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Krusty,
Thanks for the leads on different companies to check out...
I put the three of them on my watchlist to take a butcher's at later, but right now I'm out in New Zealand visiting family and due to fly home tomorrow morning ~ so probably not a good time for that... 😊
First glance, though, suggests they're all rather small cap for me.... I have learned that I suffer with a kind of "investing claustrophobia" if I'm stuck in a share I can't quickly trade out of if the decision takes me.
Inland Homes being the particular case in point a while back...
Having looked at the five year price graph, I suppose if you were buying Jupiter today and not a few years ago it would probably be easier to smile about it though..? 😊
I researched the whole of the FTSE100 back in 2003 and concluded, taken as a whole and to borrow from Kipling, that it was a trap set by knaves for fools...
However, back then ~ having just checked back for someone on my blog ~ LGEN was on a div yield of 4.8% and now it's nearly double that....
And Bellway was making an ROE of 20% in 2003 and now it's only on 4.1% for 2024.
Taking all the above numbers into account ~ is that difference stark, or what...?
Strictly
No tax on dividend held in an isa account you can earn as much as you like.
Fisherking, I don't pay a penny in tax on my dividends. But then, I've spent the last 20+ years diligently moving investments into ISA's for me & my wife, taking advantage of the excellent annual allowances available.
I think you need to reset your password strictly, someone is pretending to be you on LGEN & MNG!
Seriously now, welcome to the rest of my world. As well as TW., BDEV & PSN I'm also in here, MNG &, for better or worse, JUP. All had their merits at time of purchase, but it's been a bit of a roller-coaster. I bought my MNG for 205 (stop laughing) so that's not too bad, my average here is 277 so not great, & I don't even want to look at JUP although I only have a tiny holding. They've all helped supplement my income, and I'm still hopeful I might get my shirt back eventually. I don't do tips (I'm a terrible investor, mostly) but as you've stepped out into the shark-infested waters, you might want to run the rule over REDD & MEGP. Both still appear to have considerable growth potential whilst already paying a decent dividend.
Good luck, don't forget where your footings are though. K
Hi Fisherking, many thanks for your response. TBH, I'm not altogether sure how LGEN calculates the dividend reinvestment rate. My understanding is that they work out an average price based on low to high SP over the period of time between XD and payment date. I may be wrong on this and will gladly be put right. In terms of the tax situation on dividends, this is something I'm a tad more savvy. Remembering that my particular LGEN holding is kept in an ISA tax wrapper, here's the official word on the matter:
"You do not pay tax on any dividend income that falls within your Personal Allowance (the amount of income you can earn each year without paying tax). You also get a dividend allowance each year. You only pay tax on any dividend income above the dividend allowance. You do not pay tax on dividends from shares in an ISA" .
Hope this helps clarify the matter of tax on dividend payments. Good luck.
Phyl
I'm afraid your dividend s are now taxed
Unless you are on low income and I certainly don't know anyone that is on a low income can invest in the market.
I am retired employee of prudential cache securities and I have stated on here that I have been invested in LGEN
For over 5 years at least and they are not performing as some of their peers like Aviva.
I think if my memory serves me right the highest price over 5 years has been ,3.09.
Let's hope things in the world change sooner rather than later.
Dividend reinvestment seems at the time to be ok or at least it sounds that way but consider when you get your dividend the shares have recovered to
Well above your ex dividend price so therefore when your money is reinvested
You will not receive as many shares as you would as the price has risen again.
Jinkar thanks for the reference I’ll have a look. In answer to your question regarding holding Lgen, my take is that the American market is overvalued, the ft 100 appears to be on a up trend
and there is always constant chatter of take overs. Aviva was recently attracting speculation so one would assume that someone has also run the rule over Legal and General.
Even if there was a bid for another insurer the sector would perhaps benefit from any potential take over. So, it’s definitely one to hold is my view.
Something to think about.
@Finley, The Indian fund I use is AIE. It is an investment trust. Gone well over the last few years, a drop off in the last week or so. New to this board as I bought in to the dividend capture strategy in one of my ISA accounts. I thought I would have to hold over the summer at least but been surprised by upside momentum.
Does anybody have any bullet points that could persuade me to hold? My dividend capture strategy has worked so far this tax year.
GLA.
Going for a Sector is one way of doing things but it wouldn’t be mine, I prefer cover in various unless there’s a reason to avoid
Strictly, in my very humble opinion, you could have switched into something else much worse than LGEN. I'm a long termish investor here and been through the highs & lows on perhaps far too many occasions. Sometimes I question myself for holding this stock, but something tells me to persevere. My strategy for what its worth, is to secure tax free dividend payments to supplement my pension in a couple of years time. I may sell a few closer toward the time and invest elsewhere to reduce my exposure but thats a decision for another day. Good luck here.
Robleo,
I actually thought I was being a bit of a wuss investing across all three of the insurance big boys rather than just going for one, but that's because I'm new to this sector and there is a certainly sense of safetly in numbers...
