Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

Another HYP

General discussions about equity high-yield income strategies
Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Another HYP

#439268

Postby Wizard » September 2nd, 2021, 4:07 pm

There has been some recent discussion around 'ownership' of the HYP acronym. It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version. So why not another version? But what might the rules of this new version be, my starter for 10 would be as follows:

This HYP approach is one that invests on a Long Term Buy and Hold (LTBH) basis in a diversified portfolio of shares. Those shares should:

Not be limited to shares listed in London.
When bought, have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE100 index.
When initially bought, have yields greater than the yield of the FTSE 100 index.
When bought, be reasonably expected to sustain their dividends in the future.
Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.

dealtn
Lemon Half
Posts: 6072
Joined: November 21st, 2016, 4:26 pm
Has thanked: 441 times
Been thanked: 2324 times

Re: Another HYP

#439280

Postby dealtn » September 2nd, 2021, 4:54 pm

Wizard wrote: So why not another version?


There's nothing stopping anyone, nor has there ever been to my knowledge, posting up any strategy or system and inviting others to comment on it. So go ahead. It will be interesting to see if anyone engages with you though.

Personally I have no interest in such a strategy, but if you go ahead I might have some thoughts on individual shares.

Dod101
The full Lemon
Posts: 16629
Joined: October 10th, 2017, 11:33 am
Has thanked: 4343 times
Been thanked: 7534 times

Re: Another HYP

#439283

Postby Dod101 » September 2nd, 2021, 4:58 pm

Wizard wrote:There has been some recent discussion around 'ownership' of the HYP acronym. It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version. So why not another version? But what might the rules of this new version be, my starter for 10 would be as follows:

This HYP approach is one that invests on a Long Term Buy and Hold (LTBH) basis in a diversified portfolio of shares. Those shares should:

Not be limited to shares listed in London.
When bought, have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE100 index.
When initially bought, have yields greater than the yield of the FTSE 100 index.
When bought, be reasonably expected to sustain their dividends in the future.
Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.


All investment trusts are disqualified for now at least except for Scottish Mortgage and it is disqualified because of its insignificant yield.

Otherwise it more or less describes what I do anyway.

Dod

hiriskpaul
Lemon Quarter
Posts: 3852
Joined: November 4th, 2016, 1:04 pm
Has thanked: 682 times
Been thanked: 1489 times

Re: Another HYP

#439288

Postby hiriskpaul » September 2nd, 2021, 5:10 pm

Wizard wrote:Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.

All sounds sensible so far and probably what a lot of income investors are already doing!

Undated PIBS in addition to preference shares?
US preferred securities? (often callable, so far off call dates might fit better with your LTBH remit)

For ITs, would they be permitted if they did not necessarily invest in high yield equities, but enhanced the IT yield in some way, eg by taking charges from capital, paying income from capital gains, or generating cash from covered call writing - BlackRock Sustainable American Income Trust for example.

Edit: also, why limit this to ITs? Many open ended funds and ETFs would likely be suitable.

MDW1954
Lemon Quarter
Posts: 2358
Joined: November 4th, 2016, 8:46 pm
Has thanked: 526 times
Been thanked: 1011 times

Re: Another HYP

#439293

Postby MDW1954 » September 2nd, 2021, 5:36 pm

Wizard wrote:There has been some recent discussion around 'ownership' of the HYP acronym. It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version. So why not another version? But what might the rules of this new version be, my starter for 10 would be as follows:

This HYP approach is one that invests on a Long Term Buy and Hold (LTBH) basis in a diversified portfolio of shares. Those shares should:

Not be limited to shares listed in London.
When bought, have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE100 index.
When initially bought, have yields greater than the yield of the FTSE 100 index.
When bought, be reasonably expected to sustain their dividends in the future.
Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.


Call it what you like, as long as it's clearly distinct from the HYP discussed on HYPP. And moderators would wish to be clear that your intentions were not mischievous.

And the place to discuss it is here.

But seriously, does it matter?

