POLL - HYP Practical readers only please

[Itsallaguess]

This is a poll to try to gauge how many HYP Practical Board readers also regularly read posts contained on the High Yield Shares and Strategies (General) board.

Can I please ask that only those users who regularly read the HYP Practical Board take part in the poll?

Cheers,

Itsallaguess

[Gengulphus]

Umm... I don't specifically read either board, in the sense of trying to read all the unread posts on it or anything like that.

I do have my notification options set to be notified of new threads on both boards, and indeed quite a few others. But from there on, it's a matter of whether I'm reading the thread - some I drop as soon as I've read the first post, some I get bored with after a while and drop, some peter out and I drop them when they've gone long enough without any activity (*), some I keep because I'm pretty certain I will want to look at them again in the future. That last category only gets dropped if and when that ceases to be the case - e.g. when the takeover that the thread is about is finally over.

I do however try to use the board distinction on the fairly rare occasions that I start a new thread. For example, my "GDHYP purchase 51" post last night asking people to nominate shares they think would be the right one for it to purchase went on HYP Practical because I'm not particularly interested in getting share nominations from non-HYPers (**) and I don't want the thread to be cluttered up with 'strategy' discussions such as ones about how running a HYP strategy is silly or how any sensible HYP strategy would also be selling some of its existing holdings.

More commonly, I do use it to try to get an idea what type of responses people are looking to get. E.g. someone posts their portfolio saying that they've got some more money to invest in it - what should they do? If they've posted it on HYP Practical, I'll assume that they're only really after suggestions about which new HYP share(s) they should add to it and/or which of its existing shares they should top up. Maybe something about selling things as well, though I'll try to word it to indicate in some way that indicates I fully recognise that some don't sell voluntarily and it's simply that I don't know whether they such a person or not. On the other hand, if they've posted it on High Yield Shares & Strategies, I'll assume they're also interested in much more wide-ranging suggestions such as ITs, ETFs, funds, foreign shares, preference shares, etc.

So I don't really read either board, I do read threads from both boards, I do treat threads on the two boards differently and find the difference useful (though not as useful as it would be if more people actually adhered to it!). So "YES, I read both boards regularly" is the closer of the two answers in your poll - but if what you're really after is finding out whether people find the board distinction useful, a distinctly misleading one!

(*) Usually a week, and I should say that I only drop them because they make the last category harder to locate when I want them. Otherwise I would leave them alone on the off-chance that they might revive.

(**) Not that I have any intention of rejecting nominated shares because of who nominated them, or even of trying to judge who is a HYPer and who not. I'm not actively seeking such nominations, but I'll accept them if they meet the stated conditions regardless of who did the nominating.

Gengulphus

[idpickering]

Early days in this poll I know, but I am surprised that I am one of only thirteen that read the HYP Practical Board only. Each to their own of course, but I don’t think I’m being closed minded in doing so. I did glance at the other board early on, but found it to broad minded regarding HYPing for me.

Ian.

[Itsallaguess]

Early days in this poll I know, but I am surprised that I am one of only thirteen that read the HYP Practical Board only.

Each to their own of course, but I don’t think I’m being closed minded in doing so. I did glance at the other board early on, but found it to broad minded regarding HYPing for me.

Thanks Ian,

I'm actually surprised there's so many voting to say they only generally read HYP Practical (whilst acknowledging the issues that Gengulphus discusses earlier with regards to how people might use and view the boards in different ways).

I don't think labelling anyone as 'closed minded' is warranted, but one thing I would add, now that I've got the opportunity and is something I don't think I've ever seen discussed before, is that even through all the years back on TMF, I cannot remember a single high-yield investor who began their approach using the HYP Practical strategy and then perhaps ventured out into things like income-related Investment Trusts (and other potential 'wider-scoped' income-related strategies), who then later went on to declare that they were unhappy with that second move, and that they were moving back to a more vanilla HYP Practical strategy....

If anyone else can declare that they've done so, or can remember anyone who has done so, then I'd be all ears, but given that plenty of people have moved from a more vanilla HYP Practical approach into a wider-scoped income-related strategy, I think that should speak volumes about the potential benefits of doing so...

With that said, I'm eternally grateful for the investment opportunities that the HYP Practical approach has given me, and it's clear that without it I wouldn't be on these boards at all, but I do really see it as a potential stepping stone for my investing journey, and it's one that I decided to develop away from some years ago. Not massively, and certainly not in any sort of unique way, but certainly enough to look at my portfolio now and say that it's nowhere near 'compliant enough' to discuss on HYP Practical in any sort of detail, so I consider High Yield Shares and Strategies (General) much more my spiritual home, and did so on TMF too.

