Thanks for these Nick. I've bought a little of each.
John.
On Wed, 19 Feb 2020 at 22:40, Nick Gallop <nsgallop@xxxxxxxxx> wrote:
With the exception of exotic markets where we have no expertise, I think
we have agreed that indices are not for the investment club, so this note
is more for personal interest.
I had thought index investments were a bit dull, and a good way of
following markets down (as well as up) so I ignored them.
As the variety of indices on offer multiplied, something made me
reconsider (I think Ian Cowie may have mentioned one in his Sunday Times
article, that piqued my interest).
I offer two for your consideration. Obviously you buy at your peril: these
may not be right for you, but here’s where and why I invested:
IUKD
<https://www.ishares.com/uk/professional/en/products/251807/ishares-uk-dividend-ucits-etf>
-
iShares UK Dividend UCITS ETF. This was the one I read about, and wanting
to find something with a good yield, I had a look. It’s an index of 50 UK
companies in the FTSE 350 Index with higher yields. It currently offers a
historical yield of 5.89%. Growth over the last 3 years has been muted -
Brexit uncertainty would not have helped - but that’s not unreasonable if
you are looking for yield.
And the second one, I spotted by chance while exploring index alternatives:
I had always liked the logic of momentum investing, but it seemed too
complicated for an individual to pursue. Then I saw this momentum index
IUMF
<https://www.ishares.com/uk/professional/en/products/285208/ishares-edge-msci-usa-momentum-factor-ucits-etf-usd-acc-fund#/>
- iShares
Edge MSCI USA Momentum Factor UCITS ETF.
It’s been around for 3 years during which time it has gone up 75%. YTD
it’s up 8.87%. The website gives you charts to explore its behaviour (or
any other index, of course).
In both cases the index is rebalanced every 6 months. I noticed today's
momentum index excludes Tesla, which I suppose was not on it’s wild bull
run at the time of the last rebalancing.
Nick Gallop
+44 (0)7867 808 872
nick.gallop on Skype