MDW1954

Alaric
Lemon Half
Posts: 6033
Joined: November 5th, 2016, 9:05 am
Has thanked: 20 times
Been thanked: 1399 times

Re: Another HYP

#439307

Postby Alaric » September 2nd, 2021, 6:50 pm

Wizard wrote:When initially bought, have yields greater than the yield of the FTSE 100 index.


That would exclude all shares where the dividends had been suspended or cancelled.

But if an aim is to discuss a higher risk, higher return alternative to Bank and Building Society deposits, then a less stringent definition would define "high" as being above that of deposits.

moorfield
Lemon Quarter
Posts: 3523
Joined: November 7th, 2016, 1:56 pm
Has thanked: 1546 times
Been thanked: 1402 times

Re: Another HYP

#439310

Postby moorfield » September 2nd, 2021, 7:04 pm

Wizard wrote:Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.



Well I do agree with you preference shares merit a place in HYP. A lot of people hold them, and they are occasionally reported in HYPs (if only to accommodate the foibles of one particular poster on HYPP). There is only a small pool to select from anyway - I hold SAN (bought at sub par >10%, since doubled in price), RAVP (again bought at >10%), RE.B (paying out again but yet to catch up on its deferred cumulative dividend).

moorfield
Lemon Quarter
Posts: 3523
Joined: November 7th, 2016, 1:56 pm
Has thanked: 1546 times
Been thanked: 1402 times

Re: Another HYP

#439319

Postby moorfield » September 2nd, 2021, 8:43 pm

MDW1954 wrote:Call it what you like, as long as it's clearly distinct from the HYP discussed on HYPP. And moderators would wish to be clear that your intentions were not mischievous.


... and call that what you like, as long as it's distinct from the HYP Stephen Bland propounded! - I think that was Wizard's point on "ownership". Are you sure it's not HYPP that is not being mischievous? Does HYPP have Stephen Bland's support? (I note he is not credited or name checked in the guidelines.)

Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Re: Another HYP

#439320

Postby Wizard » September 2nd, 2021, 8:45 pm

Dod101 wrote:
Wizard wrote:There has been some recent discussion around 'ownership' of the HYP acronym. It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version. So why not another version? But what might the rules of this new version be, my starter for 10 would be as follows:

This HYP approach is one that invests on a Long Term Buy and Hold (LTBH) basis in a diversified portfolio of shares. Those shares should:

Not be limited to shares listed in London.
When bought, have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE100 index.
When initially bought, have yields greater than the yield of the FTSE 100 index.
When bought, be reasonably expected to sustain their dividends in the future.
Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.


All investment trusts are disqualified for now at least except for Scottish Mortgage and it is disqualified because of its insignificant yield.

Otherwise it more or less describes what I do anyway.

Dod

You don't explain why, but I presume you mean because they are not FTSE100 in size.

Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Re: Another HYP

#439321

Postby Wizard » September 2nd, 2021, 8:49 pm

hiriskpaul wrote:
Wizard wrote:Be ordinary shares or preference shares or shares in investment companies or investment trusts which are largely invested in quoted equities.

It is acknowledged that individual HYP investors may from time to time see the need to sell individual HYP stocks, perhaps in response to adverse performance, portfolio imbalance, or a corporate action, e.g. takeover. It is stressed, however, that HYP investing was always intended to be a LTBH strategy.

All sounds sensible so far and probably what a lot of income investors are already doing!

Undated PIBS in addition to preference shares?
US preferred securities? (often callable, so far off call dates might fit better with your LTBH remit)

For ITs, would they be permitted if they did not necessarily invest in high yield equities, but enhanced the IT yield in some way, eg by taking charges from capital, paying income from capital gains, or generating cash from covered call writing - BlackRock Sustainable American Income Trust for example.

Edit: also, why limit this to ITs? Many open ended funds and ETFs would likely be suitable.

PIBS would be fjne in principle, but likely to struggle in terms of size. Similar to the point Dod makes on Investment Trusts the size threshold may be something worth thinking about further. I went with FTSE100 initially as I thought the larger global pool would mean there was no need ro drop down to FTSE350 levels, but maybe that needs to be considered.

For ITs the point for me personally would be the income they provide to the HYP investor, rather than how they achieve it.

Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Re: Another HYP

#439322

Postby Wizard » September 2nd, 2021, 8:51 pm

Alaric wrote:
Wizard wrote:When initially bought, have yields greater than the yield of the FTSE 100 index.


That would exclude all shares where the dividends had been suspended or cancelled.

But if an aim is to discuss a higher risk, higher return alternative to Bank and Building Society deposits, then a less stringent definition would define "high" as being above that of deposits.

I think if this were an investment for somebody in drawdown (and I still think that is the only situation this should be considered, not for pot building) excluding those with cancelled or suspended dividends is the right answer.

moorfield
Lemon Quarter
Posts: 3523
Joined: November 7th, 2016, 1:56 pm
Has thanked: 1546 times
Been thanked: 1402 times

Re: Another HYP

#439327

Postby moorfield » September 2nd, 2021, 9:13 pm

moorfield wrote:
MDW1954 wrote:Call it what you like, as long as it's clearly distinct from the HYP discussed on HYPP. And moderators would wish to be clear that your intentions were not mischievous.


... and call that what you like, as long as it's clearly distinct from the HYP Stephen Bland propounded! - I think that was Wizard's point on "ownership". Are you sure HYPP is not being mischievous? Does HYPP have Stephen Bland's support? (I note he is not credited or name checked in the guidelines.)



Poor grammar and a missed word in my requote. Corrected above.

MDW1954
Lemon Quarter
Posts: 2358
Joined: November 4th, 2016, 8:46 pm
Has thanked: 526 times
Been thanked: 1011 times

Re: Another HYP

#439334

Postby MDW1954 » September 2nd, 2021, 9:44 pm

moorfield wrote:
moorfield wrote:
MDW1954 wrote:Call it what you like, as long as it's clearly distinct from the HYP discussed on HYPP. And moderators would wish to be clear that your intentions were not mischievous.


... and call that what you like, as long as it's clearly distinct from the HYP Stephen Bland propounded! - I think that was Wizard's point on "ownership". Are you sure HYPP is not being mischievous? Does HYPP have Stephen Bland's support? (I note he is not credited or name checked in the guidelines.)



Poor grammar and a missed word in my requote. Corrected above.


The HYPP board has been in place since November 2016, and Stephen Bland has posted on it many times. If it doesn't have his support, he has had ample time in which to say so. And so far, he hasn't.

The guidelines were our attempt to replicate TMF moderation rules (without actual access to those rules), and also reflect the practicalities of how many HYP investors managed their portfolios.

MDW1954

Dod101
The full Lemon
Posts: 16629
Joined: October 10th, 2017, 11:33 am
Has thanked: 4343 times
Been thanked: 7534 times

Re: Another HYP

#439341

Postby Dod101 » September 2nd, 2021, 10:24 pm

Wizard wrote:
Dod101 wrote:
All investment trusts are disqualified for now at least except for Scottish Mortgage and it is disqualified because of its insignificant yield.

Otherwise it more or less describes what I do anyway.

Dod

You don't explain why, but I presume you mean because they are not FTSE100 in size.


You my not have meant it but Scottish Mortgage is the only IT in the FTSE100 and it is also disqualified because of its very modest yield.

You might therefore want to modify the rules for ITs because of course a number of ITs are perfectly good as constituents of a HYP, IMHO only of course!

Dod

Charlottesquare
Lemon Quarter
Posts: 1775
Joined: November 4th, 2016, 3:22 pm
Has thanked: 105 times
Been thanked: 560 times

Re: Another HYP

#439347

Postby Charlottesquare » September 2nd, 2021, 11:04 pm

Dod101 wrote:
Wizard wrote:
Dod101 wrote:
All investment trusts are disqualified for now at least except for Scottish Mortgage and it is disqualified because of its insignificant yield.

Otherwise it more or less describes what I do anyway.

Dod

You don't explain why, but I presume you mean because they are not FTSE100 in size.


You my not have meant it but Scottish Mortgage is the only IT in the FTSE100 and it is also disqualified because of its very modest yield.

You might therefore want to modify the rules for ITs because of course a number of ITs are perfectly good as constituents of a HYP, IMHO only of course!

