Well, the clue is in the title and it is an easy point to illustrate: -
If you had an investment that just tracked the price of the FTSE-100 from 1st January 2000 to today (and there's no particular reason to select the 1st January, the outset of the new Millenium seemed like a nice place to start ...) then the return would be -19.96%.
The price of the index has fallen from 6,930 as at 31/12/1999 to 5,568 as at 6th December 2011. That does not sound like a particularly attractive investment over almost 11 years. But, add in the dividend yield over that period and the TOTAL RETURN is + 19.47%. Still not earth-shattering, but nevertheless a difference of almost 40%, and that is worthy of a few shards of soil.....
So, as an equity 'investor' as opposed to an out and out 'speculator,' how important is yield? EXCEPTIONALLY.
[data supplied by Financial Express, 08 December 2011]
Thursday, 8 December 2011
Tuesday, 6 December 2011
Treasury to allow fresh ISA allowance when investments collapse
The Treasury has announced plans to change the rules over the ISA allowance to allow savers hit by the collapse of a bank or investment provider to reinvest the assets.
Under the old rules, any investment or cash lost due to the collapse of a provider or bank would fall under the £10,680 annual allowance.
But according to the BBC, financial secretary to the Treasury Mark Hoban(pictured) has issued a statement to MPs outlining plans to allow savers to invest an equivalent amount without affecting their ISA allowance.
The plan formalises arrangements that were put in place in the wake of the collapse of Icelandic bank Icesave and life settlement-backed investment provider Keydata. Hoban said: '[The changes] will enable investors whose ISAs are affected by the failure or default of a financial firm to continue to benefit from tax-advantaged savings.'
'They also demonstrate the government's commitment to ensure that theISA remains a secure, accessible and tax-advantages saving product.'
[source: www.citywire.co.uk, 6 December 2011]
'Interesting and an eminently sensible idea, but one would hope the FSA will start picking up the potential failures before they happen'
Friday, 2 December 2011
THINK! Before Committing Someone to EXECUTOR Duties
You've been wise enough to arrange and update your will, so your beneficiaries are well protected, however, have you asked your proposed executor whether they are happy to accept the role?
Acting as an executor is a burden, full stop. Establishing whether the PA1, IHT400 and IHT205 or IHT207 forms need to be completed is sufficiently complex. If there is a property to deal with aside from income from various sources and a range of investments, gathering the information in order to complete them can be a difficult, time consuming job.
Be sure, at the very least, that your Executor knows who they are and perhaps give them a hand on this side of the pearly gates.
Acting as an executor is a burden, full stop. Establishing whether the PA1, IHT400 and IHT205 or IHT207 forms need to be completed is sufficiently complex. If there is a property to deal with aside from income from various sources and a range of investments, gathering the information in order to complete them can be a difficult, time consuming job.
Be sure, at the very least, that your Executor knows who they are and perhaps give them a hand on this side of the pearly gates.
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