Bye-Bye Bottle Bank: 10 Things We Learned This Week

As 2022Outlook week draws to a close at Morningstar.co.uk, we reflect on the week's nicher lessons...

Ollie Smith 17 December, 2021 | 3:01PM
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Bottle bank

The Bank Wasn’t Gonna Bottle it a Second Time

Having blindsided markets once by keeping interest rates static last month, the Bank of England could not hold any longer and opted to increase the bank rate by 0.15% to 0.25% on Thursday last week. They were previously 0.15%. Bye bye unreliable boyfriend act.

It’s Looking Good For Dividends

Expectations regarding dividend yields for 2022 differ. Link Group expects UK PLC, which is all listed shares that pay dividends, to yield 3.5% over the next twelve months. AJ Bell, meanwhile, expects yields for the FTSE 100 to be even higher in 2022 at 4.1%. Investment director Russ Mould also predicts the recovery theme to continue into next year, with 97 FTSE 100 companies paying dividends, compared with 95 in 2021 and 84 in the annus horribilis of 2020.

It’s No Time To Celebrate Diversity Data

Editor’s column duties this week fell to Morningstar data journalist Sunniva Kolostyak, whose contributions to our 2022Outlook week included this special article on the appalling lack of data covering diversity, equity and inclusion within financial services (and society at large).

Joe Biden is About to Have a Miserable Christmas

It’s not going well for Joe Biden’s Bounceback Bill. The president’s post-pandemic rebuild legislation is currently passing its way through congress, and is now facing significant problems in the form of Joe Manchin, the so-called “lynchpin” senatorial voter whose support could make or break the package’s prospects. At the moment it looks like more the latter, as this piece explored.

Bad Boards Aren’t Communicating With Staff

Fund manager Gervais Williams spoke to Morningstar team this week, and gave his take on what might be next for multi-cap investing in 2022. In the video interview, he described his dismay at companies of all shapes and sizes that fail to communicate properly with their staff. One can only imagine which businesses he is specifically referring to…

Buffett Isn’t Always Right

Warren Buffett famously remarked that investors should only buy what they are familiar with, but when it comes to 2022’s anticipated floatations, you would be wise to think. In particular: just because you use a company’s services and are impressed by its efforts, does not necessarily mean it will become a stock market darling. Proceed with caution.

Vanguard Isn’t The House Jack Bogle Built

Among our most popular reads this week was an in-depth analysis of Vanguard’s business model, written by our colleague and columnist John Rekenthaler in the US. In it, Rekenthaler argues that, though Vanguard still has an enviable business model, it has had to sacrifice or at least compromise certain of the tenets that made it famous. The mind Bogles.  

There’s a Difference Between Crypto Acceptance and Adoption

Cryptocurrencies benefited massively from the fear-of-missing-out effect in 2021, but it turns out there is a difference between the “acceptance” of crypto assets and their “adoption”. The former  denotes payment for goods using crypto, while the latter is all about trading frequency. It’s the latter that we are really keeping an eye on next year.

Healthcare Just Got a Clean Bill of, er, Health

There are plenty of stocks that look too expensive at the moment. But according to Killik & Co’s associate investment director Rachel Winter, healthcare companies could really turn heads next year. Among them is UnitedHealth Group (UNH), whose data arm is transforming the way that patients are treated. Hardly a bleak mid-winter at all.

Not All Managers Are Avoiding Chinese Tech

An interesting conversation between two of Morningstar’s brilliant data journalists revealed this week that not all China equity fund managers have ditched the country’s technology giants. In this video, Kate Lin explains to Sunniva Kolostyak that one fund she found had not held Alibaba since June 2020 was rebuilding its position earlier this year. Certain managers are also holding fast on their JD positions too.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Ollie Smith  is editor of Morningstar UK