It was clear that I was never going to be a 'Doris' type, who could simply walk away from my portfolio and enjoy the proceeds from it, so I decided that instead of spending my time discussing a HYP Practical strategy that was developed for that scenario, I was going to spend it developing my own approach in wider areas, and all I can say is that I'm very glad I did so.

That's not me saying that I'm 'open minded' in any way though - it's just that I haven't yet landed in a position where I can say to myself 'that's it - this is all I need to know' regarding an income-related strategy. Perhaps that's actually a failing on my part, and I'm 'over-complicating things' for little real benefit, but if that's the case then it's still an interesting journey, and one I'm willing to continue taking....

Cheers,

Itsallaguess

[idpickering]

Thank you Itsallaguess. I concede that my “close minded” comment may have been a bit strong. If people prefer a wider income investing strategy then who am I to argue anyway.

Ian.

[uspaul666]

Part of having a pyad/pure/strict HYP is doing very little so why ruin that by reading two boards?

[mc2fool]

Part of having a pyad/pure/strict HYP is doing very little so why ruin that by reading two boards?

Indeed, why ruin it by reading even one?

Even on TMF I was becoming bemused that such an LTBH/"Dorisian" strategy generated usually dozens of posts each day (and often more), and by the end of TMF days I had largely given up on HYP Practical, just (very) quickly "Next"ing through the vast majority of new posts each day.

I took the the move to TLF as an opportunity to go cold turkey, and with one single exception (to ensure I understood the options in the GVC takeover of Ladbrokes Coral), I haven't posted or even looked into HYP-P here at all (or HYSS for that matter).

The only voluntary activity in my 30 share HYP is the annual bed'n'ISAing, and I don't need to read an average of 34 posts a day for that. I guess I've become one of the "silent" HYPers that Pyad always claimed were the great majority. I've no idea about that claim but I can say I'm a happier HYPer for not bothering to follow HYP-P.

[Wizard]

Early days in this poll I know, but I am surprised that I am one of only thirteen that read the HYP Practical Board only. Each to their own of course, but I don’t think I’m being closed minded in doing so. I did glance at the otrher board early on, but found it to broad minded regarding HYPing for me.

Ian.

My bold.

Surely that should not be a surprise, as the "other board" is not an HYP board.

Terry.

[idpickering]

Surely that should not be a surprise, as the "other board" is not an HYP board.

Terry.

Of course I realise that Terry, but I still had a glance at what goes on there before making my mind up. I didn’t just dismiss it. I respect the fact that we’re all different and have differing views. Each to their own.

Ian

[Lootman]

I guess I've become one of the "silent" HYPers that Pyad always claimed were the great majority. I've no idea about that claim but I can say I'm a happier HYPer for not bothering to follow HYP-P.

That "great majority" are unknowable unless they show up somewhere. I suspect in reality the numbers using HYP in any formal sense can be measured in the dozens, else we'd surely see more references to it outside of TLF.

I have a theory that part of the appeal of HYP is that, despite its notional "know-nothing/do-nothing" posturing, it actually encourages a lot of time and effort invested in certain activities. As evidence I'd offer up Luniversal's former analyses and back-testing, Gengulphus's greatly detailed accounts on some topics and his GDHYP project, Ian's prolific reporting of company results and announcements, and so on. (Not criticising any of those efforts; just noting that they involve a lot of effort).

There is a certain satisfaction to doing that I feel sure. Notwithstanding the Doris analogy, it seems many investors cannot resist measuring, monitoring and managing their portfolios, whilst claiming a hands-off approach. Whether it has any positive effect on returns, given the passivity that is promoted, is open to question. But it satisfies the need to feel you are doing something.

There may be little portfolio tinkering but there is a lot of mental tinkering

[idpickering]

Thanks for the mention Lootman. Regarding the reports etc, I like to keep up to date with events surrounding my holdings, and figure the gang on the HYP Practical Board might like to as well. And I admit I get some pleasure in posting the events too.

Being informed is one thing, but I do try to be a good HYPer and leave my HYP alone if I can.

Ian.

[moorfield]

Can I please ask that only those users who regularly read the HYP Practical Board take part in the poll?

By "read" do you also mean "read and post on" ?

I voted for both btw.

[PinkDalek]

I read read to mean read.

[Itsallaguess]

By "read" do you also mean "read and post on" ?

Not really, just read, so anyone who read read to read read will be fine....

