Diversification is often said to be ‘the only free lunch’ when it comes to investing, and funds are perhaps the simplest way to achieve this.

Any investment fund represents a bundle of stocks, adding instant diversification to your portfolio. So, does it follow that more funds means more diversification and better returns, or is there a limit to how many funds it is sensible to hold?

“The key is to build a diversified portfolio because this helps you weather different market conditions,” said Clare Francis, savings and investments director, Barclays Private Bank and Wealth Management. “Diversification means spreading your money so it’s invested globally, giving you exposure to different countries and sectors, with a mix of shares and bonds.”

This can be achieved, Francis added, by using a single fund, which some platforms offer as ‘ready-made’ options.

“They invest in a mixture of bonds, shares and cash and they invest globally,” she explained. “The way they differ is the level of risk each fund takes, so all you need to do is pick a fund that best suits the level of risk you feel comfortable with.”

But it sometimes makes sense to hold more than one fund or investment trust in your portfolio. What are the benefits, and what is the ideal number of funds to hold?

Why might you want to hold more funds?

If you are a beginner investor, it can make sense to start out small and diversify your fund holdings from there.

“We see many investors start with a ready-made fund and add additional funds, or even buy shares in individual companies, once they get more confident,” said Francis. “If you don’t want to go down the ready-made route you can create a diversified portfolio yourself by buying individual funds that each invest in a different part of the market such as the UK, US, Europe, Asia and emerging markets.”

Some funds are more suitable for beginners just starting to build their portfolio. If you feel less confident, keep it simple to begin with – there is very little to be gained from adding a fund that you don’t understand to your portfolio when there are ready-made options out there that can take a lot of the decision-making off your plate.

Once you are more confident, you might want to add more funds to your portfolio in order to gain exposure to specific investment themes or sectors.

“If you prefer to build your own diversified portfolio, around 10 well selected funds can be more than sufficient to provide diversification across different asset classes, regions, market capitalisation and styles,” said Dzmitry Lipski, head of funds research at investing platform Interactive Investor.

The disadvantages of holding more funds

Adding more funds to your portfolio doesn’t necessarily mean you’re increasing your level of diversification.

“Holding too many funds can create unnecessary complexity and may result in investors owning overlapping investments without realising it,” said Barclays’ Francis.

Realistically, the more funds you hold, the less each is going to contribute to your overall returns.

“If you hold more than 20 funds, it is probably worth reviewing whether each one has a clear role and is genuinely adding something different to the portfolio,” said ii’s Lipski. “Too many funds can make a portfolio unnecessarily complicated and harder to monitor and rebalance.”

The more funds you hold, the higher the likelihood that several of them are duplicating exposure to the same stocks or assets – so holding more funds, beyond a certain level, doesn’t necessarily mean greater diversification.

“Rather than focusing purely on the number of funds, investors should ask what role each holding plays and whether it adds something genuinely different,” said Lipski.

Does the size of your portfolio impact the number of funds you should hold?

There’s no real reason why the size of your portfolio should dictate the number of funds you hold. Regardless of size, your portfolio is likely to be allocated based on percentages of the total. Your risk appetite and other factors will dictate what percentage of the whole you allocate to different sectors and asset classes.

“The size of the portfolio matters less than its overall asset allocation and the role of each fund. A large portfolio does not automatically need more funds,” said Lipski. “Someone with a relatively small portfolio can obtain broad diversification through one multi asset fund, while investors who want greater control over their asset allocation may choose several funds.

“If a fund represents less than around 2% of your portfolio, it is worth asking whether it is large enough to make a meaningful difference to overall returns or risk,” he added. “There may be good reasons for a small specialist allocation, but very small holdings can otherwise add complexity without materially changing the portfolio.”

Most people expect that if they still have money left in their pension pots when they die, their spouse or children will inherit it.

While you can pass on a pension, you cannot do so solely through your will.

Instead, most people will need to tell their pension provider who to pay their pension to when they die through a form.

Why you can’t leave your pension in a will

Under current rules, you are not able to leave a pension in your will.

This is because pensions are not treated as part of your estate in the same way as your other assets and are therefore not included in the remit of your will.

That means if you mention your pension in your will, your provider is not legally bound by the request. Instead, you will need to fill out an ‘expression of wish’ or ‘nomination of beneficiary’ form with your provider to choose an inheritor.

Pensions will be treated as part of your estate for inheritance tax purposes from April 2027, but you will still not be able to leave it in your will.

That doesn’t mean you shouldn’t mention your pension in your will though.

It is still good practice to name who you want your pension to be inherited by in your will, as well as an expression of wish form, as your pension provider will likely take this into account despite not being legally required to.

How to pass on your pension

To pass on your pension, first and foremost you should check what the specific procedure used by your pension provider is, as some may have slightly different arrangements.

However, broadly speaking, pension providers will usually have a ‘nomination of beneficiary’ or ‘expression of wish’ form that you fill out to tell them who you want your remaining pension wealth to be inherited by.

Your beneficiary can be one person (for example, your spouse), multiple people (like your children or grandchildren), or even an organisation like a charity.

For a defined contribution pension, the beneficiaries will usually be given the choice of what to do with the money. Depending on your pension scheme, they may choose whether they take it as a lump sum or leave it invested and draw an income from it.

If you have a defined benefit pension, you will not have a pot of money left after you die. Instead your specific pension scheme will decide what is paid to your beneficiaries.

Sarah Pennells, consumer finance specialist at Royal London, warned that as pension beneficiaries are worked out from your nomination form, it can be easy to forget who your pension will be paid out to when you die.

“It's important to keep these forms up to date, especially after major life events such as marriage, divorce, having children or entering a new relationship. A form that you filled in 20 years ago may not reflect your current situation,” she said.

Note that this only applies to private or workplace pensions. Under most circumstances, you cannot pass on your state pension after you die.

What happens to an annuity after you die?

Some people choose to buy an annuity with their pension wealth to get guaranteed income in retirement.

If you have an annuity, you should be aware that there are different rules for what happens to it after you die – some annuities pay money out to beneficiaries while others do not.

Pennells said: "If you've already used your pension savings to buy an annuity, what can be passed on will depend on the type of annuity you chose.

“For example, a joint-life annuity can continue paying an income to a spouse or partner after your death, whereas income from a single-life annuity will normally stop when you die unless it includes features such as a guarantee period.”

To make sure you and your loved ones are prepared, you should check what your annuity’s policy on inheritance is and plan accordingly.

It could be useful to produce a short document containing useful information about your financial affairs, which your executor and heirs can easily find after you die.

Pension provider Royal London has put together a template document called “When I’m Gone”. You can include details about which pension provider(s) to contact, as well as the location of your will and your funeral wishes.

As the investing truism goes, time in the market is better than timing the market. The spirit of this adage is that it’s generally better to sit tight and hold onto your investments rather than frequently buying and selling.

It’s impossible to know, without the benefit of hindsight, whether you’re selling one of your top stocks or funds at its peak price, or if in doing so you’re potentially missing out on future gains – so the best thing to do is usually to sit tight and let the tendency of the stock market to rise over time do its thing.

“Knowing when to sell a share can be one of the most difficult decisions an investor can face,” said Richard Hunter, head of markets at investing platform Interactive Investor (ii).

After all, when you first bought the stock, you hopefully did thorough research on the company and its prospects, and had conviction that it was set for success in the long run.

“The position becomes less clear as human psychology kicks in,” said Hunter. “If the share price has declined, there is a natural reticence to hold on to the shares rather than sell and admit defeat, even if prospects have obviously deteriorated.

“On the other hand, if the shares have risen as had been hoped, there is a fear of missing out on further gains if the investor crystallises the profit.”

Selling a stock can sometimes be sensible when there are good reasons and you do it in an informed and considered way rather than impulse or in an attempt to time the market.

Profit-taking (selling a winner)

The first reason to sell might be that the stock has performed well and you want to bank some of the profits.

“One strategy which some investors use is known in the parlance as ‘top-slicing,’” said ii’s Hunter. “Imagine that an investment of £10,000 had fortunately come good and doubled to £20,000. By selling £10,000 worth of shares, the investor would be breaking even. The remaining £10,000 would then leave skin in the game as well as representing pure profit.”

How much profit you take is of course up to you – you don’t have to sell your entire allocation, or even half of it. Remember, though, that a profit (or loss) is only on paper until you sell.

Consider also the timing of selling a stock. If the shares are held outside an ISA, selling at a profit could make you liable for capital gains tax.

Loss-limiting (selling a loser)

On the other hand, a stock that is underperforming is a very tempting target to sell, especially if you’ve lost faith in the company’s ability to turn things around.

You’ll have noticed that this is the opposite of profit-taking, but despite appearing contradictory, both approaches “make perfect sense” according to Hunter.

“While it is ‘never wrong to take a profit’, traders will point to ‘running your winners and cutting your losers,’” he said.

Be sure to check whether your initial thesis for buying the stock is no longer intact before you sell, though. Some investors might view a share price decline in a stock they still believe in as evidence that the market has overlooked something; value investors might even consider the decline an opportunity to buy more of the stock on the cheap.

Portfolio rebalancing

It’s generally considered good practice to reset your portfolio at certain intervals – maybe quarterly or twice-yearly.

When you do so, assuming that you reallocate your investments so that each carries the same weight as it did when you last rebalanced, you will sell some of your top-performing stocks, as these will now constitute a larger percentage of your portfolio than they did before.

Risk profiling

Similarly, you might sell a stock because your own risk appetite has changed since you bought it.

Perhaps you bought a high-growth stock 10 years ago when your priority was portfolio growth. You’re now 10 years closer to retirement and wealth preservation is likely to be a higher priority for you than capital growth, so you may feel the right decision is to sell this stock and use the profits to invest in a more defensive alternative, or one that offers a higher dividend yield.

“Consider the reasons you bought the shares in the first place,” said Hunter. “Are they still intact? Does the holding still fit into your investment objectives?”

Ultimately, he added, there is no definitive answer to whether and when it’s right to sell a stock, and the decision will vary from person to person.

“As long as the investor is comfortable with the rationale, there is no right or wrong time to sell,” he said.

Two things in life are guaranteed: death and taxes. Some of us have to deal with both at the same time.

You earn money and income tax takes its cut, with National Insurance following suit. You spend some of what's left and VAT takes its share. Buying a house? Stamp duty. You sell an asset that's grown in value, capital gains tax. You take a dividend from the company you built, dividend tax. Fuel duty, vehicle tax, insurance premium tax, council tax. Then HMRC comes in with the final punch combination when you die. Beneficiaries are at risk of inheritance tax. Forty percent of everything above the threshold.

With every other tax, you can do something about it on your own. Put more into the pension, use the ISA allowance, time a disposal, restructure how you take income. With inheritance tax, the planning that reduces the bill has to be done by the person you're inheriting from, and for larger estates, it has to be done years before they die. You cannot fix it afterwards. The bill comes out of the estate, which means it comes out of what would have been yours.

There are ways to reduce an inheritance tax bill though, such as making use of allowances and gifting during one’s lifetime. Often, the inheritance tax problem becomes a communication problem rather than a tax problem. Only 30% of over-55s have ever discussed inheritance with their children, according to research by law firm Irwin Mitchell. Ask people why not and 15% say it's awkward, 12% think it's rude, a Moneybox survey said. But the powerful determinant of an inheritance tax bill is whether a family can sit through that one uncomfortable conversation.

How inheritance tax thresholds work

Everyone gets a tax-free allowance when they die called the nil-rate band (NRB). It's £325,000, and anything above it is usually taxed at 40%. If the main home is left to children or grandchildren, and your estate is worth less than £2 million, a second allowance stacks on top: the residence nil-rate band (RNRB), worth another £175,000. So one person can pass on £500,000 before HMRC takes a penny. Anything you leave to your husband, wife or civil partner is completely exempt. If they die, you inherit whatever slice of their allowances they didn't use. Stack two sets together and a married couple can pass on up to £1 million tax-free – although this isn’t marriage advice.

The problem

The Institute for Fiscal Studies, a think tank, projects that if you were born in the 1980s, you probably won't inherit until your mid-sixties, and for roughly a third of that cohort, it won't be until their seventies or later.

The average person expects to inherit £62,500, according to interactive investor’s Great British Retirement Report 2026, which polls almost 8,000 savers in the UK. I don't know about you, but I think £60k would go a lot further for me at 29 than it would at 64. For a lot of high earners, the money is inherited after they’ve paid a house deposit or after the school fees mattered.

Then there's how much of it gets taken on the way. Roughly one in twenty deaths in the UK results in an inheritance tax charge, and in 2023/24 the average bill among them was £231,000, HMRC data shows. More people will get pulled into the hole every year, and one of the reasons is fiscal drag. The NRB tax-free threshold has been £325,000 since 2009 and it's now frozen until April 2031. Had it simply risen with inflation, AJ Bell reckons it would be worth close to £555,000 by the end of this decade. So while this threshold stands still, families are being dragged into the tax net as house prices rise.

Adding more fuel to the fire, from 6 April 2027, most unused pension pots will come into the estate for inheritance tax purposes. HMRC's own estimate is that around 10,500 estates will pay inheritance tax for the first time because of it, and another 38,500 will pay more than they otherwise would, at roughly £34,000 extra each.

How talking can reduce an inheritance tax bill

Changing the conversation and framing from “let's reduce an inheritance tax bill” to “when would gifting this money actually do the most good,” and you're having a completely different conversation with the same people about the same money. The second one leads to lifetime gifting. Lifetime gifting is also the thing that reduces the inheritance tax bill.

We want our parents around as long as possible. The conversation is about the money doing some good while everyone is still here to see it.

The headline rate for inheritance tax is 40%. The average effective rate those estates actually paid inheritance tax in 2023/24 was 13%. That is due to exemptions, allowances and gifts and every single one of them was a decision someone made while they were still alive to make it.

The bottom line: speak to your family about inheritance

If you're expecting some sort of inheritance, talk to your family. The potential alternative is that some of this hard-earned money goes to the taxman. If your family is anywhere near those thresholds and with the pension change coming in 2027. If you need help, consider speaking to a financial adviser – the fee for regulated advice could end up a rounding error against a £231,000 average bill.

In the weeks after the Budget of October 2024, pension schemes started receiving an unusual request. Savers who had taken their tax-free cash wanted to hand it back.

They had taken it because of rumours that the then chancellor, Rachel Reeves, was about to cut it in the Budget. She didn't.

By December 2024, HMRC was writing to schemes to explain the position. The money could go back into the pension pot, but because there is only so much tax-free in a lifetime, what these savers had taken had counted against that limit for good. The decision they took could not be reversed. There are strict rules around the tax-free pensions lump sum allowance.

The same thing happened the following year, before the Budget of November 2025, and again the rules were left alone.

Now the same warnings are circulating ahead of chancellor John Healey's first Budget on 28 October about pensions tax changes.

Healey himself has not made an announcement. This does not mean that this year's speculation is wrong, but the rumours simply mean you are being invited to act on a claim that has been made twice in two years, and been wrong twice. Which raises the question of where the claim keeps coming from.

Why Budget tax rumours keep appearing

I've worked in financial journalism long enough to know how these stories start. Journalists hear genuine policy discussions and think tanks publish proposals - and out come the warnings.

Interested parties lobby, and readers do need warning about measures that might plausibly arrive. But often, stories are

The difficulty is what happens on the way to the reader. 'This is being discussed' becomes 'this may happen'. By the time it reaches the kitchen table, it has become 'this will probably happen’, prompting some to take action too soon.

Where the numbers actually come from

In August 2024, the Fabian Society proposed that the maximum tax-free lump sum be cut to the lower of £100,000 or a quarter of someone's pension wealth. Torsten Bell, the pensions minister, had argued for £40,000 back in 2019, when he ran the Resolution Foundation.

The case for reform is a serious one, and it isn't confined to think tanks with a political affiliation. Writing in September 2024, the Institute for Fiscal Studies called the tax subsidies for pension saving generous, opaque and poorly targeted, and said they could sensibly be reformed. But it also warned against constant tinkering, and argued that savers need to know where pensions policy is going, whatever any one Budget does.

Two Budgets have come and gone since then, and savers are no clearer than they were. What they do have is a set of proposals, and no statement from any chancellor that he intends to act on them.

But the seeds of fear have been planted.

Why you can't simply put your tax free pension back

You can usually take a quarter of a pension without paying income tax on it. What far fewer people know is that there is also a limit on the total you can take tax-free across all your pensions in your lifetime, currently £268,275. It is called the lump sum allowance, and it moves in one direction. Once you have used part of it, it stays used.

HMRC's position is that sending the money back does not restore the allowance, and that there is no legal mechanism for doing so. The Financial Conduct Authority, which regulates pension providers, has said that taking tax-free cash does not by itself give you a right to cancel. Cooling-off rights attach to buying something new, an annuity for instance. Taking your own money out of your own pension isn't buying anything.

Suppose someone of 58 with a £600,000 pension draws the full quarter she is entitled to, £150,000, years before she needs it, because she has read that the allowance may be cut. The Budget comes and goes and nothing changes. Her £150,000 is now sitting outside a pension, where growth would have gone untaxed. And of the £268,275 she could have taken tax-free across her lifetime, £150,000 is gone. That part of her allowance is spent. None of what she had read was from anyone who really knew.

Are Budget rumours ever right?

Waiting is not always cheaper than acting.

In October 2024, capital gains tax rates rose from 20% to 24% for higher-rate taxpayers, and they rose on Budget day itself. People who had already decided to sell something, and brought the sale forward, saved four percentage points. The official forecasters later confirmed that enough of them did it to show up in the tax figures.

The speculation about cash ISAs proved right too. The cash allowance falls to £12,000 for savers under 65 from April 2027. So did the speculation about salary sacrifice, though that change doesn't take effect until 2029. Anyone who reorganised their pay in the autumn of 2025 moved more than three years early.

The people who gained in these three cases had something in common. They were mostly bringing forward a sale or a change they had already settled on, not doing something new because of something they had read.

Not everything in the news this autumn is speculation. Two changes affecting pensions and savings are already settled. The cash ISA change and the pension inheritance tax change both arrive in April 2027. You can plan around both, because both are coming.

A cut to the lump sum allowance is different. It has been proposed, and it has been reported. No government has said it is going to happen.