Dod


The FTSE 100/market cap rules were there for safety, but that "filter" was more than likely needed because the entities were themselves trading. (I always had reservations anyway that investors voting with their demand multiplied by the number of shares in issue to get market cap actually denoted safety)

An IT, providing it holds diverse holdings, is limited re borrowing and is not itself heavily invested into smaller companies or exotic investments, appears to me to be actually safer than some of the larger companies in which it holds investments, accordingly I am not convinced FTSE 100 market cap size ought to be the applied filter for IT investments were they to be permitted investments within any variant yield approach.

However for disclosure, I do not follow a high yield IT approach at present, I am currently happier having a mix of higher yield (say Henderson Far East) and nil yield (Say Allianz Technology) such that I find the blended yield acceptable from time to time and I can focus my investments into overseas markets and sectors as , from time to time, I see fit. Catch is right now I would not qualify as high yield re ITs as am only at 2.64% yield (though was prior to chasing into Berkshire, Scottish Mortgage, Allianz Tech, Polar, Fidelity China, Herald, JPM Emerging, JPM Indian, Monks, Polar, Stan Life small Cos and Vina Capital Vietnam at over 4%)

MDW1954
Lemon Quarter
Posts: 2358
Joined: November 4th, 2016, 8:46 pm
Has thanked: 526 times
Been thanked: 1011 times

Re: Another HYP

#439348

Postby MDW1954 » September 2nd, 2021, 11:06 pm

Dod101 wrote:
Wizard wrote:
Dod101 wrote:
All investment trusts are disqualified for now at least except for Scottish Mortgage and it is disqualified because of its insignificant yield.

Otherwise it more or less describes what I do anyway.

Dod

You don't explain why, but I presume you mean because they are not FTSE100 in size.


You my not have meant it but Scottish Mortgage is the only IT in the FTSE100 and it is also disqualified because of its very modest yield.

You might therefore want to modify the rules for ITs because of course a number of ITs are perfectly good as constituents of a HYP, IMHO only of course!

Dod


As moderators, we're (informally) discouraged from participating in threads in which we are actively moderating.

But I think that it's worth flouting that convention to point out that I at least would feel excluded from such a definition of an alternative HYP, because I hold quite a few ITs. Most of my SIPP is ITs.

If the intention is a more all-encompassing definition, then a bit more work is required.

MDW1954

Arborbridge
The full Lemon
Posts: 10371
Joined: November 4th, 2016, 9:33 am
Has thanked: 3601 times
Been thanked: 5227 times

Re: Another HYP

#439358

Postby Arborbridge » September 3rd, 2021, 12:20 am

Wizard has invented an HY portfolio - magic! But why call it a HYP when that name is already recognised here as something else?

Naturally, people can discuss any HY strategy here - that is the purpose of the board - but to pretend that this new thing it is what most posters would accept as a HYP is disingenuous. Setting up a rival HY portfolio and using the same name is either unimaginative or provocative. No, it's downright provocative, end of.

I am left with the suspicion he is launching yet another attempt to kill off the HYPP board - but it's so transparent. Why he developed such a dislike of HYP and its board can only be imagined. Perhaps he will tell us one day.

Arb.

Itsallaguess
Lemon Half
Posts: 9129
Joined: November 4th, 2016, 1:16 pm
Has thanked: 4140 times
Been thanked: 10023 times

Re: Another HYP

#439370

Postby Itsallaguess » September 3rd, 2021, 6:18 am

Wizard wrote:
There has been some recent discussion around 'ownership' of the HYP acronym.

It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version.

So why not another version?

But what might the rules of this new version be, my starter for 10 would be as follows:

<snip>


Can I just politely ask how far you've thought this particular idea through?

Let's say that you eventually end up with a new set of 'HYP' guidelines, with your list of quite granular and presumably quite 'tight' rules, and I'm only saying 'tight rules', because if they're not tight, then I'd have to ask - why have them?

So, what then?

If someone else has got a different flavour of 'HYP', but they want to discuss it on this board, isn't it going to be a little difficult to discern just which 'flavour' of HYP is being discussed at any given time?

