The Israel/Gaza crisis continues. Public opinion is shifting against the Israel government here, even in North London – which would normally be one of the most sympathetic neighbourhoods outside Tel Aviv.
The Ukrainians are left feeling somewhat zero-sum in the battle with Israel for foreign support and attention. Some informed opinion now says the war is over, bar the fighting, and the only thing left is a land-for-peace deal. And the USA election, which is still almost a year away. Sigh.
I don’t have any perspective on it, sadly, other than that I hear of some nasty low level youth violence/intimidation/vandalism in North London in Jewish neighbourhoods by pro-Palestinian, dare-I-say-it pro-Hamas hotheads. But in most of London life carries on unchanged.
Markets fell pretty painfully in October. USA/S&P wasn’t as badly hit as other market, thank goodness, but my weighted markets still fell by 2.3%. If there is a non-zero chance of a major regional conflict developing, and/or a chance that Russia gets to have its wicked way with Ukraine after all, then I think the markets have underreacted. But that’s apparently typical at the onset of geopolitical disasters.
In any case, my portfolio managed to drop by 3.2%. My underperformance I think was at least partly caused by Google’s 7.5% drop in the face of some awkward disclosures they are making in their US anti-trust hearings.
As well as a decent dollop of dividends in October, I had a small bit of ‘windfall’ (ish) liquidity this month, as I took advantage of an opportunity to sell some of an angel shareholding via a ‘secondary’ transaction – i.e. selling some shares to another investor. This investment was made under EIS, so is tax free. It’s the equivalent of a few months’ worth of my interest charges, so it’s welcome, but not needle-moving. There are precious few exits / liquidity opportunities in the private/angel world at the moment, which was a factor in deciding to take up the offer to partially offload. For more insight into my psychology check out my recent blog post on Feeling Broke.
I finish the month underweight cash (/overweight margin loan), a bit overweight US equities and underweight international equities. This is a pretty familiar posture.
For some reason shoplifting is in the news. There’s evidently an epidemic of it. Not just in the UK, but wider afield too – hence major brands pulling out of cities like San Francisco. From what I hear there is a general increase in antisocial behaviour, dating from the covid-19 pandemic roughly speaking. I’m not sure what is going on but it isn’t sounding good.
Here in London I haven’t myself particularly experienced this epidemic of antisocial behaviour. Do I live in a bubble, or is London itself somehow avoiding it? Or is it all media hype? I don’t believe the latter.
Markets in September
Meanwhile, in the markets, it isn’t antisocial behaviour exactly but nor is it very social. Markets were generally down in September. UK equities were up, but only when viewed in pounds – which fell significantly in September.
The blended market average dropped 3%, in local currencies. Foreign currencies gained 2.2% vs the GBP, so the wider market only dropped 0.9% in GBP.
My portfolio in September
My portfolio dropped a bit more than that: 1.3%. Given my leverage and my tech exposure (AMZN dropped 8%, for instance), I am where I expected to be.
I made miserable progress repaying my margin loan in September. I have some excuses, but I am not feeling very happy about the situation. My annual interest costs are too high. I finish the month a bit overweight on USA equities, a bit underweight on EUR/Asian equities, and with too large a loan. Thankfully my loan is mostly in GBP – so is falling in value versus global market.
FIRE v London 