Three questions to ask yourself before 28 October

Before acting on anything you read between now, here’s what you should ask yourself first:

1. Has this been announced, or is somebody predicting it?
2. If the prediction is wrong, can you undo what you did?
3. What will waiting cost you?

The third question isn't a way of talking yourself into doing nothing. Sometimes waiting has a real price, as anyone who sold an asset after 30 October 2024 discovered. But that price is usually one you can work out in advance. The cost of acting on a rumour that turns out to be wrong often isn't.

The Budget is on 28 October. Until then, the thing to keep hold of is the difference between what the government has announced and what other people think it might do. The first one you can plan around. The second is a forecast, and there's no way of knowing in advance which forecasts are the right ones. Where a decision can't be undone, that difference is worth waiting a few weeks to resolve.

Alphabet, the parent company of tech giant Google, is one of the largest companies in the world.

It is a front-runner in artificial intelligence (AI) and part of the so-called ‘Magnificent 7’ stock group. But, if you go to buy Alphabet shares, you’ll notice you have a choice to make.

Alphabet has two stock listings: (NASDAQ:GOOGL) and (NASDAQ:GOOG). The two tickers refer to separate share classes for Alphabet.

GOOGL refers to Class A shares or common stock, which carry shareholder voting rights – each share you hold grants you one vote whenever a shareholder vote takes place.

GOOG refers to Class C shares. These confer the same amount of ownership over Alphabet’s equity, but they don’t give you any voting rights.

Because both share classes represent the same level of equity in Alphabet, their prices are similar. However, GOOG tends to trade at a slight discount compared to GOOGL because it doesn’t give you any voting power.

For example, on 18 September GOOGL closed at $349.54 while GOOG closed at $344.41.

While each share class trades separately, they still represent equity in a single company and as such Alphabet’s market capitalisation (market cap) is calculated as the sum of both share classes.

You may sometimes see the two share classes split – for example, a list of S&P 500 stocks or the holdings in a tracker fund will usually list each share class separately.

As of 18 September the iShares Core S&P 500 UCITS ETF (LON:CSP1) lists Alphabet Class A as its fifth-largest holding with 3.1% of the fund, while Alphabet Class C is the seventh-largest with 2.5% of the fund. In reality, though, Alphabet is the third-largest company in the S&P 500 and accounts for a combined 5.6% of the ETF.

Which class of Alphabet stock should you buy?

The answer depends on what you’re hoping to get out of buying Alphabet shares.

If you want to be able to exercise shareholder voting rights then Alphabet’s Class A stock (GOOGL) is the one to buy.

But if you aren’t too fussed about voting – and it’s worth noting that, as Alphabet has a market cap over $4 trillion, your vote is likely to be a miniscule fraction of the total – then GOOG is slightly cheaper, meaning you pay fractionally less for a very similar level of financial return (it has a dividend yield of 0.26% compared to GOOGL’s 0.25% as of 18 September).

In reality, the difference is very small, and capital gains are likely to be similar for both stock classes over the long term (GOOGL gained 148% in the five years to 18 September, compared to GOOG’s 143%), so don’t fret too much over deciding which to buy.

Depending on the investing platform you use, the decision may be made for you as some platforms only offer a single class of Alphabet stock.

Is there a third class of Alphabet stock?

There is a third class of Alphabet stock – Class B. Unlike Class A and Class C shares (GOOGL and GOOG) Class B shares are not traded publicly, meaning you won’t be able to buy them.

Alphabet’s Class B shares are held by company insiders, mostly its senior leadership. They convey ten votes per share – meaning that senior executives hold the majority of control over the decisions the company takes whilst still being able to raise capital in the stock market.

Recent falls in Indian stocks have created opportunities to invest in some long-term growth stories at attractive prices.

India has been one of the world's fastest-growing major economies in recent years and this rapid economic growth is changing how its 1.4 billion people spend and save. As household incomes rise and more people move into the middle class, demand is growing for everything from convenient ways to shop and eat to insurance and branded consumer goods.

These long-term shifts are creating opportunities for Indian stocks that can capture a growing share of consumer spending, particularly those with strong brands, wide customer reach and plenty of room to grow.

At JPMorgan India Growth & Income, we focus on finding high-quality companies with the potential to benefit over the long term. Here are three examples.

Three Indian stocks for your portfolio

Zomato (Mumbai: ETERNAL) is one of India's leading online food delivery and restaurant discovery platforms, connecting consumers with restaurants and delivery partners across the country. As more Indians move to towns and cities and become comfortable ordering online, the company has grown rapidly, building a large customer base, an extensive restaurant network and more than 400,000 delivery partners.

Zomato's size gives it an important advantage, and its Blinkit business is also tapping into another fast-growing habit, offering rapid delivery of groceries and everyday essentials. Rising incomes, growing smartphone use and increasingly busy urban lifestyles are all helping India's food-delivery market to expand. With an established technology and delivery network, we believe Zomato (which trades under its parent name Eternal) is well placed to capture more of this spending as consumers increasingly prioritise convenience.

SBI Life Insurance (Mumbai: SBILIFE) is one of India's leading life insurance companies, offering a broad range of insurance and savings products. Its close relationship with State Bank of India, one of the country's largest banks, gives it access to an extensive branch and customer network, helping it reach a large pool of potential customers across the country. Insurance remains relatively underused in India, leaving considerable room for the market to grow.

Many Indian households still favour traditional ways of saving, but rising incomes and growing financial awareness are gradually changing these habits. As India’s middle class expands, more consumers are looking to protect their families and plan for retirement. With its strong distribution network and record of growing faster than many of its peers, SBI Life is well placed to capture this rising demand.

Varun Beverages (Mumbai: VBL) is India's largest PepsiCo bottler, manufacturing and distributing brands including Pepsi, 7Up and Mountain Dew. It operates in one of India's fastest-growing consumer categories, yet soft-drink consumption in India remains relatively low compared with other markets, leaving significant room for growth as incomes and spending rise.

Varun Beverages has built an extensive manufacturing and distribution network, helping it reach consumers across India's many cities, towns and rural areas. As the business grows, this scale also helps it produce and distribute drinks more efficiently. Combined with a strong record of execution, we believe Varun Beverages is well placed to continue growing as more Indian consumers spend on branded drinks.

India's recent market weakness shouldn't overshadow its long-term growth potential. As incomes rise and consumer and financial habits evolve, well-positioned companies have an opportunity to grow alongside the country's consumers and turn its economic expansion into attractive returns for shareholders.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

As CEO of Likewise Group (Aim: LIKE), Tony Brewer is playing out the final act in a long-running commercial rivalry. Brewer built UK flooring distributor Headlam into the market leader. But it collapsed into administration on 1 September, and now he is running the company taking its place

Brewer entered the carpet trade in 1977 as a 17-year-old at Midlands Carpet Distributors (MCD). There he learned the ropes under founder Graham Waldron. In 1991, Brewer and Waldron took a 22% stake in the listed conglomerate Headlam. Waldron was CEO at the time. They stripped out its legacy footwear and textile divisions, turning the company into a focused flooring distributor designed to consolidate the UK wholesale floor-coverings market.

At the time, the trade was populated by hundreds of small, family-owned merchants. Most carried modest stock, ran inefficient local delivery routes and lacked buying power with continental mills. Brewer and Waldron saw an opportunity and began buying these operators, preserving local trading names and centralising supplier negotiations.

Between 1991 and the 2008 financial crisis, Headlam became one of the London market's best-performing stocks, generating operating margins near 8% and returns on capital employed comfortably above 20%. When the crisis halted UK housing transactions, the sharp drop in flooring installations sent scores of private distributors to the wall. Headlam absorbed the shock, took the displaced accounts and emerged controlling roughly 30% of the domestic wholesale market.

Brewer was highly regarded by investors and staff alike. Then, in 2016, the board intervened. Disagreements over operational strategy and succession led to a boardroom rupture and Brewer walked out of the business he had spent a quarter of a century creating.

Two years in exile convinced Brewer that Headlam was vulnerable. Under the succeeding management, the market leader had become bureaucratic and indebted, with a sprawling network of regional properties and central administrative overheads. In 2018, Brewer partnered with property investor Paul Bassi to establish Likewise Group, floating the business on Aim to secure development capital. The objective was simple: build a modern distributor that could replicate Headlam's original service model without inheriting its structural deadweight.

Wholesale flooring distribution depends on logistics and relationships. Independent flooring retailers, regional contractors and self-employed carpet fitters cannot afford the capital or warehouse space to hold large inventories. The distributor carries the stock, extends trade credit and provides the delivery infrastructure needed.

Relationships matter just as much. Independent retailers and trade fitters tend to buy from sales representatives they trust to resolve delivery problems and secure stock allocations, rather than from a corporate brand. A decent sales representative will typically handle between 120 and 140 commercial accounts. Brewer used his industry standing to recruit heavily from Headlam's commercial team. Over several years, dozens of sales representatives, regional managers and senior logistics directors moved to Likewise. When they moved, many of their local trade clients followed.

The result was a damaging loss of volume at Headlam. In wholesale distribution, where operating margins rarely exceed mid-single digits, high fixed costs in depot leases and central overheads mean falling volumes can rapidly erode profits and turn to painful losses. As sales slipped, Headlam's overheads overwhelmed operating cash flow, turning predictable earnings into trading losses and adding to the strain on its debt facility until liquidity ran out. Capturing the spoils of Headlam's collapse will not be a simple walkover. The UK wholesale trade is no longer populated by the inefficient merchants of the 1990s. The surviving independent distributors are disciplined, well-managed businesses with clean balance sheets and strong regional customer loyalty. They will contest every square yard of displaced volume.

Likewise Group has plenty of room to grow

Likewise Group has been taking share from Headlam for years. Its national network is smaller but newer, and its sales operation has been built around many of the people who know Headlam's customers. Headlam falling into administration therefore accelerates a process that was already under way.

The business also needs to spend money on warehouses, equipment and stock before it can handle much more trade. That explains why Likewise Group raised £32.5 million in fresh equity in July. Management is using the proceeds to fund freehold logistics facilities needed to handle the additional trade.

Likewise Group now has significant spare capacity. As stranded trade accounts and displaced contractor orders flow into its national network, the additional revenue should carry little extra distribution cost. Moving from current revenue run-rates towards its £300 million capacity ceiling could therefore lift operating margins from the current 2.5% towards 5%, or 6% if the UK housing cycle turns favourable.

At full capacity, that throughput generates between £15 million and £18 million in annual operating profit. Against an enterprise value of about £100 million, the shares trade on less than seven times mature operating profit. The Aim market holds scores of cheap small-cap shares that languish for want of a catalyst. Likewise has one. The irony is that the man who built Headlam is now in the best position to pick up what it has left behind.

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In Paul Smith's new memoir, Threads, My Life in Style, he recalls how he went to his deserted offices during the Covid lockdown dressed in a suit in an effort “to make life seem more normal”. There he found 18 containers of milk burst on the floor and spent three hours mopping it up. He found himself thinking: “I wonder if my friend Giorgio Armani is doing something like this now? Or Tom Ford?” When he recounted this to his colleagues, “they all said the same thing: ‘Oh no! Only Paul Smith…'”. He took it as a compliment.

Smith's “can-do” attitude and infectious “joie de vivre” have always been a feature of his work, says the Financial Times. He's “the perfect ambassador for the soft power of tailoring – both in person and as founder and designer of his namesake business”. The atmosphere around him is one of such “merry eclecticism and creativity” that it's hard to believe he turned 80 in July.

Paul Smith on opening his first ‘boutique’ in 1970

Smith – who opened his first shop in Nottingham in 1970 – declares he doesn't think of the birthday as a milestone because “if you put too much importance on it, it becomes a burden. Like: ‘Oh, I'm old now.'” Smith remains in charge of his destiny. The business, which now has about 120 shops around the world, remains independent and he is the majority shareholder with a 69.5% stake. Tailoring remains Paul Smith's “north star” and the label has recently been emphasising the “practical” qualities of the suit – dubbing its latest men's collection, shown in Milan in June, “Suits in Unsuitable Situations”. Fashions change and cycles come and go – recent years have been as punishing for Paul Smith as any other luxury brand. But the bread-and-butter business is still socks: “the brand sells 700,000 pairs a year”.

“I always joke that I used to think VAT was vodka and tonic,” Smith says of his own business acumen as a young entrepreneur. It's one reason why he set up the Paul Smith Foundation to offer practical advice to people in the creative industries. But in fact, clothes were in his blood. His father, Harold, sold clothes and linens door to door on credit. Born in 1946 in Nottingham, Paul Smith left school at 15 with no qualifications and began working in a clothing warehouse as an errand boy, says Vogue. At 17, a serious accident put an end to his cycle-racing ambitions, but the upside of a six-month stint in hospital was that he made friends with the local art-school crowd, who introduced him to the world of art and fashion. After taking courses in tailoring, encouraged by his artist wife Pauline, Smith opened his first “boutique” in 1970 in a tiny back room in the city centre, says The Guardian.

The secret to Paul Smith's success

The 1970s were an exciting time to be building a fashion brand. Having made his name in London, Smith opened a shop in New York and was soon hanging out with the Studio 54 crowd – selling suits to Jack Nicholson and David Bowie. A big fan of the work of Yves Saint Laurent, a seminal moment for him was the launch of “Le Smoking”, the first woman's tuxedo from a major couture house. His own moment came when “suits got a boost thanks to the Big Bang in the 1986”, says the FT. Young urban professionals would head to Smith's shop in Covent Garden and find “Prince of Wales checks made with innovative colours and unexpected jacket linings”. They might also pick up a Filofax – one of the first of the many design objects that Smith has sourced or collaborated on over the years.

In the 1990s, the brand peaked, says The Guardian. “We're definitely not as relevant as we used to be,” says Smith of the brand's recent struggles, but “my company motto is ‘never assume' and that's helped me enormously over the years”. Longevity, he concludes, is about hard work, reassessing and never thinking you've “made it”. “Nobody cares how good you used to be.”

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The growth of passive investment means pension savers could be sleepwalking into disaster. Amid growing speculation about the potential for a stock market correction – or even just a prolonged period of flat returns – investment experts are increasingly worried about the risks many pension savers are unwittingly exposed to. Passive investment has compounded such dangers.

The reality is that most savers in workplace pension schemes never make an active investment choice – the employers' scheme Nest says more than 90% of savers behave this way – leaving their contributions to flow into default fund strategies. These largely rely on low-cost index-tracking funds that passively follow the market up and down.

Data suggests that even savers with self-invested personal pensions (Sipps), which offer more control over investment choices, are also opting for passive funds en masse. Data from platforms such as Interactive Investor repeatedly shows that index-tracking funds are among the most popular options with these savers.

The trouble with passive investment and index-tracking funds

The problem is that index-tracking investment may be riskier than savers realise. It's not just that these funds automatically follow markets down in challenging periods. The bigger worry is that many index-trackers are far more concentrated than is immediately apparent.

A low-cost fund offering exposure to the MSCI World Index, for example, sounds attractive. You're ostensibly getting a cheap way into a spread of investments on stock markets worldwide.

In practice, however, this is no longer the case. “While 20 years ago a passive investment approach provided well-diversified exposure, the same is clearly not true today,” points out recent analysis from JPMorgan Asset Management. “These benchmarks are now vulnerable to very specific risks inherent in today's shifting economic and political tides.”

In particular, the stellar performance of a handful of the large US technology giants in recent years has completely skewed the make-up of market indices. The US stock market now accounts for more than 60% of the MSCI World Index; within that allocation, the ten largest companies on the US market – mostly big tech – account for more than 40%.

In other words, investors with supposedly diversified portfolios are actually betting a very large chunk of their savings on a small number of businesses in the US tech sector.

There are similar concerns, meanwhile, about bond markets, where the huge issuance of US Treasuries to finance the mushrooming US debt has had the same effect. These bonds now dominate indices of fixed-income securities.

The impacts are significant. Pension savers are often invested via strategies that split their money by holding 60% in equities and 40% in bonds, with those allocations secured through passive funds.

But JPMorgan's analysis suggests savers who made such choices – or defaulted into them in the past – now have portfolios that look very different. A 60:40 strategy launched in 2008, for example, would have split equity and bond holdings accordingly, and allocated roughly 40% of the total portfolio to the US, with the remainder spread in markets across the rest of the world. But market movements since then mean that portfolio would today be more than 80% exposed to equities and 55% invested in the US.

Even worse, some investment experts believe passive investment increases the risk of a major stock market crash. By artificially inflating demand, passive funds drive some companies to unsustainable valuations, they argue, with the bursting of the bubble eventually becoming inevitable.

The bottom line? Your pension portfolio may be full of hidden dangers, particularly if you've left it alone for years and opted for default, passive investment strategies. Now might be a good moment to check where you stand.

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Metallurgical coal has spent the past few years as the industrial commodity nobody wanted to admit owning. It sits under the same coal label as the thermal coal that funds have been told to divest from, even though it does an entirely different job. Capital has stayed away, generalist investors have ignored it, and the sector has traded as if the world were quietly winding it down.

That is starting to look like a mistake. The metallurgical coal price has rallied from $224 a tonne to $282 in a few weeks, and the equities have followed. The median move across the listed coal group is close to 25%. This looks like the first sign of a market waking up to something that has been true for some time – metallurgical coal is structurally indispensable, and the world simply doesn't have enough of it.

What is metallurgical coal?

Start with what metallurgical coal actually is, because the name causes endless confusion. This is not the thermal coal that gets burned in power stations. Metallurgical, or coking, coal is an industrial input. It goes into a blast furnace alongside iron ore, and through a chemical process that has not meaningfully changed in a century, and becomes the coke that reduces iron ore to metallic iron. There is no other input that does this job at scale. If you want steel, and the world wants a great deal more steel, you need metallurgical coal.

This is where the demand story gets interesting, because it is not really a China story any more – it is an India story. India's National Steel Policy targets 300 million tonnes of crude steel capacity by 2030, roughly double where the country is today. That target is not aspirational chatter, it is showing up in blast-furnace construction across five states. My own modelling shows India's blast furnace capacity rising from around 99 million tonnes a year in 2025 to 197 million by 2030.

Run the standard conversion of roughly 0.8 tonnes of coking coal per tonne of crude steel through that, and you get somewhere in the region of 78 million tonnes of additional gross coking-coal demand once those furnaces are running flat out. However you cut it, the direction of travel is the same: materially higher.

