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We had some very interesting purchases and sales between FTSE 100 actions in November.
Hindsight is of limited value. But it can give us an idea of how sentiment might be changing. And in a key sense, it seems to me that it is.
I am going to select a few here, based on the operations carried out at the investment services company. AJ Bell.
Dividends are back
All year I have been harping on about how I rate the investment manager. M&G as purchase.
It's the kind of company that can suffer when people withdraw money from their investments to spend on food and mortgage payments. So, a higher than average risk, I would say.
But share price weakness helped boost dividend yields among the biggest FTSE 100 stocks.
Even now, after topping AJ Bell's November buy list, we're still looking at a 9.4% forecast.
Get benefits?
Rolls-Royce holdings is one of the most talked about stocks of 2023. And having tripled so far this year, those smart enough to buy have done very well. That's not me, of course, I'm clearly not that smart.
Still, my main fear in recent months is that the price has gone too high now.
The new CEO, Tufan Erginbilgiç, has set ambitious goals for the coming years. But I'm always cautious about buying stocks on a wave of optimism.
Interestingly, Rolls-Royce was the best-selling stock in November.
The return of value?
From these commercial figures I deduce one key thing.
It looks like good old-fashioned value investing might be back in fashion.
We see actions like those of home builders. Khaki and Taylor Wimpey making a comeback.
I also see people getting fond of British American Tobacco, after months of turning his back on him. I know, it's smoking and all that. So, yes, that is the clear risk.
But British American is a leader in next-generation tobacco products. And it's been almost painful to see the low stock valuation and great dividend yield.
never too late
I think the market could be moving away from short-term sentiment investing and toward a long-term value approach. It is a regular cycle.
I wonder why so many people left it so late.
For me, the best time to buy depressed value stocks is when they are, well, at their most depressed. When pessimism dominates the outlook and fills the financial headlines.
Still, many of us don't like to take risks in such dark days. And I can't really fault that.
Make our own decisions
Each of us has to determine our own approach to risk and how much we are willing to take when we contribute our hard-earned money.
That's why I didn't buy Rolls-Royce shares when they were so low. And I didn't triple my money in 2023.
Well, at least the market is starting to agree with me on some of my favorite stocks for 2024.
Let's toast to a prosperous and valuable New Year!
