How can 1 US company be worth more than the top 350 UK companies?

[Deleted User]

wmb194 said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

I removed those same sectors from the S&P500 and the market cap drops by just 26%. 

The contrast is undeniable. I don't really mind if the UK stock market is fuelled by high profit no growth companies, but I better be getting a 10% dividend yield as a result.

You cannot think of any companies operating in Britain and for which people work that aren't listed on the LSE?

Of course there are but that same logic can be applied to how many US company operating in the states that aren't listed.

The point is the ones that are listed, are massively dragging down the index with their 0 growth dead end sectors.

Section62

[Deleted User] said:

wmb194 said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

I removed those same sectors from the S&P500 and the market cap drops by just 26%. 

The contrast is undeniable. I don't really mind if the UK stock market is fuelled by high profit no growth companies, but I better be getting a 10% dividend yield as a result.

You cannot think of any companies operating in Britain and for which people work that aren't listed on the LSE?

Of course there are but that same logic can be applied to how many US company operating in the states that aren't listed.

The point is the ones that are listed, are massively dragging down the index with their 0 growth dead end sectors.

You think financial services and insurance are "dead end"?

And mining?  ...the sector winning the raw materials to manufacture the 'stuff' people want. (Did anyone mention "EV batteries" or "Rare earths"?)

wmb194

[Deleted User] said:

wmb194 said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

I removed those same sectors from the S&P500 and the market cap drops by just 26%. 

The contrast is undeniable. I don't really mind if the UK stock market is fuelled by high profit no growth companies, but I better be getting a 10% dividend yield as a result.

You cannot think of any companies operating in Britain and for which people work that aren't listed on the LSE?

Of course there are but that same logic can be applied to how many US company operating in the states that aren't listed.

The point is the ones that are listed, are massively dragging down the index with their 0 growth dead end sectors.

So the things you value are happening in Britain but in this thread you've be saying* that 'almost nothing but dinosaur' things happen in Britain... Try some Socratic thinking; can you think of exceptions that you can use to modify your statement?

What are you trying to achieve in this thread? You don't think banking and insurance et al will exist in 100 years' time? If it's an attempt to try to decide where to invest I thought you'd settled that for yourself in another recent thread: 100% in a US S&P500 tracker.

*"The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc."

InvesterJones

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

Despite being corrected several times, you're still confusing the economy with stock exchanges.

Hoenir

Middle_of_the_Road said:

Hoenir said:

Middle_of_the_Road said:

GeoffTF said:

Middle_of_the_Road said:

GeoffTF said:

Middle_of_the_Road said:

masonic said:

Perhaps they are overvalued.

No doubt some are. Would like to know how these two companies are valued 

Tesla ~ $1 tn
Ford ~ $40 bn

The market believes that the net present value of Tesla's earnings will be much more than Ford's. If you believe that the market is wrong, you can buy Ford and short sell Tesla. You may, however, find that the market can remain irrational for longer than you can stay solvent (as Keynes famously said).

Understood.
It does seem rather irrational that one is going to have 25 times the earnings, whilst selling 75% fewer vehicles.

You would have made 14% with a short on Tesla today:

https://finance.yahoo.com/news/live/stock-market-today-dow-sp-500-nasdaq-slide-as-tesla-dives-14-on-trump-musk-escalation-200450230.html

Tesla is still showing a post election gain though.

Driven by the feud brewing between two of America's finest citizens, which likely could have been predicted, but I wouldn't gamble in this market, seems no more credible than bitcoin.

Trump has stabbed Musk in the back. The "Big Beautifull Bill" is destined to remove the state subsidy from Tesla cars. Another nail in Musk's business plan. That $250 million (£187m) spent supporting Trump's election campaign is dead money.

No doubt. I probably shouldn't comment further, at risk of straying into political territory.

Putting the politics aside. Musk has returned to Tesla and discovered the extent of the company's downward slide. End of the day as a manufacturer carries a high level of fixed costs. Falling sales therefore are a hit straight to the bottom line. 

[Deleted User]

wmb194 said:

[Deleted User] said:

wmb194 said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

I removed those same sectors from the S&P500 and the market cap drops by just 26%. 

The contrast is undeniable. I don't really mind if the UK stock market is fuelled by high profit no growth companies, but I better be getting a 10% dividend yield as a result.

You cannot think of any companies operating in Britain and for which people work that aren't listed on the LSE?

Of course there are but that same logic can be applied to how many US company operating in the states that aren't listed.

The point is the ones that are listed, are massively dragging down the index with their 0 growth dead end sectors.

So the things you value are happening in Britain but in this thread you've be saying* that 'almost nothing but dinosaur' things happen in Britain... Try some Socratic thinking; can you think of exceptions that you can use to modify your statement?