India knows this is its weak point. The country imports 85% of its coking coal today, and the stated policy objective is to bring that down to 65% by 2030 through domestic washing and beneficiation (techniques designed to strip impurities from coal and metal ores). Even if that target is hit in full, absolute import volumes are still likely to rise because the base demand is growing so much faster than domestic supply can be brought on. India is diversifying away from its historic reliance on Australia, buying more from the United States, Russia, Canada and Mozambique, and state-owned groups have been in talks about acquiring Russian coking-coal assets outright.

Meanwhile, supply has been shrinking. Years of capital starvation induced by the trend towards environmental and social governance (ESG), permitting delays and genuine geological depletion in premium Australian basins have left the seaborne market thin. Add in diesel-driven cost inflation in Appalachia and Australia, worsened by Middle East oil disruption, and you have a supply side that cannot respond quickly to a demand shock. That asymmetry – fast-growing structural demand against supply that takes years and enormous capital to expand – is precisely the set-up that produces the kind of price move we've just seen. It should persist for years.

None of this means coal prices run in a straight line from here. A benchmark of $282 will attract new supply eventually; it always does. But the mistake I see investors making is treating this as a short-covering bounce in an unloved sector. It is not. It is a repricing of a genuine structural mismatch between where steel demand is heading, particularly in India, and where metallurgical coal supply actually is. The market has been asleep on this trade for a long time. It is now stirring. I would rather be early to that than early to leave it.

Metallurgical coal investments to buy now

The large, liquid metallurgical coal producers are the first port of call. Alpha Metallurgical Resources (NYSE: AMR) and Warrior Met Coal (NYSE: HCC) are the two most relevant US-listed groups: low-cost, high-quality producers with the operating leverage to a rising benchmark that has driven their share prices up sharply already this month.

Peabody Energy (NYSE: BTU) gives broader diversified exposure across both metallurgical and thermal coal, while Ramaco Resources (Nasdaq: METC) offers a smaller play on the same rally. All of them benefit mechanically as the benchmark price climbs, and all of them remain cheap against where metallurgical coal pricing looks to be heading over the next few years.

My own top pick sits a little further down the market-capitalisation scale: Clinch Resources (Toronto: CLCH). Clinch is bringing new North American metallurgical coal supply into production at exactly the moment the market has turned, with surface output already running at its Lanes Branch mine in West Virginia and underground production ramping up into the autumn. Production looks poised to climb from under 400,000 clean tons in the 2025-2026 fiscal year to roughly two million clean tons in 2027.

Our fair-value estimate, based on a $240-a-tonne benchmark that the market has already blown through, points to C$2.50 in the base case and C$3.90 in the bull case, against today's share price of around C$1.05. The firm also boasts a stake in JJ Resources' high-value coal project, and an early-stage rare-earths angle in leftover rock waste from previous mining activities, neither of which the market is pricing in at all yet.

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A decade ago, the idea that infrastructure could be an exciting, growth-focused investment was unlikely. The sector was seen as a source of steady income that would hopefully keep pace with inflation, but probably not offer much more. Talk to an infrastructure specialist today and it's clear how much has changed in a few years, especially when it comes to energy and power.

In the past two weeks, I've spoken to Jean-Hugues de Lamaze of Ecofin Global Utilities and Infrastructure (LSE: EGL) and Daniel Chu of ClearBridge Global Infrastructure Income Fund. Both argue that the fundamentals of the sector have shifted, yet markets are still underestimating the capital that will be required and what it means for investors.

To give a simplified summary, the bull case begins with the need to renew and replace ageing infrastructure, much of which was built over 50 years ago. This applies across many infrastructure subsectors. Second, there's the electrification of the economy as a result of the energy transition, which requires investment both in new generation and in grids and batteries to support more use of renewables in the generation mix. On top of that trend, we have the growth of new, power-hungry users such as AI and data centres adding fresh demand (see chart). Finally, there's a growing focus on boosting security of supply and resilience in the face of both geopolitical threats and climate change.

Infrastructure valuations at a discount

The investments needed will be large. As one example, de Lamaze points to Germany's infrastructure plans, which could require more than €700 billion between 2026 and 2035. Governments are not going to want to fund all of that given the state of public finances. This will create huge opportunities for private capital, often in partnership with the public sector.

A further positive for investors, he says, is that many utilities' business models have also changed for the better, especially in power. A greater share of revenue comes from longer-term contracts and less from short-term sales. This provides greater certainty for earnings, which is reassuring if much of the sector is likely to invest in expanding capacity in the years ahead.

Despite these tailwinds, valuations for listed infrastructure funds remain at a significant discount to where similar assets are valued in private deals, say both managers. We shouldn't bet on this gap being closed, but listed stocks look attractive by historical standards even before allowing for a structural shift in growth rates. Investors want to see more proof of successful execution and earnings growth, says Chu. That could come by 2028 – and with it, at least something of a rerating for the sector.

You'll be able to hear my discussion with Jean-Hugues de Lamaze on the MoneyWeek Talks podcast next week.

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Saltford House, Saltford, Somerset

A Grade II-listed, late Georgian house with a walled rear garden with a large lawn, a patio and a greenhouse. The house has decorative plasterwork, wood floors, period fireplaces and a large kitchen with French doors. 7 bedrooms, 4 bathrooms, 4 receptions, 3-bed flat, garden room.
Price: £2.75m Hamptons 0117-911 1455

Allardice Castle, Inverbervie, Montrose, Angus

An A-listed, 16th-century castle with a walled garden and grounds bordering Bervie Water, on which it has fishing rights. It has an inglenook fireplace and a spiral staircase leading to a watch tower. 6 bedrooms, 3 bathrooms, 2 receptions, library, outbuildings, 3 acres.
Price: £950,000+ Strutt & Parker 07384-826784

The Garden House, Stockland Green Road, Tunbridge Wells, Kent

An award-winning contemporary property situated in a large walled kitchen garden. The house has floor-to-ceiling windows and sliding doors overlooking the landscaped walled gardens. 5 bedrooms, 4 bathrooms, 2 receptions, study, breakfast kitchen, boot room, cinema room, gym, outbuildings, gardens, 1.25 acres.
Price: £3.75m Knight Frank 01892-772947

Ludstone Hall, Claverley, Shropshire

A Grade I-listed Jacobean manor with mullioned windows and a balcony. The gardens include a front courtyard, a moat, a walled kitchen garden and wooded grounds with a stream cascading into lakes. It has a 17th-century carved oak staircase, oak panelling, open fireplaces and a kitchen with an Aga. 9 bedrooms, 7 bathrooms, 4 principal receptions, indoor swimming-pool complex, 2-bed gate lodge, coach house, 9.10 acres.
Price: £3.95m Fisher German 01530-410840

Newburn House, Newburn, Northumberland

A Grade II-listed Georgian house set in walled gardens that include a courtyard garden and a Japanese garden. It has open fireplaces and a large kitchen. 5 bedrooms, 2 bathrooms, 5 receptions, workshop, 0.87 acres.
Price: £850,000 Finest Properties 0330-111 2266

Dillington Hall, Dillington, Norfolk

A Grade II-listed Georgian house dating back to 1780 with landscaped gardens that include an established walled garden bordered by woodland. The house has open fireplaces and a large dining kitchen with an Aga. 6 bedrooms, 4 bathrooms, 2 receptions, study, office, old laundry, 2-bed apartment, cellars, stables, garage/workshop, stores, grounds, heated outdoor swimming pool, tennis court, 2 acres.
Price: £1.75m Sowerbys 01362-693591

Barholm Castle, Gatehouse of Fleet, Castle Douglas, Kirkcudbrightshire, Dumfries & Galloway

A restored, A-listed 15th-century tower house surrounded by landscaped gardens and walled gardens overlooking Wigtown Bay. It has a turnpike stone staircase, a great hall with a painted beamed ceiling and a barrel-vaulted kitchen. 3 bedrooms, 3 bathrooms, study/bedroom 4, 2.75 acres.
Price: £695,000+ Savills 0141-222 5875

The Old Rectory, St Just in Roseland, St Mawes, Truro, Cornwall

A Grade II-listed Georgian house on an estate in an Area of Outstanding Natural Beauty. It has walled gardens, a vegetable garden, a Mediterranean-style courtyard designed by an award-winning landscape gardener, and is situated 100 yards from St Just Creek with direct access to the beach. 6 bedrooms, 5 bathrooms, 3 receptions, breakfast kitchen, library, orangery, games room, 2 annexes, 1.09 acres.
Price: £5m Fine & Country 01326-334658

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There is a great wave of money – and artwork – heading the way of younger generations. The value of the “great wealth transfer” from the post-war baby-boomer generation in Britain alone has been estimated at £5.5 trillion over the next 30 years.

Baby boomers were prolific art buyers. “Spending on art accelerated as the rich got richer, moved into ever-larger houses and became eager to splash out on discretionary purchases,” says Felix Salmon on Bloomberg. That in turn led to a boom in artists who could afford to live by the brush. There were 8,300 artists whose works had sold at auction in 1988, according to the Artnet Price Database. In 2012, that number had ballooned to 90,275.

Sadly, unlike Hokusai's Great Wave – a print of which came from a single-owner collection amassed over years to sell for HK$21.7 million (£2 million) in Hong Kong last October – the great art wave racing towards the younger generations is mostly made up of works of questionable value. What to do with it all? “The sheer tonnage of boomer-owned art is vast, and the total demand for it doesn't come close to the amount of supply that's about to arrive,” says Salmon.

The big auction houses are only interested in the most-valuable artworks. So, that's fine for the likes of businessman Joe Lewis, 89, whose collection of paintings by Freud, Bacon and other celebrated artists sold for £296.3 million in late June to become the most valuable single-owner collection ever sold in London. And it's fine for the estate of the late Microsoft co-founder Paul Allen, whose collection fetched $1.6 billion in 2022 to set the global record. Other inheritors will count themselves lucky if they can slough off a painting or two to the local auctioneer. More probable, says Salmon, the whole lot will be sold to a professional estate liquidator.

What can you do with the unwanted artworks?

You could, of course, simply give them away. The cultural gifts scheme and acceptance in lieu can both be used in Britain to reduce inheritance tax bills.

But the artworks must be of a sufficiently high calibre and you must be able to find a museum or gallery willing to take them. That's not a given, since it involves a lot of time and expense, from cataloguing and restoring artworks to insuring and keeping them safe if not for immediate public display. And increasingly, museums can take their pick, because they are not short of offers.

So, after all that, you might as well admit defeat and keep the damn thing – which is probably what the original collector had intended or hoped you would do from the start. The trouble is, fashions change and what was fresh and exciting half a century ago may seem dull or worse in the social-media age, or the artist may have faded from memory, rendering their works worthless. It is a conundrum inheritors of art will have to face in the coming years.

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Who says Apple doesn't innovate any more? After the iPhone and iPad, we now have something entirely new: iFlation. When the technology giant launched its latest phone last week, most of the attention focused on the way it folded in half. But there was something else eye-catching about it as well. It costs almost $2,000. A top-of-the-range version will retail at more than $3,000.

That's a lot for a phone and a big increase on earlier versions. When the first iPhone was launched back in 2007, it cost $499. Adjusted for inflation that is about $800 in today's money. So even in real terms, a flashy new Apple device has almost doubled in price over the last two decades. The ability to keep pushing prices higher may help explain why Apple is one of the biggest and most profitable companies in the world.

It is far from alone as there is a broader trend at work here. Lots of high-status, luxury goods keep on getting more and more expensive. Take tickets for the Glastonbury Festival. We learned last week that next year's event would cost £408. That compares with £87 in 2000 or £170 in today's money. Likewise, Chanel's signature handbag has risen fivefold in price over the past two decades. A Rolex Submariner has more than doubled in price in real terms.

These are just samples of a select group of products that don't simply perform a function – such as telling the time or making a phone call – but also signal your status, make you feel good about yourself, and impress your friends and neighbours. There are plenty of cheaper phones on the market that perform perfectly well. Some of them even fold in half. But they don't have the cachet of an Apple. Likewise, you can pick up a perfectly reliable watch in any department store, or even just use your phone, and it will tell you the time. But it doesn't tell the world how successful you are in the same way as a Rolex. The trouble with such high-status goods is that they are getting more and more expensive.

Why? To start with, companies have to keep pushing up the prices of such goods to maintain their exclusivity. By definition, a status good only maintains its position by having some degree of exclusivity. If everyone has one, it is not so classy any more. Price rises are one way to make sure its status is preserved.

Next, although we might not especially notice it in low-growth Europe, the world is getting richer. The number of millionaires in the world has roughly doubled from about 30 million a decade ago to roughly 60 million now, according to the UBS Wealth Report. There are a lot more people with plenty of money to spend, but often only a fixed number of things for them to spend it on. The result is that prices keep going up to match a limited supply with a soaring level of demand. As Asia and South America carry on growing a lot faster than the rest of the developed world, that is only going to get worse. On current trends, the iPhone 20 will cost $5,000 or more by the end of the decade.

Apple will only have themselves to blame

The problem, however, is that the economy is already struggling, with most people finding their living standards squeezed. If high-status goods become less and less affordable, it makes that situation feel worse. Even people who, by any reasonable measure, are making enough money to count themselves part of the affluent middle class may suddenly find they can't afford an Apple phone or a high-class watch. For anyone on a lower income, it becomes impossible to get to Glastonbury.

The divide between a tiny minority that can still afford a few luxury goods and everyone else will just get wider and wider. The result? The latter will feel more and more alienated from a free-market economy that no longer seems to deliver.

For corporations, raising prices is great for the bottom line, if you can get away with it. But if it means you undermine support for free-market capitalism, perhaps that is not such a great trade. At a certain point, iFlation will create a backlash, with the calls for wealth taxes and caps on corporate profits becoming louder all the time. The likes of Apple will only have themselves to blame for pushing prices up too aggressively.

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How is the music industry doing?

The music industry is doing an awful lot better than it was ten years ago and far better than many media sectors. In the first decade of this century, the global music business had a famously torrid time of it, as consumers pinched content for free via file-sharing sites. Sales of physical CDs collapsed and the nascent digital-download channel failed to make up the difference. Between 1999 and 2014, global revenues shrank by 40% and reasons to be cheerful were thin on the ground.

But since then, it's been a growth story, driven by technology. If the internet destroyed the record companies' old business model, the ubiquity of smartphones facilitated the rise of the now-dominant streaming model, where labels and artists license their content to sites such as Spotify (which marks 18 years in business next month) and Apple Music. In 2017, revenues from streaming surpassed sales of physical formats (CDs and the like) and downloads for the first time – and they've continued growing strongly since. At the same time, legacy formats, notably vinyl, have enjoyed a resurgence as a premium, niche product for superfans.

Has Spotify changed the music industry?

It has permanently altered the music industry's economics, yes. In the age of Spotify and Apple Music, it's easy to listen to songs via playlists without even knowing the name of the artist. That tilts power away from performers and towards songwriters. It has also made it harder than ever to break new acts and for artists to build long-term fan bases – both trends that raise questions over long-term revenue streams. At the same time, it has delivered lucrative new revenue streams for legacy acts, as new generations of listeners decide that the old songs really are the best. And it has helped moves by a growing number of big-name acts to sell off their back catalogues to investors.

How has Spotify affected artists?

The advent of Spotify has been to the benefit of artists and consumers, says Simon Heptinstall in The Spectator. The old bloated music industry, with its inflated unit prices, concentrated its massive wealth at the top, but failed to fund a thriving grassroots scene. The industry “funded Elton John's drug binges, Led Zeppelin's private Boeing 720 waterbeds and Keith Moon driving a Lincoln into a Holiday Inn swimming pool”. But if you weren't one of a handful of “anointed megastars, you didn't get pressed to plastic”. Last year alone, Spotify paid a record £860 million to the UK music industry, twice as much as ten years ago. Forty-five per cent went to independent artists and grassroots labels. Globally, it paid out $11 billion – up 10% in a year – with half going to independents. More than 1,500 artists earned over $1 million each and about 80 artists generated more than $10 million from Spotify alone.

How big is the music industry?

Big and getting bigger. According to UK Music – a trade body representing all sectors of the industry – the contribution of music to the UK economy hit a record £8 billion in terms of gross value added (GVA) in 2024 – up 5% on 2023. UK music exports that year hit £4.8 billion, also up 5% year on year. UK growth is currently in line with global trends. Goldman Sachs, which tracks the global music industry across the recorded, publishing and live sectors, reported 6.2% growth from 2023 to 2024. It puts the total global market at about $105 billion in 2024 and forecasts a lift to almost $200 billion by 2035. Its 2024 forecast puts the live market at roughly $35 billion, recorded music at about $31 billion and publishing at roughly $10 billion.

Did social media democratise music discovery?

The overarching theme is of a tech-enabled structural shift in power from labels to artists, says Nick Lawson of Ocean Wall, a London-based research-led investment bank. The traditional music business model was an unequal bargain, where advances were “loans dressed as gifts”, and rights were surrendered in return for “access to a distribution machine that only the majors could operate”. That machine is broken. “Streaming democratised distribution. Social media democratised discovery. And a generation of artists, watching their peers retain their masters and still reach global audiences, has concluded that independence is not just viable, it is preferable.” Some 55%-60% of artists now operate independently.

What does streaming mean for the music industry's growth?

Streaming is now maturing in developed markets, says Perry Gresham of MIDiA Research. Future growth will be driven by emerging markets and premium tiers. More broadly, beyond streaming, it will depend on the wider ability of artists and rightsholders to fully exploit the “fan economy” – the industry's new buzzword – meaning live music, merchandise, physical products, direct-to-fan services and other forms of “expanded rights”. According to Goldman Sachs, studies show that 10% to 15% of fans are willing to spend multiples of the standard price for premium offers such as early access to tickets, exclusive content, high-quality audio or merchandise. This could add billions of dollars to annual industry revenues by 2030.

Who will capture that value from the music industry?

