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Equity Insight

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Not only are we having to contend with the ever present and seemingly endless Brexit negotiations but we are now having to suffer lurid press headlines in regard to vast hordes of politicians who can’t seem to keep their hands under control.  No doubt we shall hear more about the do’s and don’ts from Clive and Caroline and possibly what are the consequences from Chris!

We have today received notification from the Monetary Policy Committee of the Bank of England that interest rates have risen by 0.25% to 0.5%.  For some this is historic as not only will it be the first time that rate have risen in over 10 years but also possibly the first time ever that they have doubled in a single day!

Given all these changes I thought that you should have a read of the latest Equity Insight – Issue 660.  There are some views on what is happening to the markets but also some thoughts on how business is reacting and positioning itself for a number of potential outcomes.

Feel free to contact me if there is anything of interest in the Equity Insight that you might like to discuss on either my mobile 07711 710 628 or my email address Rupert.harvey@redmayne.co.uk.

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3 business lessons from the movie Hidden Figures

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Inspiration in business can come from the strangest places. The other evening I was watching the film Hidden Figures. It tells the true story of a group of African-American women who played a crucial role in the space race for NASA during the 1960s. It’s an inspiring and moving story of their fight against prejudice and discrimination in an America that still had segregation. 

It’s a great film, well worth watching, but next day I realised it had a lot of messages about building successful businesses.

One of the three main characters is Dorothy Vaughan. Dorothy headed a 30-strong segregated team of ‘human computers’, women who made the complex mathematical calculations needed for space flight by hand. The film tells how she realised that the new IBM computer would soon replace her job, so she took matters into her own hands, taught herself the programming language Fortran then trained her entire team in it too.

There are three key things all of us can learn from Dorothy Vaughan’s story.

1.      She had her eyes open

Dorothy identified and understood the threat to her livelihood – she was alert to the changes going on around her. Are you looking to see trends and developments in your particular marketplace? Are you awake to changes? What are the threats to your business right now? These may not be technical, as in Dorothy’s case, but may pose just as big a threat.

Too many business owners have their heads in the sand, focusing purely on what they are doing – and the way they have always done it. Develop a strategy for making yourself aware of the changing business environment.

2.      She embraced the change

Dorothy Vaughan refused to be left behind. She didn’t moan or complain about her bad luck, being a ‘human computer’ just when a machine that could do 24,000 calculations per second was being launched. She equipped herself with the knowledge to take advantage of the brave new world of machine computers.

And it wasn’t easy – in the film, the book she needs to teach herself programming is in the ‘white only’ section of the library where she is not allowed to go. So she ‘borrows’ it as she is thrown out by police, telling her son ‘I have paid my taxes, you can’t steal something that you have already paid for’!

As an African-American woman in the segregated south of the USA, Dorothy faced just about every level of opposition she could. Her determination and effort made the difference; through her struggle she positioned herself as the go-to expert.

As Charles Darwin said, ‘it is not the strongest species that survive, nor the most intelligent, but the most responsive to change’. Dorothy took a threat and turned it into an opportunity.

3.      She took her team with her

Throughout her career Dorothy Vaughan was an advocate of women of all colours. Having learned Fortran, she taught her team, so that when NASA realised it needed more programmers, she could meet that need with her team, thus keeping them all in a job.

Investing in your team, keeping their skill set up to date, is crucial for any business to grow. If you find yourself unable to trust your workforce with tasks, ask yourself if you have equipped them with the skills necessary. A chain is only as strong as its weakest link!

In a rapidly changing business environment, we all need to be looking at what’s coming down the line. We’ll need to adapt, to develop our skills, and ensure our team is ready too.

Now, the big question is who to cast in the lead role of ‘Altus – The Movie’?

 

 

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Should we fear October

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Should we fear October?

11 October 2017

October is considered by many to be the scariest month. This year, not only do we have Friday the 13th to contend with, in addition to the traditional Halloween mischief night and trick or treating, but seasoned investors may know that October is historically one of the most volatile months for stocks.

Additionally, for those of you who are superstitious, 2017 may bring extra dread if you believe the ‘curse of the number 7’. This relates to the theory that the month of October suffers especially significant drops, in particular, in years ending in the number 7.

The most well-known cases of this phenomenon were in 2007, 1997 and, of course the largest of drops, known as ‘Black Monday’, in 1987.

On 19th October it will be 30 years exactly since ‘Black Monday’, when the FTSE 100 index dropped by 12.2 per cent and the Dow Jones plummeted by almost 22 per cent in just one day, falling by 508 points. This still stands on record as the biggest single-day percentage decline.

