Jan 2021 review – spring cleaning underway

FIRE v London6 Comments

The end of 2021’s first month.

January 2021 was quite an eventful month. Vaccine wars (amidst which, the UK has managed over 9m vaccines, thank goodness). Gameshop / WallStreetBets/ DeepFuckingValue memes. Trump’s coup over, Biden’s presidency now in place. Plenty going on.

Lockdown continues relentlessly in the UK. My area of London is proving to be reasonably compliant, to boot. Local covid-19 cases have halved since the early January peak, but remain far too high for comfort. Thankfully a large number of ‘oldies’ have been vaccinated, I know from personal experience, so with luck in a few weeks we will see that impact feeding through in the hospital statistics.

The markets ramped quite impressively in January, until they didn’t. The month end numbers suggest there isn’t much to see here – the month end hiding some quite vivid action.

In the meantime, I was very busy – trying to (partially, at least) replace my portfolio with one (ish) ETF. I’ll report on my progress below.

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Reducing my portfolio to one ETF

FIRE v London53 Comments

My last post, reviewing 2020, observed that my performance is, superficially at least, very similar to Vanguard’s WoRLd equity tracker ETF VWRL. That’s despite my portfolio involving a helluva lot more complexity/faff. My post elicited this comment from Bob:

Thanks for sharing, intriguing as always. As someone who recently (18 months ago) simplified my portfolio into three holdings: 1 VWRL seven figures, 2 [single megacap tech stock] six figures, 3 Vanguard Global Bond six figures. I find myself reading about your complexity and not feeling jealous one bit. So the question is, why do you dislike VWRL (or similar global tracker) so much? You mention the comparison several times, what is stopping you making the change? That is after all what reviews should lead to e.g. insights, and change.

Bob, commenting on 2 January 2020

Bob’s challenge is a good one. Why wouldn’t I just swap out my entire portfolio for, say, holding only a single world equities tracking ETF like VWRL or its non-Vanguard equivalents (see Monevator’s updated list of alternatives here, or the SRI alternatives listed on my ETFs page)?

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Whither London?

FIRE v London9 Comments

I feel as if there is a crescendo of doom-mongering about London.

Some of the most expensive footfall in the world

Most notable for me was a piece a week or two ago by Simon Kuper in the FT. Kuper argues that three things threaten to diminish London, risking it following Vienna and Constantinople into decline:

  • Covid-19. Covid means lockdown. And lockdown means working from home. Kuper argues that “though working from home threatens all cities, it disproportionately threatens London”.
  • Brexit. The “UK-EU trade deal does little for London”. In the first week of the Brexit new world, apparently €6bn a day of stock trading moved from the UK into the eurozone, which alone could be worth has much as £20bn a year of lost revenues (a quarter of the UK’s services trade surplus). I hear rumours that Goldman Sachs is yet to move 2000 roles from the UK into the EU. That is a lot of tax that won’t be paid to HMRC, and fancy dinners no longer being enjoyed in the West End.
  • The role of English. Kuper argues that “a decade ago there was no obvious European substitute for London. Now, cities like Berlin, Copenhagen, Amsterdam have become quasi-bilingual business hubs.”

Kuper cites house price data as suggesting that “local rivals are eating into London’s supremacy”: London’s prices have fallen (in international terms) since 2016, whereas Parisian prices are up about 25%. More money is going into Paris’ office space than London’s in 2019, the year before the pandemic.

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