Not the traditional record labels, says Lawson. The majors are built around rights ownership, but their data on fan behaviour is fragmented across ticketing platforms, streaming services and merchandise partners. Live music will remain the “structural backbone” of the industry – spending has risen in 29 of the past 33 years, an impressive recession-proof record. Meanwhile, artist-centric royalty platforms will shift payment models towards genuine engagement, rather than fraudulent streams and AI-generated oversupply. That leaves an opening for firms (such as ATC, in which Lawson owns a stake) that aim to serve artists in the round – combining management, fan engagement, touring, booking and exploiting intellectual property – rather than acting as rightsholders. The future is an “artist economy” in which authenticity is valued most. The firms that built the tools, the data and the trust stand to benefit the most.

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Baltic Classifieds (LSE: BCG) operates a wide range of car, job, real estate, and professional services websites in Lithuania, Latvia and Estonia. It is uniquely placed to benefit from the region’s prosperity. While countries such as France, Spain and Germany have been struggling, the Baltic states have been quietly getting on with boosting productivity and growth. Barely two decades after joining the EU in 2004, Estonia's GDP, adjusted for inflation, is now close to that of Portugal, while Lithuania's is not too far off Italy's.

Baltic Classifieds runs 14 different websites and has benefited from the fact that the Baltic states have a strong digital culture, regularly scoring highly in international surveys of digital competitiveness and digital security. Strong economic growth in the area has been a further tailwind.

How Baltic Classifieds is profiting from the network effect

Most of Baltic Classifieds' websites are leaders in their sector. This is important since online marketplaces tend to benefit from network effects, with buyers and sellers gravitating towards a few major portals. Some of Baltic Classifieds' websites, such as the Estonian car site Auto24, are so dominant they have no major specialist competitors. It's estimated that each resident of the Baltics visits the group's websites about ten times a month. This market power allows the company to make large operating margins, which reached 68% in 2026, and Baltic Classifieds earns a double-digit return on capital employed.

Baltic Classifieds should benefit from the fact that both income and wages in the Baltic should continue increasing at a much stronger rate than the rest of Europe. However, Baltic Classifieds is also attempting to increase its profits in three other ways. Firstly, it's investing in cutting-edge technology to ensure its websites stay popular. It's also trying to find new ways to monetise its websites through partnerships. Finally, it's selectively buying other companies to fill the gaps in its portfolio.

Baltic Classifieds's sales have more than doubled since 2021, with normalised earnings per share increasing more than tenfold during the same period, and both are expected to keep growing. The balance sheet is healthy, with net debt declining since 2022. Despite the company's solid fundamentals, the stock trades at a very reasonable 15.5 times projected 2028 earnings with a solid dividend (for a technology company) of 2%.

Baltic Classifieds also looks appealing from a technical perspective – the share price has done better than the overall market over the past one, three and six months and trades above its 50- and 200-day moving averages. I would therefore suggest you go long at the current price of €2.45, at £110 per €1. I would put the stop-loss at €1.65, which gives you a total downside of £880.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

Caledonia Investments (LSE: CLDN) is one of the market's more esoteric investment trusts. Founded by the wealthy Cayzer family, which once owned one of the world's most powerful shipping conglomerates, the £3.1 billion fund now functions as a multi-asset growth and protection vehicle.

Caledonia has been part of the MoneyWeek investment trust portfolio since 2013. We like its diverse approach and its aim of earning solid long-term returns of 3%-6% above inflation, while managing risk during periods of uncertainty and instability. The Cayzers own 51% of the trust, putting it under the stewardship of a powerful long-term shareholder.

However, while the trust has undoubtedly achieved its performance target over the past three, five and ten years, its recent record still leaves something to be desired with regard to its share price, which languishes on a 35% discount to net asset value (NAV).

Three-way split in Caledonia's portfolio

Caledonia's portfolio is split into three roughly equal pools: quoted equity, private equity funds and private capital. At 25% of net asset value, the private capital pool is the smallest of these three segments. This portfolio comprises ten high-quality UK mid-market businesses with “prudent capital structures”. The largest holding here – and in the portfolio overall – is AIR-serv Europe. This firm designs, manufactures, and maintains forecourt equipment like air, vacuum and jet wash machines. Since being acquired in 2023, its value has grown from £143 million to £215 million as of the end of August. Last year, the company paid Caledonia a £24.5 million dividend.

These types of holdings give the trust an edge over other wealth protection vehicles. Other trusts in the sector usually rely on third-party funds, equities and alternative investments, Caledonia has direct control over these holdings and is not subject to additional fees. It can also buy and sell when it sees fit – if an asset such as AIR-serv is working well, there's no need to sell. Other private capital holdings include hospitality operator Butcombe (4.1% of NAV or £127 million) and garden centre operator Blue Diamond (1.9% of NAV or £60 million). The latest addition is a 61% stake in Conquip Engineering.

Listed equities are 32% of NAV at present. This pool comprises around 30 equity holdings, including tobacco giant Philip Morris (2.9% of NAV or £91 million), Texas Instruments and Microsoft.

Finally, there's the private equity fund pool. At 32% of NAV, this is equal to the direct private holdings, but with holdings in 80 funds across 45 private equity managers, there's more diversification. Caledonia says it's often the only European investor in these vehicles, which are predominantly focused on buy-out deals in the North American mid-market segment.

Caledonia's stubborn discount

Aside from the goal of beating inflation by 3%-6%, Caledonia also uses the FTSE All-Share Total Return index as a benchmark for its performance. Over the past decade, the trust's NAV has beaten the consumer price index including housing (CPIH) by a factor of three times and matched the FTSE All-Share.

However, both NAV and share price have trailed the FTSE All-Share over three and five years, while the share price over five years has fallen short of its inflation-plus target. Management has tried a share split to improve liquidity and has been buying back stock to unlock value. Since 1 April, it has spent £30.6 million buying shares at an average discount of 37%. This has boosted NAV by 3.5p per share, but the discount remains stubbornly wide. More work is needed here.

That said, Caledonia's edge lies in its diversification. In an ever-rising market, its strategy is always going to lag. The test will come in the next crash, when we see if it outperforms investors who increasingly seem besotted with the AI bubble.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

The full new state pension is set to exceed £13,000 per year next April, breaching the tax-free personal allowance for the first time.

The triple lock mechanism means the state pension increases by the highest out of wage growth, inflation or 2.5%.

The state pension is set to rise by 3.9% from April 2027, in line with the earnings growth element of the triple lock. This will likely be confirmed in chancellor John Healey’s Autumn Budget.

If confirmed, the full new state pension would rise to £250.70 per week, or £13,036.40 a year.

The first £12,570 of taxable income you get per year is tax-free thanks to the personal allowance, meaning many retirees who only received the state pension haven’t been taxed on it in the past.

State pension income will not be taxed if it's sole income, government says

If you had a taxable income of £13,036, you would usually owe around £91.48 in income tax.

However, the government said last year that pensioners will not need to pay tax if they only receive income from the state pension, even if it goes above the £12,570 personal allowance.

In the 2025 Autumn Budget, then-chancellor Rachel Reeves said: “We are ensuring that people only in receipt of the basic or new State Pension do not have to pay small amounts of tax through simple assessment from April 2027.”

She later added in an interview with broadcaster Martin Lewis in November 2025: “In this parliament, [people who only receive income from the state pension] won’t have to pay the tax, further out, I’m not going to be able to make any commitments on that, but we’re looking at a simple workaround at the moment.”

Although Reeves is no longer chancellor, pensions minister Torsten Bell confirmed the new government will stick to this pledge on 16 September.

He said: “In line with the commitment made at Budget 2025, pensioners who only just exceed the personal allowance will not have the administrative burden of paying small amounts of tax in this Parliament.

“The chancellor will set out further details on how that commitment will be delivered at the Budget.”

The government said the move will “ease the administrative burden for pensioners” and mean they do not have to “pay small amounts of tax via simple assessment”.

The system for this hasn’t been confirmed but more details may be released in the Autumn Budget.

Do you have to pay tax on other pension income?

If you have income from another source, perhaps from a workplace pension or part-time work, you will likely have to pay income tax.

Your pension provider usually calculates your tax and deducts it from your pension income through pay as you earn (PAYE), meaning any tax you owe will be automatically paid for you.

What is simple assessment, and will you have to pay tax on your state pension using it?

Simple assessment is a method used by HMRC to collect tax when a self-assessment tax return is not required but tax cannot be collected through PAYE.

It is used by HMRC to collect tax in some simple circumstances, including if you need to pay tax on your state pension.

Had the government not intervened, pensioners whose sole income is the UK state pension may have had to pay tax by simple assessment next year.

However, as the government has confirmed those who only get an income from the state pension will not need to pay small amounts of tax on it, you will likely not need to complete simple assessment.

The video games industry has seen more change in recent times than almost any other. Over the past 15 years, gaming technology has “moved very quickly, the behaviours and culture have grown and expanded exponentially, and there has been a constant stream of changes that has made the industry exciting”, says Greg Weller, head of gaming partnerships at Generation Media. Some of the changes have been positive. The industry has become “an established, mainstream constituent of the entertainment industry”, with an estimated 3.6 billion people around the world now playing games in some form, says Gavin Smith, a senior commercial banker at Arbuthnot Latham.

However, “rising development costs, greater regulatory scrutiny and the concentration of player attention around a handful of major franchises could end up limiting that growth”, says Smith. Artificial intelligence, too, clearly has “significant transformative power”, though it's too early to say whether this will be good for the sector.

The industry's reputation for being “recession-resistant” has already been tested, with companies cutting around 45,000 jobs since 2022, as Adam Smart, global director of products for gaming at AppsFlyer, points out. Still, the opportunities outweigh the risks, making it a great time to invest. Consultant BCG estimates the market will grow by about 6% a year, reaching a value of $350 billion by 2030. Other estimates put the growth rate even higher.

Browser-based video games are the future

The big growth has come from games that you can play on your mobile phone or through your web browser as they are “really easy for virtually anyone to play” without having to splash out on expensive gaming hardware, says Matthew Dolgin, a senior equity analyst at Morningstar. Many of them also have a social element or are integrated into social media, which is bringing more and more people into gaming, including many of those who wouldn't otherwise have ever considered playing video games.

At the same time, the balance of power between mobile companies and the app stores has shifted. Until recently, developers just accepted that 30% or more of their revenue would go to Google Play or the Apple Store, says Stein Janssen, chief operating officer at browser-based games website Poki. But this has been increasingly challenged in the courts and in legislation. Apple has faced an investigation from the European Commission as well as lawsuits. Janssen expects this pressure to lead to a reduction in the cut that Google and Apple are able to take from sales of mobile games.

Indeed, many mobile games companies are starting to bypass Google and Apple completely by “starting their own stores for people to download games or buy in-game items”. Others are switching from mobile games funded by payments (either up front or in-app) to ones that are free, but rely on advertising revenue. Browser-based games are the future, says Janssen, as they can be played immediately, rather than waiting for a download.

Shifts in the big-budget video games subsector

Mobile and browser gaming may be the fastest-growing part of the industry, but the big budget games (or the AAA games as they are sometimes known) are still doing well. Revenue for this subsector will grow by a still respectable 4.7% a year for the next four to five years, according to BCG. Whenever “there are truly engaging games on the market new people start playing, and every year we see new generations of gamers log on”, says Andrew Bowell, CEO of immersive entertainment studio Iconic Interactive. Throw in the older generations who are already at home with games and the industry “should continue to grow”.

At the same time, outside expanding areas such as Asia, much of the growth is less about attracting new players and more about how revenue is collected – or in other words, about getting existing players to spend more, says Noam Korbl, CFO at PropFirms. Large parts of the industry have “moved from selling a boxed product once to charging for continued access, cosmetics, season passes and subscriptions”. Recurring spending from an existing player base is “far more predictable than hoping a single release performs well in its launch quarter, and investors tend to pay more for predictability than for creativity”.

Another big trend affecting AAA gaming is what Smart calls “platform convergence”, where the “old lines between console, PC and mobile blur as cross-platform play and cloud gaming let the same title reach players everywhere”. This means that studios and publishers now receive “diversified revenue streams”. This doesn't completely insulate them from the financial consequences of a flop, but it does mean that a shock in one segment, system or region “doesn't necessarily sink the whole industry”.

Video games conquer films and TV

Modern games have moved away from being just single products to being “franchises made up of a wide-ranging bundle of intellectual properties, with distinctive characters and even music”, all of which “lend themselves to broader application than just computer games”, says Aminder Khatkar, a partner at Brandsmiths. Such intellectual property (IP) can (and has) been exploited for lots of different things, including experiential events, but the most obvious application is in film and TV. There is a “definite convergence”, says Khatkar, between gaming and TV and movies.

The conversion of characters and franchises that have their roots in gaming into films and TV shows represents “one of the biggest opportunities across the media industry”, says Smith. Recent adaptations such as drama series The Last of Us and Fallout have shown that “gaming IP can attract substantial audiences beyond gaming itself”. Successful gaming franchises have “established fan bases, global reach, and richly developed worlds that sustain audience engagement across a range of formats”. In some cases, gaming IP is becoming more valuable than traditional film or television enterprises. Nintendo, for example, is expanding franchises such as Pokémon, Zelda and Super Mario into films, merchandise and theme parks.

The number of games being adapted into TV shows or films is increasing, says Stefan Seidel, a professor of information systems at the University of Cologne. Well over 200 adaptations have been commissioned since 2019, according to market research firm Ampere Analysis. And when an adaptation succeeds, “it lifts the games that already exist”. After the Fallout television series, for example, “the years-old Fallout 4 video game climbed back into the top five of the US sales chart, and daily players of the older games stayed far above pre-series levels for months”.

Interestingly, the circular effect is bigger for TV adaptations than films. The typical TV show increases the number of people playing a particular title by more than 200%, compared with 48% for films, according to Ampere's research. Still, even the boost from film is substantial and far greater than the increase in numbers that comes from updates and new downloadable content. The games industry is starting to become a much bigger and lucrative version of the toy industry, says Heather Delaney of Gallium Ventures, where TV shows based on the toys have long boosted sales.

Will virtual reality live on?

Delaney is a bit cooler on virtual reality (VR), which many previously saw as the wave of the future. Indeed, Facebook changed its name to Meta in October 2021 due to its belief that the future lay in what it called a “Metaverse” of people communicating (and playing) through virtual-reality headsets. Recently even Meta has been pivoting away from both the Metaverse and VR in general, closing three of its VR studios and laying off 10% of staff in the area, in favour of “adaptive reality” glasses that merge digital content with the physical environment. VR turned out to have too many limitations when it comes to gaming, not least the feeling of isolation while playing.

Meta's “gradual retreat” from VR “probably tells us something about where the wider subsector is heading”, says Smart. Enthusiasm for VR came at a time when people “were stuck at home” during the Covid pandemic and looking for escapism. Still, VR is unlikely to entirely disappear as it has attracted a “passionate core audience” and when done well can provide “one of the most exciting experiences in gaming”. The launch of new hardware, such as Valve's Steam Frame, may attract a new audience to VR.

Others are more optimistic. Meta may have cut back its investment on VR, but it has not completely abandoned it and it is still trying to push the technology, albeit in a way that is less high-profile, says Khatkar. Indeed, Meta's partial retreat shows the sector no longer needs to be “artificially propped up” by big tech firms but is strong enough to be left to individual companies producing software that can meet the demand, says Matt Celia of Light Sail VR. More than 20 million Meta Quest headsets have now been sold, with one in four teenagers in the US owning a VR headset, and a new product upgrade is likely in the near future. More than a million people use the headsets every day, “which is relatively high for an emerging technology”. Several independent studios and apps have started to make money from VR games.

AI won't kill the video games industry

One of the biggest questions hanging over the industry is the impact of AI. Some of the fears are clearly justified. It's hard to deny that the demand for processing power and chips created by AI “has pushed up the cost of consoles and computer equipment”, says Sean Kealy, VP of equity research at Panmure Liberum. But fears that AI will allow anyone to easily create games at zero cost, making games companies redundant, are also exaggerated – at least for the foreseeable future. AI “is not capable of producing a video game in and of itself, by itself, straight away”.

The release of footage generated by Google's cutting-edge AI world-building tool Project Genie, which caused the share price of many developers to fall when it was released in February, demonstrates the limitations of modern AI. “Video generation struggles to maintain coherent frames over more than a few minutes, with the entire world behind you different from the one that you walked through just seconds previously,” says Kealy. He also points out that there are open questions around copyright, not just in terms of the use of copyrighted content in AI, but also in terms of copyrighting AI-generated content.

There's a long way to go before the human element in games creation can be bypassed completely, agrees Seidel. The more likely outcome is that AI will be used in something like the same way as the industry has over the past few decades used “procedural generation” – where game elements such as the appearance of monsters and treasure are randomly created. After a lot of trial and error, games companies found this worked best when it was accompanied by designers “who kept evaluating and adjusting what the tools produced, and who continued to design the parts of the world that mattered most by hand”.

At the same time, AI could help the industry in two main ways. Firstly, it will help keep costs under control. With the typical cost of making a game having “risen over time from $50 million to $500 million”, anything that helps the industry “take a leaner approach to game development” will be good for developers, says Bowell. There could be particularly big time-saving efficiency gains when it comes to creating characters, environments and texturing. The use of large language models will also make the interactions between gamers and computer-controlled characters (NPCs) more “non-scripted and dynamic, which in turn will make games more interesting and replayable”, says Massimiliano Calamai, games director at Smallthing Studios.

Over time, the positive and negative aspects of the AI revolution will make “distinctive intellectual property and strong distribution even more valuable”, says Marc Fernandez, the chief strategy officer at Neurologyca, which tries to produce AI that better understands context. The big winners will be studios with “valuable IP, engaged communities, and the ability to turn adaptive, personalised worlds into long-term player engagement”.

We look at some of the most promising investments to profit from all these trends below.

The best gaming investments to buy now

Take-Two Interactive (Nasdaq: TTWO) owns Rockstar Studios, the company behind the successful Grand Theft Auto franchise. Gamers are eagerly anticipating GTA VI, the latest instalment in the franchise. It is “an example of exceptional intellectual property that can help sell software, move hardware and command the culture”, says Greg Weller of Generation Media. The company also owns games studio 2K, which has several successful franchises, and mobile developer Zygna, which allows it to also benefit from the boom in mobile gaming. Take-Two has a strong record, with revenue nearly doubling between 2001 and 2006. The stock trades at a reasonable 21 times expected 2028 earnings.

