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Eric Chalker's Blog


Will this be the end of share ownership?

This is the month, January 2018, when the EU wanted to begin abolishing share certificates.  Thanks to George Osborne and his Treasury team, it was put back to January 2023, but is now mandatory for all EU members.  Britain is leaving the EU, but the necessary changes have already begun and it seems inconceivable that they will be stopped.  If the changes go the wrong way, no individual will be able to own listed company shares after the end of 2024, or even sooner than that.

The changes are a consequence of the EU’s Central Securities Depositories Regulation (CSDR), number 909/2014.  It requires all shareholdings to be held in what is called ‘book-entry’ form, either via an authorised Central Securities Depository participant or using an alternative dematerialised holding method.  By January 2023, this will apply to all new share issues, in theory leaving conversion of existing shares until January 2025, but in practice this may not be possible.  As new share issues include placings, open offers and rights issues, the changes may actually be applied simultaneously to avoid problems arising from mixed holdings.


Blog Calendar


How to value companies

   It is not unusual at Christmas time to come across book recommendations, but probably not to see one recommending a book on accountancy.  Even so, this is the subject today – recommended reading for those who would like to be better investors.  The book is “Accounting and Business Valuation Methods,” written by a leading member of the UK Shareholders’ Association, Malcolm Howard.


Greatland Gold, great excitement

With 3,000 share posts on this website alone in the last 7 days, excitement is evident.  However, those who attended yesterday’s AGM may now be rethinking their positions.  It’s not that there’s a lack of value, but expectations of becoming rich overnight are suffering a setback and this can be seen in some of the share chat. 


Boardroom Secrecy ? how far should it go?

Xavier Rolet, CEO of the London Stock Exchange, is leaving under circumstances which are being challenged by a major investor.  It appears that he is bound by a non-disclosure agreement not to explain the reasons for his unexpectedly early retirement.  Why should investors be prevented from having this information?


More about VCTs

Four weeks ago, on 13th October, I asked “Who benefits from Venture Capital Trusts?”  These have been heavily promoted recently, supposedly in anticipation of a more restrictive regime being introduced in the Budget in just under a fortnight’s time.  Examining my own experience, I concluded that, generally speaking, these are not a good investment.  Ironically, this has since been confirmed – and by my own VCT provider, no less!


How bad might it be?

If stock markets fall, what should we expect?  Our individual answers to this will differ, so it is not for me to make a forecast, but what if it is more than the simple ten per cent ‘correction’ that some are forecasting?  Sometimes markets reverse and then keep on falling.  What might such a reversal look like?


Who benefits from Venture Capital Trusts?

Journalists’ interest in VCTs has recently been reawakened by the thought that VCT tax benefits might suffer in the government’s next budget, due in a month’s time.   This is on the back of several new fund raisings by VCT managers which may also have been stimulated by the same thought – or perhaps by the thought that this is a good time to persuade wealthy savers to part with more money.


Takeover Panel becomes an arm of government

Most private investors are probably only vaguely aware of The Takeover Panel.  It is generally thought of as acting as umpire when a merger or acquisition has been proposed, in order to ensure fair treatment for interested parties.  At the behest of the government, it is now preparing to be a judge as well, which some might think will interfere unwarrantably with investors’ rights to obtain best value for money when disposing of their investments.

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