Chicken Licken is hibernating

Just when the news cycle makes you think that the world has gone mad and is beyond repair, I found some comfort in the Wetherspoon results this morning which showed increased sales of 6% for their financial year. I suspect even if there were a nuclear war, Brits would still shrug and head out for a pint.

In my opinion, investment markets are being a bit weird. To use a technical term. They seem almost blasé about geopolitical events, which would normally knock confidence. Investment pundits can refer to “risk off” scenarios, which basically means that investors across the world squeal and do a Chicken Licken, retreating to cash and shouting that the sky is falling in. But Chicken Licken is seemingly in hibernation and our appetite for global stock markets continues apace.

Across major investment platforms in September, the mixed bag that is Fidelity Index World was a bestseller still, and in ‘EFT’ Land (Exchange-Traded Funds) Vanguard’s S&P 500 was a popular way to access the US market in an easy, cheap way. We’ll bring you the full round-up on recent best-selling funds in next week’s blog.

Oil shoots up and interest rates (probably) come down…

Despite the general resilience of markets, yesterday Joe Biden’s comments on potential Israeli retaliation against Iran’s oil industry sent the oil price soaring. Iran exports about 1.7 million barrels of oil a day, most of which heads to China. And as with anything, if there is less of it, people are prepared to pay more to get their hands on it. So BOOM goes the oil price. Which means Shell’s share price is up 6% in one week. And funds which avoid oil – often those with sustainable or ethical in the name – will mostly be down.

Closer to home, the Governor of the Bank of England was also moving markets yesterday with just four words. “A bit more aggressive” was how he described his thinking on future interest rate cuts. Unlike yours truly, Mr Bailey is not prone to excessive exuberance and adjective-overdose, so when he says things like this, they're very specific and deliberate signals, not a description of his reaction to running out of tea bags. Expect a rate cut in November and probably again in December.

Foxy Loxy is NOT hibernating

With a Budget looming (which I think will be inevitably gloomy for most investors, as Rachel Reeves takes the role of a well-dressed Foxy Loxy), more people are trying to move their savings into tax-efficient ISAs and pensions. Platforms are reporting high customer activity as many customers rush to pay into pensions and ISAs before potential cuts, changes or limits are imposed.

It’s a natural time to look for some help and lots of people want some advice to make sure they’re not doing anything wrong or daft with their money. But financial advice is increasingly out of reach for many. The rule of thumb used to be that you needed to have at least £100,000 in cash, investments and pensions to make it worthwhile for the adviser to have you as a client. These days it’s nudging up to nearer £200,000. Gulp.

This week one reader asked me how to find someone who could just give her a summary overview of her finances for a few hundred pounds. Unfortunately, this is not easy. Anyone giving advice is on the hook for this advice, so it’s hard to do this in a ‘quick and dirty’ way. If you don’t have the whole picture and any advice given results in a bad outcome, the adviser could get clobbered down the track. As a rule of thumb, ongoing financial advice will cost roughly 2%-2.5% a year for the whole package – investments, pensions, admin and advice.

It’s a chunky amount and people want to know they're getting value for money. If you’re one of our many readers wondering if your financial adviser is doing a good job for you, or where to start in your search for one, this piece will cover what to look for, what to ask, what to pay and more.

And finally, if you’re a bit more Cocky Locky…

If you’re a die hard DIYer, this week Saxo Bank went live with a refreshed investment platform. It’s worth a look if you’re a relatively engaged investor, interested in tips and ideas and don’t like paying above the odds on foreign exchange fees. They have some fee-free dealing in the US as a sweetener for new clients and interesting stock tips based on various themes.

One reason I love investment markets is that they're an honest mirror of the world and people. In the scenario of a Trump victory, their tips include picks from the oil, gas, banking and defence sectors. In the case of a Harris victory, it’s green energy, semiconductors and healthcare. If you want to know what the global opinion is of anything or anyone, don’t read a newspaper. Look at the stock markets. Because money doesn’t lie!

Have a great weekend everyone. I’m planning a swim in the sea later. My personal challenge is to go through the winter this year, although if I go quiet on this, you know I’ve Chickened out!

Holly

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