If Take-Two is a growth story, then Ubisoft (Paris: UBI) is about value. The company has faced many challenges and has struggled with sales and profitability, says Matthew Dolgin of Morningstar. But with rival Electronic Arts now a private company, Ubisoft is the best option for those who want to invest in a traditional games company with multiple large franchises, which include the Assassin's Creed and Far Cry series. Ubisoft looks cheap on multiple valuation metrics, trading at less than half the estimated value of its net assets.

CD Projekt Red (Warsaw: CDR) is an example of just how volatile the fortunes of games companies can be. It has struggled since the release of a hotly anticipated game resulted in mixed reviews. Its sales and share price are now well below pandemic peaks. Development delays have also been a problem. However, the company still makes money from licensing the brand rights to its hit series of Witcher games and is preparing several big releases in the next few years, including Witcher 4 and Cyberpunk 2077 II, which should substantially boost revenues. The stock trades at 25 times estimated 2027 earnings.

Sony (Tokyo: 6758) is not a pure play as it only makes about a third of its sales from games and related services, with music and entertainment systems also being major sources of revenue. The importance of gaming to the firm is only set to rise, however, following its decision to partially spin off its financial services business. It sells games hardware, most notably the PlayStation (which includes a VR headset), as well as its own software. Some of its game franchises, most notably the post-apocalyptic drama The Last of Us, have also become successful TV series. The stock trades at 16 times expected 2028 earnings.

Nintendo (Tokyo: 7974) is a games company with a long pedigree. It still produces a regular stream of new titles and hardware (most recently the handheld Switch 2) and it has also been finding new sources of revenue. Nintendo has been working harder to make money from its major franchises outside gaming. The Super Mario Galaxy Movie, for example, has already made more than $1 billion at the box office and a major new film based on The Legend of Zelda series is due out next spring. The stock trades at 21.5 times projected 2028 earnings.

One smaller UK-listed company worth looking at is Everplay (Aim: EVPL). Everplay has three businesses, including German developer Astragon and Storytoys, which produces educational apps for children between the ages of two and eight using licensed IP. The big business is Team 17, which publishes independent games such as Worms and Wardogs. The latter recently sold a million copies on the first day of its release. Everplay has an impressive record of monetising the IP of the developers that it works for, says Sean Kealy of Panmure Liberum. Revenues have more than doubled between 2020 and 2025 and the stock trades at only 10.3 times projected 2027 earnings.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

Arriving at ROMEO Napoli felt less like checking into a prestigious luxury hotel and more like wandering into a contemporary art gallery. A Christian Leperino sculpture was there to greet me, and there were artworks at every turn. It was easy to forget I was visiting the heart of Naples. But only momentarily, since ROMEO Napoli does such a good job of delivering incredible food and a vivid, vibrant atmosphere – two things that are very much associated with the city.

Elegance meets modern comforts at ROMEO Napoli

Each ROMEO property has been designed by a different architect, giving each hotel its own identity. The Naples hotel, designed by Japanese architect Kenzo Tange, strikes a balance between contemporary luxury and elegance.

I stayed in a deluxe harbour room, where rich macassar ebony wood, soft lighting and modern furnishings came together to create a warm, calming space. The hotel offers a range of rooms and suites to suit different stays, from stylish harbour-view rooms like mine to expansive wellness suites with their own steam room and sauna. At the top end is the two-bedroom penthouse suite, spanning 165 square metres.

Naturally, there are plenty of spaces to relax beside your room, at ROMEO Napoli. I particularly liked the games area in the lobby, where a vintage radio, table football and a carefully laid-out chess board are surrounded by contemporary artwork. There's also an impressive wine cellar with more than 600 bottles, giving guests another reason to stay in for the evening.

Spa experience to remember

However, the spa was the highlight of my stay. The spa experience starts before you have even stepped inside the treatment room. I walked down a softly lit corridor, with warm orange lighting and calming music playing, before misted glass doors slowly opened to reveal the spa area.

I started with the hot and cold stone walkway (a hydrotherapy feature, where guests walk barefoot through shallow channels of water at different temperatures), before moving between two Jacuzzis, each set at a different temperature, followed by the steam room and sauna. The facilities were excellent, but it was the atmosphere that really made it special. Dark stone, soft blue lighting and gentle water features created a space that felt so calming. I could easily have spent the entire afternoon there.

As if the spa weren't enough, the rooftop infinity pool is another highlight.

Looking out across the Bay of Naples towards Mount Vesuvius, it's the kind of view that makes you want to stay in the water a little longer. It was the perfect place to slow down after a day exploring Naples.

Dining chez Alain Ducasse

No trip to Naples would be complete without experiencing the city's food, and dining at the hotel's Il Ristorante Alain Ducasse Napoli didn't disappoint. Breakfast was served each morning here, and it quickly became one of my favourite parts of the day, the breathtaking view being reason enough. There was something so peaceful about eating breakfast while overlooking the water. We also returned one evening for the restaurant's five-course tasting menu. Every dish was beautifully presented, but what really stood out was watching one of the pasta courses being finished right at our table. Seeing it prepared in front of us made the whole experience feel that bit more special.

Seared red mullet with carrot and seafood kimchi, followed by roasted Laticauda lamb (a local breed), served with a pearled jus, are two dishes that feature on the tasting menu (€270 per person). It was also the attention to detail and the interactive nature of the meal that made the dining experience so memorable. For example, when the bread arrived, it came with two small wooden spoons – one topped with butter and the other with sea salt and pepper that we crushed using traditional stone grinders. Such a simple touch, but it turned something as ordinary as seasoning bread into part of the experience.

Exploring Naples and beyond

The location is one of the best things about ROMEO Napoli. Sitting right by the waterfront, it was the perfect base for exploring the city. During our stay, we made the most of the city's famous food scene, trying authentic Neapolitan pizza, hunting down the legendary €1 Aperol spritz, and ending many afternoons with some of the best coffee gelato I've ever had. Naples was the perfect way to begin our trip, offering a taste of Italy's history, culture and energy before we continued on to the Amalfi coast. A visit to Pompeii was also easy to arrange, with the ancient city just a 40-minute bus ride away, and the coaches conveniently located opposite the hotel. From there, we continued to Amalfi, with a stop in Sorrento – a fitting next destination, as the ROMEO Collection is set to open its next hotel there shortly.

Vaishali was a guest of ROMEO Napoli. From €555 per night, visit theromeocollection.com.

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Pension contributions are often the first cuts made when money is tight. It’s understandable – the benefits of these savings are not realised for many years ahead, so it’s easy to pause contributions.

But many do this with a huge misconception that you can make up for it at a later stage, and it is not as simple as that. The moment you stop, you miss out on compounding, free money from your employer, and the tax rebates – you cannot make up a pound for a pound at a later stage.

So while stopping pension contributions may seem like the obvious way to boost your immediate income, it could cost you thousands in later life.

What are the costs of stopping pension contributions?

Research from investment platform Moneybox shows the average earner (£39,000) could boost their annual income by £1,000 by pausing pension contributions for one year, but the cost of doing this is £12,000 on their overall retirement pot.

The longer you stop, the more significant the impact is. Standard Life finds a 22 year old on £25,000 paying the minimum contribution of 5% and getting 3% from their employer could build a pot of £210,000 by 68. But if they pause contributions for two years between 30 to 32, the pot would only be £200,000. A five year pause between 30 to 35 would mean you take a financial hit of £25,000. And should you take a long break of 10 years between 30 to 40, you could end up with £49,000 less.

There may be many reasons that force you to stop paying into your pension, such as taking a break to raise a family, redundancy or going self-employed. Often, just wanting more money in your pocket each month is the reason. Life happens, but is pausing pension contributions always the only solution?

What can I do instead of pausing pension contributions?

If you are looking to boost your monthly income, then instead of pausing pension contributions, take a look at other ways you can cut your costs.

For example, as simple as it may sound, having a budget in place can help identify unnecessary spending and costs. For example, are you paying for unwanted subscriptions? This is one trap I find myself often falling into.

Ask yourself if you could also get cheaper deals on broadband, mobile phones, or insurance costs. I recently saved £400 on my home insurance by simply switching to a new provider instead of accepting the renewal quote.

You may find that you can save a lot more with a budget and slashing unnecessary costs than you would by temporarily pausing pension payments.

If you have little choice, then think about gradually paying in more when you do restart pension contributions. You could even pay in bonuses or pay increases to give your pension pot an ad hoc boost. And if you're lucky to have an employer who is happy to match increased contributions, then this is worth considering as this is free cash from your workplace that you may otherwise not get.

How much do I need in my pension?

If you think losing a few thousand off your pension pot may not be a big deal, then it is first worth thinking about whether you will have enough in the first place.

Most people underestimate the income they would need in retirement and how big the pension pot needs to be to deliver that. Two-thirds of your pension will typically come from investment growth, so the longer you are invested the better.

According to Pensions UK, a single person would need to have a post-tax income of £45,400 for a comfortable retirement – or £62,700 as a couple.

The single person would need a pension pot of £691,000, according to analysis from wealth management company Quilter, while a couple would need a combined pot of £778,000.

The’ rule of 300’ for retirement

Another way to work what you need to maintain a certain lifestyle when you stop working is by using ‘the rule of 300’ by Standard Life. You simply multiply your everyday costs by 300 to estimate what it will cost you throughout retirement.

So, for example, if you pay £12 subscription a month, multiply it by 300, meaning you would need £3,600 in retirement to continue to pay for it. And if your golf membership is £75 a month, you will need £15,000 to carry on golfing.

So, before you stop pension payments, it may be worth thinking about the retirement you really want and how you will pay for it.

The F&C Investment Trust aims to deliver long-term growth in capital and income for shareholders. It is a FTSE 100 constituent and is the oldest and one of the largest investment firm in the UK, with assets that exceed £7 billion. It invests in listed equities and private equity and has delivered 55 consecutive years of rising dividends. The trust is globally diversified and conservatively managed.

I have managed the firm since mid-2014, working with specialist stock-pickers from Columbia Threadneedle Investments and elsewhere in the market. This gives the trust exposure to different geographies, investment styles and sectors, including firms benefiting from long-term changes in what we spend money on, how we pay and use technology. The following holdings illustrate these themes.

Diverse stocks for long-term growth

Mastercard (NYSE: MA) is at the heart of the long-term move from cash towards card and digital payments. It earns fees on transaction volumes and values without taking credit risk, enabling an asset-light business model and exceptional capital returns. Its scale provides a significant competitive advantage. Consumers want cards that are widely accepted, while retailers want to accept the cards their customers already use, making Mastercard's network difficult for new competitors to replicate. Beyond the ongoing shift away from cash transactions in developed markets, there are opportunities for growth in emerging markets too. Mastercard is also expanding its value-added services, including cybersecurity, data analytics and open-banking services, providing further opportunities for growth.

Infineon Technologies (Frankfurt: IFX) is a leading supplier of the technology underpinning three significant long-term trends: electrification, energy efficiency and AI infrastructure. It has a strong competitive position built over many decades. Sophisticated power management is at the heart of many of the transitions currently underway, including the shift to electric vehicles, renewable energy and modernising the grid, and Infineon is the global leader in power semiconductors, which are essential in this area.

The rapid growth of AI is creating another significant source of demand. The data centres needed to train and run increasingly sophisticated AI models require huge amounts of computing power and electricity, making efficient power management increasingly important. This represents a significant new growth market for Infineon that barely existed a few years ago. While its shares have been volatile, we believe the current valuation does not fully reflect the potential.

Live Nation Entertainment (NYSE: LYV) is the world's largest live entertainment company and has grown revenues by 15% per year on average since the pandemic. The company is benefiting from a structural shift in consumer spending towards experiences over goods, with demand for live experiences, such as concerts, increasing as a result. The combination of ticketing through Ticketmaster, concert promotion through Live Nation and venue ownership and management gives the business a strong position across the live entertainment industry. Consumers can buy their tickets, see their favourite artist and attend a venue all within the same platform. This vertically integrated model creates a powerful competitive advantage, allowing Live Nation to benefit at several different points as demand for live entertainment grows.

The three businesses above operate in very different industries, but each has built a robust competitive position in an area benefiting from a long-term shift in demand. For investors, identifying companies capable of turning these structural changes into sustainable long-term growth can provide opportunities that extend well beyond the short-term market cycle.

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Shares in housebuilder Vistry (LSE: VTY) jumped 18% on 25 August when it was announced that the Kent-based company would receive £350 million as part of the government's £39 billion social and affordable homes programme.

The funding package was significantly higher than the award under the previous programme (£278 million). It was also the largest possible award in the first round of funding allocations (£9.5 billion). Vistry said it will deploy the funds immediately to more than 3,000 affordable homes. Per-home funding is £116,000, up from £79,000.

Vistry delivers around 15% of the UK's social/affordable homes and is one of the best ways for investors to benefit from Labour's drive to get the country building again, but the firm has consistently disappointed investors. After the recent funding package, there could be some light on the horizon. At the current valuation, investors don't seem to be pricing in any growth.

How Vistry became the UK's most shorted company

It's fair to say that Vistry has a chequered history as a public company. Greg Fitzgerald, the former CEO and executive chair, built the firm, which was formerly known as Bovis Homes, through a series of deals, rebranding the group as Vistry in 2020 following its £1.1 billion acquisition of Galliford Try's housing businesses. Fitzgerald aimed to create a builder focused on partnerships with local housing providers and local authorities, rather than sales to private markets, which seemed the right course as politicians began to re-prioritise public-sector housebuilding. To that end, the group bought Countryside Partnerships for £1.3 billion in 2022.

Fitzgerald had the vision, but struggled to realise it. Vistry's vocal shareholders, US hedge funds Abrams Capital and Browning West (more than 20% ownership), haven't helped. The funds came on board with the Countryside merger and have since increased their stakes. In March 2023, it emerged that they wanted to offer Fitzgerald a bonus of up to £60 million if the shares hit £18 within three years. The proposal mimicked the agreement with Persimmon's former boss Jeff Fairburn, who was forced to resign following public outcry over his £75 million long-term bonus package. Vistry's remuneration committee voted it down, but the damage was done.

Since then, the firm has issued six profit warnings. In October, November and on Christmas Eve in 2024, it issued three consecutive warnings that higher-than-expected costs would hit the bottom line. This trend continued in 2026. In March, the shares plunged more than 20% in one day when Vistry announced Fitzgerald would retire and the firm lowered its outlook for the year. Then, in May, Vistry said material cost inflation would hit pre-tax profit by around 10% for the year. In July, these forecasts were scrapped altogether. The firm told investors it would report a pre-tax loss of about £30 million for the first half of 2026 on top of the £40 million reported for the first half of 2025.

This stream of bad news has crushed the shares. Although they have risen 20% since their multi-decade low in June, they're off 80% after peaking in August 2024. Vistry is now the most shorted company listed on the London market.

Is there any silver lining for Vistry shareholders?

Unfortunately for long-suffering shareholders, there could be more bad news to come. Reports suggest Fitzgerald pushed Vistry's land buyers to purchase any land they could get their hands on, some of which can't be used. It's believed that the new CEO, Adam Daniels, is working to undo these errors. Ultimately, sales will help him improve the balance sheet, but there could also be write-downs. Buyers know the company is in a rush to sell and they will push a hard bargain.

So where's the good news in all of this? Well, Vistry is operating in a structurally sound market with increasingly supportive stakeholders across the value chain. The government's £350 million cash pot has removed immediate speculation about a deeply discounted rights issue and private bank funding for social housing is starting to be crowded in. Lloyds and Santander have both announced boosts to funding for the sector this year.

As a new CEO, Daniels has a chance to get to grips with all past problems (the group is also replacing the CFO) and reset expectations. Vistry needs to take control of costs and move forward rather than stumbling over its own mistakes.

Vistry is a deep value play

While the company faces an uphill struggle, brokers are optimistic. Panmure Liberum thinks the company is taking the right steps to reduce leverage (with a year-end target of £100 million of net cash and average daily debt of £650 million in the second half compared with last year's £771 million) and has pencilled in housing completions of 16,330 for fiscal 2026, up from 15,658 as stalled developments from last year reach completion. The broker believes completions will rise further to 17,170 in 2027 and to 20,157 by 2030. Panmure has pre-tax reported profit falling from £196 million to £29 million in fiscal 2026, before rebounding to £173 million in 2027 and then £452 million by 2030.

Peel Hunt has a similar outlook, with a pre-tax profit of around £300 million pencilled in by the end of the decade. If Vistry comes close to these figures, the shares look cheap at current levels. Vistry is trading at an average forward price-to-earnings (P/E) ratio of 5.5 for 2027 based on Peel Hunt's and Panmure's figures. What's more, its tangible book value per share – mostly land and property yet to be sold – is 625p, a full 120% above the current price. With the shares priced at around half the sector average and more than 50% below book value, if Vistry can prove to the market it's back on track, the shares could double.

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Since the turn of the century, the price of gold has risen more than fifteenfold, while the S&P 500 is a mere 8.5 times higher, after including dividends. Who'd have thought it? Selective dates, I hear you cry, but it remains true. In 2000, gold was on its knees after a two-decade bear market, while US equities were in a generational technology bubble, rather like they are today. Still, at no point have equities been stronger than gold this century, even at the depths of despair in 2015, following a 45% correction in the gold price.

Gold is a popular form of jewellery because of its beauty, timelessness and durability, but financiers like it because it is scarce and liquid. Being scarce means that governments can't print more, making it an effective store of value. Being liquid means you can trade gold in billions of dollars at the touch of a button, whatever the state of the global economy. Gold provides the backstop to the financial system.

Our governments have borrowed too much money, and it's an open secret that they'll never pay it back. But they'll pretend to do it the old-fashioned way, which is to print more money. That will devalue the currency, which ultimately means the purchasing power of money falls. The rising gold price will not only compensate for the falling pound in your pocket, but will also deliver something extra as the asset becomes increasingly sought after around the world.

Why gold is a universal form of payment

Central banks have always believed in gold. Imagine trying to transact large sums of value around the world before modern payment systems were created. An ounce of gold was recognised from here to Timbuktu and still is to this day. Central banks hold much of their reserves in gold, both to protect themselves from inflation and to meet foreign liabilities when required.

