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Pearson: am I at the tipping point?

Practical discussions about equity High-Yield Portfolios (HYP) for income
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pyad
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Re: Pearson: am I at the tipping point?

#192123

Postby pyad » January 9th, 2019, 9:55 am

monabri wrote:Pearson...yield is 1.74% (figure from dividend data)....what possible reason is there to keep hold of when one could buy income of 3x this amount without too much digging. The only reason I can think of is that the share price is well below the purchase price and that is a factor?

Or, for every £1k of currently invested money in PSON, one could sell and effectively buy £3k "worth" of dividend elsewhere....


edit..or one could buy 3 off £1k top ups ..thus spreading the 'out of the frying pan' risk...


The main reason to hold PSON is that the investor already owns it and is an eternity HYPer. This removes all decision making and most monitoring requirements, other than dealing with the effects of occasional mandatory corporate action.

Tinkerers should have sold PSON a long time ago if they are playing it logically with some sort of math dumpology based on, eg., yield relative to the market, and as you say, reinvested in a much higher yielder. What I'm commenting upon here is the sort of dither-tinkering resulting from having no clear sell signals. I don't really get that at all.

monabri
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Re: Pearson: am I at the tipping point?

#192127

Postby monabri » January 9th, 2019, 10:12 am

monabri wrote:Pearson...yield is 1.74% (figure from dividend data)....what possible reason is there to keep hold of when one could buy income of 3x this amount without too much digging. The only reason I can think of is that the share price is well below the purchase price and that is a factor?

Or, for every £1k of currently invested money in PSON, one could sell and effectively buy £3k "worth" of dividend elsewhere....


edit..or one could buy 3 off £1k top ups ..thus spreading the 'out of the frying pan' risk...


I didn't express that very well... I meant to spread the money released 3 ways!

monabri"s magic money tree ..graduate of the Abbott school of economics :)

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Re: Pearson: am I at the tipping point?

#192132

Postby moorfield » January 9th, 2019, 10:44 am

pyad wrote:Tinkerers should have sold PSON a long time ago if they are playing it logically with some sort of math dumpology based on, eg., yield relative to the market, and as you say, reinvested in a much higher yielder. What I'm commenting upon here is the sort of dither-tinkering resulting from having no clear sell signals. I don't really get that at all.


Quite brilliant. Two new words in one post to enter the HYP lexicon alongside pickering. What a new year's treat.

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Re: Pearson: am I at the tipping point?

#192135

Postby Dod101 » January 9th, 2019, 10:54 am

Something is wrong somewhere, but I find myself basically agreeing with pyad. He has reflected pretty much what I said yesterday afternoon. Having held on until now, holders might just as well keep Pearson unless very anxious for more income.

Dod

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Re: Pearson: am I at the tipping point?

#192136

Postby Snorvey » January 9th, 2019, 10:57 am

dumpology

That's a new word. Official.

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Re: Pearson: am I at the tipping point?

#192145

Postby monabri » January 9th, 2019, 11:13 am

Dod101 wrote:Something is wrong somewhere, but I find myself basically agreeing with pyad. He has reflected pretty much what I said yesterday afternoon. Having held on until now, holders might just as well keep Pearson unless very anxious for more income.

Dod


Just lie down in a cool, dark room until normal service is resumed....

;)

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Re: Pearson: am I at the tipping point?

#192160

Postby Arborbridge » January 9th, 2019, 12:17 pm

Thanks for all the feedback, particularly the rare contribution from pyad. Nice to have his opinion, especially about not putting too much weight on others opinions, including his.. bravo!

As to the rule based tinkering, well that is exactly how this discussion arose. Pearson crossed the threshold and after waiting for the dust to settle it's clear that the road back will be a long one. TJH in the past has mercilessly sold when a share crossed his boundary, or when he is convinced the "knees have stopped jerking" so now would be the right time to sell. However, his input was to wait until the next dividend declaration - presumably to get some steer as to how quickly the dividend might be restored. So even TJH shades his own tinkering policy to suit the circumstances - which I would suggest might be part of his success. He has "rules" but bends them when he believes it to be appropriate.


BTW, I haven't returned to this pickering episode until just now, having be busy walking to the shops and back, but in the meantime, I see the Pearson share price has perked up even more. In a week, gaining the equivakent of three years or so dividend can't be bad. And Monabri echoes my own thoughts (and I daresay Dod's too) in pointing out I could achieve two or three times the yield elsewhere and not put up with the wait for dividends to restore.

Pyad knows I'm cursed as a tinkerer, but in my defence, I would say a reluctant one! Lord, make me a perfect HYPer, but not yet.

Arb.

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Re: Pearson: am I at the tipping point?

#192222

Postby tjh290633 » January 9th, 2019, 5:47 pm

monabri wrote:Pearson...yield is 1.74% (figure from dividend data)....what possible reason is there to keep hold of when one could buy income of 3x this amount without too much digging. The only reason I can think of is that the share price is well below the purchase price and that is a factor?

Or, for every £1k of currently invested money in PSON, one could sell and effectively buy £3k "worth" of dividend elsewhere....


edit..or one could buy 3 off £1k top ups ..thus spreading the 'out of the frying pan' risk...

You may not have noticed the big rise in PSON's share price last year, which has continued this year.

I could swap it for another share, but I am getting the prospect of being able to buy yet more income if I hang on for a while.

As I said above, I'm awaiting developments. SP currently 1020.5p, but six months ago it was 717p. I am almost 50% up over that six months. I'm happy to wait a bit longer.

