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IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 5:56 am
by idpickering
My HYP was last discussed on this board, starting on 20 May 21, here;
viewtopic.php?f=15&t=29509Not much has changed since then (obviously) and my HYP has been left alone to do it's thing. Next Tuesday my account with Halifax is set up to buy some of The Renewables Infrastructures Group (TRIG). I do like to have two shares per sector in my HYP if viable, and believe TRIG will sit alongside my Greencoat UK Wind (UKW) holdings in the overall renewables sector nicely. Next Tuesday's buy will be only a quarter average capital value weighting of my 25 other HYP holdings, and will be built up over time to get to that average capital value weighting. My other option was to buy yet more British American Tobacco, but I think I've bought enough of them already, and don't want to fall foul of a potential 'confirmation bias' trap.
Ian.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 10:51 am
by teecee90
I'm thinking of adding one or both of these.
Like others (I think), I set percentage holding limits (to inform new purchases and top-up decisions) for individual shares (5%), sectors (10%) and industries (20%). I'm curious how others would classify the likes of UKW and TRIG for this purpose. The official ICB sector is "Closed End Investments" and the Industry is "Financials", neither of which make much sense to me for managing portfolio diversification. I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group. Any views?
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 11:02 am
by Itsallaguess
teecee90 wrote:
I'm curious how others would classify the likes of UKW and TRIG for this purpose.
The official ICB sector is "Closed End Investments" and the Industry is "Financials", neither of which make much sense to me for managing portfolio diversification.
I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group.
Any views?
'
Subsidised Industry'...
Cheers,
Itsallaguess
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 11:41 am
by MDW1954
teecee90 wrote:I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group. Any views?
They are quasi-REITs selling to utilities, but not (in my view) utilities themselves. So "Energy" would be the better group, I think.
MDW1954
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 11:48 am
by kempiejon
Ian, I jumped on the green band wagon a while back with TRIG, still yielding in the ball park 5% I bought at a few years ago. BATS at nearer 8% would make it the winner in a fair fight but as you've already said you have enough that rules them out. If I was minded to add more to my HYP I'd plump for the bigger yield, particularly as BATS has a much longer history and I think bigger CAGR of dividend.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 12:17 pm
by daveh
Itsallaguess wrote:teecee90 wrote:
I'm curious how others would classify the likes of UKW and TRIG for this purpose.
The official ICB sector is "Closed End Investments" and the Industry is "Financials", neither of which make much sense to me for managing portfolio diversification.
I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group.
Any views?
'
Subsidised Industry'...
Cheers,
Itsallaguess
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 12:21 pm
by TheMotorcycleBoy
daveh wrote:Itsallaguess wrote:teecee90 wrote:
I'm curious how others would classify the likes of UKW and TRIG for this purpose.
The official ICB sector is "Closed End Investments" and the Industry is "Financials", neither of which make much sense to me for managing portfolio diversification.
I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group.
Any views?
'
Subsidised Industry'...
Cheers,
Itsallaguess
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
https://www.proactiveinvestors.co.uk/co ... 18138.html
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 12:22 pm
by idpickering
kempiejon wrote:Ian, I jumped on the green band wagon a while back with TRIG, still yielding in the ball park 5% I bought at a few years ago. BATS at nearer 8% would make it the winner in a fair fight but as you've already said you have enough that rules them out. If I was minded to add more to my HYP I'd plump for the bigger yield, particularly as BATS has a much longer history and I think bigger CAGR of dividend.
My thanks to all who’ve chipped in with their views thus far.
In reply to kempiejon, I do get where you’re coming from. It’d be very easy to opt for BATS, with their quarterly ex dividend date coming up in a couple of weeks. I do get that, and I respect your opinion on this, but I’m looking at diversifying further in this new sector, for me anyway. I’m not ignoring you, and thank you for your input, but TRIG get my vote on this occasion I think.
Ian.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 12:36 pm
by moorfield
MDW1954 wrote:teecee90 wrote:I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group. Any views?
They are quasi-REITs selling to utilities, but not (in my view) utilities themselves. So "Energy" would be the better group, I think.