And if it is, that's likely to be a recurring theme, I'd have thought, what with all these different flavours of 'HYP' flying around, so you might ultimately prefer a separate board where 'your' flavour of HYP can be discussed by those following your new guidelines, and where people running other types of 'HYPs' are politely asked to stay away from, so as to avoid the type of multi-HYP confusion discussed above....

And if you got your separate board, what would be to stop people holding different flavour HYPs wanting to discuss 'their' HYP flavour on it, with everyone using the word 'HYP' to then describe different 'guideline-led' processes on 'your' HYP board?

I hope you can see where I'm going with this, because I'm sorry to say (and I'm more than a little perplexed to *see*....) that you actually seem to be setting off at the start of a journey that ultimately led to the *exact* 'HYP Practical' situation that you regularly look to disparage....

So like I say - have you really thought this particular approach through?

Cheers,

Itsallaguess

Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Re: Another HYP

#439480

Postby Wizard » September 3rd, 2021, 3:32 pm

Itsallaguess wrote:
Wizard wrote:
There has been some recent discussion around 'ownership' of the HYP acronym.

It is acknowledged that HYP as defined in HYPP is not the same as the original PYADic version.

So why not another version?

But what might the rules of this new version be, my starter for 10 would be as follows:

<snip>


Can I just politely ask how far you've thought this particular idea through?

Let's say that you eventually end up with a new set of 'HYP' guidelines, with your list of quite granular and presumably quite 'tight' rules, and I'm only saying 'tight rules', because if they're not tight, then I'd have to ask - why have them?

So, what then?

If someone else has got a different flavour of 'HYP', but they want to discuss it on this board, isn't it going to be a little difficult to discern just which 'flavour' of HYP is being discussed at any given time?

And if it is, that's likely to be a recurring theme, I'd have thought, what with all these different flavours of 'HYP' flying around, so you might ultimately prefer a separate board where 'your' flavour of HYP can be discussed by those following your new guidelines, and where people running other types of 'HYPs' are politely asked to stay away from, so as to avoid the type of multi-HYP confusion discussed above....

And if you got your separate board, what would be to stop people holding different flavour HYPs wanting to discuss 'their' HYP flavour on it, with everyone using the word 'HYP' to then describe different 'guideline-led' processes on 'your' HYP board?

I hope you can see where I'm going with this, because I'm sorry to say (and I'm more than a little perplexed to *see*....) that you actually seem to be setting off at the start of a journey that ultimately led to the *exact* 'HYP Practical' situation that you regularly look to disparage....

So like I say - have you really thought this particular approach through?

Cheers,

Itsallaguess

I'm just trying to get input on what a further evolution of an HYP might be, beyond the version defined on HYPP. Any such discussion would be off topic for HYPP itself. No desire for another board or to create a new religion, if others think there should be other modification of any such approach that is up to them and it is their portfolio. I thought the whole idea of the two boards was that HYPP was for the discussion of specific tactical points of a specifically defined version of HYP, and HYPSS included inmits remit the discussion of other strategies to the version of HYP that is discussed on HYPP.

Wizard
Lemon Quarter
Posts: 2829
Joined: November 7th, 2016, 8:22 am
Has thanked: 68 times
Been thanked: 1029 times

Re: Another HYP

#439483

Postby Wizard » September 3rd, 2021, 3:38 pm

Some very helpful input around collective investments in particular. I would therefore suggest the following revised rules...

This HYP approach is one that invests on a Long Term Buy and Hold (LTBH) basis in a diversified portfolio of shares and collective investments. Those investments should:

Not be limited to shares listed in London.
Be ordinary shares, preference shares, shares in investment companies, investment trusts and other collective investments.
Any collective investments should be largely invested in quoted equities.
When bought, shares or preference share should be issued by companies that have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE100 index.
When bought, collective investments should have a market capitalisation large enough such that if listed in London they would be a constituent of the FTSE350 index.
When initially bought, have yields greater than the yield of the FTSE 100 index.
When bought, be reasonably expected to sustain their dividends in the future.

Any further thoughts?


Return to “High Yield Shares & Strategies - General”

Who is online

Users browsing this forum: No registered users and 10 guests