Before Nixon took the US dollar off the gold standard in 1971, the central banks typically held 60% of their reserves in gold. The figure spiked in 1979, after high inflation in the 1970s, as the price soared. Then we had the “Volcker Moment” in 1980. The then-chair of the US Federal Reserve, Paul Volcker, hiked interest rates to an unprecedented 20% to fight off inflation, which then embarked on a four-decade decline, up until Covid.

In the 1980s and 1990s, with inflation low and growth solid, the central banks lost interest in gold. Their share of reserves fell until 2008, just in time for the global financial crisis. Gold reserves then stabilised at 10%. After the invasion of Ukraine they started to rise for the first time since the 1970s. The 2022 war in Ukraine, which is still ongoing, saw the US and Europe freeze Russia's reserve holdings of US Treasuries. Central bankers, especially in the Middle East and Asia, took note. If Russia's reserves could be confiscated, so could theirs. The diversification into gold grew at the expense of US Treasuries, with China leading the charge.

Today, gold's share of reserves has grown to nearly 30%. Some of that can be attributed to a rising price, but the central banks have also added a staggering 4,500 tonnes to their holdings, worth $20 billion. With such high demand, gold has been able to shrug off the impact of higher interest rates.

The relationship between gold and real yields

Since gold pays no interest, it has traditionally moved inversely to bond yields. If rates are at 10%, it is more expensive to hold gold, in terms of opportunity cost, than if they are 1%. Inflation matters too: if yields are 10% and inflation is also 10%, the real yield is zero. Gold is said to be an inflation hedge that maintains its purchasing power over the ages. In that sense, the real yield has always been a more important driver for the gold price than the yield itself.

But there are different types of inflation. Consumer prices (CPI) reflect the cost of living, which many believe to be understated. Then there is monetary inflation, or the money supply, which has grown at an average rate of 7.5% for three decades. For most gold watchers, this is the number that really matters. If the amount of money increases, gold will appreciate and act as a balance.

It turns out that the growth of the value of the above-ground gold supply follows monetary inflation over the long term. Indeed, this is the basis for the World Gold Council's expected return framework for gold. They say the gold price should match nominal GDP growth over the long term. That is real growth and inflation combined. Since nominal GDP and the money supply normally match, gold follows the money supply, which is entirely logical.

It turns out that it does over the long term, but with cycles. There are times, like today, when demand from central banks and investors is high, and so gold rises faster than new money creation. And there are other times, such as the 1980s and 1990s, when gold gives up ground at a time when growth is robust and inflation contained.

In January this year, the price of gold touched $5,595. That marked a 434% gain from its $1,064 low in late 2015. The year 2025 was gold's second-best in modern records, with a 65% rise, last beaten in 1979 with a 126% gain. That was too much, too soon and there can be no doubt that gold got ahead of itself. Since then, there has been a healthy 29% correction. I think the worst is behind us and a gradual recovery is underway.

The recent boost came in August, when US Treasury secretary Scott Bessent announced an intervention in the Japanese yen and then two weeks later increased purchases of long-dated Treasury bonds. The amounts of money involved were on the light side, but the signalling was explosive. Governments are worried about the rising cost of borrowing and are prepared to intervene. Whatever they say, everyone knows it means printing more money, and there is much more to come.

The gold price will hit $7,000 by 2030

In 2020, I wrote a piece entitled The Rational Case For $7,000 Gold By 2030 for the London Bullion Market Association (LBMA), the world's trade body for gold. At the time, the gold price was $1,700 an ounce, and many dismissed my piece as pie in the sky. Yet the premise was simple: long-term expectations for inflation would shift from 2% to 4%.

So far, and according to official data, the shift has been gentle, but expectations are rising. The bond market, as measured by Treasury Inflation-Protected Securities (TIPS, inflation-linked US government paper), is not yet pricing in much higher consumer-price inflation, but is heavily concerned by public debt. Inflation expectations have not yet rung alarm bells, but with rising food and energy prices, and higher debt-servicing costs, it is a matter of time. Gold is signalling where the bond markets are headed, and that is not a happy place.

With $5,595 reached this year, my $7,000 target for 2030 looks plausible. I am confident that it will be achieved and wouldn't be averse to increasing that target given what is coming down the road. Many Western governments are broke, yet continue to be spendthrifts. The worse the situation gets, the more investors will flock to gold to protect themselves from the carnage caused by rising interest rates.

In the interests of balance, I'll explore the bear case. Under the right set of circumstances, that could be devastating for the gold price, just as it was in the 1980s and 1990s. But what would need to happen?

The US budget deficit is 6.1% of GDP. In practice, that means in 2026 they will spend $7.4 trillion against tax receipts of $5.6 trillion. That is a $1.8 trillion annual deficit. Then consider that their outstanding debt recently exceeded $40 trillion, a sum that keeps growing. In Germany, the deficit is 2.8%, in China 4.5%, in the UK 5% and in France 5.7%.

Austerity would mean balancing the budget, which the UK last managed to do in 2001. With a balanced budget, as the economy inflates and grows the ratio of debt to GDP soon declines. Do that for a decade or so, and debt servicing returns to being a minor expense. Take Ireland, where debt ballooned to 120% of GDP after the 2008 crisis. With an enforced austerity programme, it has now slid to 33%. Portugal was at 140%; now the figure is 91% and falling. The Netherlands, Denmark and Sweden all have low debt-to-GDP ratios despite being “progressive”. If the major industrialised nations balanced their budgets, or even signalled their intent to do so, the price of gold would fall. But with the US, the UK, Japan, China, Germany, France, Italy and others still behaving badly, we are not there yet – or frankly even close.

Gold is a buy until the political winds change, which will one day happen. The electorate in Argentina surprised us all when they chose president Javier Milei with his chainsaw. The people were fed up with an over-indebted, failed state, and they opted for austerity over chaos. The real surprise was that the support came from the youth, who gave him 70% of their vote.

It comes down to the simple fact that today's debt is tomorrow's problem. Governments that borrow to pay their bills are passing the bill to the next generation. There comes a time when austerity shifts from being perceived as an immoral choice to becoming the only choice. When that happens, it will be time to reduce your gold and switch back to bonds, possibly at very attractive interest rates.

Gold investments to buy now

You can invest in gold in a number of ways. My clients at ByteTree hold the gold exchange-traded fund (ETF) known as the iShares Physical Gold ETC (LSE: SGLN). They also hold the Silver ETF, iShares Physical Silver ETC (LSE: SSLN) and gold miners through the VanEck Gold Miners ETF (LSE: GDGB). Silver and the miners tend to do much better than gold in a rising market, but fare worse should the gold price fall.

British investors who want to touch their gold should hold Britannias or Sovereigns, which are free of capital gains tax. They can do this through a reputable dealer such as Sharps Pixley or The Pure Gold Company. But if you do buy physical gold, please keep it in a vault. And if you insist on keeping it at home, then the best security is not to tell anyone!

For the adventurous, add a little Bitcoin into the mix. I created the BOLD index, which combines bitcoin and gold on a risk-weighted basis. Bitcoin is often considered digital gold since the supply is constrained and it is a store of value. Rather than have a 50/50 split, I weight according to volatility.

That means more gold than bitcoin, since it is less volatile. That manages the risk and since the assets have low correlation and act independently, BOLD rebalances the portfolio each month. BOLD reduces the stronger asset, adding to the weaker asset, in a top-secret investment strategy known as “buy low, sell high”. The result is a strategy that has similar volatility to gold, but with higher historical returns. BOLD is available as an ETF, the 21Shares Bitcoin Gold ETP (LSE: BOLD).

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Britain gained full access to the CPTPP, the huge Pacific free-trade zone, last week after Canada's ratification. It is by far the most significant trade deal that Britain has been able to secure since leaving the EU. Though, with the bond markets in meltdown, the cost of Britain's debt starting to soar, and the economy sliding closer to recession, it is perhaps not surprising that this piece of positive news did not get much attention.

The CPTPP – or Comprehensive and Progressive Agreement for Trans-Pacific Partnership, to give it its full, if slightly cumbersome name – is a free-trade zone that covers 12 countries across Asia and the Americas, including Canada, Japan, Mexico, Australia and Malaysia. It became fully operational on 1 September. Our exporters now have full, tariff-free access to its 600 million consumers. The Treasury estimates the deal could deliver a £2 billion boost to the economy. It could be far larger: the CPTPP represents a vast market that is growing at a rapid rate.

The problem is that at precisely the same time that the CPTPP comes fully into effect, the government is talking about a “reset” with the EU. Prime minister Andy Burnham has talked constantly about getting closer to the EU, and senior ministers have come out in support of joining the customs union. But any closer relationship would, in effect, mean leaving the CPTPP. Brussels would demand full control of our trade policy as part of any deal, and membership of the customs union would mean that the EU would set Britain's tariffs again, including levies on anything we buy from the Pacific. The two trade deals are incompatible.

It would surely be crazy to choose Europe over Asia. Europe is a larger overall economy, it is a lot closer, and it still accounts for more than 40% of British exports. But we already have tariff-free access to the EU's market through our existing agreement. For growth, which is what really matters, the Pacific bloc is far more important than the European one.

To start with, it is rising in significance, while Europe is steadily declining. At the start of the century, the EU accounted for 25% of global output. Today it is down to 15%. By contrast, the Pacific, on both Asian and American coasts, has been growing far faster. Right now, the CPTPP is only £4 trillion behind the EU, measured by total GDP. Within a decade, the Pacific bloc will have overtaken the EU. That makes it a far more lucrative market.

The CPTPP is what the EU might have been

Next, the legal framework of the CPTPP is far superior. Members have full access to each market within the bloc based on recognition of each other's standards. Subject to local vetoes, if your product is on sale in Japan and meets all its safety and regulatory standards, then you can sell it in Mexico or Australia, and vice versa. It acknowledges that there is no need for an extra layer of bureaucracy. More importantly, there is none of the paraphernalia of an emerging superstate. There is no CPTPP flag, or anthem, or foreign minister strutting about on the world stage. There is no freedom of movement. It is just a simple free-trade zone that allows goods and services to be sold, and without tariffs, across a huge range of territories – akin to what the EU was back when it was just the Common Market.

Finally, it is easier to do business with. When an economy is stuck with zero growth, as Italy, France, and now Germany are, there are very few commercial opportunities. Not much is getting built, companies are not investing and consumers don't have much money to spend. By contrast, when it is growing rapidly, as most of the Pacific is, lots of possibilities open up. People are ready to sign deals because they need stuff. British firms will find it far easier to grow their order books in Australia, Chile or Malaysia than they will in Portugal, Greece or Austria.

So long as the PM keeps talking about a reset with the EU, there is no point in British businesses embracing the opportunities offered by the Pacific deal. The government should make it clear that Britain's main trading bloc is the CPTPP and that we have no interest in anything other than our existing trade deal with Brussels – and then seize the opportunities the CPTPP offers.

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The on/off Middle East crisis is on again this week, sending up oil prices in response. Dated Brent – a key benchmark based on North Sea oil – is above $100 for the first time since July at the time of writing.

Every time oil moves in a significant way, it raises the question of how best to play higher prices. One answer to that depends on what kind of move you expect.

Dated Brent – which is the benchmark that you tend to hear most – reflects what is happening to demand for physical oil right now. It is an example of a spot price, meaning the price to complete a commodity transaction immediately. In the case of Dated Brent, the buyer is buying a cargo of oil that will be loaded on a predefined date in the next few days or weeks.

However, traders also pay close attention to futures prices – the price of a contract to buy or sell oil at some point in the future. That date may be in one month, three months, six months or further ahead. There is a long chain of contracts which can stretch out for years, but most activity is in the ones closest to expiry.

As an individual investor, you can't trade physical oil directly. You could trade oil futures, but using an exchange-traded fund (ETF) such as WisdomTree Brent Crude Oil ETF (LSE: BRNT) is simpler. Yet this distinction between spot and futures prices is still important when using an ETF.

How oil ETFs work

While ETFs for gold or other metals often hold physical metal and reflect the spot price, oil ETFs have traditionally worked by buying futures contracts for near-term months. As each contract gets close to expiry, the ETF sells its existing position in that contract and rolls over into another contract a month or two further out.

So the ETF will reflect the trends in near-term oil futures. It will also gain or lose from a less obvious source of return called roll yield. If futures prices for the nearest months are higher than those for more distant months, the ETF will be selling higher and buying lower each time, and will earn a profit from doing so. Conversely, if prices for nearer months are lower than more distant months, the ETF will be selling lower and buying higher, and the roll yield will be negative.

If – as is often the case in a crisis – spot prices spike by much more than futures, a typical oil ETF will not rise by as much as the spot price does. However, the new-ish Onyx Spot Return Crude Oil ETF (LSE: OIL) takes a different approach. It holds very short-term daily Dated Brent futures, which it continuously rolls over. As a result, it is a closer proxy for the spot price. This product launched in June and has beaten traditional ETFs since then (see chart). Whether it keeps doing so depends on whether spot prices remain much higher than futures and on whether the futures roll yield is positive or negative. Regardless, it's interesting to see a new way to trade immediate shocks to physical oil prices that relies less on shifts in futures.

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Airlines have been one of the hardest-hit industries as a result of the war in Iran, and the industry is struggling to recover from a succession of punishing shocks.

The Covid pandemic was a challenging start to the decade for the airline industry, as it all but shut down global travel. Two years later, Russia’s invasion of Ukraine sent oil prices sky-high, pushing up input costs for airlines.

The story has been similar in 2026, with the US/Israeli conflict with Iran prompting the closure of the Strait of Hormuz, through which around a fifth of global oil supplies previously moved, adding further upward pressure onto the cost of jet fuel while pushing global inflation higher.

“High oil prices are turning the coming winter into a stress test for airlines,” said Lale Akoner, global market strategist at investing platform eToro. “Fuel and labour costs are rising, while geopolitical disruption and pressure on household budgets make it difficult to pass them on through higher fares.”

The International Air Transport Association warned in June that global airline profits would halve in 2026 due to higher fuel costs.

Airline stocks have been punished. The NYSE Arca Airline Index, an index of US-listed airlines, fell 11.9% in 2026 through to 10 September, while the STOXX Europe Total Market Airlines Index, which comprises European-listed airlines, fell 12.8% over the same period.

But while it is undoubtedly a challenging period for the sector as a whole, are there opportunities amid the disruption?

What does EasyJet’s acquisition mean for airline stocks?

One of the biggest consequences of the rout in airline stocks appears to be the acquisition of EasyJet (LON:EZJ) by US-based private equity firm Apollo.

EasyJet rejected a sequence of bids from private equity firm Castlelake, calling the bids “opportunistic” given they followed a sharp nosedive in the airline’s share price. EasyJet’s share price had declined by over 30% in the 12 months to the end of May, before Castlelake’s first bid.

Eventually, though, Castlelake’s rival Apollo made a bid that EasyJet’s board felt compelled to accept, and it now looks as though the airline will be acquired.

“EasyJet is now a different kind of investment, with Apollo agreeing to buy the airline for 715p a share,” said Akoner. “The deal, which appears likely to be completed, has largely insulated the shares from the latest fuel shock.

“However investors should be wary as most of the takeover gain has already been captured, leaving limited additional upside before the expected completion in early 2027.”

EasyJet’s takeover highlights the extent to which airlines are under pressure, and that this creates an opportunity that institutional investors are already exploiting.

“We think this difficult backdrop could still produce winners,” said Akoner. “Airlines are already cutting unprofitable routes, and weaker operators may have to go further. Fewer available seats should support ticket prices and allow the most efficient airlines to increase market share.

“For investors, the sector increasingly looks like a contest between companies with genuine cost and balance-sheet advantages and those relying mainly on passenger growth.”

Which airlines could be resilient?

Andrew Hollingworth, founder and portfolio manager at Holland Advisors, is of the view that the worse things get for most airlines, the better they are for Ryanair (DUBLIN:RYA) as it has permanent pricing power.

“Ryanair is the lowest cost producer,” said Hollingworth. “If they put their prices up by three euros, [no other airline] is remotely near them, so everyone’s got to pay. “

Most other airlines, though, only have pricing power when the winds are blowing in their favour.

“If the oil price is moderate or rising, but the economy is good, and demand on their routes is good, and they haven’t got new competitors, they can put their prices up and pass on cost inflation,” said Hollingworth. “But if the economy isn’t so good, but the fuel price is still rising, hard luck. There isn’t enough demand to pass on the cost inflation.”

Like Ryanair, Jet2 (LON:JET2) is also a low cost provider, but it offers more to customers through its scale economy than low prices alone.

“It’s not actually an airline, it’s a package holiday company,” said Hollingworth. “Jet2 gives you good value for money on a package holiday, but it also gives you customer service.”

That gives the company excellent customer loyalty, but Hollingworth doesn’t believe this is fully priced.

“The stock market's got it on a very low P/E ratio because it says ‘it's just another average tour operator like Tui,’ but that's not how the customer sees it,” he said. “The customer sees that they give them value for money, they give them good quality service.”

How to invest in airline stocks

If you think it’s time to buy rather than sell airline stocks, you have a few options (besides buying the shares of companies outright).

There are a number of thematic exchange-traded funds (ETFs) tracking the travel sector that offer exposure, such as the iShares STOXX Europe 600 Travel & Leisure UCITS ETF (DE:EXV9) which is a tracker fund following its namesake index, and the US Global Investors Travel UCITS ETF (LON:TRIP) which is an actively-managed ETF offering exposure to travel and tourism stocks. While both of these are diversified travel and leisure funds, airline stocks like Ryanair feature prominently in both portfolios.

Another option is the VT Holland Advisors Equity Fund, which is managed by Hollingworth. It holds Jet2 as its largest holding (with 8.1% of the portfolio) and Ryanair as the sixth-largest (with 4.4%) as of 28 August. Note this isn’t an airlines-focused fund, but one which aims to invest in compelling business models trading at favourable valuations across a range of sectors.

For listed private equity funds, discounts to net asset value (NAV) widened sharply when bond yields rose in 2022. Investors were anticipating that the valuations of private equity investments would follow share prices down after the customary lag.

Boards responded with share buyback programmes in an attempt to add value and close the discounts. Yet discounts remained stubbornly high as valuations stagnated.

When markets started to move higher two years ago, investors could reasonably have expected private equity fund valuations to follow. This should have led to a fall in discounts, regardless of buybacks. Yet the evidence for this is mixed.