Cheers,

Itsallaguess

[CryptoPlankton]

I read read to mean read.

Agreed! To read read to mean more than read is to read something into it that one shouldn't read.

Edit: If I'd read on I could have avoided a red face...

[Gengulphus]

... but one thing I would add, now that I've got the opportunity and is something I don't think I've ever seen discussed before, is that even through all the years back on TMF, I cannot remember a single high-yield investor who began their approach using the HYP Practical strategy and then perhaps ventured out into things like income-related Investment Trusts (and other potential 'wider-scoped' income-related strategies), who then later went on to declare that they were unhappy with that second move, and that they were moving back to a more vanilla HYP Practical strategy....

If anyone else can declare that they've done so, ...

I'll take your use of "the HYP Practical strategy" to be shorthand for "a strategy that matches the requirements of the HYP Practical board", because as I've said before, there are numerous different strategies that match those requirements.

And I cannot say I entirely fit your description, because I began my investment career (beyond accumulating cash savings, that is) by occasionally buying shares in well-publicised IPOs (mainly the government privatisations of the mid-to-late 1980s and early 1990s) and quite literally putting the certificates in the bottom drawer of my desk and more-or-less forgetting about them. Around the same time, I got some shares in my employer as a result of employee share options, and quite a few years later, shares in another employer similarly. Every now and then, a small dividend cheque would arrive in the post and I would eventually get around to banking it. And that was the limit of my investment activity: I was very much an "eternity buy & hold investor", never selling a share voluntarily until 1998 (though there had been enforced sales by takeovers before that), and even then it was a matter of special circumstances to do with shares in the second employer. That was in the early lead-up to the tech boom and the shares I sold had already been affected significantly, so I suddenly found myself in possession of a very nice sum of money and so finally got around to being a bit more organised about my investing... Part of it went into funds ISAs over the next couple of years and I selected the funds that they invested in to be a few income-oriented funds with different geographical focusses - IIRC UK, US, Europe and Far East. So those were my first deliberately income-oriented investments - I was getting nicely-rising dividend income from several of the privatisation shares, but I hadn't chosen them with income in mind, just a general impression gathered from newspaper articles that they were good investments. (I wouldn't be anything like that trusting of newspaper articles these days, and shouldn't have been then! But as it turned out, those ones were generally correct...)

And then the tech boom really got going, and my remaining shares in the second employer (I'd only sold a small fraction of them) shot up in value - and I finally got around to actually setting myself up with a broker account and doing some 'normal' sales. I sold three more tranches of shares in the second employer in November 1999, December 1999 and March 2000, as a result of which I had life-changing sums of money to invest. And I didn't really know what strategy to use... My solution to that was to park most of it in bank deposits and similarly-secure investments, while splitting the remainder between running various different strategies (mostly inspired by TMF, which I'd joined in October 1999) that I thought might suit me. They included a Value strategy which focussed on high yield as a value indicator, but didn't really care whether it actually got any dividend income or not - and some of its most successful investments were bought in 2000 and sold just a few months later for a substantial capital gain, but without passing through an ex-dividend date and so never paid me a dividend. And it did very well in 2000 and early 2001, even while the market was falling as the tech bubble collapsed - which isn't surprising if you look at the FTSE 350 Higher/Lower Yield indices for that period: they show that higher- and lower-yield shares were generally behaving very differently from each other at the time. I.e. about all that I'm now certain I was doing right with that strategy was choosing to be in high-yield shares.

In November 2000, pyad published his original HYP articles. I liked the look of the strategy from the moment I read them, but was a bit cautious about their simplicity - e.g. saying nothing about what to do about takeovers and other corporate actions. TMF shortly later created their High Yield Portfolio board (later to morph into High Yield Share Strategies when their HYP Practical board was split off in 2008) and I joined in on it; over the next few months, I learnt more and got various ideas about it from that and decided to run it as another 'experimental' strategy. IIRC, it was funded by the proceeds of having decided that one or two others of the 'experimental' strategies didn't suit me well enough and closed them down. So HYP was my third strategy using high yield as a major element in its choice of investments and my second income-oriented strategy. And that's what means that I don't fit your description - I didn't begin my approach using a HYP strategy.

