HYP Practical discussions

[csearle]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

This is my question too.

"Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

Cheers,
Chris

[Gengulphus]

Example - I ask the Board whether I should sell Unilever because its yield is too low, and replace it with a higher yielding substitute. Others tell me all the qualities of the share and recommend that I keep it. How is that different from the exact same post advocating it for purchase?

It cannot be exactly the same post: they're advocating that you hold rather than sell, when the alternative post that you're hypothesising is advocating buying. It might be based on exactly the same analysis of the company, and a reader might decide to buy on the basis of that analysis. But it won't contain the same advice, and readers are of course free to use what they read in any way they see fit: the board's rules can only be about what people post, not about what they think or do (other than posting).

In practice I do not see many discussions where someone actually advises a purchase or sale, nor where such advice is asked for. It is usually more a "just the facts, ma'am" kind of analysis of a share and, as such, the points made could be identical whether the topic is buying X, continuing to hold X or sell X.

I am not a mindreader, and can only respond to the example you gave, not to whatever other example you might have had in mind!

But now that you have revised your example, I agree that in that revised example, both posts might contain exactly the same advice - i.e. none whatsoever! Which is fine: "just the facts, ma'am" analysis posts are fine in my view as long as the analysis is reasonably relevant to an on-topic HYP Practical issue - with both "HYP" and "Practical" being needed!

There are also many investors who adopt the position that they do not continue to hold a share unless they would buy it now if they did not hold it, which again shows the degree of conflation between the two or three).

And that conflation is in the mind of the reader - some readers will treat "continue holding" as equivalent to "buy if you don't already hold", others won't. It's not in the words of the post or the context in which it was made, and as I said in your quote from my post, "a reader might decide to buy on the basis of that analysis. But ... readers are of course free to use what they read in any way they see fit: the board's rules can only be about what people post, not about what they think or do (other than posting)."

Gengulphus

[melonfool]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

This is my question too.

"Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

Cheers,
Chris

Potential shares are fine. But ones which have never paid a divi and have just said they are going to start are unlikely to be fine due to the selection criteria - it would be a short thread anyway!

(and not 'any given share', still restricted to UK FTSE350 shares and not funds/ETFs etc)

Mel

[tjh290633]

As far as I can see, we have three situations here. First of all a share meets the criteria for inclusion in an HYP.

Then comes the stage where the share price has risen to such an extent that the yield falls below the minimum level for inclusion but meets all other criteria. If you have it, continue to hold it, but don't add to it; if you don't hold it, it is no longer eligible as a new selection.

Finally the share rises to such an extent that the yield is now less than half that of the market. It could also be that the dividend has been reduced but the share price has not fallen in sympathy, so that the yield is still below an acceptable level. This is when complete disposal may be considered, but is not compulsory. Topping up is definitely off the agenda.

All of these were originally bona fide HYP selections. They are in an HYP and may therefore be legitimately discussed on the Practical forum.

TJH

[Gengulphus]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."?

As that stands, yes, since it would allow discussion of any share that has ever been a candidate for a HYP in the past, which is a much larger universe than those currently eligible.

Not quite: that wording allows discussion of any share that has been selected in the past. Merely being a candidate isn't enough - it's got to have made it through to actually being selected!

Gengulphus

[Lootman]

But now that you have revised your example, I agree that in that revised example, both posts might contain exactly the same advice - i.e. none whatsoever! Which is fine: "just the facts, ma'am" analysis posts are fine in my view as long as the analysis is reasonably relevant to an on-topic HYP Practical issue - with both "HYP" and "Practical" being needed!

I didn't revise the example. It was the same all along.

The difference is that I pointed out that posts such as that are not usually formally couched as "advice" to buy, hold or sell. Rather they just present facts about the share. And the key point there was that the contents of that post are the same regardless of whether anyone is viewing it as a potential buy, hold or sell, so basing moderation on some of those but not others is likely to be ineffective, impossible or both. Likewise basing moderation on whether you think I was offering advice rather than analysis is likely to be subjective and variable.

