Member Info for NormaStits

Corporate pension funds that adopted LDI strategies are really plotting for their end game (insurance buy in or buy out). They have been reducing equity weightings for more than 10 years. Re-equitising their portfolios does not feature in the glide path to that end game. I’ll take the bet!

They won’t look at equities again…

Offer would be sub £4 now given the move in Kist sp? Granted, that’s way above the current SQZ sp…

…small dividend payoff against the risk of capital value erosion given the current political climate right now. ‘Analysing fundamentals’ is a fruitless task right now. The goalposts move almost hourly.

It will mean a Labour government sooner rather than later. That will damage SQZ value more than a non-change in corp tax rate.

This is not mis-selling. The pension funds have professional advisors that advised clients to do these leveraged LDI programmes. Likes of L&G are just the implementers. The risk of this outcome was always there. As usual, the buyers did not believe that the risk would materialise…that is, a violent spike in UK gilt yields. Buyer beware as the warnings were there and spelled out.

Who knows?? Every day we get closer to a Labour government with its plans for windfall taxes and a ‘national energy company’. Predicting anything is foolish in the current climate…

UK pension funds do not own a whole lot of equities any more and no real bias to UK. That ended years ago. The wreckage is in gilts and all the other stuff they have to sell to meet collateral calls on LDI programmes. Impact on UK stick market should be muted. Not sure how they unwind their blind lust for all those private market assets consumed over the past 10 years…

Risk markets are in gentle sell-off mode right now. Generally 1-2% off and a few up days. They are drifting down. We haven’t reached capitulation point, usually provoked by a corporate or geopolitical ‘event’. That’s when the proper downdraught occurs and the 180 and below level may appear. This is not a credit-driven recession…yet. Signs of that start to appear and the sell-offs accelerate and become capitulation. That’s the time to go shopping for quality sticks and high yield bonds that are money good.

It’s a generally crap, but bouncy, market and the SQZ share price is up 25% in 3 months and 50% YTD. Not so bad. 17p annualised payout that is likely to rise.

Flabby, you still just seem to complain about this stock. Why not just get rid and ease your frustration? All of us would love it to +10p each and every day, but it won’t.

Look forward to a happy post from you when the value is realised…one day…

They would probably love to add to their holdings, but can’t because of all the hand-wringing over ESG criteria. Many asset managers are falling over themselves to extol their E credentials, so cannot buy the very assets that their investment instincts would demand.

That’s hyperbolic b/s.

Tempting to regard this as cheap vs recent history. However the market backdrop has fundamentally changed very quickly. It could settle, but the global background is bad enough without the UK self-harming on top of that. I’m interested to buy more, but need to see thing stabilise somewhat first. Ditto AV. facing similar conditions. Hedgies can easily lever up and take UK assets much lower via the £ or securities markets.

If this moves to being a full-blown liquidity crisis, they’ll be going even cheaper…

Thought you might have sold and moved on by now flabby? This share only seems to disappoint you. The disconnect between price and value will close at some point. Fundamentals remain strong.

Pardon?

Luciano - a fool’s game to try and predict commodity prices at this mad time in this mad world. Trading in and out on price predictions is way more luck than judgment. Investing in companies that are exposed to the underlying introduces several more layers of uncertainty. We can all be heroes or zeroes based on what we did or didn’t do off short term price movements, but investing is a long term decision and shutting out the day to day noise is key. Develop your thesis and stick with it until it is proven up or it breaks.

Well that escalated quickly. Take it outside folks and let’s keep the SQZ conversation going.

That’s more like it ;-)

Come on flabby, celebrate an upward movement?