By early 2003, I'd gained enough experience of running the 'experimental' strategies to know that most of them didn't really suit me, and to know that I felt ready to commit more thoroughly to the ones that did. In particular, the high-yield-based Value strategy had begun well and continued quite reasonably into 2002, but from the late spring of 2002 onwards, it was doing pretty badly - basically, the market had moved into full 'bear' mode, affecting high-yield shares as well as everything else. It also basically relied upon me taking a moderately detailed look at the portfolio and (IIRC) the top 200 shares by market cap once per week, which had begun as being quite interesting as I learnt how the market behaved but had become rather tedious, as well as consuming an uncomfortable amount of my spare time and being rather depressing - I knew that the portfolio was falling in value and didn't need a weekly extended reminder of the fact! So I dropped all but two of the 'experimental' strategies, namely HYP and a mainly AIM-based smallcap strategy. I did keep the income-oriented funds ISAs going, though I was no longer adding to it.

And that's how it remained until latish last year, when I finally got around to tidying up the income-oriented funds ISAs and a few other funds ISAs from early on - my share accounts generally hadn't been ISAs early on, as I didn't want to waste my ISA allowances on what might have turned out to be 'experimental' strategy mistakes (and in a few cases did!). That was basically because I'd never got on well with fund investing or other forms of collective investing: as far as I'm concerned it just replaces the job of choosing companies with that of choosing fund managers, and I find the former far easier. In essence (though maybe a bit unfairly!), I'd prefer to make my own investing mistakes than to pick people to make them for me... And while picking companies is in many ways picking their managers, so it might be argued that I'm just picking many managers rather than few - but good diversification does involve picking enough of what you're diversifying about. And there is the difference that I can see myself following the old advice to pick a company that any idiot can run, because sooner or later one will, but how on earth do you pick a fund that any idiot can run? (Yes, I know one decent answer to that, namely that you pick index trackers - and there is a loose sense, which I'm afraid I'm not willing to explain, in which they do feature in my investing.)

The other thing to say that the way I run my HYP has slowly morphed towards (though not into) the 'more vanilla' forms. For example, I've always been a tinkerer, selling HYP shares occasionally but not enough to mean that my strategy no longer meets the LTB&H requirement of HYP Practical. But as the years have gone by, I've done so less and less, as I've discovered that much of my tinkering has been just as likely to jump from the frying pan into the fire as the reverse.

So the movement of my high-yield/income-oriented investments, such as it is, has generally been towards a more vanilla HYP Practical approach. I do still run the mainly AIM-based smallcap strategy and don't plan to stop anytime soon, and it does sometimes produce a lot of dividend income, even more than my HYP in very occasional years - but that income is not to be relied upon and not particularly aimed for.

So all in all, I definitely don't fit your description in all details, and might not in any that you regard as important. But I have moved away from some other high-yield/income-oriented strategies and towards HYP, based on experience of the former.

Gengulphus

[Itsallaguess]

... but one thing I would add, now that I've got the opportunity and is something I don't think I've ever seen discussed before, is that even through all the years back on TMF, I cannot remember a single high-yield investor who began their approach using the HYP Practical strategy and then perhaps ventured out into things like income-related Investment Trusts (and other potential 'wider-scoped' income-related strategies), who then later went on to declare that they were unhappy with that second move, and that they were moving back to a more vanilla HYP Practical strategy....

If anyone else can declare that they've done so, ...

...

So the movement of my high-yield/income-oriented investments, such as it is, has generally been towards a more vanilla HYP Practical approach. I do still run the mainly AIM-based smallcap strategy and don't plan to stop anytime soon, and it does sometimes produce a lot of dividend income, even more than my HYP in very occasional years - but that income is not to be relied upon and not particularly aimed for.

So all in all, I definitely don't fit your description in all details, and might not in any that you regard as important. But I have moved away from some other high-yield/income-oriented strategies and towards HYP, based on experience of the former.

Thanks for that background Gengulphus, and all i can say is that if you end up being the exception that proves the rule, then I think I'd be more than happy with that!

Cheers,

Itsallaguess

[tjh290633]

I'm probably one of the longest duration investors here, having started with a unit trust savings plan in 1958. That was more or less it until I started a unit-linked life assurance in 1969, and then my mother died in 1970 and I inherited a few shares and some fixed interest securities. Some more unit trusts followed, mostly commodity oriented as they were offering higher yields, and one property fund (structured as a life insurance bond, I think). I gradually sold the fixed interest stocks and put the proceeds into more unit trusts, starting another savings shceme, and in 1973 one of the shares (Brooke Bond Liebig) was taken over for cash. I bought a couple more shares in my then and former employers. By now I had two unit trust savings plans and the unit-linked life assurance. I see that in 1966 I was given a company car and sold one of our cars, putting the money into yet another unit trust.