Diverging fortunes for private equity funds

Pantheon International (LSE: PIN) and HarbourVest Global Private Equity (LSE: HVPE) have returned almost 20% in one year, while Patria Private Equity (LSE: PPET) is up over 50% in three. All had significant help from narrowing discounts. However, 3i (LSE: III) has lost 25% and HgCapital Trust (LSE: HGT) almost 15%, as their discounts have headed in the wrong direction.

What is going on? The answer is that 3i and HGT are special cases. 3i traded on a large premium thanks to the phenomenal performance of discount retailer Action, which had come to account for over three quarters of its NAV. When Action's growth appeared to falter, that led to a slump in 3i's share price. The £28 billion trust now trades on a 7% discount, up from 30% a few months ago.

3i's update at its annual general meeting in June showed that pessimism about Action had been overdone. Performance in the rest of the portfolio is steady, but accounts for less than a quarter of the total. So despite 3i's shares being much better value than they were a year ago, they are still very much a bet on one company.

HGT specialises in the software sector and so it has suffered from fear that its holdings will be disrupted by AI. This fear may prove exaggerated, but has led to a justifiable fall in the share price even though underlying performance has been good. In its June update, it reported growth in revenue and cash generation of 16% and 19%, respectively, as well as £134 million of realisation proceeds in the first half at an average uplift to carrying value of 31%.

However, it has continued to reduce valuations and its portfolio is now valued at a weighted average multiple of 23 times cash generation. This still looks rich, especially as the portfolio carries plenty of debt, but is more than offset by the shares trading at a 23% discount. The shares have recovered from their May low, but the rally should go further.

The price of Oakley Capital (LSE: OCI) has also recovered, but it still sits on a discount of 33%, despite reporting a gain of 6% in NAV in the first half. Literacy Capital (LSE: BOOK) was a sector darling until two years ago, since when its shares have slid 40% to a 37% discount. The NAV has fallen 7% over the last year and is up just 3% over three, but an upturn is surely imminent. Both shares look a bargain.

Time to boost demand for private equity funds

Meanwhile, the funds of funds such as HarbourVest, Pantheon, Patria, ICG Enterprise (LSE: ICGT) and CT Private Equity (LSE: CTPE) – which invest in the funds of other managers or co-invest in companies alongside them – all trade on discounts of 25%-30%. Their boards continue to be obsessed with share buybacks to reduce the discount, but they need to focus more on increasing the demand for their shares than reducing the supply.

Investors are hungry to see evidence of hidden gems in private equity fund portfolios that can grow much larger over time. Action was once just a modest holding for 3i. Boards need to move onto the front foot in extolling their holdings. Yet investors shouldn't wait for them to do so, or they will end up paying much higher prices.

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What is a data centre?

A data centre is a big, highly secure building full of computers and the other physical infrastructure that the digital world is built on. They've been around for decades (since the 1940s, reckons IBM, in the form of “server rooms”), but the internet, cloud computing and now the widespread adoption of AI have all radically increased the need for giant – and now “hyperscale” – centres. Nowadays, much of what we do online every day – from Google searches to banking to streaming Netflix – depends on computing power and connectivity housed in data centres. There's no single authoritative figure for the number of such centres in the world, because there's no universally accepted definition of how big an installation has to be to count as one. But in terms of large data centres, commercially operated by companies such as cloud providers, there are around 11,000–12,000 worldwide, with the majority in the US.

What's inside a data centre?

A typical data centre will contain servers (powerful computers that process, store and distribute data); networking equipment (to connect the servers to the internet); sophisticated cooling systems (otherwise computers get very hot, and then stop working); and power infrastructure (such as substations, back-up generators and batteries). In recent decades, data centres have got much bigger, with so-called “hyperscalers” – the likes of Microsoft, Google and Meta – building vast campuses covering many acres. A data centre with 150 racks holding 25 servers each equates to 3,750 servers; but that's no longer considered large. According to the International Data Corporation, a true “hyperscale data centre” is one that contains at least 5,000 servers and occupies at least 10,000 square feet of physical space and uses more than 100MW of energy. And many are now vastly larger than that. A hyperscale data centre can hold thousands of racks and hundreds of thousands of servers – all built on vast sites covering hundreds of acres.

Why are data centres controversial?

Much media coverage of the backlash (or “techlash”) against data centres focuses on distrust of Big Tech and AI, and fear of job losses. More than half of Americans say they're more concerned than excited about the growing use of AI in daily life, according to a recent report from the Pew Research Centre. But the dominant sources of opposition are more mundane, says The Economist. Polls suggest that what worries people about the centres is their perceived local impact. In a recent Fox News poll, 75% of respondents cited concerns such as energy use, utility and water bills, construction disruption and traffic as the main reason they opposed a data centre in their area. Just 11% pointed to AI itself.

The politics around building data centres

More than 500 US counties and municipalities have passed data-centre bans or moratoriums, while dozens of proposed projects have been abandoned. Research group Data Centre Watch calculates that grassroots groups blocked or delayed at least 75 data centre projects worth about $130 billion in the first three months of 2026 alone. That's close to the $156 billion worth of facilities that were disrupted during all of 2025. What's striking, too, is how swiftly politicians have shifted their position. The Republican governor of Texas, Greg Abbott, once touted the state as the “epicentre of AI development” – it boasts the most of any state except Virginia. Last week, though, now up for re-election, he said data centres had “dug their own grave” by overreaching. Across the US, the issue has emerged as a surprise key battleground in the US midterm elections, with some unexpected opponents (Republicans) and supporters (union-backed Democrats) of development. With typical grace and tact, president Donald Trump opined that: “The only reason that communities throughout the USA should not want data centres is if they want to end up being backwards and poor. If they want to be successful and rich, with far lower taxes and jobs all over the place, let data reign.” China is delighted with the US backlash, he claimed. “If we kill the golden goose, you will only have yourselves to blame.”

Is Donald Trump right about data centres?

Perhaps. “Voters and politicians alike are making a big mistake” in blocking data-centre growth, says The Economist. One common myth is that data centres guzzle endless water. In fact, a mid-sized centre uses about as much as two golf courses and much less if it recycles its water, as many now do. Concerns over energy use are more credible, but there's little evidence that they raise energy prices for households; rather, by increasing demand they spread the fixed costs of infrastructure among more kilowatt-hours sold. And in any event, the “answer to competing demands on resources – whether water, electricity or something else – is to price them according to their scarcity, thereby encouraging more provision and higher living standards over time. It is not to ration inputs according to the arbitrary judgment of scolds.”

What about here in the UK?

Britain has a claim to being the home of the first data centre – in the large shed at Bletchley Park where wartime cryptographers built Colossus, the world's first programmable electronic computer. Today, the UK has 450 “large data centres”, according to government figures, with more than half of them in or close to London. In September 2024, the government designated data centres as critical national infrastructure and in January 2025 announced five “AI Growth Zones”, with £28.2 billion of planned investment. Our biggest data centre to date, says James Price on CapX, is a 148MW site outside Cardiff, but progress is slowing, with the likes of the UAE and Japan now steaming ahead. This, of course, is hardly a surprise. “In Britain, we can force £100 million to be spent on a bat tunnel; imagine what our planning system will do with a gigawatt campus.”

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New Year in the Maldives

Join Pixie Lott in the Maldives this Christmas. The British pop star will be performing on New Year's Eve at the InterContinental Maldives Maamunagau as part of the resort's "12 Pearls of the Ocean" programme of festivities. Each "pearl" is a day of activities and entertainment following a theme, starting with the lighting of the Christmas tree on 22 December. Santa arrives by boat on Christmas Day, the "Pearl of Champagne" features an exclusive yacht cruise with Champagne, while the Pearl of Play takes the form of a lively lagoon party and a moonlit dinner by the sea. At midnight on New Year's Eve, the sky above Maamunagau will be illuminated with fireworks and a drone display to see in 2027. In tandem with the "12 Pearls of the Ocean", guests can also learn about marine life with British artist and diver Janavi Kramer or enjoy a treatment in the spa, where wellness practitioner Braj Raj Singh will be taking up residence.

From around $1,500 a night, maldives.intercontinental.com.

Live like a local in Munich

Have you ever wished you could experience a place the way the locals do? Kempinski, Europe’s oldest luxury hospitality company, has launched a programme to achieve just that. Called E.R.A.s, which stands for Experience Real Access, guests staying at the Hotel Vier Jahreszeiten Kempinski Munich can undertake a literal flying visit of Bavaria’s royal castles aboard a private flight, guided by two historians. There is, as part of the programme, also a hosted dinner with live music in the royal halls of the Nymphenburg Palace. Alternatively, guests can brush up on their skills as painters, discover Bavaria's famous beers and the region's automotive heritage. Or they can take the plunge – into the Eisbach canal, guided by a Wim-Hof expert and go for a morning run with legendary German former footballer Lothar Matthäus.

E.R.A experiences from €130 per person, kempinski.com.

Starry nights in Northumberland

Matfen Hall's location on the edge of the International Dark Sky Park in Northumberland makes it the ideal luxury stay for enjoying starry nights in Britain. The area offers some of Europe's clearest night skies. The wild and rugged Northumberland National Park is also just a 25-minute drive away from the hotel, encompassing around 400 square miles of untouched landscape, tranquil rivers and sweeping moorland close to the Cheviot Hills. But if the nights prove too brisk, you don't even have to leave the comfort of your room – the spacious suites have their own telescopes. Within the Dark Sky Park, the Kielder Observatory will also be hosting stargazing activities. Afterwards, warm up in Matfen Hall's three AA Rosette The Emerald Restaurant.

From £350 a night, matfenhall.com.

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Reaching the age of 65 signals the beginning of retirement for many, but it can also usher in a phase of tax headaches.

The number of over-65s paying income tax has risen by more than three million over the last five years, according to figures from HMRC.

Meanwhile, greater numbers of beneficiaries of estates face paying inheritance tax (IHT) as asset values rise and with unused pensions set to be included in estates from April 2027.

The number of over-65s paying tax on their savings interest is rising too, while 38% of people who paid capital gains tax (CGT) in 2024/25 were 65 or older.

However, there are ways those in their mid-60s can minimise the damage and keep the taxman at bay.

Income tax on state, personal and workplace pensions

An increasing number of pensioners are paying income tax on their pension wealth due to frozen tax thresholds.

The personal allowance has been frozen at £12,570 and higher rate income tax band at £50,270 since April 2024. Meanwhile, the additional rate tax band was cut from £150,000 to £125,140 from April 2023.

A recent Freedom of Information (FOI) request submitted by Steve Webb, former pensions minister and partner at pension consultants LCP, revealed hundreds of thousands of pensioners are being pulled into paying more tax due to these frozen thresholds – a process known as fiscal drag.

The FOI found those of state pension age, aged 66 and over, paying income tax at 40% or 45% has more than doubled from 494,000 since 2021/22 to 1,092,000.

The number paying tax at 45% has almost tripled from 39,000 to 115,000.

With income tax thresholds frozen until 2031, these figures are likely to rise higher.

Webb said: “Many people of working age may have expected that they would be basic rate taxpayers in retirement, but few will have expected to find themselves paying 40% or more out of their pensions in tax.

“But this is the norm now for over a million pensioners, with the number set to rise further.”

How to pay less income tax on your pensions

One way to avoid tipping your income into a higher tax band is to time when you make withdrawals from your pensions, Webb said.

For example, you could split a single large withdrawal into two and spread it across two tax years to keep your taxable income in those two years lower.

Another, Webb said, is by adding more into a pension after you’ve retired.

He explained: “It’s still possible to get tax relief on contributions up to age 75, which lowers current taxable income – especially in years when you would otherwise be a higher rate taxpayer.

“For those who have income to spare in retirement, additional pension saving can be worth considering.”

It’s worth noting, there are rules around how much tax relief you can receive on pension contributions if you have flexibly accessed your pension.

For example, the money purchase annual allowance applies to contributions if you’ve accessed taxable cash from a defined contribution pension. If the allowance is triggered, tax relief is usually limited to contributions of £10,000 a year gross.

Capital gains tax

Over-65s often take up a large share of CGT liabilities in the UK.

Data from HMRC reveals that of the 551,0000 people who paid CGT in 2024/25, 212,000 (38%) were aged 65 or older.

Sarah Coles, head of personal finance at investment platform AJ Bell, said: “People tend to build assets as they go through their working life, so wealth peaks around the age of 65, and at that point they start spending their way through their wealth. This period captures that turning point.”

How to lower your capital gains tax bill

Wherever possible, you should hold assets within tax-wrappered accounts like ISAs or pensions so any gains are free from CGT.

Make the most of your CGT annual allowance as well. This allows you to dispose of gains of up to £3,000 each tax year free from CGT.

Coles, from AJ Bell, said it’s worth making the most of your CGT annual allowance each year on an ongoing basis, so you can dump assets tax-free bit by bit.

Also, if your partner hasn’t used their annual CGT allowance or ISA allowance, you could transfer assets to them to pay less tax or even a lower rate of CGT.

Source: HMRC

Income tax on savings

Over-65s are increasingly paying income tax on savings held outside tax-wrappered accounts.

The number of savers in this age group paying income tax on their savings is forecast to reach 2.1 million in 2026/27, more than four times the 517,000 in 2022/23, according to Freedom of Information (FOI) figures obtained by Paragon Bank.

The total tax liability facing over-65s in 2026/27 is expected to reach £3.34 billion compared with £795 million in 2022/23, based on the FOI figures.

How to avoid paying tax on your savings

You could try overpaying on your mortgage if you’ve got surplus cash you don’t need to access immediately. You could also pay off any credit card bills or personal loans using money from your savings pot as well.

Make sure you’re putting savings into tax-wrapped ISAs as any interest earned on them will be tax-free.

Andrew Wright, head of savings at Paragon Bank, said using ISAs was particularly critical for those aged 65 and over, as new rules limiting the annual cash ISA limit to £12,000 from April 2027 won’t apply to this age group.

“Making full use of your ISA allowance can help protect more of your hard-earned interest from tax and those aged 65 plus have the benefit of retaining the full £20,000 cash ISA allowance from next tax year,” Wright said.

Inheritance tax

Frozen IHT thresholds and rising asset prices are dragging more and more estates into HMRC’s net, including those of over-65-year-olds.

IHT receipts in the three months to July 2026 totalled £3.2 billion, according to HMRC, £100 higher than over the same three month period in 2025, and they’re expected to climb more when unused pensions form part of people’s estates from April 2027.

Ian Dyall, head of estate planning at wealth manager Evelyn Partners, said: “It’s worth remembering that it’s not strictly the deceased estate-owner who pays inheritance tax but the beneficiaries.

“However, that doesn’t make it any more palatable to those who have carefully saved and invested, and who want to pass on that family wealth without a big tax charge.

“It’s also worth pointing out that as people are living longer, many beneficiaries are in their fifties or even sixties before they inherit from their parents – so it may well be the case that more 65-year-old beneficiaries are starting to face IHT bills.”

How to lower an inheritance tax bill

Start with making the most of your gifting allowances. For example, you can give away up to £3,000 tax-free each financial year to one or more people through the annual exemption rule.

You can also make regular gifts to people, as long as they’re made out of income and not capital and they don’t affect your standard of living.

This is known as ‘expenditure out of income’ and can include regularly paying rent for a child or adding money into an under-18’s savings account.

Gifts of any size can be made IHT-free if they are made seven years or more before your death.

Dyall said: “The earlier gifting is done the better as that gives the seven year rule more time to expire, which then means the gift will be fully outside the estate.”

Most people build an investment portfolio gradually over many decades, through monthly contributions they barely notice.

An annuity works the other way. It is bought in one transaction and cannot be undone, often leaving buyers agonising over timing. With annuity rates at an 18-year high, is now the moment, or is it worth waiting for better gilt yields?

When you buy an annuity can make a big difference. On Canada Life's benchmark, a healthy 65-year-old with £100,000 bought £4,521 a year in January 2022. By the end of September 2022 the same £100,000 bought £6,873. Those who waited nine months got an extra £2,352 a year for the rest of their life.

Then again, 2022 was not a normal year, and no one knows what will happen in advance.

Tracking annuity rates

UK consumer champion Which? tracks the annuity market each month, recording the best income a healthy 65-year-old could buy with £100,000. In 2025, the worst month to buy was February, at £7,525 a year. The best was June, at £8,011. December closed at £7,665. The difference between best and worst was £486 a year for life.

But now compare providers. In January 2026, the most generous on the market offered £7,649 on the same £100,000. The least generous offered £7,100.

You can close the provider gap by collecting quotes. But you can’t close the timing gap. You can only stop a single day setting your income for life.

While drip-feeding into equities usually leaves you worse off than buying the lot at once, because shares are expected to rise and uninvested money misses the climb, annuity rates carry no such expectation.

Buying in stages is insurance against a rate move nobody can forecast. It won’t leave you better off than a single purchase would, but spreading the purchase over several dates means no single morning's pricing sets the whole income.

Huang, Milevsky and Young worked the problem through in the Review of Finance in 2017. Give a buyer a fixed budget, improve the rate on offer by roughly a tenth, change nothing else, and the sum they should commit today jumps from about 5% of that budget to about 85%. The authors call the pattern 'an asymmetric dollar-cost averaging strategy'. The market is American and the product is a deferred annuity, so the numbers do not transfer, but the pattern does.

Standard Life's model fixes the dates in advance. It is the only detailed UK modelling of staged annuity purchase I can find, and its saver buys at 65, 70, 75 and 80 whatever rates are doing. The rate improves at each purchase, from 6.6% of the pot at 65 to 7.0% at 70, 8.1% at 75 and 10.0% at 80. Every bit of that improvement is the buyer getting older. In the model, market pricing never moves. A model in which conditions never change cannot demonstrate the value of spreading purchases across changing conditions.

Standard Life's saver starts with £150,000. About £90,000 buys a level annuity at 65, and about £20,000 more buys another at 70, 75 and 80, with whatever is left in drawdown. The model assumes 5% a year on that balance, 3% drawn from it, and good health throughout. By age 90 that saver has drawn £259,115. A single purchase at 65 would have paid £253,775. Standard Life does not do that subtraction anywhere in the release, so here it is: £5,340.

