Weekend reading: End of summer update

My weekly commentary followed by my weekend news and blog links round-up.

A quiet week on Monevator due to my short canal break hides lots going on behind the scenes.

With the days getting shorter and the crops being harvested, it’s a good time for an update on this blog and the markets.

Quick holiday report

A few readers were kind enough to ask how my holiday went. It was fantastic! Most of my worries about dad evaporated once we were on the boat, and it was me who fell into the canal, not him!

The trip prompted a reasonable amount of soul searching like all good breaks should, and in turn that’s inspired some article ideas.

If you’re in the UK and fancy traveling along a stretch of largely unspoiled (although in places over-shallow) water, I definitely recommend the hire company we used, Cambrian Cruisers.

The husband and wife team of Jonathan and Camilla were very friendly and thorough (and if they’re reading this, I trust they’ll preserve my anonymity!)

The trip wasn’t cheap at around £900 given the short duration though, so it’s best shared between several paying adults if possible.

Blog update

Regular readers will know that Monevator isn’t exactly a lucrative venture. I’m now making more than $1 a day from blogging, but it’s still nothing like paying for the time I put in.

I think being in the UK doesn’t help, for various reasons. Focusing on investing and getting richer rather than getting out of debt doesn’t help either. Finally, I don’t really fill the blog with ads, let alone peddle dodgy money making guides.

One thing I could do more of is to independently review bank accounts and credit cards, which pay commission for anyone who signs up from your site. It could be good for readers, and my bank balance. But the UK affiliate people weren’t anything like as geared up for blogs as the US ones last time I looked.

While I’d love Monevator to be a part-time job then, it’s currently more a full-time hobby.

On that metric, things are progressing slowly but surely. Visitor numbers are inching up. You’ve probably noticed more comments on the blog, and several fellow personal finance bloggers have been kind enough to link to my articles or run guest posts from me. A couple have offered much appreciated tips through email.

The most important metric is there’s very nearly 500 of you now subscribing for regular Monevator updates via RSS or email subscription, while over 200 people now follow Monevator on Twitter.

I’m proud and touched by your interest and support. (And please do feel free to spread the word!)

Stock market update

I don’t know if it’s a problem or part of the charm of this blog, but readers may have noticed an element of “do as I say, not as I do” about it.

For instance, while I’m intellectually committed to index tracking and believe passive investing is best for most people, I personally also trade shares, some of which I discuss on Monevator.

I’ve given up worrying about this from a blogging perspective. It’s me, and a blog is nothing if not honest. I’ve no intention of giving readers half the story to create a pure but false impression.

What does worry me is how my asset allocation has gone out the window with my own personal portfolio. I am now 90% in equities, albeit distributed across the spectrum and world, and including venture capital trusts.

Roughly half of this in passive vehicles of one sort or another, the rest is in stocks or collective investment trusts.

How has this happened? Throughout the bear market I’ve been buying shares, throwing my last non-ring-fenced cash reserves into the market back at the March lows.

This has been great for the past six months, but after such a giddy rise it’s hard not to feel vulnerable.

While I’m still youngish and can afford to risk massive equity exposure, I’d ideally have at least 25% of my portfolio in government bonds. But I simply can’t bring myself to buy them at these low yields!

I think the corporate bond opportunity has largely passed now, but I’d be happy to hold more cash. My move back into commercial property in June has gone very well, but that recovery is surely correlated with equities at the moment.

My pure passive investing friends will wince, but these short-term issues do present challenges. I still think stocks are attractive after two bear markets in a decade, but I don’t deny the outlook is choppy after such a strong rally.

What I may do is move some of my index funds into more defensive shares such as GlaxoSmithKline, the drugs giant. Lots of similar shares at the value end of the spectrum seem to have been left behind by the rally (utilities are another example) and may provide something of a halfway house should the markets turn south again.

The fact is these have been extraordinary times, and out-of-the-box thinking has served me pretty well in the past two years of crisis.

The next few months on Monevator

Most immediately, I have another cracking post in the wings from Tim at the highbrow Psy-Fi blog. Look out for that next week.

I also need to finish up my series on corporate bonds, borrowing to invest and rebalancing your asset allocation.

Beyond that I want to look more at the housing market, which is showing frustrating signs of life (I’m currently renting) and connected to that I have some ideas for posts asking what we’re all investing for.

Please do stay tuned, and let me know if there’s anything you’d like to see or want to share, either in the comments below or privately.

Some interesting financial blog posts

• Money Energy has posted an extremely detailed investigation into different ways to buy gold.

• Frugal Dad has a guest post from Financial Highway on five ways to destroy your investment portfolio.

• The Weakonomist is sick of tipping, but I don’t see anything changing. The malaise is spreading from the US, and employers have gotten used to us subsidizing service out of moral guilt.

• Don’t forget to download this free book from Oblivious Investor before the end of the month!
  

• The iii blog rejects Business Post Group for its Thrifty 30 portfolio. (I think it looks tempting, but that’s what makes a market!) Author Richard Beddard and Monevator were both tipped as personal finance Twitterers to follow by The Motley Fool last week.
  

• Amateur Asset Allocator has some tips on investing in a low return environment.

• Len Penzo explains everything you could want to know about the economics of rechargeable batteries.

• Five Pence Piece is a new-to-me British personal finance blog. It’s more about money saving than investing, and the author Lee is very enthusiastic. Here’s how he cooks in batches to save cash.

• Shrewd Cookie has a wallplanner available as a free download. Can’t beat free, but it isn’t really that focused on finances. An idea for Version 2? (Via MoneyWatch).

The pick of the weekend newspapers and sites

• There hasn’t been this many small investors trading shares since the dotcom boom, says the FT. Not a very bullish sign.

• Dividends are still falling in the UK, which is giving equity income managers a hard time. (FT)

• Kevin Goldstein-Jackson holds various Falkland Island investments that did well this week. (I regret not buying Falkland Island Holdings when I looked at it earlier this year, although it’s been a bouncy ride). (FT)

• The Economist has a typically detailed article on the luxury goods sector, particularly France’s LVMH.
  

• You can get 5% on cash savings if you lock up your money for five years. (I wouldn’t). (FT)

• The UK government scheme offering cash for old cars is running out of money, says The Independent. Move fast if you want to benefit.

• Buffet’s taste in suits has boosted shares in their Chinese manufacturer. (Those investors might not be so impressed if they’d read about his dress sense in The Snowball.)

• Emerging markets have further to go, says Robin Geffen in The Independent.

• On that note, The Motley Fool likes the look of emerging market fund managers. Charlemagne looks particularly interesting.

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