Investec prefs

[OldBoyReturns]

Latest (swaps/futures) market-implied UK policy (base) rate curve (in brackets: the recent market-implied lows at year-end 2023). Goes to show how the market has repriced from an overly optimistic rate-cutting frenzy to a more orderly path.

Current: 5.25%
3mth: 5.21% (5.20%)
6mth: 4.96% (4.80%)
1y: 4.40% (3.74%)
2y: 3.84% (2.99%)
3y: 3.64% (2.85%)

Is there some public website from which this information can be got? I can find it for US but could not find it for UK.

There is a lot of useful info on the Chatham Financial site:

https://www.chathamfinancial.com/techno ... rket-rates

[BondSquared]

https://www.chathamfinancial.com/techno ... rket-rates

If you click on the tab "Forward Curves" then the "3 Mo. Compounded SONIA" graph is somewhat of a proxy for base rate expectations. Not perfect but gives you the right post code.

[OldBoyReturns]

Today's BoE MPC decision to hold base rate at 5.25% means the next INVR dividend (determination period 6 months to 31 March) will be 31.25p per share as base rate will have been at 5.25% for the entire 6 month period.

Next MPC meeting will be on 9 May so that guarantees at least another 39 days based on the current rate.

Also Investec released a positive trading statement yesterday:

https://www.londonstockexchange.com/new ... t/16385556

[Padders72]

Today's BoE MPC decision to hold base rate at 5.25% means the next INVR dividend (determination period 6 months to 31 March) will be 31.25p per share as base rate will have been at 5.25% for the entire 6 month period.

Next MPC meeting will be on 9 May so that guarantees at least another 39 days based on the current rate.

Also Investec released a positive trading statement yesterday:

https://www.londonstockexchange.com/new ... t/16385556

Good news certainly, and I note the price has held steady around 530p recently despite suggestions above it will tank.

One slight worry is that it was noted in the media recently that Investec have a presence in the UK car finance market, which is of course currently under investigation due to the dubious practice of discretionary commission. They are not one of the bigger players implicated (others include Lloyds, Close Brothers etc) but nevertheless have some exposure. I'll try to find a link, I think it was in the Times. It didn't suggest major exposure.

[bofh]

A Fitch report published in January noted:

We estimate that Lloyds and Barclays generated over GBP8 billion in pre-impairment operating profit in 2023, Santander about GBP2.5 billion, and Investec about GBP500 million. Close Brothers recorded GBP316 million in its last full-year accounts.

https://www.fitchratings.com/research/banks/uk-banks-misconduct-risk-is-highlighted-by-fca-motor-finance-probe-26-01-2024

The Times article from 14th March stated:

Investec said the provision was included in guidance for adjusted operating profit of between £867 million and £910 million, an increase from £819 million for the 12 months ended March last year.

https://www.thetimes.co.uk/article/investec-sets-aside-funds-for-motor-finance-inquiry-bqnczjtkk (paywall)

I guess we'll find out more in a couple of weeks when Investec publish results (May 23rd).

I note price is back to 570p today.

[88V8]

....over the next twelve months I give you four certainties:

1 The SP of GACA will rise, such that I will be able to sell for more than the 126.5p I paid today, or sell previously by tender.
2 The SP of INVR bid to bid will fall by more than the received divis of March and September.

For the record, my selling price for INVR last Friday was 519p, so that's my starting bid point for 12 months' time.
V8

I note price is back to 570p today.

I am beginning to have a feeling that my timing and prediction might have been slightly off.
Never mind, I will be right eventually

V8

[Walkeia]

To state the obvious - a significant portion of the recent share price 'performance' can be attributed to the upcoming dividend declaration and ex-dividend date in early June. Added a holding today as it compliments my predominantly passive portfolio well

[Padders72]

For the record, my selling price for INVR last Friday was 519p, so that's my starting bid point for 12 months' time.
V8

I note price is back to 570p today.

I am beginning to have a feeling that my timing and prediction might have been slightly off.
Never mind, I will be right eventually

V8

The buy price may be 570p but the sell is only 560p in fact. Still rather more than the 519p you sold at but then again GACA has put on a nice gain in the same time frame (its 132.7p to sell right now) to don't beat yourself up about it just yet. Who knows, the picture may have reversed in Feb. I was skeptical of your claims but I hold both so win either way

[phil57]

Bought a few of these today, at 608p I guess Mr Market thinks rates are not going down any time soon, as do I.

[GoSeigen]

Bought a few of these today, at 608p I guess Mr Market thinks rates are not going down any time soon, as do I.

Yeah weird today the quotes were actually slightly backwardated.

GS

[Padders72]

I was getting quoted 580p buy today by ii so 608p sounds pricey but maybe you were after some volume and had to pay a premium. I’ve got a few of these now and I like them a lot.

[phil57]

Ha! Not that many, just £8k's worth. I think on reflection I was naive to say to the AJ Bell guy over the phone that it was OK to buy 'at best' instead of putting a limit buy order on via the website, and so I got 'stuffed'. The website quote was 575-595 but that was indicative only, no dealing available online.

I should know better, having been a money broker back in the dim and (very) distant past! Ah well, lesson learned

[Padders72]

Ha! Not that many, just £8k's worth. I think on reflection I was naive to say to the AJ Bell guy over the phone that it was OK to buy 'at best' instead of putting a limit buy order on via the website, and so I got 'stuffed'. The website quote was 575-595 but that was indicative only, no dealing available online.

I should know better, having been a money broker back in the dim and (very) distant past! Ah well, lesson learned

Don't worry about it, after the next dividend it will just be noise. I decided to hold these on the expectation of a full % drop in rates over the course of 2025 at which point they would still be yielding over 8% on the current price. It now seems that might not be the case after all so even better.