MDW1954
ICB re-jigged their classifications last year to add the "Real Estate" industry. I would classify them under that, alongside all the sectors/subsectors such as:
Diversified REITs
Health Care REITs
Hotel and Lodging REITs
Industrial REITs
Infrastructure REITs
Office REITs
Residential REITs
Retail REITs
Storage REITs
Timber REITs
Other Specialty REITs
etc.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 1:01 pm
by Dod101
daveh wrote:
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
And as an infrastructure fund I would go for 3i Infrastructure, HICL or the like. They do not keep making placings to raise more capital and have a better spread of projects.
I also intensely dislike windmills. A blot on the landscape.
Dod
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 16th, 2021, 1:34 pm
by Gengulphus
teecee90 wrote:I'm thinking of adding one or both of these.
Like others (I think), I set percentage holding limits (to inform new purchases and top-up decisions) for individual shares (5%), sectors (10%) and industries (20%). I'm curious how others would classify the likes of UKW and TRIG for this purpose. The official ICB sector is "Closed End Investments" and the Industry is "Financials", neither of which make much sense to me for managing portfolio diversification. I'm minded to give them a new sector classification of "Renewables" and add them to either the "Energy" or "Utilities" industry group. Any views?
From the HYP point of view, the point of assigning a sector (or occasionally sectors) to a company is IMHO to classify the main type (or types) of business activity from which it makes its earnings and pays its dividends, so that the HYPer can ensure that the HYP's dividends are derived from a wide variety of different types of business activity and so aren't likely to be unduly affected by bad problems hitting a specific business area. (Economy-wide problems hitting a wide variety of business areas are another matter, as the last 15 months or so have amply demonstrated!)
So I would classify UKW as being in the Energy Utilities sector (which I'm considering renaming it as the Energy Supply sector) - its approach within that sector is much more focused than those of SSE and NG., on generation rather than distribution, on electricity rather than gas and on wind rather than fossil fuels or even other renewables, but it's fundamentally in the same business (e.g. SSE could in principle absorb it without any fundamental change to its business). TRIG I'm less familiar with, but what little I've read about it indicates it's very similar (just without the "or even other renewables" part).
Their different, more focused approaches do indicate some extra diversification, of course, but I'm not convinced it's enough to count as anything more than within-sector diversification. And the pressures of electricity generators to move towards using more renewables suggest that the amount of extra diversification is likely to reduce rather than increase in the future...
Gengulphus
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 10:09 am
by Arborbridge
Dod101 wrote:daveh wrote:
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
And as an infrastructure fund I would go for 3i Infrastructure, HICL or the like. They do not keep making placings to raise more capital and have a better spread of projects.
I also intensely dislike windmills. A blot on the landscape.
Dod
If I said I
liked windmills, would that be a good reason to invest
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 11:24 am
by Dod101
Arborbridge wrote:If I said I
liked windmills, would that be a good reason to invest
Now Arb, with great respect, has been somewhat argumentative of late so I will pick my words carefully. I think anyone who invests in the likes of TRIG must like what I call windmills, or more correctly I suppose, should be called wind turbines. They are after all investing almost exclusively in them.
I happen not to much like the investment proposition, and very much dislike the disfiguring of the landscape that they produce and so will not invest in them.
Dod
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 11:34 am
by Arborbridge
Dod101 wrote:Arborbridge wrote:If I said I
liked windmills, would that be a good reason to invest
Now Arb, with great respect, has been somewhat argumentative of late so I will pick my words carefully. I think anyone who invests in the likes of TRIG must like what I call windmills, or more correctly I suppose, should be called wind turbines. They are after all investing almost exclusively in them.
I happen not to much like the investment proposition, and very much dislike the disfiguring of the landscape that they produce and so will not invest in them.
Dod
It was only a leg pull, and I do appreciate the investment argument you have too.
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 2:49 pm
by TUK020
Dod101 wrote:daveh wrote:
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
And as an infrastructure fund I would go for 3i Infrastructure, HICL or the like. They do not keep making placings to raise more capital and have a better spread of projects.
I also intensely dislike windmills. A blot on the landscape.
