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mikthe20

Contrarian Investment Sectors?

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OK,clearly the housing markets still getting a lot of investment despite the thoughts of many on here. I'm interested in investing in areas but most assets seem to be at highs. Stock markets are at highs, many sectors within those markets are at highs (eg. oil and mining stocks). Does anyone have any suggestions on what sectors are being ignored or are under-valued.

Property - forget it

Oil and mining - at highs and very popular

Gold/silver - at highs, maybe still some way to go, already invested

Financial sector shares - must be at highs?

Retail sector - no thanks

Emerging markets - at highs

Europe - seems to be different cycle to US/UK, already invested

Pharamaceuticals - seems to have concentrated into very few big players so unlikely to see many bug share increases?

Classic cars, wine, art - at highs

All I can think of is:

- there ain't nowhere left so go defensive into cash (interest rates going up)

- even more defensive into physical gold

- tech stocks!

- debt-related companies like Debtmatters (already did that some time ago - great investment)

- utility companies as safe recession-proof, especially with energy prices up

- euros?

Any thoughts anyone? Usually its pretty clear one main asset class is out of favour, but I can't see it right now unless I've forgotten something - or is it the "cash is king" phase now? Sorry if this seems a dumb question.

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OK,clearly the housing markets still getting a lot of investment despite the thoughts of many on here.

Sorry to stop you there - I think you mean the MEW industry.

I'm not so sure the housing industry is doing much my way - Norfolk.

We had a the major property paper for the areas quoting -5.2% on it's front page.

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Any thoughts anyone? Usually its pretty clear one main asset class is out of favour, but I can't see it right now unless I've forgotten something - or is it the "cash is king" phase now? Sorry if this seems a dumb question.

No I don't think this is a stupid question at all. I like these suggestions FWIW:

"- there ain't nowhere left so go defensive into cash (interest rates going up)

- even more defensive into physical gold

-- euros?"

I think it may prove to be prudent to hold cash, or cash equivalents, outside of a bank or building society account.

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Pharamaceuticals - seems to have concentrated into very few big players so unlikely to see many bug share

Actually not, pharma is still in need of consolidation, Glaxo is amongst the biggest (if not the the biggest) yet it has less than 11% of global market share.

The demographics fit their outlook nicely and wider short-term scares from things like the Vioxx lawsuits are keeping the market subdued and p/e's at good levels.

I'm gonna go get me some drugs! Anyone care to agree?

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I might have a closer look at pharma - ageing populations and all that.

Already have exposure to mainland Europe.

Forgot about Japan - looks like a good idea.

Thanks chaps/chapettes.

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Large caps in general look cheap relative to mid and small cap and pharma and financials have been left behind therefore in equity world, those look OK although not mega cheap on an absolute basis.

Unfortunately, I think your problem points to the fact that the tidal wave of liquidity has floated all asset classes and none are cheap. Of course, one way to exploit this is to short or buy puts on things....

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Guest Guy_Montag

Of course, one way to exploit this is to short or buy puts on things....

What does that mean?

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What does that mean?

Essentially puts and calls are about betting on the movement of share prices up (calls) or down (puts) by some future point in time. They are very much about trading rather than investing.

The trading is a geared because you are doing it on changing margins rather than the price of stock per se. You can make a lot but, unless you know what you are doing and even if you do, lose a lot too.

Seriously, if you don't know what they are then they are not for you.

At least not until you've found out a lot about them, had some virtual experience and fully understand the risks and how to limit them.

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Actually not, pharma is still in need of consolidation, Glaxo is amongst the biggest (if not the the biggest) yet it has less than 11% of global market share.

The demographics fit their outlook nicely and wider short-term scares from things like the Vioxx lawsuits are keeping the market subdued and p/e's at good levels.

I'm gonna go get me some drugs! Anyone care to agree?

inclined to agree here!!!!!....the global population aint getting any younger.plus with all the new found wealth in asia the better healthcare will come as part of the package.

...and if bird flu DOES strike.....then pharma is certainly gonna be a HOT sector.

....generic pharma is the place to look,less risk than the big westerns....something like ranbaxy or teva is a good bet.

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No I don't think this is a stupid question at all. I like these suggestions FWIW:

"- there ain't nowhere left so go defensive into cash (interest rates going up)

- even more defensive into physical gold

-- euros?"

I think it may prove to be prudent to hold cash, or cash equivalents, outside of a bank or building society account.

hi vinny could you explain what you mean holding cash outside of a bank building society

cheers

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Guest muttley

....generic pharma is the place to look,less risk than the big westerns....something like ranbaxy or teva is a good bet.

Teva. Aren't they American?

I'm using loads of their products lately.

