Share portfolio - heavy on Utilities. What to do?

John_Smith_2019

Apodemus wrote: »

There was a piece in the Economist a number of years ago that looked at post-election stock market response to General Elections which suggested that a post-election bounce is more likely after a Labour win. The expected result tends to be priced in before Election Day, after which the market just gets on with the job again. Market losses ahead of a predicted Labour win get made up again after the expected event comes true, while an expected Tory win has not caused a pre-election drop, hence no post-election bounce. Of course the analysis must have been based on very few data points, so the stats might be questionable and not reliable as a pointer to future events.

EDIT: Also worth noting that the analysis referred to the market as a whole and not any individual stocks.

Could this be due to a drop in the pound?

kinger101

Thrugelmir wrote: »

Where's the £5.8 bn going to come from?

The magic money tree.

John_Smith_2019

kinger101 wrote: »

The magic money tree.

MMT - now that's a topic that needs it's own thread!

benbay001

I can believe thats true, Apodemus.

But at the same time, i personally have ignored utilities companies as i dont see they are worth the risk of becoming state owned. If Labour lose the election, its likely JC will be ousted in which case normal service should hopefully be resumed.

No doubt im not the only one.

As for OP, if you would buy the shares yourself, right now, for the price they are at, then they may be worth keeping.
If buying a load of utilities stocks isnt something you would otherwise done if they hadnt been gifted, then i would get rid.
Another test would be, is there a price in your head, that if the market opened tomorrow, and the share suddenly shot up xx%, you would sell at?
If you have no idea what your sell point is, then you should sell right now.

Thrugelmir

John_Smith_2019 wrote: »

The BoE will create the currency digitally.

BOE is independent to the Government of the day.

hit_and_run

Apodemus wrote: »

There was a piece in the Economist a number of years ago that looked at post-election stock market response to General Elections which suggested that a post-election bounce is more likely after a Labour win. The expected result tends to be priced in before Election Day, after which the market just gets on with the job again. Market losses ahead of a predicted Labour win get made up again after the expected event comes true, while an expected Tory win has not caused a pre-election drop, hence no post-election bounce. Of course the analysis must have been based on very few data points, so the stats might be questionable and not reliable as a pointer to future events.

EDIT: Also worth noting that the analysis referred to the market as a whole and not any individual stocks.

A step up in public investment would be positive for shares. As would ruling out a hard brexit. So UK shares generally could easily rise if Labour win this time.

Shares slated for nationalisation would probably be an exception, at least immediately after the election. In that there would be uncertainty about the nationalisation price, at least until the nationalisation bills were published.

hit_and_run

Thrugelmir wrote: »

BOE is independent to the Government of the day.

It's just operational independence, i.e. not real independence. The Treasury and the BoE work together; and in the event of any conflict, it's the BoE that would have to give way. As it should — anything else would be inconsistent with democracy.

Consider that every tranch of QE was carried out by the BoE only after a letter from the Chancellor authorizing it. And that the Chancellor has the power to overrule the BoE on setting interest rates — this is spelled out in the Act of Parliament which granted the BoE its nominal independence. And the Chancellor could simply replace the Governor of the BoE. If push comes to shove, there is no real independence.

John_Smith_2019

Thrugelmir wrote: »

BOE is independent to the Government of the day.

Thanks for making me laugh on an otherwise dismal Sunday afternoon.

Even if the BoE was truly independent:

1. It wouldn't make any difference, as they just carry on with QE anyway.
2. They are only 'independent' since the govt said they were (a few years ago). Obviously, this rule could be changed back easily enough.

John_Smith_2019

hit_and_run wrote: »

A step up in public investment would be positive for shares. As would ruling out a hard brexit. So UK shares generally could easily rise if Labour win this time.

Shares slated for nationalisation would probably be an exception, at least immediately after the election. In that there would be uncertainty about the nationalisation price, at least until the nationalisation bills were published.

Those shares could be worth buying at that point.
Markets often oversell on the initial panic.

NedS

National Grid and SSE have moved offshore to protect themselves against Labour plans:

https://www.bbc.co.uk/news/business-50536205