Dod
Do you regards windmills as more hideous than pylons? And do you have a similar attitude to NG & SSE?
I won't go there on gas storage.........
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 3:23 pm
by Dod101
TUK020 wrote:Dod101 wrote:daveh wrote:
But getting less so, most of the new projects ( ie ones they are buying into now that are still under construction) are free of subsidy. Which of course adds greater risk on future income as profits are much more reliant on wholesale energy prices.
I classify my TRIG as an infrastructure fund, and HPTUSS also classifies it as Infrastructure.
And as an infrastructure fund I would go for 3i Infrastructure, HICL or the like. They do not keep making placings to raise more capital and have a better spread of projects.
I also intensely dislike windmills. A blot on the landscape.
Dod
Do you regards windmills as more hideous than pylons? And do you have a similar attitude to NG & SSE?
I won't go there on gas storage.........
At least pylons just stand there. These windmills are nearly always in large clusters and much more obvious to me anyway, since they have to be set up to catch the wind so yes I think they are more hideous or intrusive. SSE installed a set of high pylons from the Highlands to the Central Belt a few years ago and managed to place them as unobtrusively as possible and If I remember correctly even managed to place some of the cables underground in the Cairngorms National Park. Ironically that was to carry electricity from some of these wind farms. I am not convinced by the investment case either.
I hold by SSE and NG. They have windfarms but at least in the case of SSE they are building off shore and in any case form only a part of their portfolio.
Dod
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 4:11 pm
by moorfield
I find many things hideous ...
Environmental polluters
Animal testers
Peddlers of dubious derivative finance to small businesses
Manufacturers of tobacco products
Exploiters of zero-contract employees
Exploiters of third world employees
Exploiters of indigenous rainforest
Government bribers/palm-greasers
Manufacturers of weapons
... but if I avoided all those I wouldn't have much dividend income to live off !
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 17th, 2021, 7:58 pm
by Wizard
Dod101 wrote:TUK020 wrote:Dod101 wrote:
And as an infrastructure fund I would go for 3i Infrastructure, HICL or the like. They do not keep making placings to raise more capital and have a better spread of projects.
I also intensely dislike windmills. A blot on the landscape.
Dod
Do you regards windmills as more hideous than pylons? And do you have a similar attitude to NG & SSE?
I won't go there on gas storage.........
At least pylons just stand there. These windmills are nearly always in large clusters and much more obvious to me anyway, since they have to be set up to catch the wind so yes I think they are more hideous or intrusive. SSE installed a set of high pylons from the Highlands to the Central Belt a few years ago and managed to place them as unobtrusively as possible and If I remember correctly even managed to place some of the cables underground in the Cairngorms National Park. Ironically that was to carry electricity from some of these wind farms. I am not convinced by the investment case either.
I hold by SSE and NG. They have windfarms but at least in the case of SSE they are building off shore and in any case form only a part of their portfolio.
Dod
I find wind turbines far more aesthetically pleasing than ugly old pylons.
Moderator Message:
Folks, I think we've collectively made it clear that we have differing views on the aesthetics of windfarms. But as Moorfield reminds us, the lure of dividend income can cause some of us to rein in our disdain in the interests of investment returns. So with that point made, let's all move on. --MDW1954
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 18th, 2021, 10:56 am
by 88V8
I view 'renewables' as a punt.
In a post-subsidies world... eventually.... they may pay long-term or not.
Meanwhile if one brave, one is getting in at the ground floor.
I have a toe in a general infrastructure IT, which is about as far as I want to go.
V8
Re: IDP - My June 2021 HYP intended purchase.
Posted: June 18th, 2021, 11:11 am
by idpickering
88V8 wrote:I view 'renewables' as a punt.
In a post-subsidies world... eventually.... they may pay long-term or not.
Meanwhile if one brave, one is getting in at the ground floor.
I have a toe in a general infrastructure IT, which is about as far as I want to go.
V8
Yep, I respect your opinion on this. For me, although I might top up my UKW shares and TRIG in the future too, I’m in no rush to widen my infrastructure quasi REIT bet to be honest. I’m not saying I won’t buy other like outfits in the future though. We’ll see.
Ian.