In this week’s copy of MoneyWeek magazine: why sterling’s slide is nothing to fear; why it’s best to bide your time when investing; and the best way to value currencies.
Plus, Matthew Lynn espouses the virtue of the “gig economy”; Max King picks three solid investment trusts to buy for income; and I look at the trouble easyJet has found itself in of late.
All that, plus more regular features, guest comment and digests of the week’s financial news, could be yours if you take out a subscription now. You’ll get the magazine delivered straight to your door, access to the smartphone and tablet app and MoneyWeek.com. Why not sign up now?
How to benefit from a weaker pound
The venerable pound hit an all-time low this week. It has recovered (very) slightly – as I write, it’s hovering at around $1.22. But it’s still looking fairly queasy.
“The pound has crashed”, says John Stepek in this week’s cover story, “because markets are suddenly worried that Brexit really does mean Brexit” in the wake of the swashbuckling “hard Brexit” rhetoric of Theresa May and the Eurosceptic wing of the Tory Party.
But “does the crashing pound really prove that Brexit is a dire mistake?” asks John, “or is it just a necessary step on the path to rebalancing the UK economy – painful for some, but equally beneficial for others?
Britain has been running a big current account deficit for a long time now. A weaker pound can help change that, says John. In short, says John, “if the ‘march of the makers’ and the ‘Northern powerhouse’ are ever to be anything more than empty slogans” then Britain needs “something more radical than a half-hearted reshuffling of regulatory responsibilities backed up by endless quantitative easing – and the weaker pound can help with that.”
But “it isn’t all upside”, John explains. “A weaker currency will drive up the price of imported goods.” John explains the ups and downs in depth, and picks the best ways to invest if you want to benefit from the weak pound. Find out how, bysign up now.
The slow road to profits
This week, Merryn talks to another successful fund manager and wheedles out of him the secret of his success – Charles Heenan of Kennock Asset Management. His fund has has made an annualised return of 9.4% since its inception, and was up 30% this year by the end of September. So he clearly knows what he’s talking about. “We are value investors”, he says, and “that means price matters”. But, obviously, you can’t just buy any old cheap stock, and finding quality companies is tough – Charles buys just one or two stock a year. “You have to be patient”, he says.
Find out how he does it, and what some of his favourite companies are at the moment, sign up now.
How to value currencies
On his investment strategy page this week. Matthew Partridge takes a look at currencies. Specifically, how to value them, with particular focus on the pound. There are various indices – one of the most basic and most famous is the Economist’s “Big Mac index” – which is suggesting the pound is indeed relatively cheap at the moment. But there are others, too, which put the pound at different levels. Matthew explains what they are, and the pros and cons of each.
Max King’s picks for income
With interest rates practically zero, “investors are chasing after income wherever they can find it”, says Max King. It may come as a surprise to discover that investment trusts specialising in UK income and “managed by some of the most highly regarded managers” are trading on “reasonable” discounts to asset value.
Max picks three that are currently trading on discounts of 8% and 9% and which are yielding around 3.5%. Find out what they are by sign up now.
Gigging for your life
Regular contributor Matthew Lynn sets his sights on the “gig economy” this week. It’s a complex subject. To some, it’s a welcome evolution of the labour market, which frees people to earn money on their own terms without being shackled to a nine-to-five job. For others, it’s an insecure way of life where workers are exploited via loopholes in employment law, denied the safeguards and benefits that have been won over the years; a return to pre-industrial economy.
Safe to say, Matthew’s on the side of the free market. “The gig economy is one of the great growth stories of the decade”, he says. “It is creating jobs in a way that no other sector can right now.” He proposes four key reforms he wants to government to make that should give the self employed “the freedom to develop their own careers”.
Elsewhere, Natalie Stanton looks at the business of dying, and the remarkably expensive funeral industry; we look at Donald Trump, and attempt to unravel some of the myths behind him; and guest contributor Peter Warburton examines the “wishful thinking” that surrounds inflation forecasts.
All that, plus the usual digest of the news, advice on pensions, property and personal finance. Why not give it a go? sign up now.