Further to that, a moderator may not even know if the share in question qualifies as a HY candidate until the conversation is over and a determination, if any, is reached. By which time there would be no point in moving it from one board to the other because everyone will have moved on anyway!

As an example, the task of determining whether share X has EVER been above the average market yield is not trivial. If it was for just one day in the last decade or more, then it qualifies. But who really knows that? Probably not me, not you and not the average moderator. So if you come along and say you bought X when it yielded more than the average, chances are we will all give you the benefit of the doubt. I certainly would not expect a moderator to know that, nor invest the effort to verify it.

Which just leaves us with common sense and a sense of proportion. "When it doubt, let the conversation continue and see what happens" is perhaps the most prudent course.

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."?

As that stands, yes, since it would allow discussion of any share that has ever been a candidate for a HYP in the past, which is a much larger universe than those currently eligible.

Not quite: that wording allows discussion of any share that has been selected in the past. Merely being a candidate isn't enough - it's got to have made it through to actually being selected!

True, although the only evidence that it has been actually selected is the word of the poster, who presumably wants to discuss it anyway. So unless a moderator is willing to call that poster a liar, it would stand!

[melonfool]

As an example, the task of determining whether share X has EVER been above the average market yield is not trivial. If it was for just one day in the last decade or more, then it qualifies. But who really knows that? Probably not me, not you and not the average moderator. So if you come along and say you bought X when it yielded more than the average, chances are we will all give you the benefit of the doubt. I certainly would not expect a moderator to know that, nor invest the effort to verify it.

Which just leaves us with common sense and a sense of proportion. "When it doubt, let the conversation continue and see what happens" is perhaps the most prudent course.

No, I would expect the poster to explain in their post why they were mentioning it and show how it 'qualifies'!

And I heartily disagree with your last sentence, which will be no surprise to you I expect. It would not be a useful mantra for a couple of the boards here and it most certainly could not be described as 'prudent'.

Mel

[Lootman]

No, I would expect the poster to explain in their post why they were mentioning it and show how it 'qualifies'!

And I heartily disagree with your last sentence, which will be no surprise to you I expect. It would not be a useful mantra for a couple of the boards here and it most certainly could not be described as 'prudent'.

I see very few posts here where the poster verifies that a share he is talking about qualifies. We mostly just assume it does if they selected it. Otherwise those posts where people list their entire portfolio would be very long indeed.

And if the moderation here is so perfect, as you suggest, then why do we now have a 5-page discussion about problems with it? Part of that problem might be a failure to listen and learn on the part of some moderators here, perhaps?

[melonfool]

No, I would expect the poster to explain in their post why they were mentioning it and show how it 'qualifies'!

And I heartily disagree with your last sentence, which will be no surprise to you I expect. It would not be a useful mantra for a couple of the boards here and it most certainly could not be described as 'prudent'.

I see very few posts here where the poster verifies that a share he is talking about qualifies. We mostly just assume it does if they selected it. Otherwise those posts where people list their entire portfolio would be very long indeed.

And if the moderation here is so perfect, as you suggest, then why do we now have a 5-page discussion about problems with it? Part of that problem might be a failure to listen and learn on the part of some moderators here, perhaps?

Sorry, senior moment, just link me back to where I said the moderation was 'so perfect'?

I was talking about the situation where a share is borderline and I have seen many times when a poster has explained why they think something might be an HYP share - I wasn't talking about the more usual suspects, like Glaxo, or HSBC. This thread is not about those, it's about the ones that may or may not be.

We moderate based on the guidelines and rules. Lines from the guidelines and rules have been posted in this thread several times - I can really see no actual problem at all other than that dspp moved a thread and has admitted he was trying to be helpful. ULVR has been discussed on HYP many, many times and never caused an issue.

Maybe someone could, in a sentence, having read what is in this thread, tell us what the problem is that we are not listening to and not learning? In a sentence, not another five pages. Because I am totally lost and can't help feeling that most of this is just trouble making and trolling.

Mel

[Gengulphus]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

This is my question too.

"Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

That 'logic' would suggest that the mention of "potential shares" can be dropped entirely, so that the sentence would reduce to "Discussion of shares which have been selected in the past is acceptable on the HYP Practical Board." But that has an obvious problem if treated as a comprehensive list of what types of discussion are acceptable (which I think the current sentence is fairly clearly intended to be) - it would be impossible for any share that hasn't been selected for a HYP in the past to ever become discussable!

Which implies that there is a problem with the 'logic'... I think that problem lies in the intended meaning of the word "potential". I suspect it's basically just meant to cover the situation that someone has a share that meets the "have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index" criteria, to indicate that in that case there's no need to show that it actually is in a HYP - it's enough that those criteria mean that it's currently a potential HYP purchase.

So basically, I think the following would be a first pass at a clearer wording:

"The following types of discussion are acceptable on the HYP Practical board:

* Discussions about practical purchase decisions of shares for a HYP. Candidate shares should have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index.

* Discussions about practical issues relating to holdings bought for a HYP in the past, with the exception that decisions about further purchases of an existing holding should only be discussed if they meet the requirements of the first bullet."

Only a first pass, though - there's certainly a wording ambiguity about the word "should" (it can be interpreted as either "must", i.e. an actual requirement, or "should preferably"), there may well be others and there are any number of detailed interpretation points (what type of yield is to be compared with the FTSE 100 yield? is a decision about taking up rights in a rights issue a purchase decision? etc, etc, etc). Additional user guidance might be wanted about them - but there is the issue that the more you provide such additional guidance, the more ammunition you give to any 'rules lawyers'...

Gengulphus

[Gengulphus]

I didn't revise the example. It was the same all along.

The difference is that I pointed out that posts such as that are not usually formally couched as "advice" to buy, hold or sell. ...

So what? Those in your example were - I'll embolden where it says that, since what you yourself have said seems to have escaped your memory:

Example - I ask the Board whether I should sell Unilever because its yield is too low, and replace it with a higher yielding substitute. Others tell me all the qualities of the share and recommend that I keep it. How is that different from the exact same post advocating it for purchase?

I don't mind that you occasionally find you haven't quite said what you meant, and want to revise it - I do the same from time to time. I do mind when you deny having done so - it makes sensible progress in a discussion impossible!

Gengulphus

[Lootman]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

This is my question too.

"Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

That 'logic' would suggest that the mention of "potential shares" can be dropped entirely . .

Depends how you read that rule. I read it as "discussion of potential HYP shares is allowed" AND "discussion of shares that have been selected in the past is allowed".

It depends on whether you read that "and" as a list of two valid and separate types of discussion or whether you read it as a 2-part criteria where both parts have to be satisfied. I read it as the first, as it stands. Whoever wrote that clause about "potential HY shares" presumably did so for a reason.

Rather than parsing what the words might mean, we should instead perhaps discuss whether the potential of a share to be a valid HY candidate is something we'd like to able to discuss. Personally I think we need a reason to disallow it. That reason may well exist but at least we should have that discussion.

[tjh290633]

* Discussions about practical purchase decisions of shares for a HYP. Candidate shares should have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index.

You have omitted the requirement for at least 5 years of dividend payments, ideally rising each year, but not having been reduced, which was always in the criteria.

TJH

[Gengulphus]

As far as I can see, we have three situations here. First of all a share meets the criteria for inclusion in an HYP.

Then comes the stage where the share price has risen to such an extent that the yield falls below the minimum level for inclusion but meets all other criteria. If you have it, continue to hold it, but don't add to it; if you don't hold it, it is no longer eligible as a new selection.

Finally the share rises to such an extent that the yield is now less than half that of the market. It could also be that the dividend has been reduced but the share price has not fallen in sympathy, so that the yield is still below an acceptable level. This is when complete disposal may be considered, but is not compulsory. Topping up is definitely off the agenda.

All of these were originally bona fide HYP selections. They are in an HYP and may therefore be legitimately discussed on the Practical forum.

Agreed with your conclusion, but you're bringing your personal rules about when to consider complete disposal and when not to into a discussion about what is (or should be) allowed on the HYP Practical board. Nothing against them as personal rules, but I would object if they got enshrined into the HYP Practical board guidance and (for instance) people started having posts treated as off-topic because they were discussing selling a share whose yield had dropped to 60% of the market yield!

