FCA declares its innocence to the charge it's dithering in fixing double counting of Investment Trust costs. It seems to be saying that it has to follow the laid down processes while waiting for government to pass legislation via a statutory instrument. Meanwhile, a more wide-ranging fix, Baroness Altmann's Private Members Bill has to slowly make its way through endless parliamentary stages. Getting Investments Trusts out of 'ER' and into recovery mode.  

Administrators for London Capital & Finance, the collapsed mini-bond issuer, have started Court proceedings against the former CEO Michael Thompson, alleging that it was a Ponzi scheme from the start. 

FT article says Hargreaves Lansdown is "clunky and expensive". 
 
Its share price is down two-thirds from its May 2019 peak.  And in a sign that investors think its stock has further to fall, the company is the third most shorted stock in the UK, with just under 15 per cent of shares out on loan. (FT subscription required) 

Hargreaves shares fall >6% on interim results, which shows average fees extracted of £400 from the average customer who has £78,000 of assets. They have 1.82 million customers but only 1% growth. 

St James's Place has set aside a provision of £426mn for potential client refunds to address ongoing advice issues, after it saw an uptick in complaints.

Star fund manager system is "ludicrous". So says this author and that it’s not enough to be a stock picker these days. P.S. ignore the company self promotion.

Star Fund Managers - have they had their day or is just not their day today?

Eight Common Investing Mistakes Made by Private Investors, a useful reminder from Peter Higgins aka 'Conkers' and friend of ShareSoc.

The FT reports that the UK has opened up access for retail investors to buy newly issued gilts in drive for fresh source of demand. (FT subscription required) 

Citywire adds that Hargreaves Lansdown and Interactive Investor will be the first platforms to offer this new direct access to Gilts Auctions at the mid-market price, without incurring buy/sell spreads in the secondary market. As exempt from CGT, Gilts can be held outside a SIPP or ISA and so minimises platform fees. 

Oliver Shah bashes Stamp Duty in the Sunday Times. A classic example of a tax that supposedly brings in revenue, but in reality depresses economic growth and reduces overall tax. Why does a country that wants to be a leader in financial markets also have a tax that makes it uncompetitive? Even France does not have stamp duty on trading for companies with a market cap of <1bn euros. (See the last section of the article). (Times subscription required) 

More calls to abolish Stamp Duty in shares to get British Savers back into investing. As a tax it raises less and less and in a competitive world charging the most tax on transactions is self-harm. 

Treasury tries to defend 0.5% Stamp Duty by conveniently forgetting that investing capital now flows globally, not just locally. Bean counters! US and Germany have no equivalent, France is at 0.1% and Spain exempts companies <1Bn.  One of many reasons why UK markets are stifled. 

Fidelity explains in simple terms why forecasting big increases in the state pension as a % of GDP are making government consider increasing the State Pension Age again and again i.e. when you get it. Highlighting, that future pensioners don't have the savings of previous generations and working lives will have to be longer.

NEST puts pensioners money into more Green investments against the current trend where financial returns are being prioritised instead. It may be a smart move to go against the herd, but only time will tell. At least they seem to have negotiated the fees down with the manager. With 5% of funds under management being invested, it will still be a huge amount of money, over time. (Times subscription required)

Public Sector Pensions are the elephant in the room. In 2021 their liabilities exceeded 100% of GDP. Author argues that their contributions would be better put into assets and investments for the benefit of all.  

Most (but not all) Private Equity Trusts are suffering from long term NAV discounting hitting their share prices and performance. This cogently argued piece suggests that there is a lot of hidden value that will eventually be realised and cause their share to rerate. (Telegraph subscription required) 

FT reports that purchases of Investment Trusts fell by 1/3 on Adviser Platforms to under £1Bn, and some saw net negative demand. Misleading cost disclosures caused huge collateral damage and widened NAV discounts, so when combined with rapid tech industry consolidation, the flow of funds to momentum tech growth stocks, such as the MAG 7, hits hard. In comparison, Nvidia's post results 1-day jump in value of $276Bn exceeded the total value of all UK Investment Trusts at $250Bn.  (FT subscription required)  

Is it a good time to make investments in VCTs?

Merryn Somerset-Webb over at Bloomberg covers the Magnificent 7 comparative research by Deutsche Bank macro strategist Jim Reid. They represent 25% of US markets in the highest concentration since the 1920s and the PE ratio is the highest since the Nifty Fifty in 1971. What happened then and is it any different now?

Chinese fast fashion firm SHEIN considers IPOing in London rather than New York, says Bloomberg. I'm sure the London Stock Exchange and UK government would be delighted. However, the real reason for this switch, appears to be that US regulators are likely to demand more transparency about its operations than SHEIN is willing to provide. Though SHEIN would much prefer a US listing, due to lower valuations and liquidity in London. Those are the issues that need to be addressed, rather than indulging in a regulatory race to the bottom. Such races usually end badly for investors

Lord Jacob Rothschild has passed away. He founded and led major financial institutions such as St. James Place, GAM fund managers and of course what is now RIT Capital. This article charts his history.

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