Omicron, its effects and the strange times we have all endured these last two years. It is time to be positive and optimistic and despite the constraints and precautions, to hope that everyone has a good time and a lovely opportunity to remember families and friends and not overlooking those on their own too. 

Of course for many there will be sadnesses upon which to reflect as well. We also have a New Year to which to look forward and to see with optimism what it might bring, temporarily filing in the bin all the gloom and despondency which all the media loves to throw at us and to remember the simplistic portrait of an innocent Baby in a manger who grew-up to become the Saviour of the World.  
New year resolution for non-client readers!  
I think sometimes in our Firm we make this job too difficult. Now look, we manage clients’ money for them. We are staunchly independent and are not restricted to any ‘product range’. We can buy investments that you can’t, hold them in ways that are not available to you and we can spread the risks so widely that you can’t hope to replicate the protection we can build from such a diversified portfolio, whilst at the same time not limiting the opportunity for great returns (and far superior to doing ‘nothing’ or simply leaving your money stagnating in some ‘fund’ you happened to have been sold for a commission years ago). We don’t care what something is ‘called’ and don’t worry about how well known the manager may be or what the fund is called because that doesn’t matter to us when we complete our ‘due diligence’ on every choice we take, so you, the client, don’t have to worry about that.

We are probably the very best value manager and financial adviser on the whole market especially for what we offer and how we can do ‘it’. We aren’t the cheapest by the headline but we certainly aren’t dear at all and you can subscribe money to our staunchly independent systems without a penny of subscription costs (up to 6% is charged elsewhere, eg St James’s Place) and our management fees are not unreasonable especially for the fantastic quality of what we can do. You’re already paying fees somewhere else but you won’t be receiving anything like the same degree of care and attention. Isn’t it time, if you are not a client, letting us show you what we can do and sending us some money to manage for you? You can even tidy-up all those dribbles of odd money in pensions or ad hoc shares and unitised holdings and ISAs elsewhere if you wish. There are not even any advisory fees if you do that ‘Execution Only’ and even if it might take years for your fees to us to cover the costs we incur in processing your investments but that’s our choice! You can start with as little as £1,000 in an ISA (or £50pm), similarly small sums in Pension and £10,000 in a Portfolio but clearly the bigger the sums then the wider the range of investment components and we’d like you to enjoy the best possible spread after all! Just ask and we’ll send you details and application forms (or they are on the website).

Please don’t kid yourself that you have the same access to markets, systems and information as we do (and we are learning and discovering constantly too) and indeed that you will actually get around to doing what you may even imagine you ought to be doing; we do, because it is our job. Isn’t it time you trusted us to prove that to you, if you are not a client already?  
Family Compass  
We were delighted to meet the whole remaining grant request for Family Compass recently. This is a local charity which our charitable foundations were able to support through our DCF endowment. The Charity is keen to promote its ‘KIT’ – ‘Keeping it together’ wellbeing boxes, if you would like to buy one for a Child you may know would appreciate one.  

Behavioural bias number two affecting your financial/investment decisions  
Do you recognise this in yourself? If so then you have slain one of the biggest barriers to sensible investing. Not only that but not realising these traits exist will lead you to some awful judgements or inaction – we have seen it time and time again sadly. You are more open to superstition and not fact and more prone to scams and pure gambling when the odds are against you – they always are. We are here to help you realise these psychological traits are not good for prudent investing! Here’s the next in the series!  
Gamblers’ fallacy  
So here it is. Primarily it is when a gambler has a string of losses they try to convince themselves that they are due a good win to compensate. Of course, unless mathematics is involved (eg a pack of cards with a definite number of outcomes), the ‘past’ has no relevance to the future for unrelated investments. This problem can become compounded if the gambler really convinces themselves it is evidently the case they are going to win (and win-back all their past losses) so they increase the stakes as a consequence – oh dear. (Do we hear that over half those buying National Lottery tickets actually truly believe they are going to win the big prize as that is how they will be removed from their present situation, whatever that may be.

The flip side to this is that if a gambler has a series of wins, then they consider they are an expert at predicting the future so their confidence grows and also the risks and stake money they commit, despite their success being purely down to sheer luck. And before you say ‘that’s not you’ it can manifest itself with things like residential property development and nice ‘safe’ assets like that too, let alone ‘Premium Bonds’, so beware!  
These animals, which allow investors and advisers to trade assets and hold them safely, also have problems which they don’t publicise. We have found that many bar certain stocks. That’s a disadvantage for their customers but an advantage for us as we can buy ‘anything’ and that means buying things cheaper than otherwise they would be because many investors can’t hold them. They could be gold coins at half their value but if you can’t have them, tough. As they receive new customers, any unacceptable stocks coming across have to be dumped regardless of price – what a wonderful opportunity for a deft-footed, small and independent investment manager like us! (The reasons they reject things are manifold, from stocks being more complicated to trade or the client needing to be a ‘professional investor’ to be able to buy them).

Let me give you a current silly example. The Platform has barred purchases of a Loan Fund as it is winding-up (meaning selling-down all its assets and sending the cash to shareholders). So you can keep what you have or must sell on the market if you don’t want to be holding a stock which is going to be suspended at the end of the year as the final loans are redeemed and the last pennies distributed (some is due next week in fact). Now, you may say ‘why buy that?’ Indeed but as people are selling at the equivalent of only 60% of what they are likely to receive in the next year or so, why on earth would they sell and why can’t investors buy this from the impatient now because they can receive an uplift of 67% simply by being inconvenienced with a suspended investment and having to wait a while? (So in plain English, investors are selling £1’s worth of loans for 60p, so we can buy from them to relieve them of the irritation but ‘this’ major platform won’t allow purchases anymore because the stock is liquidating… Yes, there may be reasons why we only receive 85p in the end but we could receive £1.10 too, depending on the last loan repaid and the final costs of winding-up but the comfort cushion makes it very attractive to us.  We shall try to fill our boots whilst we can still buy them. That’s why already we have accumulated 9.5% of all the shares remaining… ssshsh… don’t tell everybody! As the suspension date approaches, we expect even more people to sell-out simply to take whatever cash they can to avoid holding a suspended stock – how foolish but thank you, we’ll relieve you of that anxiety… if we can make a return of two-thirds over say twelve or eighteen months and on a portfolio of asset-backed loans with plenty of collateral… that’s a pretty generous return and with negligible risks – just the sort of ‘technical’ thing we like for clients. If you’re with us, I suspect you have some – if you are not, then I bet you won’t!  
Risk Warning  

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 celebrate our 35th anniversary in 2020 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