The Time To Buy - are we there yet?

[vrdiver]

From another thread (viewtopic.php?f=106&t=36272&start=20) I noticed that TRIG and HICL are close to their 2020 (Covid) lows.

Sure, there's some negative rumours re windfall tax and price caps circulating, but even assuming these come true, with the current drive to ween ourselves off gas, it seems to me there will be a lot of investment opportunity and growth for these types of investments.

Am I missing something, or has the market really taken a short-term view and overreacted?

VRD

[EarnestHummingbird]

Like many, my investments are being hit but I have the luxury of being able to accumulate more rather than living off the investments.
I've been buying as the prices go down but it might just be getting much worse as bond yields fly up.
I dothink that at these prices, it's a once in a decade buying opportunity and you'll only know when the right time to buy was when it's too late.

[pje16]

you'll only know when the right time to buy was when it's too late.

Time to dig out my crystal ball

[monabri]

Like many, my investments are being hit but I have the luxury of being able to accumulate more rather than living off the investments.
I've been buying as the prices go down but it might just be getting much worse as bond yields fly up.
I dothink that at these prices, it's a once in a decade buying opportunity and you'll only know when the right time to buy was when it's too late.

I reckon that the "once in a decade buying opportunity" has happened twice....the last one less than 2 years ago.

[richfool]

From another thread (viewtopic.php?f=106&t=36272&start=20) I noticed that TRIG and HICL are close to their 2020 (Covid) lows.

Sure, there's some negative rumours re windfall tax and price caps circulating, but even assuming these come true, with the current drive to ween ourselves off gas, it seems to me there will be a lot of investment opportunity and growth for these types of investments.

Am I missing something, or has the market really taken a short-term view and overreacted?

VRD

Yes, I've been having similar thoughts. The planned increase in corporation tax is not now taking place. I wonder whether the market has realised that yet and taken it into account.

[pje16]

I wonder whether the market has realised that yet and taken it into account.

I don't think “the market” would miss something like that
although you wouldn't know it the way the prices have dived recently

[UncleEbenezer]

Am I missing something, or has the market really taken a short-term view and overreacted?

VRD

A yield of five or six percent looks very different when inflation is 2% compared to double digits. And this is not a sector where capital growth will serve to plug that gap.

[Dod101]

From another thread (viewtopic.php?f=106&t=36272&start=20) I noticed that TRIG and HICL are close to their 2020 (Covid) lows.

Sure, there's some negative rumours re windfall tax and price caps circulating, but even assuming these come true, with the current drive to ween ourselves off gas, it seems to me there will be a lot of investment opportunity and growth for these types of investments.

Am I missing something, or has the market really taken a short-term view and overreacted?

VRD

Yes, I've been having similar thoughts. The planned increase in corporation tax is not now taking place. I wonder whether the market has realised that yet and taken it into account.

That is small beer at least in the short term compared to the upset caused by the mini budget. As to the original question, the questioner is really asking is if we are near the market bottom. Who knows? As has been said many times, if we could tell that we would all be rich. I suppose though that it cannot be a bad time to buy. The UK market was not demanding before and with the FTSE100 under 7000, it cannot be a bad time now. Of course it could go a lot lower yet but who knows?

Dod

[Lootman]

The UK market was not demanding before and with the FTSE100 under 7000, it cannot be a bad time now. Of course it could go a lot lower yet but who knows?

Well of course the FTSE-100 was at 7,000 in 1999 so it clearly was never a good level to buy the FTSE at any time in the last 23 years. A FTSE-100 tracker has basically performed like a bond, and the real money was made in other markets.

I have been nibbling but only at foreign shares and funds. I just see too much risk and uncertainty in the UK for the foreseeable future.

I tend to be more active in the markets during down periods like this, as I use the opportunity to liquidate holdings and pay less CGT, reinvesting in new positions and simplifying the portfolio. Whilst when markets are going up, I generally do very little.

[Urbandreamer]

As to the original question, the questioner is really asking is if we are near the market bottom. Who knows?

Dod

Possibly, but this is the green investing board.

I seem to remember that you were unconvinced when TRIG had an open offer, given the difference between their dividend and earnings.
I on the other hand felt that the money would be put to good use building infrastructure that they could profit from.

The windfall taxes clearly indicate that I was wrong and that the government regard return on investment as unacceptable. I won't be investing any more in UK based renewable energy.

Short-sighted? Well, it depends upon just how common you believe these "one-off" taxes will become, doesn't it. They do seem to happen with distressing frequency and are popular with all political parties.

Of course, if it's not "time to buy" and you have money to invest, do you keep it as £'s? If you do regard it as a good time to buy, is the UK a good place to invest?

[vrdiver]

Am I missing something, or has the market really taken a short-term view and overreacted?

A yield of five or six percent looks very different when inflation is 2% compared to double digits. And this is not a sector where capital growth will serve to plug that gap.

I'm working on the basis that the capital value has been hit a lot harder than other shares (cf TRIG 20th March 2020 at 103p, vs 119p as I write, versus the FTSE 250 at 13,600 vs 16,700 for the same period (TRIG being 16% higher, vs FTSE 250's 23%).

If my assumption is right, that the relative underperformance is due to political noise, then when the noise goes away, the capital should recover? For renewables, the story still appears good (even more so with Putin helping us understand the risks energy dependence).

So my question is not so much long term growth, as more of whether this is an opportunity to enjoy a reversion to the mean?

VRD

[Dod101]

As to the original question, the questioner is really asking is if we are near the market bottom. Who knows?

Dod

Possibly, but this is the green investing board.

I seem to remember that you were unconvinced when TRIG had an open offer, given the difference between their dividend and earnings.
I on the other hand felt that the money would be put to good use building infrastructure that they could profit from.

The windfall taxes clearly indicate that I was wrong and that the government regard return on investment as unacceptable. I won't be investing any more in UK based renewable energy.

Short-sighted? Well, it depends upon just how common you believe these "one-off" taxes will become, doesn't it. They do seem to happen with distressing frequency and are popular with all political parties.

Of course, if it's not "time to buy" and you have money to invest, do you keep it as £'s? If you do regard it as a good time to buy, is the UK a good place to invest?

Oops! I tend not to notice which Board we are on but focus on the question.

Not out of any great insight, but I just do not like those companies that need to keep raising money, nor do I much like 'one trick' companies such as TRIG and Greencoat. In general though, with the huge volatility now might be the time to buy if you are into that sort of thing but I would not buy the specialist companies anyway.

Dod

[EarnestHummingbird]

I've managed to make a few purchases this week and last and am up - (let's not think about the rest of the portfolio)

I do expect there to be more chaos in the weeks ahead but buying in at these prices seems like a good idea.
If they keep falling, well that's just life.

[richfool]

I topped up JLEN last week, just before the latest falls!!

[EarnestHummingbird]

I think that even after the recent (dead cat) bounce - prices look cheap across the range of renewable energy investment trusts (JLEN, TRIG, UKW, GSF...)

What I don't get is why prices are jumping up and down.
The gilt yields might be part of it but it's not a clear relationship.
Maybe it's windfall tax or CTax threats or likelihoods - but do things really still look 15% worse than a few weeks ago?