However, despite the dramatic falls, the crash of 1987 was relatively short lived. During the next two trading days, the Dow gained nearly 300 points and the market actually finished the year above where it started.

The stock market is resilient and has recovered from difficult times. When considering the month it is worth remembering that past performance is not an indicator of future results. October is actually one of only 3 months in the year when the FTSE 100 tends to outperform the mid-cap FTSE 250. This could be due to the fact that October signals the end of the weak trading period, starting at the beginning of May, caused by the ‘Sell in May’ effect.

Additionally, on average, markets in October tend to rise in the first fortnight of the month before falling back. The last few days of the month tend to see a rise and the last trading day of the month usually has the best record of any month’s final trading day.

This year could be a positive one for October, as gains in the market have successfully navigated August and September, the worst two-month stretch of the year, based upon historical performance. If this trend continues in October we could see even stronger gains in the market going into 2018.

However, with the threat of a potential rise in interest rates, tightening monetary policy in the US and the conflict between the US and North Korea and other geopolitical factors it may be worth keeping a look out for signs of potential volatility.

Be prepared to react but keep a level head, don’t panic and think about the longer term. Having confidence in your portfolio and holding well-thought-out investments with long-term strategies should help you to stay calm when others may not.

Additionally, if stocks do fall in October, as history suggests, then this could actually present buying opportunities, especially if stocks become attractively valued.

Of course, if you find that you lack the time or opportunity to monitor your portfolio then you may wish to entrust the running of your portfolio to a qualified Investment Manager, obviously I would be only to happy to help out.  Please contact me on 07711 710 628 or Rupert.harvey@redmayne.co.uk.

Please note that investments can fall as well as rise in value and past performance is not an indicator of future results.

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Equity Insight

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We continue to live in volatile times and global equity markets are reflecting this.  We have seen geopolitical tensions rise as North Korea continues to ‘tease’ the Donald and the on-going drama of the Europeans and British negotiators speaking in foreign tongues making the perfect antidote for insomniacs.  Even mother nature is getting a little restless by sending a few ‘gusts’ around the world!

Given all of the above I thought it worthwhile to add another bit of useful information about shares and the rights of shareholders in the this link Equity Insight – Issue 656.  As always feel free to get in touch if there is anything that you might feel inclined to talk about.

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As many young people get ready to head off to uni, and the latest batch of graduates enter the job market, it’s worth taking a look at what the apprenticeship system can offer individuals and businesses.

We all know that having a well trained workforce is essential. Just over half (54%) of small firms say being unable to recruit the right person has hit them financially. Well, why not create the right person?

We are seeing the benefits of that ourselves at Altus. Chloe Handy joined us almost a year ago now. She has spent 1 day a week studying at Stourbridge College, while learning with us in the ‘real world’. She has recently gained an excellent 87% merit pass in her AAT Level 2.

The apprenticeship has worked for Chloe, giving her the opportunity to study for a qualification while gaining practical experience in a ‘proper job’. It has also worked for us because we have gained an employee that we can train from the ground up in the ethos and culture of the way we do things here at Altus. From a financial perspective we enjoy a ‘discount’ from the minimum wage in the early stages when the apprentice is learning the role and we got a small grant towards all this too.

Chloe is not our first apprentice. Amy also joined us as an apprentice and has developed into a highly valued member of the team having moved from administration to payroll and now bookkeeping. Christian also developed his skills through the apprenticeship route, although not with us here at Altus.

Of course, as with all recruitment, getting the right person is vital and apprenticeships should certainly not be seen as a short-cut to the recruitment process. The difference is that you are looking for potential not the completed package.

In May there was a change to the way the apprenticeship scheme is funded. This included a new concession for firms with less than 50 employees taking on apprentices aged 16-18. While large employers will have to contribute 10% of training costs, this will not apply to those small firms. Instead the Government will pay 100% of the training costs.

Because 16-18 year-olds can incur additional costs to support in the workforce – such as needing more supervision and pastoral care – employers will be given £1,000 towards this.

There’s also cash help for taking on apprentices from deprived areas, who were in care or have an Education and Health Care plan. A flat rate of £471 for training will also be given if the apprentice still needs to reach minimum standards in English and Maths.

The changes are underpinned by the new apprenticeship levy paid by employers with a pay bill of over £3 million. The plan is to double investment in apprenticeships by 2020.

Taking on an apprentice can have lots of benefits for a business, allowing you to grow your business by training up a workforce to meet your specific needs.

 

 

 

 

 

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