The COVID-19 pandemic period has prompted huge numbers of people to foray into the world of investments for the first time through a combination of spare time, spare cash (for many) and the proliferation of apps which “gamify” investing. Market highs and the rocket powered rise of certain “story stocks” and cryptocurrencies haven’t hurt either. Everyone wants a piece of the action, it seems.
Our most recent blog introduced the topic of investment style, looking specifically at why many are now advocating a switch in focus from growth to value i.e. the hunt for undervalued stocks. We now turn to another not-to-be-forgotten element of investment style: market capitalisation. Again, this is timely to discuss since new research is turning old assumptions on their head.
I’m guessing that many, many of us will be thinking yes to that question currently after a year of loungewear and every type of grooming being an amateur effort (if at all!). But actually, what I’m referring to is the need to check in on your investment style to ensure it still fits your purpose and the landscape ahead.
Having been one of those people frantically trying to use up my ISA allowance before the end of the tax year one too many times, I’m not going to admonish anyone who came to regret April 5th being on a beautiful Bank Holiday. I hope you all got to use this most useful tax shelter to the maximum.
Your younger years wouldn’t be your youth unless they were “wasted” to a large extent with fun and frivolity. Goodness knows, there’s enough time for the more serious cares of life to weigh you down. However, there is one notable exception to that creed: investing.
The Bank of England estimates that Britons are sitting on £100 billion of excess savings due to lockdowns. Almost three-quarters of people say they aren’t going to spend their extra cash and are presumably going to put it to work. For those investing for a better financial future, there is a strong case to be made for buying British – that is, upping their exposure to UK equities.