Monthly Archives: November 2022

The announcements made yesterday by our fourth Chancellor in 5 months, Jeremy Hunt, will have come as little surprise to most. In a clear attempt to do the precise opposite of the ‘shock and awe’ tactics of the Liz Truss / Kwasi Kwarteng Government, most of the content of yesterday’s announcement had been rumoured or leaked to the press already.

First to the good news, if we can find any in there…

Well. The markets didn’t hate the announcements. Again, most of them were known beforehand and would have already been priced in – the FTSE 100 barely moved yesterday ending the day down just 4 or so points.

In addition, Jeremy Hunt renewed the Government’s commitment to tax-efficient (and growth-promoting) investments such as VCTs (Venture Capital Trusts) and EIS (Enterprise Investment Schemes). There had been some small rumours that these might have been on the chopping block so it is encouraging to see these additional tax-efficient vehicles retained.

Finally, there was nothing much was changed in terms of the actual structure of the tax system. The core way that tax operates and the rules and legislation surrounding it were broadly kept the same.

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I was not scheduled to write a new blog post today, but given yesterday’s monumental market events, I thought it would be a good idea to pen a brief note.

So often, I talk about the risk of missing the “best days” in the markets.

What I am referring to here is that missing out on just the best 5 or 10 days in the market within a multi-decade time period can have a huge impact on your overall investment returns (or losses as the case may be).

I have shared this document before, however if you would like an explanation of just how powerful this concept is, please click the button below to see a wonderful page by Fidelity:

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You will have to excuse the somewhat more technical nature of today’s post, however, we seem to be at a bit of an inflection point in markets with a huge volume of change going on all at once.

During times like these, our ‘inner chimp’ has the capacity to take over and override our more rational human brains. Our ‘inner chimp’ refers to the emotional and instinctive reactions we have to things every day – the weather, an interaction with another person, the news headlines or the stock market for example.

During times like these, the media will do all that it can to grab the attention of our inner chimp. They will use scary headlines to describe what might otherwise be fairly mundane events to capture our imagination and get us clicking and reading their stories.

It is fairly common to see headlines such as:

“Stock markets in freefall”

“Carnage in bond markets”

“The death of the 60/40 portfolio” (I will come back to this in a moment)

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