Gengulphus

[csearle]

So, this in the current guidelines, is not clear enough for you: "Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

This is my question too.

"Discussion of potential shares, and of shares which have been selected in the past, is acceptable on the HYP Practical Board."

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

That 'logic' would suggest that the mention of "potential shares" can be dropped entirely, so that the sentence would reduce to "Discussion of shares which have been selected in the past is acceptable on the HYP Practical Board." But that has an obvious problem if treated as a comprehensive list of what types of discussion are acceptable (which I think the current sentence is fairly clearly intended to be) - it would be impossible for any share that hasn't been selected for a HYP in the past to ever become discussable!

Huh? I must have misunderstood something? I don't see at all that the mention of "potential shares" can be dropped entirely. I read it as you can discuss potential shares and, if you like, those selected in the past. That doesn't mean they have to have been selected in the past (if they are potential shares), just as it doesn't mean they have to be potential shares (if they have been selected in the past).

Which then influenced what you went on to say.

I wouldn't be against a refinement of the guidance but I honestly think that it is not necessary.

Which implies that there is a problem with the 'logic'... I think that problem lies in the intended meaning of the word "potential". I suspect it's basically just meant to cover the situation that someone has a share that meets the "have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index" criteria, to indicate that in that case there's no need to show that it actually is in a HYP - it's enough that those criteria mean that it's currently a potential HYP purchase.

So basically, I think the following would be a first pass at a clearer wording:

"The following types of discussion are acceptable on the HYP Practical board:

* Discussions about practical purchase decisions of shares for a HYP. Candidate shares should have a dividend yield above the average for the FTSE100 index and be drawn from the constituents of the FTSE 350 index.

* Discussions about practical issues relating to holdings bought for a HYP in the past, with the exception that decisions about further purchases of an existing holding should only be discussed if they meet the requirements of the first bullet."

Only a first pass, though - there's certainly a wording ambiguity about the word "should" (it can be interpreted as either "must", i.e. an actual requirement, or "should preferably"), there may well be others and there are any number of detailed interpretation points (what type of yield is to be compared with the FTSE 100 yield? is a decision about taking up rights in a rights issue a purchase decision? etc, etc, etc). Additional user guidance might be wanted about them - but there is the issue that the more you provide such additional guidance, the more ammunition you give to any 'rules lawyers'...

Gengulphus

[Lootman]

you're bringing your personal rules about when to consider complete disposal and when not to into a discussion about what is (or should be) allowed on the HYP Practical board. Nothing against them as personal rules, but I would object if they got enshrined into the HYP Practical board guidance and (for instance) people started having posts treated as off-topic because they were discussing selling a share whose yield had dropped to 60% of the market yield!

The fact that HYP says nothing about when to sell, whether to sell, or how much to sell, means that I would have thought it was impossible for a topic about selling to be off-topic.

If HYP is silent about something then effectively there is no rule. And that seems to be the case in practice because some here never sell, some here sell according to their rules, like TJH, and some sell because they get a "feeling", need the cash or a hundred other reasons.

HYP does suggest that portfolios are not churned and that it is a longer-term buy-and-hold strategy. But it says nothing material about selling (which personally I always thought was one of its weak points, but I digress).

PS: HYP may have rules about forced sales, but I am talking about voluntary ones here.

[Lootman]

I don't see at all that the mention of "potential shares" can be dropped entirely. I read it as you can discuss potential shares and, if you like, those selected in the past. That doesn't mean they have to have been selected in the past (if they are potential shares), just as it doesn't mean they have to be potential shares (if they have been selected in the past).

For what it is worth, I agree and that is exactly the situation I read and (I thought) understood.

[Gengulphus]

Rather than parsing what the words might mean, we should instead perhaps discuss whether the potential of a share to be a valid HY candidate is something we'd like to able to discuss. Personally I think we need a reason to disallow it. That reason may well exist but at least we should have that discussion.

