Share portfolio - heavy on Utilities. What to do?

nicsim

I inherited a number of shares in various companies (mainly former utility companies) from my dad when he passed away a few years ago. I've always viewed these as a long term "nest egg" to form a large part of any retirement plans I had. But (and putting the politics aside) I'm a bit concerned about the effect on those shares if a Labour government were to put in place its plans for re-nationalisation etc.

I'm 15-20 years from retiring (when they stop moving the goalposts) and a tad concerned I'll have nothing left - or very little when I need it to retire or gift any to my kids.

For info, the shares are in things like SSE, BT, National Grid, Centrica, Severn Trent.

Does anyone else have similar concerns and what advice have you had if any?

eskbanker

The potential for renationalisation is just one factor that endorses the usual recommendation that investments should be diversified, i.e. concentrating all your pot into one industry in one country is much riskier than spreading your eggs across many baskets.

Even for experienced investors with time, knowledge and inclination to research company fundamentals, it's generally accepted that diversifying across sectors/industries, markets/geographies and asset types is a more prudent approach to investment.

Fortunately there are a range of global multi-asset funds that allow such diversification, so IMHO you'd be better off selling the individual shares and buying into something much broader than one industry and country. The usual question to consider ignores any sentimental attachment to inherited shares: if you had a pot of cash to invest right now, would you buy these?

Your reference to these forming "a large part of any retirement plans I had" rings even louder alarm bells - what sort of retirement provision do you have in proper tax-efficient pensions?

capital0ne

Sell all and buy PNL, CGT and RIT

Thrugelmir

Hardly good performers. Sentiment shouldn't be a good reason to hold them. Personally I'd liquidate and reinvest the proceeds back into your pension pot.

nicsim

I should also add that I have a couple of pensions from previous jobs - my current one is a non-contrib scheme, but I've always looked on the shares as being steady risers over the years. "All good things..." though I guess. :think:

I also have some in Reckitt Benckiser and Shell.

Gadfium

nicsim wrote: »

I inherited a number of shares in various companies (mainly former utility companies) from my dad when he passed away a few years ago. I've always viewed these as a long term "nest egg" to form a large part of any retirement plans I had. But (and putting the politics aside) I'm a bit concerned about the effect on those shares if a Labour government were to put in place its plans for re-nationalisation etc.

I'm 15-20 years from retiring (when they stop moving the goalposts) and a tad concerned I'll have nothing left - or very little when I need it to retire or gift any to my kids.

For info, the shares are in things like SSE, BT, National Grid, Centrica, Severn Trent.

Does anyone else have similar concerns and what advice have you had if any?

I'd be much, much, MUCH more worried about having "a large part of of any retirement plans" held in a tiny selection of individual shares, especially shares in fossil-fuel based industries, than worrying about what "might" happen in a UK election. The election will be long forgotten about in 20 years time.


Get them sold and the sums reinvested into something sensible ASAP!

AnotherJoe

Sell them all and buy a global tracker. At the moment you are invested in poor companies in one economy all very susceptible to political events.
Sell them first and then worry about what tracker to buy later, don't get analysis paralysis and hold on because you can't decide what to buy.

eskbanker

nicsim wrote: »

I should also add that I have a couple of pensions from previous jobs - my current one is a non-contrib scheme, but I've always looked on the shares as being steady risers over the years. "All good things..." though I guess. :think:

I also have some in Reckitt Benckiser and Shell.

Don't you think Thomas Cook shareholders saw them as being long-term steady risers too? Carillion? Enron? etc....

What sort of 'large part' do your shares currently constitute of your overall projected retirement wealth? 25% could be considered large (but obviously not a majority), whereas, say, 75% would be an entirely different issue....

Thrugelmir

nicsim wrote: »

I should also add that I have a couple of pensions from previous jobs - my current one is a non-contrib scheme, but I've always looked on the shares as being steady risers over the years. "All good things..." though I guess. :think:

BT was trading at over £20 in the early 2000's............

If you hold individual shares then they need to be part of cohesive portfolio.

National Grid and SSE both have a future in terms of renewable energy generation. Both are investing in this sector for the future. The UK leads the world in terms of decarbonising.

Voyager2002

I endorse the comments about diversification. I would just add that the plans for (re)nationalisation would involve replacing the shares with government bonds, which would be worth the same as the shares but would have lower volatility.



As it happens I do not hold any of the shares in question, but if I did I would not be at all concerned at the plans for nationalisation.

sevenhills

nicsim wrote: »

For info, the shares are in things like SSE, BT, National Grid, Centrica, Severn Trent.

Does anyone else have similar concerns and what advice have you had if any?

I have had Centrica shares for less than a month, they are up by 12.66% although lower than the last couple of years.
I also have National Grid, up around 8% since I bought them recently. I am hoping the share price increases if Labour dont get a majority.
It has crossed my mind to sell Centrica, selling at the right time is hard to judge.