TJH

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Re: Pearson: am I at the tipping point?

#192227

Postby Arborbridge » January 9th, 2019, 6:19 pm

tjh290633 wrote:You may not have noticed the big rise in PSON's share price last year, which has continued this year.

I could swap it for another share, but I am getting the prospect of being able to buy yet more income if I hang on for a while.

As I said above, I'm awaiting developments. SP currently 1020.5p, but six months ago it was 717p. I am almost 50% up over that six months. I'm happy to wait a bit longer.

TJH


Interestingly, if you had followed your advertised guidelines, you might well have sold months ago when the yield was below 2% and the price had stabilised. This shows that like all the best investors, you don't always obey your own rules but apply some secret sauce.

Arb.

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Re: Pearson: am I at the tipping point?

#192263

Postby PinkDalek » January 9th, 2019, 10:05 pm

Snorvey wrote:dumpology

That's a new word. Official.


It was once:

https://seekingalpha.com/article/396448 ... -dumpology

That from 2016.

This “author” from 2010 (look away if easily offended):

https://www.urbandictionary.com/author. ... =Dumpology

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Re: Pearson: am I at the tipping point?

#192328

Postby StepOne » January 10th, 2019, 9:50 am

Dod101 wrote:
StepOne wrote: If I were you, I would do nothing for 6 months and review the situation then.


Aka kicking the can down the road.

Dod


You say that like it's a bad thing :lol:

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Re: Pearson: am I at the tipping point?

#192331

Postby Dod101 » January 10th, 2019, 10:10 am

StepOne wrote:
Dod101 wrote:
StepOne wrote: If I were you, I would do nothing for 6 months and review the situation then.


Aka kicking the can down the road.

Dod


You say that like it's a bad thing :lol:


I note your 'lol', so I am not sure of your point, but yes I do not think there is much point in that. What is going to happen in six month's time which will tell you something you do not know now? Not a lot is the only answer I can think of. This is after all the HYP Board. The dividend is unlikely to double in that time and even if it did, what would have happened to the share price and thus the yield? That is what we are interested in.

So either hold Pearson or ditch it. Agonising over a share does not often work out well in my experience.

Dod

pyad
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Re: Pearson: am I at the tipping point?

#192332

Postby pyad » January 10th, 2019, 10:12 am

PinkDalek wrote:
Snorvey wrote:dumpology

That's a new word. Official.


It was once:

https://seekingalpha.com/article/396448 ... -dumpology

That from 2016.

This “author” from 2010 (look away if easily offended):

https://www.urbandictionary.com/author. ... =Dumpology


Yeah but as you know I meant the new meaning here of adopting some sort of clear selling rule for HYPer tinkerers.

I see dumpology as superior to the sort of dither-tinkering seen in this thread, for those that feel they have to tinker at all.

StepOne
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Re: Pearson: am I at the tipping point?

#192334

Postby StepOne » January 10th, 2019, 10:21 am

Dod101 wrote:
StepOne wrote:
Dod101 wrote:
Aka kicking the can down the road.

Dod


You say that like it's a bad thing :lol:


I note your 'lol', so I am not sure of your point, but yes I do not think there is much point in that. What is going to happen in six month's time which will tell you something you do not know now? Not a lot is the only answer I can think of. This is after all the HYP Board. The dividend is unlikely to double in that time and even if it did, what would have happened to the share price and thus the yield? That is what we are interested in.

So either hold Pearson or ditch it. Agonising over a share does not often work out well in my experience.

Dod


It's pretty much my response to anyone who considers tinkering - give it 6 months and see what you think. If they return in half a year and ask the same question, I'll probably suggest waiting another 6 months. I think it sounds more palatable than a dogmatic 'never sell!'.

I'm not completely against tinkering, but I think it should be kept to a minimum, and that quite often people sell when the situation appears to be at its worst, so holding on for a recovery might turn out to be a good thing.

It's really just a tactic to keep trading to a minimum.

StepOne

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Re: Pearson: am I at the tipping point?

#192336

Postby Arborbridge » January 10th, 2019, 10:33 am

StepOne wrote:
I'm not completely against tinkering, but I think it should be kept to a minimum, and that quite often people sell when the situation appears to be at its worst, so holding on for a recovery might turn out to be a good thing.

It's really just a tactic to keep trading to a minimum.

StepOne



That's a good policy, and one I've pretty much put into practice with Pearson - but there comes a time when one thinks the worst is past, the knees have stopped jerking and it is time to look again, seriously, at whether I can improve my income.

For the moment, I'm taking TJH's view on board and waiting for the trading update. I have a feeling the price might drop though - there's a lot of "hope" in the price at present.


Arb.

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Re: Pearson: am I at the tipping point?

#192337

Postby bluedonkey » January 10th, 2019, 10:35 am

I don't have much to add other than that Pearson has been subject to my default action: do nothing, not even pickering.

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Re: Pearson: am I at the tipping point?

#192339

Postby kempiejon » January 10th, 2019, 10:42 am

I usually only sell my HYP picks to harvest unsheltered capital gains and fill my SIPP/ISA and I hold Pearson in my ISA. If the share price rises indicates a successful change of corporate bias (and I have no idea if it does) then I think it's plausible that dividends will increase. If the company is doomed then the price and dividend will obviously suffer. The share price over the past year or so is many times the increase in dividend income I could have found elsewhere, so far this looks like a self healing share to me.


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