Simple: just about every share under the sun has the potential to become a valid HYP candidate, given sufficient time and luck. The site owners' and moderators' intention in having the HYP Practical board is pretty clearly not that it should be a board on which just about every share under the sun can be discussed (otherwise they'd have settled this debate long ago!), which is a valid reason for them to disallow such discussions on the HYP Practical board, until and unless their intention changes. (And it's also a strong reason to believe that whatever "potential shares" in the guidance is intended to mean, it's not "shares that have the potential to become valid HYP candidates".)

As for whether the potential of a share to be a valid HYP candidate is something we'd like to able to discuss, doubtless some of us would and some of us wouldn't. Those of us who would like to discuss it are already amply catered for, as they can do so on either the Share Ideas board or the High Yield Shares & Strategies board (the latter because HYP is a high-yield strategy, making the question of whether the share is a high-yield share moot). Those of us who don't want to discuss it can easily avoid such discussions; those (if any) who not merely don't want to discuss it but don't even want to be able to discuss it should IMHO be ignored, as that stance amounts to attempted censorship of such discussions.

Gengulphus

[Lootman]

Rather than parsing what the words might mean, we should instead perhaps discuss whether the potential of a share to be a valid HY candidate is something we'd like to able to discuss. Personally I think we need a reason to disallow it. That reason may well exist but at least we should have that discussion.

Simple: just about every share under the sun has the potential to become a valid HYP candidate, given sufficient time and luck.

Well, it is in the rules right now so I don't think that a blanket assertion that it should not be is too helpful, without at least trying to understand both the value of discussing potential shares and what would be reasonable criteria for allowing or denying them. The fact you personally don't want that is interesting but you are only one vote and clearly the rule-writers saw the value of it.

I'd suggest instead that the rule be retained and that moderators simply use common sense in determining whether the "potential" is viable or not. For instance if a share is just below a market yield, just announced very strong earnings and made an encouraging statement about returning more money to shareholders, then I think I'd rather hear about that than have it arbitrarily banned.

So I agree with csearle that the rule as stated, which allows discussion of potential HY shares, is not causing a problem and I see no reason to change it. I trust the moderators to distinguish reasonable potential HY shares from unreasonable ones.

And no matter what the board, I never have a problem ignoring topics that do not interest me. I just ignore them - a basic cognitive skill.

[Gengulphus]

So it is clearly worded as it need be. This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board.

That 'logic' would suggest that the mention of "potential shares" can be dropped entirely, so that the sentence would reduce to "Discussion of shares which have been selected in the past is acceptable on the HYP Practical Board." But that has an obvious problem if treated as a comprehensive list of what types of discussion are acceptable (which I think the current sentence is fairly clearly intended to be) - it would be impossible for any share that hasn't been selected for a HYP in the past to ever become discussable!

Huh? I must have misunderstood something? I don't see at all that the mention of "potential shares" can be dropped entirely. I read it as you can discuss potential shares and, if you like, those selected in the past. That doesn't mean they have to have been selected in the past (if they are potential shares), just as it doesn't mean they have to be potential shares (if they have been selected in the past).

OK, if I've now understood you correctly, you are saying that in cases where a share has been selected in the past (such as Unilever), this whole debate about the potential of a share is, by logic, irrelevant - with nothing implied about cases where the share has not been selected in the past. That I agree with, but your actual wording appeared to me to be structured in "conclusion because reason" form as:

"This whole debate about the potential of a share is, by logic, irrelevant because the second part of the AND clause, if true for any given share, makes it acceptable for the HYP board."

The conclusion part was too comprehensive, as it implies that the "potential shares" part of the guidance is entirely redundant, and so I disagreed with it.

If I've diagnosed what went wrong correctly, the problem is basically that you intended "if true for any given share" as part of the conclusion, but it had got divorced from the conclusion... Not trying to ascribe blame or ask for a verdict on that - I'm genuinely in two minds as to whether you should have worded it better or I should have seen what you meant (or indeed both!) - but it's good to have (hopefully) sorted it out!

I wouldn't be against a refinement of the guidance but I honestly think that it is not necessary.

I wasn't for a refinement of the guidance when this thread started - it seemed less than ideal in places but adequate - but I am starting to wonder!

Gengulphus