Come 1977 we were buying a house under construction and I needed to put down a full deposit before we were able to sell our existing house. Accordingly, the original unit trust savings scheme was terminated and the units sold, as were a couple of other unit trust holdings. I see that ICI spun off IMI in that year and I participated in the IPO. In 1978 I started one more unit trust savings scheme then, in 1979 we had the first privatisation and I bought some BP. and added a couple more shares in following years. In 1983 I took out a couple more unit linked life assurances, with 10 year lives, aimed at when I reached 60 and possible retirement. Then came British Telecom and British Gas privatisations and the floating of TSB (in which I participated on behalf of my children).

Then in 1987 PEPs were introduced, and I set about making full use of my entitlement, by selling shares and buying different ones inside my PEP, putting the emphasis on dividend generation in the main. This was repeated in the following years, when I also invested in a company under the Business Enterprise scheme and our local privatised Electricity Company, disposing of one of my unit trust holdings. I also bought some shares in Forte Ltd, as I was by now making considerable use of their hotels and Travelodges, and as a shareholder I enjoyed a considerable discount. Somewhere along the way, the dreaded Johnson-Fry Worst Performing Fund "bond" came into the picture, I think after those 10-year life assurance deals matured, most of which went into further OEIC PEPs. Several of my other unit trust holdings were converted into PEPs, rather than continuing building my main share PEP, and one was also opened in my wife's name. Diverfsification, one could call it. Forte got taken over by Granada and I ended up with a single company PEP in their shares.

I retired in 1998 and was able to resume investing in the share PEP until ISAs replace PEPs, when I began building an ISA alongside the PEP, without duplication. Come 2002 and my first grandchild was on the scene so I started a blind trust for her, using Witan's Jump scheme, followed in due course by two more, one using FRCL and the other Alliance Trust. In 2005 I decided to dabble a little in AIM shares, most of which fell by the wayside, although I still own three.

That is more or less the story, up to the point where PEPs and ISAs could be amalgamated into a single ISA in 2008. Just before that I had transferred one of the UNIT Trust/OEIC PEPs into the main one, and done likewise with the Single Company PEP in 2005. 2008 was also the first year that I started withdrawing cash from my ISA, funding a Golden Wedding party and a cruise. Other than the advent of a further grandchild in 2009, for whom a further trust fund was set up, that is the status quo. A share ISA plus three OEIC ISAs, an OEIC outside the ISA shelters, a few AIM shares and four trust funds using ITs.

One of these days, perhaps when I feel anno domini catching up with me, my Share ISA (which is my HYP) may be switched into ITs, to make things easier to manage. Not yet, though. I might add that the ITs have been performing nicely since they started. Witan and F&C are well ahead of the pack. I reckon that I could fund care for an indefinite period, should the need arise. Maybe a live-in care assistant would be the optimum route. We shall see.

TJH

[csearle]

...Notwithstanding the Doris analogy, it seems many investors cannot resist measuring, monitoring and managing their portfolios, whilst claiming a hands-off approach. Whether it has any positive effect on returns, given the passivity that is promoted, is open to question. But it satisfies the need to feel you are doing something.

There may be little portfolio tinkering but there is a lot of mental tinkering

Insightful. I think you're right. C.

[IanTHughes]

I confess, I am an HYPer but I am no Doris!

“Doris”, if I remember PYAD’s original article correctly, inherited her portfolio of shares from her parents and/or her husband. She knew little or nothing about the shares in her portfolio simply because she did not build it herself. She simply benefited from the income it provided.

I, on the other hand, am funding my HYP with ISA and SIPP contributions, made annually or monthly depending on my work status and, unlike Doris, I must make regular purchases to build up my HYP. That understandably requires some investigation and maybe an understanding of company reports that I am sure “Doris” never cared about. Part of that “investigation”, for me at least, is to read the HYP board here, which I am sure “Doris” would not even have known existed.

I do however know of someone who was a “Doris”: my mother.

My mother inherited from her father a portfolio of shares from which she used to regularly receive dividends. I well remember the times when I was with my mother at the bank, depositing her dividend cheques. My duty at the time was to write out the credit slips. Two of the companies that I remember well were: Shell Transport and Trading and Bank of Scotland (Mum was Scottish).

Now, my mother was a Doctor, an Obstetrician, and certainly an intelligent woman. However she knew little or nothing about the world of investment, apart from the fact that dividends were cash received, “ker-ching”!

Anyway, the point I am trying to make is that building an HYP portfolio, rather than living of the proceeds of one, does not mean that one has nothing to do. To insinuate that every HYPer must be and act like “Doris”, is frankly ludicrous.


Ian