Original Broadcast: The Financial Outlook for Personal Investors
Russ Mould of A J Bell comments that, given the headwinds buffetting markets in 2025, you would hardly expect it to have been such a fantastic year for assets. He suggests 5 topics for investors to consider in 2026: interest rates; AI; commodities; small caps; and cash returns. Monetary and fiscal policy (except taxes in the UK) was generally stimulative and looks likely to continue. We have little direct involvement in AI so, if it blows up, the UK will be less affected than other markets. Miners and oils have been great performers this year but the profit upgrades we're now seeing are mostly because of metal miners. Small caps have been nowhere to be seen. Why? It is not healthy if the small and medium-sized companies that employ 90% of workers are struggling. UK investors have seen over £180bn returned to them in 2025. That's over a 6% return on the All-Share Index, which should continue to support UK shares if things continue as they are.
Guests: Russ Mould
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Original Broadcast: The Financial Outlook for Personal Investors
Finlay Mathers of Edison discusses BP, which has changed strategy to give an emphasis to shareholder return, increasing investment in oil & gas by 20% while reducing transition investment by 70%. The company will be focussing on cost reductions and efficiency, strengthening its balance sheet and reducing net debt. Neil Shah of Edison returns to the topic of Games Workshop, which he has mentioned here before on more than one occasion. This one-time small company has now entered the FTSE and the shares are up 40% this year. It's an exceptionally well-run business and its Warhammer figurines will become even better known when the Amazon TV series approaches production. It has a very progressive dividend and, while it is on a PE of 30, it is a niche business that should keep growing at pace.
Guests: Finlay Mathers,Neil Shah
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Original Broadcast: The Financial Outlook for Personal Investors
Russ Mould of A J Bell says that Rachel Reeves' Budget was delivered with an eye on the bond markets. Fortunately for her, the 10-year gilt has been steady since, even if it is higher than when Labour took over and has moved in a different direction to BoE interest rates. All equity investors have an interest in gilt yields, whether they know it or not. Russ reckons this year could be the UK's best performance since 2009. Derided as being dull for being heavy with banks, miners and emerging markets, those have all been good performers, while the once-popular dividend compounders have seen only 1 in the top 20 risers. They got ahead of a sensible value.
Guests: Russ Mould
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Original Broadcast: The Financial Outlook for Personal Investors
Professor Tim Evans of Middlesex University thinks that Rachel Reeves' highly-political Budget could have bought her and the Prime Minister some time, calmed the markets and even reunited the Labour Party. But what will be the unintended consequences? There will be a lot of deferred pain through tax rises. It could create weaker productivity, risk a two-speed economy, dampen consumer spending and investment, persuade more wealthy and talented people to emigrate, depressing tax revenue and it may yet prove inflationary. It will take some time before we get a clearer idea what the consequences will be.
Guests: Professor Tim Evans
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Original Broadcast: The Financial Outlook for Personal Investors
Neil Shah of Edison Group says markets were relieved that the Budget did nothing to undermine confidence. Banks reacted positively, as did Rank, along with wealth managers and financial services, as it will be increasingly punitive to save or invest outside a tax wrapper. High end housebuilders suffered and the tax increases won't help the consumer sector. For somebody looking for exposure to precious and strategic metals, Neil highlights the closed-end Baker Steel Resources Trust. It has increased net asset value 40% in a year. It trades on a 35% discount, as do many in the sector, but Neil feels over the long term this should narrow. Info on Edison website.
Guests: Neil Shah
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Original Broadcast: The Financial Outlook for Personal Investors
In the wake of Nvidia's 3rd quarter results, Russ Mould of A J Bell says that all capital expenditure booms come to an end because of over-investment. It is too soon to say how this one will turn out. He is intrigued, though, that AI tech needs energy and mined metals and yet capex in those sectors is very low. With AI, we need to see some return on the money invested. If it turns out to be the productivity boom we've been looking for, then people's perceptions towards mining and energy should change, although in both those fields it takes some time for capex to bear fruit.
Guests: Russ Mould
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Original Broadcast: The Financial Outlook for Personal Investors
Neil Shah of Edison Group says that the heathcare sector has had a torrid time recently but that many of the risks that caused the rerating are vanishing. Positives include demographics, innovation and the patent cliff, which is increasing M&A activity. He mentions some good specialist investment trusts worth considering. He also feels that small caps might soon come into their own, with Budget changes possibly benefitting them. There is plenty of value there and Rockwood Strategic, with a concentrated portfolio of just 25 stocks, has a really good track record, aiming for a 15% annual RoR. It's worth looking at their well-designed website.
Guests: Neil Shah
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Original Broadcast: The Financial Outlook for Personal Investors
Russ Mould of A J Bell and author of the Telegraph's Questor column wonders why the Chancellor gave a speech about giving a speech, comparing it to Hugh Dalton having to resign in 1947 for letting slip something in the Budget. But the Budget will be important for affecting the 10-year gilt yield, seen as the risk-free rate. Any other investments should be priced to provide higher returns. As examples, utilities are seen as bond proxies as there's little expected capital growth, whereas discounted cash flow models are used to price tech stocks. If the 10-year yield rises, it decreases the value of equities and vice versa. Investors should always bear in mind its importance.
Guests: Russ Mould
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Original Broadcast: The Financial Outlook for Personal Investors
Neil Shah of Edison group feels that Primary Health Properties, which does what it says on the tin, will benefit from the takeover of Assura. 80-90% of its income is backed by the government so the shares can be compared to gilts, except that the company will produce growth and rising dividends. It's on a prospective yield of 7.7%. He is also upbeat on the UK market. American investors are looking for value, yield and safety outside the US and, despite all the doom and gloom, there are positive signs in the UK. Neil thinks there will be a Santa rally this year.
Guests: Neil Shah
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Original Broadcast: The Financial Outlook for Personal Investors
Russ Mould of A J Bell says that he is being bombarded with questions about whether there will be a market meltdown. On the negative side are government debt and interest bills which inhibit growth and might lead to a deflationary bust; soaring private debt; the private credit wobble; unbalanced markets; and high valuations. On the positive side the US economy might run hot as Trump wants; central banks might cut interest rates; and AI could produce an amazing productivity boom. Nervous investors should maintain a diversified portfolio and keep nothing that is giving you ulcers or sleepless nights.
Guests: Russ Mould
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