With the UK Chancellor announcing his mini budget just a few moments ago I thought it might be an interesting time to reflect on the multitude of implications it might hold for those investing in the United Kingdom.
Areas of Opportunity
From an equities perspective there would appear to be the opportunity to pick potential winners in a number of areas: House Builders – a result of the 6 months stamp duty holiday and an increase in the threshold below which Stamp Duty is not applied is likely to drive demand.
Achieving this house builders will need to accelerate schemes delivering more product to the market rapidly. This in turn has the benefit of encouraging the construction companies and of course material suppliers. So, some potential winning stocks there.
Similarly, the change in VAT and the “discounted weekday meal” during August will help bring some of the major restaurant groups back to action and in turn likely provide an uptick in their share price and those of supplier groups. Again, a potential source of investment benefit.
The Risks
Having pointed out the benefits we should of course mention the risks:
a second wave, localised or more general, of COVID 19 will likely ensure people return to home quickly and see a potential sharper downturn in valuations;
an unwillingness of shoppers, buyers, eaters and drinkers to take those first tentative steps back to normality to really deliver on this.
Banks who are being told on the one hand to prepare for doomsday would now need to be allowed to loosen the shackle from which the FCA have been binding them over the past 10 years and stretch the types of mortgage products they can offer, and take more risk in an unstable jobs market. Wil they be allowed to do this, and if so will they?
All in all whilst the writer thinks the UK Governments policies are an innovative and interesting set of plans by the UK government and will undoubtedly help the economy and help the retention of jobs will it have the same benefit to equity investors whether they be directly invested or via the plethora of funds. We don’t think so – the head winds are very strong!
What is the Alternative?
We retain the belief that ‘investing’ in products that offer a secure fixed income and have insured fixed assets that reside beneath the return remains the best approach in current market.
Add to that the fun of a passion and so much the better. Berkeley House product ‘The Yacht Bond” provides for all of those criteria.
“The Yacht Bond’
‘The Yacht Bond’.
As always entering into any form of ‘investment’ requires due diligence.
It seems this again points to the benefits of utilising the services of a boutique regulated alternative asset managers who specialise in these types of opportunities, effectively providing some degree of increased assurance that investments, whilst not removing all the risk, are managed correctly. Berkeley House Capital is one such boutique Company.
If you are a Wealth Manager, IFA, Family Office or Finance Professional and would like to know more about our investment products and/or services, send us and email to arrange a convenient time to discuss.
If you would like to discuss any aspect of this note please feel free to email: charlotte@berkeleyhousecapital.co.uk and one of the team will be very happy to arrange call with you.
www.berkeleyhousecapital.co.uk
12 Hay Hill, Mayfair,
London. W1J 8NR
United Kingdom
+44 (0) 207 863 7507
1. Berkeley House Capital is an Appointed Representative of Alternative Asset Management Ltd which is authorised and regulated by the Financial Conduct Authority (No. 450404). Not all of our activities are regulated by the FCA, further details are available from us on request.
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