I'm a pharmacist, not a hypochondriac.

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hi vinny could you explain what you mean holding cash outside of a bank building society

cheers

Sure. I mean your money should perhaps be held in a depository, safe, under your matress, or in cash equivalents.

For cash equivalents I mean fixed price Government bonds / treasury notes. (Although there is risk in these instruments).

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

I think you should to understand why I don't think you should be holding cash in a bank or society.

In short, could I suggest you research the following?:

*Fractional reserve banking.

*Carry trade.

*1929 depression.

*The current debt bubble.

* The legal right you have (or in actuality don't have) to your deposit(s) in banks.

I wonder if the banks can remain solvent in the coming years. An extream view - perhaps, but at the interest rates they pay (Gov bonds can beat them in most cases) it's not worth the risk.

It is YOUR money they are lending to people to buy overpriced houses (and other overpriced assets), conservatories, speedboats, flash cars, and chav jewelery etc. If we suffer a massive downturn (hint), what do you think they will be able to pay you back?

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Teva. Aren't they American?

I'm using loads of their products lately.

I'm a pharmacist, not a hypochondriac.

teva are an israeli company listed on nasdaq....they are experts in flogging the out-of-patent drugs to developing(and developed) countries.

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hi vinny could you explain what you mean holding cash outside of a bank building society

cheers

He or she means under your mattress because the HPC zeitgeist is that a bank run and financial armageddon is more of a risk than being burgled, your house catching fire, or just losing the interest.

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A few other areas of note perhaps:

- Energy and environmental technology including renewables and energy efficiency (I'm already in this quite heavily as work in the sector)

- Car manufacturers (I did say contrarian!)

- Transport (airlines, trains, shipping, ports etc)

- Media?

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Food producers such as Northern Foods (NFDS) and ABF (ABF) are currently out of fashion. Probably due to high energy costs and an unwillingness by the big 4 supermarkets to accept price increases. I'd imagine there'll be some consolidation in the market and profits will recover eventually so, one to keep an eye on rather than jump straight in.

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Buy the 10 over 2year US treasury bond yeild spread its currently just above 1 :)

Japanese Reits ? anyone That 13/14year recond is going to turn around if things keep going the way they are.

Edited by jonpo

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He or she means under your mattress because the HPC zeitgeist is that a bank run and financial armageddon is more of a risk than being burgled, your house catching fire, or just losing the interest.

:lol::lol::lol:

Is there a high probability of a run on banks? I'm not sure.

Look at the risk v.s reward for holding money in a bank though.

0 to 5%(tops) interest per annum secured against bonds, stocks and real estate (let's not complicate things by going into derivatives). If banks were to pay the correct premium via interest for the risks they take then I'd consider leaving my money in a bank.

There are of course, drawbacks to holding cash outside of a bank, I would not put a large percentage of banknotes "under my mattress" - though I suggest that at people have at least some cash on hand. There are other places to put your money - I have suggested some here.

BTB - If you want to leave your money in a bank - fine - be their guest.

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Oddly enough, wildly unlikely mass events can be more likely to affect an individual than everyday personal tragedies. I remember reading somewhere (the Economist, I think) that you are more likely (as an individual) each year to die as the Earth is hit by a giant asteroid than you are to die in a plane crash.

(Although I believe the odds of being killed by asteroid are dropping every day as the mapping of asteroids is improved, and eventually they will be less of a threat when they can be course-corrected or "humanity" has spread away from Earth. But this is just an example of how counter-intuitive "that's just too wild a scenario" type actions can be statistically rational.)

Durch, I'm sure you posted long ago about your experience of bank runs - I can't remember what you said. If I have not got this wrong - could you re -tell your tale ( with a bit of background)here please?

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Hi vinny. Here's the post I think you mean (click). Not exactly bank runs, but financial chaos resulting from explosive "snap-backs" from market distortions introduced by over-interfering governments.

I would certainly say our current fiat money central banking system is state planning at its worst.

Thanks Durch.

Goodness - It's been almost a year since you posted this originally! No wonder I could not remember the content!!!!

Keeps my faith in the debt free, gold holding, mainly liquid position I have taken.

For those who have a go at Dr Bubb - his quote from the same thread:

"Meantime, it has risen by only 15% in Dollars ($438 to $505).

If the dollar peaks now (at year end), will we see a 30%+ move in Dollar Gold in 2006?

$650 Gold in 2006 is not impossible, gentlemen and ladies.,

particularly if the Dollar falls."

Edited by vinny

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Guest boredwaiting

I was thinking the same thing. Credit to Dr Bubb.

Definately he has his eye on the ball, i wished i sorted out some gold before - i have just invested some but not sure where it will go...

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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