Dod101 wrote:I am bemused to note that Shell London shares have now fallen below £10, closing on Friday at £9.905, and HSBC is now just above £3 at £3.03. How have the mighty fallen.
At these prices it is too late to sell so I will just need to hang on but what a change in fortunes in the last few years. If I were a business I would be showing those two holdings together with Imperial Brands if not exactly discontinued businesses (not yet anyway), then certainly as businesses held for sale, which I intend to do over the longer term.
Dod
Concentrating investments even in large companies can prove quite disappointing sometimes.
I have always smiled when I’ve read posts which praise the “culture” of some large companies and use it as a reason to invest. In another thread Shell was being praised recently for having a better culture than BP.
Shell, HSBC, Legal and General, some tobacco companies, Centrica have all been praised in the past for their culture. How are the mighty fallen?
Anyone who has worked for a major international company must be aware that it is quite difficult to assess the culture of the company, even from within and even at a senior level. The culture can change substantially without the leadership changing. For example HSBC has been involved in some dubious businesses and was lucky to be rescued from massive American sanctions by George Osborne when he was Chancellor. And yet it has been praised for its “culture” in forums here suggesting this as a reason for investing.
Don’t get me wrong, I am invested in Shell and L and G and for a time had shares in HSBC. But my reason for investing wasn’t some misguided belief in their culture. It was because they made up a part of a widely diversified portfolio.
A good example of the irrelevance of culture might be Tesco. As an early investor, their dividends soon paid for the shareholding. Warren Buffett was impressed with them at one stage. Was the culture at Tesco always wrong? As a customer I have always found them to be good (and especially efficient at handling Covid problems). As an investment for the future, with their low margins, who knows?
The Covid situation has reassured me that a widely diversified portfolio is a good strategy (including a number of HYP shares). Whilst some giant companies are out of favour now, others have benefited from the situation.
Regards
Howard
HSBC’s lucky escape in 2016:
https://www.independent.co.uk/news/uk/p ... 32171.html