Whereas, within the house builder sector, where I am more confident, rightly or wrongly, of what I am about, I have been happy to be invested 100% in a single share on quite a number of occasions when and for as long as, to my view, that company has been the stand out best value...
Of course, I'm not Warren Buffett and I haven't always called it right... ☹
But I'm happy to stand on my track record if anyone wants to judge me on it and this game has been providing me with a decent enough crust for the past twenty four years to be much more than just satisfied with it.
I wish you well though, following your own path of a blend of shares and funds...
Strictly
Londoner,
"I recall your focus in the housing sector was on tangible book value. Given Bellway’s focus on organic growth I could imagine Bellway featured in your recovery plays, but my focus is on the macro, as was my question yesterday - what’s different this time round for the house builders. While I understand your decision to rotate to a different sector, I’m left wondering why you think the traditional builders will return to their previous growth rates, albeit starting 3-years out."
My concern is very much that the house builders may not get back to their former glory.
Bellway have averaged a return on equity of around 16% for the past 40 years.... that's pretty awesome ~ to put some numbers on it, they've turned a starting BVPS in 1983 of 51p into a 2023 BVPS of 2,871p plus paid out 1,361p in dividend over that time...
How many investors have beaten that...?
Of course, you'd have had to know to be in Bellway at the outset, and the irony for me is that I sold my business (which gave me the capital to invest) in 1984 but didn't start managing my own stuff until 2000 and didn't have my house builder share epiphany until 2003.
It took me ten years of paying attention and trading on perceived value gaps to firstly catch Bellway up and then finally overtake its performance through trading.
So I could have profitably sat on my a.se for a decade and done nothing if I'd have only known about Bellway from the get go.
Not for nothing is the company affectionately known as Ghost Dog in our investing circle.
......................
"I’ve posted my macro view to the Vistry board, in which I attempted to make the case that it will be different this time for the traditional builders, hence my preference for Vistry’s partnership model. I post my ideas in the hope of receiving a response along the lines, you’re wrong and this is why!"
In sharp contrast to Bellway, Vistry is somewhat less-than-affectionately known as Battersea in our group.... as a fellow London lad, you'll no doubt understand the connotation..? 😊
We've had much discussion about this company on our blog ~ several of us agree that we see it as the triumph of jam tomorrow over past track record.
To put some numbers on it, from 1987, Bellway's BVPS went from 183p to 2,871p with 1,282p of div, whereas Bovis/Vistry BVPS only went from 185p to 600p, with 701p of div.
Over the past decade, Vistry's BVPS has stood still...
And yet, for this dubious confection, one pays a PBV of over 2.0 for Vistry compared to below 1.0 for Bellway....
Maybe they will yet emerge triumphant and, of course, it takes a buyer and a seller to make a market, and clearly others see this very differently to me...
If you would like to chat about all this on our blog, which was until very recently dedicated to house builders but now also embraces the big insurance boys ~ which has come as a bit of a shock to some of the folk on the blog ~ let me know....
Stric
Fair points, except the risks of selling before XD and hoping to buyback at a price lower than the dividend was declared by numerous people. I did that this time (not bought back in yet) and for the time being, it looks like I've missed out.
But I've done this for 3 years in a row and profited very well.
I certainly wouldn't advise anyone to follow my lead. Each to their own. What I've achieved in the past is no indicator of future performance.
Post XD is just about behind us with the SP holding up very nicely indeed. Some folk on this board thought maybe the SP would continue to sink toward £2.20 post XD, but the opposite seems to be happening. Since post XD the SP has recovered beyond imagination as the norm is for it to continue dropping I must admit. For those buying in on the XD drop, congratulations, you are all in the blue. I have LGEN tucked away in my ISA. I'm 60% all in which many on this board will shout against not being diversified enough. I, like many others, can also look toward a dividend reinvestment payment early June to help compound matters. Normally, at this time of year, I simply sit indoors and watch the rainfall on my LGEN shares, but today, I'm having my day in the sun. Good luck to all LGEN investors on this board no matter what your short, nedium and long term strategies are.
Well that was quick. Recovered from ex-divi drop already. What a great stock to sit on and watch the cash roll in!
Someone was bleating about loss of capital being unacceptable despite the fat dividend. Well it hasn't happened to me, quite the opposite in fact but then I hardly ever buy at the top of the market and so my average is £2.35 for this great share. If I can't buy at a fairly low price, I go elsewhere or sit on my cash.
Mid-60s, retired and happy to be currently 89% in individual dividend paying shares and 11% in funds. Only down on 2 of my 15 individual shares, so things looking up lately. A maximum of 13% in any one share, which is of course LGEN!
There seems to be a lot of different investing strategy's here, the best one of course is the one that you are happy and comfortable with
I guess i have gone a bit more cautious as i'm getting older, a split of 60% funds and 40% dividend shares i find is working well for myself and i would not put more than 10% of my portfolio into any one share, but each to their own as others have mentioned, if you are happy with what you are doing that's all that matters
let's just hope we can all keep making a good profit from this one
I need to look at the Indian etf scenario. Probably safe to say I think they have done all rather
well and I’m probably late to the party. As businessman they are immensely sharp, so it would
be fair to say that you would assume that any legitimate investment would do rather well.