What are you trying to achieve in this thread? You don't think banking and insurance et al will exist in 100 years' time? If it's an attempt to try to decide where to invest I thought you'd settled that for yourself in another recent thread: 100% in a US S&P500 tracker.

*"The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc."

The issue isn't how stable the deep rooted the companies are, the issue is how much my money will go up if I invest in them. You will never get tech level returns on oil & gas, mining, insurance, banking etc because these are essentially zero growth stocks.

If I wanted a 4% return per year investment I'd just put it into government bonds.

InvesterJones said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

Despite being corrected several times, you're still confusing the economy with stock exchanges.

I'm not, but investors make their money when the index goes up so if the companies are not in the index it's irrelevant.

InvesterJones

[Deleted User] said:

InvesterJones said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

Despite being corrected several times, you're still confusing the economy with stock exchanges.

I'm not, but investors make their money when the index goes up so if the companies are not in the index it's irrelevant.

Well you have confused it several times in the original post and posts since, but OK, so now GDP, economy etc. are irrelevant, you're only asking why the FTSE 350 constituents have a combined total market cap less than the biggest company in the world by market cap? Is that correct?

Hoenir

The issue isn't how stable the deep rooted the companies are, the issue is how much my money will go up if I invest in them. You will never get tech level returns on oil & gas, mining, insurance, banking etc because these are essentially zero growth stocks.

Sounds if you are speculating rather than investing. Around 50% of the Companies listed on the US markets are unprofitable. Around 1 in 8 large caps on the NASDAQ. These are your growth companies.  By the time they reach the SP500 index they are profitable.  Have to be. As that's a criteria for inclusion.  

Companies that don't grow at all ultimately cease to exist. That's the nature of ruthless nature of business. Survival of the financially fittest.  Coca Cola first listed in 1919. Hasn't done badly for a boring old low tech company has it? 

GeoffTF

[Deleted User] said:

The issue isn't how stable the deep rooted the companies are, the issue is how much my money will go up if I invest in them. You will never get tech level returns on oil & gas, mining, insurance, banking etc because these are essentially zero growth stocks.

If I wanted a 4% return per year investment I'd just put it into government bonds.

UK companies tend to pay out big dividends. That comes off the capital growth. If you get 4% dividends with inflationary growth of dividends and capital, you are a winner with 7% total return. There is the alternative of tech stocks with sky high valuations, but they do not have to disappoint much to lose you money. There is also the possibility that Trump will levy high taxes on your US investments, or worse:

https://www.youtube.com/watch?v=2S7gWNxzlvE

I do not know what will happen, so I spread my risk.

wmb194

[Deleted User] said:

wmb194 said:

[Deleted User] said:

wmb194 said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

I removed those same sectors from the S&P500 and the market cap drops by just 26%. 

The contrast is undeniable. I don't really mind if the UK stock market is fuelled by high profit no growth companies, but I better be getting a 10% dividend yield as a result.

You cannot think of any companies operating in Britain and for which people work that aren't listed on the LSE?

Of course there are but that same logic can be applied to how many US company operating in the states that aren't listed.

The point is the ones that are listed, are massively dragging down the index with their 0 growth dead end sectors.

So the things you value are happening in Britain but in this thread you've be saying* that 'almost nothing but dinosaur' things happen in Britain... Try some Socratic thinking; can you think of exceptions that you can use to modify your statement?

What are you trying to achieve in this thread? You don't think banking and insurance et al will exist in 100 years' time? If it's an attempt to try to decide where to invest I thought you'd settled that for yourself in another recent thread: 100% in a US S&P500 tracker.

*"The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc."

The issue isn't how stable the deep rooted the companies are, the issue is how much my money will go up if I invest in them. You will never get tech level returns on oil & gas, mining, insurance, banking etc because these are essentially zero growth stocks.

If I wanted a 4% return per year investment I'd just put it into government bonds.

InvesterJones said:

[Deleted User] said:

IanManc said:

[Deleted User] said:
........ but yeah it's pretty dead on the island nowadays ........

The UK is the 6th largest economy in the world, and the 9th biggest manufacturer in the world.

However, it has a sizeable portion of its population which glibly talks the UK down contrary to the evidence.

The problem is the companies that make up the overwhelming bulk of our "large economy" are in no growth sectors. Banks, oil, mining etc. 

Just for fun I removed banks, oil & gas, insurance, mining, and tobacco from the FTSE 350 and the market cap drops by 45%. So nearly half of the market cap is made up from those relic companies.

Despite being corrected several times, you're still confusing the economy with stock exchanges.

I'm not, but investors make their money when the index goes up so if the companies are not in the index it's irrelevant.

In the past year or so you'd have done really well in British and continental European banks and insurers. Don't forget to add back dividends when looking at their performance.

I thought you were an all of market tracker investor so why are you trying to pick? Buy an all world tracker or stick with your preferred S&P500 tracker.