How sustainable is your investing?

The Black Live Matter protests are shining a light on racism, and police brutality. Which both feel quite a long way from the topic of this blog. But as I reflect on them I realise that I have never really discussed any ‘purpose/values’ driven investing. So here goes.

I notice my age increasingly frequently these days, especially at work – where I am almost the oldest person in a young, dynamic, London workforce.

The non-silicon side of Old St Roundabout

Where I am aligned with my workforce is that we are all, by the main, modern, liberal, decent Londoners. I don’t believe anybody I work with is a racist, or a sexist, or somebody who would wilfully harm the environment.

Nonetheless, my younger colleagues definitely differ from me in how they put values front and centre; they crave a ‘purpose’, and they embrace their purpose/values in much more of what they do. So, for instance, to the extent they manage their investments they would be much more likely, I think, than my peers to look for ‘socially responsible’ investing – or Environmental/Social/Governance (ESG) investing.

Why ‘socially responsible investing’ never appealed to me

When I started my investment journey, over twenty years ago, any ‘environmental’/similar investing was, to put it charitably, a niche sport. The range of investments was very limited, and it was assumed that the returns would be mediocre. Fees were high. I was not attracted to it.

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May 2020: A sunny month

Well, May 2020 was the month that highlighted, as the Economist put it, Boris’ short-Cummings. Remember much else happening that month?

In May the UK started unlocking, slowly. The government(s) has(ve) been slowly releasing the strait jacket to fit what people (in London at least) have been doing anyway for a week or two. I’ve stayed healthy, and my boundaries have enlarged slightly – by which I mean I had my first Zoom party, and there are slightly more restaurants available on Deliveroo.

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April 2020: A mad bounce

It’s been a much calmer month in the markets.

Of course it’s been the month that the UK’s Prime Minister went to hospital, with a “50:50” chance of making it out alive.

Lockdown has been the word on everybody’s lips. I spent the entire month working (hard! Even a bit over the long Easter weekend) from home. And, while the UK extended its lockdown from 3 weeks to 6, by the end of the month the lockdown mood music from across Europe and beyond had noticeably improved.

Markets up almost 10%

And, my, how the market’s mood had improved. The US, the S&P rose from 2462 on 1 April to 2923 on 29 April, a rise of 19%. In a month. If you had the courage to burn dry powder on US equities in late March you could have seen over 20% gains since. My (slightly leveraged) “US tech” equity subportfolio rose about 25% – led by Amazon breaking to new highs above $2400.

S&P 500, FTSE-100, AMZN over April

US equities were in fact the standout winner, up 13% in the month, while other equity markets rose 4-6%. In part, this reflects ‘big tech’ (which account for >10% of the US market). Bonds had a pretty good month too, aside from in Oz – where the currency recovered 4%.

April 2020 market & currency movements

What’s going on : is it QE?

I have been finding the market hard to fathom.

Continue reading “April 2020: A mad bounce”