Famous last words and all that, I’ll let you know how I get on.
Thanks,
Finley.
Finley1 - yes, I can recall Charlie saying that on numerous occasions. That's fine if you know what you're doing! I recognise that my circle of competence (another WB/CM saying) is fairly narrow so tend to have plenty of diversification within my portfolio.
I do like managed global equity funds and also tracker funds. Nothing directly in India as yet.
I also still like the odd dable in single shares. Although I've been moving away from them over the years and was down to my last in LGEN, I couldn't resist both Nvidia and Microsoft last year. I consider my purchase in Nvidia, especially, to be a lost opportunity . If only I'd have been braver! Never mind as a pensioner living off his investments I need to be careful. Not too careful though!! Good Luck.
Zac, when I’ve put my feet up watching the television, and the ever helpful YouTube. I’ve listened to dearest Warren and the late great Charlie Munger, and it was often stated that
the small investor can do very well from a handful of stocks, and if they are not that confident in that strategy then just buy the S and P 500.
I dare say you of course know all this, and of course it is each to their own. I know you like the managed funds, do you by any chance have one for India, I’m curious ?
Thanks,
Finley.
Correction, got the wrong year.
It was July 2009, at 51p.
Another point on my strategy.
Having been through the mill with several market crashes, my hope is that the dividend income streams will be impacted to a lesser degree and duration than the capital values. I also have insurance in the form of cash.
I've heard the case for holding growth funds and selling to release income as required. I manage four pension funds for family members, with three in drawdown. They are all invested in funds and investment trusts, because I took a decision not to invest their pensions into individual shares. I can handle a 50% hit to equity, but prefer the protection of a 3rd party investment professional to explaining such a market fallout to a family member.
But it leaves me with the problem of deciding when and how much of the growth funds I need to sell down to cover monthly income requirements. Much easier if the natural dividend income exceeds income requirements but their funds don't allow me the luxury. The following link describes a strategy that might be of interest to others with the problem.
aaii.com/journal/article/10681-optimizing-retirement-withdrawals-using-the-level3-strategy?printerfriendly=true#
Meconopsis, I think the thread deserves a new title.
Well, that was a shocker – Berkshire’s holdings. Sadly, I think many private investors have a similar profile to their holdings, but probably not with Apple at the top. Going by the boards of some stocks I follow for amusement; the headliners would be stocks 99 out of 100 investors have never heard of. In Buffett's defense, while Apple might not have the near term growth expectations of Nvidia, for example, I think Apple is likely to be around 20 years from now - another Coca Cola - I wouldn't be so sure of Nvidia.
As I’ve transitioned from a position with employment income and investment income into retirement, diversification has been on my mind. A conventional route in retirement would be an allocation to bonds and annuities. Not for me but appropriate for many investors.
Frequently, over the decades of my investment career I’ve looked at bonds. I love numbers and have played out various scenarios with ladder structures around bond interest and duration to pay a reliable income stream, but ultimately rejected them on the basis equities prevail over the longer term.
Last year, a family member with a very low investment risk threshold asked me for advice. (Many years ago, I completed 3 FCA certificates, so I know the importance of client assessment.) Knowing he doesn’t have any dependents, or close family, I suggested he consider annuities. He chose not to, but the exercise prompted me to look at LGEN. I saw a company paying close to 10% dividend yield with an expectation the dividend would grow at 5% over the following 2 years. I noticed that many other UK companies had also entered the high yield sphere. Previously, I’d been more focused on growth plays. While I maintain that a good growth stock will likely produce a higher total return than LGEN paying 10% growing at above inflation, I chose to move a large part of my portfolio into the high yield sphere.
While I’m still tweaking my strategy, my thinking is that the dividend payers cover more than my income requirements, which allows me to invest the excess back into my preferred growth stocks and a bit back into the high dividend sphere to enhance the inflation proofing of my dividend income. (I think that explains it)
I also see this as a good point to be in UK stocks. Whether it’s Brexit, Covid government policy or whatever, I feel the stagnation in share pricing may be coming towards the end and as interest rates drop – I think towards 3% - the high yield sphere will be more attractive. The dividend yield on LGEN might fall towards 6% but we’d see a corresponding appreciation in the capital returns.
* When I invested in LGEN last year my portfolio application (Microsoft Money) threw up an investment I made in LGEN in July 2008, at 51p. Highlights the chaos of the period and the case for not over trading - I sold the holding a few months later, probably trading into something going the other way.
In isolation, no. However, even allowing for the size of their holding in Apple, Berkshire are still well diversifiedacross other shares and businesses they own. I just think it can be an uneccesarily high risk for private investors to hold a very concentrated portfolio.
That's my view but each to their own.