Across 25 years, that is 2.1% more income.

The staged buyer pays for that £5,340 up front. In year one the income is £8,155 against £10,151 for a single purchase, a fifth less. Annual payments catch up at 75. But a decade of shortfall takes some making up, and the running total does not favour staging until 88. The model stops at 90, so the whole gain lands in the last three payments. The drawdown pot is empty by 80, which means the flexibility being sold runs out eight years before the money arrives.

The cost of waiting to buy an annuity

The cost of waiting is built into the rate. An annuity pays more at 80 than at 65 partly because the insurer expects to pay out over fewer years, and partly because buyers who die early subsidise those who live longer. Money still sitting in drawdown earns no share of that subsidy. It sits in markets instead, taking a different risk while it waits. The better rate at 80 is what waiting since 65 has already paid for.

Can you split your annuity pot?

Splitting a pot is easy enough. Aviva, Canada Life, Legal and General and Standard Life all set a £10,000 minimum on what is left after tax-free cash, so £250,000 divides four ways at each of them.

Pricing the split is harder. Phoenix Life, which shares an underwriting company with Standard Life, tells consumers that some providers may pay more on one large purchase than on several small ones. It doesn't say how much more. Standard Life's adviser site, meanwhile, says an annuity is unlikely to suit a client who wants savings kept invested for growth, which is what staging asks of them for 15 years. I can find no published estimate of what a UK annuity ladder would actually have returned.

But one argument for staging survives. Insurers price on life expectancy, so a condition that shortens it lifts the rate, and a later purchase may qualify where an earlier one did not. Which? found a 65-year-old in relatively poor health quoted six% above the standard rate by Legal and General and 15% by Aviva. Nobody can plan around that, but it is real.

So the order matters. Collect quotes first: in January 2026 the gap between the best and worst provider was £549 a year, and it is the one gap in this decision you can close. Then decide whether a fifth less income at 65 is worth paying to spread a risk nobody can forecast.

Staging is insurance. Sold as anything else, it is a poor deal.

Retirement planning and making the most of pension pots is firmly under the spotlight with more people facing a shortfall when trying to achieve a comfortable retirement.

The government’s Pension Commission warned in a recent report around 15 million people aren’t putting enough away for later life, particularly low and middle-earners, the self‑employed and women.

Meanwhile 45% of working-age adults, around 18 million people, are not saving into a pension at all despite nearly half of them being in work, the report found.

Greater numbers of people are forecast to be renting into retirement as well, according to recent research by retirement firm Standard Life, increasing the financial burden on pensioners.

All the while, the cost of the triple lock is coming under strain and the state pension may not be as generous in the future.

Given the context, your pension savings should be working as hard as possible. Experts say, though, for a lot of people, they're not and basic errors are costing savers potentially tens of thousands of pounds.

Steve Webb, partner at pension consultants LCP, Helen Morrissey, head of retirement analysis at investment platform Hargreaves Lansdown, and Daniela Silcock, director of Daniela Silcock Pensions Research, shared six pension mistakes you should be avoiding.

Not keeping paperwork

An estimated £31 billion is sitting in lost pension pots, according to the Pension Tracing Service. If you have a pension you have forgotten about, then some of this money could be yours.

Losing tracking of a pension pot can be easily done if you've misplaced paperwork containing contact details for pension providers and policy numbers.

These types of details will usually be on annual account statements or sometimes welcome packs or joiner letters from your pension provider.

Webb said: “I have lost count of the number of people who have contacted me asking for help tracking down a lost pension from a previous job.

“Those who have kept paperwork have a far better chance of success, enabling us to work out where the pension money is now held.”

If you’ve looked thoroughly and can’t find key pension paperwork anywhere, there are other ways to track down policy numbers and contact details for providers.

If you’re looking for an old workplace pension pot, you can try getting in touch with a previous employer through Companies House. Failing this, you could contact the free-to-use Pension Tracing Service.

Not making the most of employer matching

Under auto-enrolment rules, workers earning more than £10,000 a year are automatically put into an occupational pension scheme by their employer.

Under the rules, you contribute a minimum of 5% of your monthly salary to the pension and your employer adds 3% on top.

However, you can contribute more to a workplace pension if you want and some employers will ‘match’ this amount.

For example, you could pay 8% a month and your bosses would add 8%. If you have the budget, then matching is worth considering as it could give you a significant boost to your pension savings with extra free cash from your employer.

Research by Standard Life found someone starting working at 22 on a salary of £25,000 increasing monthly contributions into a workplace pension by just 1% could add £26,000 to their pension pot.

Webb said: “[It] is an incredibly efficient way of rapidly building up a pension pot, as every extra contribution is effectively doubled overnight.”

Not claiming tax relief on pensions

Pension tax relief is a tax break offered by the government to encourage people to save for retirement.

It is applied at your marginal tax rate, for example a basic-rate taxpayer would receive 20% tax relief and a higher-rate taxpayer 40%.

All basic-rate taxpayers receive pension tax relief automatically, however, if you are in a ‘relief at source’ pension scheme, you will need to proactively claim tax relief if you are a higher or additional-rate taxpayer.

Roughly 800,000 people failed to claim higher rate pension tax relief worth over £1 billion in 2023/24, according to a Freedom of Information request submitted by Webb.

He said so many people were missing out simply because they “will not realise that there are two different ways in which pension tax relief can be delivered”.

“This may be news to many people…but it matters hugely – if you pay £80 into a pension you get £20 basic rate relief making a gross contribution of £100 into your pension. But having made a gross contribution of £100 you are entitled to £40 relief if you are a higher rate taxpayer, not £20, and £45 if you are an additional rate taxpayer.

“You only get this if you claim it. The missing amount is £20 per £80 that you have paid in, which could amount to thousands of pounds for some people.”

You can claim tax relief either through your tax self-assessment tax return or via gov.uk.

Transferring a defined benefit pension into a defined contribution pension

A defined benefit (DB) pension, sometimes called a final salary pension, typically pays out a certain amount based on your salary and how long you’ve been part of a pension scheme.

Defined contribution (DC) pensions pay out a certain amount depending on how much you and potentially an employer have put into them, as well as how your investments have done.

You can transfer a DB pension into a DC pension, however Silcock explained once you’ve done this, the guaranteed benefits that come with it are permanently given up.

“A DB pension provides an income for life with protection against inflation. It may also provide an income for a partner or other dependent after the member dies.

“After a transfer [to a DC pension]…poor returns or high withdrawals could mean that the money runs out.”

That said, there can be advantages to transferring to a DC pension, including that you get more flexibility in choosing how your pot is invested.

You can also withdraw all the money from a DC pension in one go, which could work out more cost-effective than a DB pension if you don’t have long to live or you need the money to cover medical expenses if you have a terminal illness.

In addition, while most DB pensions will continue to pay a portion of your pension income to any of your dependents after you die, DC pensions can typically be left to a wider set of people, giving you more choice in who inherits your pension funds.

Adding too little into your pot and for not long enough

Not putting enough into a pension throughout your life, and starting too late, will reduce the size of your retirement pot.

Silcock pointed out that some people don’t contribute to pensions because they’re taking on caring responsibilities or simply because they can’t afford it, however others delay saving simply because “retirement feels a long way off”.

“People are likely to get more from their pension if they start contributing when they are young and continue throughout their working life,” Silcock said.

She gave the example of someone’s pension growing at 5% a year, with £1,000 contributed at age 20. This would be worth around £7,040 by the time the person turned 60.

This same amount added to a pension at age 50 would be worth just £1,630 – £5,410 less.

Silcock said for someone who doesn’t have the budget to start saving into a pension, it’s worth exploring if a partner can make contributions on their behalf.

Assuming you will get a full state pension

The full new state pension is worth £241.30 a week and can form the bedrock of your retirement pot, but not everyone will get that amount. Anyone planning for retirement should take time to look at how much state pension they will get.

To receive the full amount, you need 35 years’ National Insurance (NI) contributions, however you may be missing years, for example if you’ve had to leave a job to care for a child or relative.

Morrissey warned: “Don’t assume that you will receive a full state pension. If you’ve spent any time out of the workforce, you could have gaps in your National Insurance record that mean you get less.”

If you are missing years, you can top up your state pension with voluntary contributions – but before you do, consider whether it is worth topping up National Insurance contributions.

If you're young and still working, you have plenty of time to make up for the gap.

Young savers could be missing out on lower fees and higher returns by leaving money in a child trust fund (CTF) rather than transferring into a Junior ISA (JISA).

CTFs were a tax-free savings account available to children who were between 1 September 2002 and 2 January 2011. These accounts were given a funding kickstart from the government with an initial deposit of £250. The idea was to build a savings habit for children early on, letting the accounts earn savings interest or invest in the stock market before they could access the funds at age 18.

CTFs were replaced by Junior ISAs in November 2011, pushing responsibility onto parents to set up their own savings for their children. This also made CTFS ‘zombie’ accounts as providers shifted their focus onto Junior ISA.

But millions of savers still hold CTFs. The oldest children on the scheme turned 18 in September 2020 and around three million accounts have matured since then.

Of these around 2,285,000 were claimed or automatically transferred to an ISA as of April 2025, while 758,000 CTFs have not been claimed.

Experts warn that those who still have money left in both ongoing and matured CTFs could be better off with a Junior ISA where there are wider range of fund options for investments and better rates for those who kept their money in interest accounts. Even the fees attached to investment accounts can be lower.

What's the difference between a Child Trust Fund and a Junior ISA?

Both CTFs and a Junior ISA aim to encourage people to start saving with tax-free cash and stocks and shares versions.

You can’t open a CTF anymore but they were offered by banks, building societies and asset managers. If you are a parent of a child who was eligible for a CTF but did nothing with the money, the government will have put it into a default account for you which you will have to track down – there is currently £1.6 billion sitting in unclaimed CTFs.

Similarly, Junior ISA are offered by banks and you can open a stocks and shares version with investment platforms such as Hargreaves Lansdown and AJ Bell.

The annual contribution limit of £9,000 is the same and both offer the same tax advantages with no UK income or capital gains tax to pay on any returns.

There are differences when it comes to account administration. Most Junior ISAs can be opened and managed online, while there may be CTFs where you can only make changes and find out details via the post or over the phone.

Since CTFs are no longer available, providers will also be putting greater resources into Junior ISAs, meaning the fund options for investment are also going to be bigger.

For both accounts, the money is locked away until the child turns 18, at which point they become the legal owner of those assets.

While Junior ISA become adult ISAs at maturity, CTFs don’t change and the money can just stagnate until action is taken, which is another reason to consider moving your money.

Other differences emerge when it comes to returns and charges.

Should you move a CTF into a Junior ISA?

JISAs have more to offer than CTFs, says Alice Haine, head of personal finance for Hargreaves Lansdown.

“A child can only hold one CTF and switching between cash and investments may require a transfer to another provider.

"With a JISA, a child can hold both a cash Junior ISA and stocks and shares one simultaneously, with the savings limit split between the two as desired. So there can be benefits to transferring across.”

Money left in a cash CTF could be getting a poor return compared with JISAs as banks and building societies have little incentive to offer decent rates, plus the rate tends to drop after maturity.

High inflation could also mean the lower returns in a CTF mean you are losing money in real terms.

How do the returns on a Junior ISA compare with a CTF?

Product choice is wider when it comes to choosing a cash Junior ISA and returns can be slightly higher.

For example, savers in Yorkshire Building Society’s now-closed CTF are getting a rate of 3.65%, which drops to 2.35% at maturity.

An average CTF pot of £2,200 would earn £80 of interest in a year or £51.70 if it had already matured.

In contrast, Leek Building Society has a top cash JISA rate of 3.85%.

The typical £2,200 CTF pot would earn a little more interest at £84.70 in a cash Junior ISA in a year or around £30 more under a matured interest rate.

A bigger difference emerges if you are investing. This is where charges can hit your CTF returns harder compared with stocks and shares Junior ISA.

While cash CTFs don’t have charges, millions of investment accounts were opened on behalf of parents by HMRC as default stakeholder options - typically backing tracker funds - that had fees capped at 1.5% per year.

Charges can be lower for a Junior ISA plus there are typically wider investment options beyond UK trackers that were offered by CTFs.

A 1.5% fee is expensive for what's typically a basic UK tracker fund, says Antonia Medlicott, founder of Investing Insiders. “Over 15 years, the average fund in the Investment Association's global sector grew by around 240%, while stakeholder CTF returns tracked closer to the far more modest bond and mixed-investment sector averages.

“That's two decades of compounding working against these children rather than for them.”

A modern Junior ISA can cost as little as 0.15% to 0.35% depending on the investment platform before underlying fund charges.

”This isn't a marginal saving, it's the difference between a fund that's barely kept pace with inflation and one that's actually done its job.”

How to transfer a CTF to a Junior ISA

Once you find the best Junior ISA to transfer the funds to, you will need to complete a transfer form with the new provider.

The transfer can only be completed by the registered contact, usually the parent or the child once they turn 18.

You will need to provide details such as your child’s Unique Reference Number, which you’ll find this on your annual CTF statement as well as the details of the account type and the provider. If you have lost the details, you can use HMRC’s CTF finder at gov.uk.

A transfer can take between two to six weeks and some platforms may even pay cashback for moving money across. Not all providers let you transfer a CTF into a Junior ISA.

You cannot hold both, so the CTF must be transferred in full and closed. This means that before moving, parents should compare charges, investment choice, performance and any valuable existing features.

Energy Performance Certificates (EPCs) are not only a legal requirement, but increasingly scrutinised by buyers considering purchasing a home.

Data from property portal Rightmove reveals buyer demand for homes with an EPC rating of A was up by 22% in July this year compared to July 2025.

Colleen Babcock, property expert at Rightmove, said: “A home's energy efficiency can influence buyer demand, how quickly it sells, and ultimately the price a buyer is willing to pay.

“We’re seeing stronger price performance among more energy-efficient homes, while properties with lower EPC ratings are seeing smaller price growth overall.”

EPCs were rolled out by the government from 2007 and provide a rating based on the energy efficiency of a property.

Homes are ranked from A (most efficient) to G (least efficient). The certificate also offers recommendations on how a home could be made more energy-efficient and the savings to be made implementing them.

For example, yours might tell you to add draught proofing around your property, or to install solar panels to lower your electricity bill.

Why do you need an Energy Performance Certificate?

EPCs are a legal requirement if you’re selling, renting or building a property.

You must order an EPC for potential buyers or tenants before putting a property on the market to sell or rent.

In Scotland, you must also display the EPC somewhere in the property, like next to the boiler. This rule doesn’t apply to homes in England, Wales or Northern Ireland.

EPCs are valid for 10 years so it’s worth checking if yours is coming up for renewal.

How do you get an Energy Performance Certificate?

You can check if your property has a valid EPC via gov.uk, by entering your postcode, street name and town, or EPC number.

The digital version of an EPC will tell you when it is due to expire, as well as the potential score you could achieve by making energy improvements.

The average energy rating in England and Wales is D (score of 60).

If your property and digital EPC does not appear after taking these steps, or your EPC has expired, you’ll need to pay for a new one from an accredited assessor. You can find one via gov.uk.

The cost of the assessment varies depending on the assessor and the size of your property. According to trade platform Checkatrade, you’ll typically pay £65 to £120.

After it has been done, the assessor should give you a digital copy of your certificate.

Can you get free or discounted EPCs?

You should check if you can get a free or discounted EPC through your bank, building society or energy firm.

• Skipton Building Society customers signed up to its membership scheme can get free EPCs.
• Lloyds Bank offers customers cashback and free EPCs if they make energy-saving home improvements like installing heat pumps, insulation and solar panels.
• Santander customers with a Santander mortgage or personal current account can get an EPC for £75.
• Buy-to-let lender Foundation offers free EPCs to customers buying qualifying mortgages.
• OVO Energy customers can get a Home Health Report carried out on their property, which includes an EPC, for £25.

How Energy Performance Certificate rules are changing

The government is set to launch a new framework meaning EPCs will have four cost metrics instead of one: energy cost, fabric performance, heating system and smart readiness.

The reforms were initially due to launch in October 2026, but have been delayed. They are currently set to be rolled out in the second half of 2027.

Separately, landlords must ensure all private rental properties have an EPC rating of C or above, from E currently, by 2030 under the Minimum Energy Efficiency Standard (MEES).

However, they will have to ensure they meet the C rating under the new framework being rolled out from 2027.

Landlords will have to meet a C standard in the fabric performance metric. They can meet this by, for example, installing loft insulation, cavity wall insulation or double glazing.

They will then have to meet the C standard in either the heating systems or smart readiness metric. They can meet the heating systems metric by installing a heat pump or low-carbon heat network and the smart readiness metric by having solar panels or smart electric vehicle (EV) charge point.

It will be at the landlord’s discretion as to whether they choose to meet the heating systems or smart readiness metric.

When do you not need an Energy Performance Certificate?

You don’t need an EPC for any of the following:

• temporary buildings that will be used for less than two years;
• stand-alone buildings with total useful floor space of less than 50 square metres;
• industrial sites and workshops;
• buildings that are due to be demolished;
• holiday accommodation that’s rented out for less than four months a year;
• residential buildings intended to be used less than four months a year;
• places of worship.

Most people in the UK have a pension of some kind, with 82% of employees contributing to a workplace pension. Those who don’t contribute to a pension but have still worked for most of their life should also be eligible for the state pension, under current rules.

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For people retiring within the next 15 years who have not saved enough for their retirement – or even those who just want to protect and grow the pension pot they have – now is the time to confront the numbers.

More than half of UK adults (56%) say they feel hopeful or excited about retirement, according to new research from PensionBee from a survey of 1,000 UK adults in August 2026.

Yet this emotional optimism is rarely matched by financial certainty. Just 16% have both worked out how much they will need and feel confident they’re on track to reach their retirement goals. More than a third (38%) have no idea how much their desired retirement will cost.

Fifteen years might not feel like a long time when it comes to retirement planning, but it is certainly not too late to make a meaningful difference, Lily Megson-Harvey, policy director at My Pension Expert, said.

“The worst thing people can do is bury their heads in the sand because they are worried they have fallen behind.”

15 years from retirement? The first steps

To retire by 2041 with your finances in the best shape, the first step is to get a clear picture of where you stand. That means finding out what you have saved across all your pensions and ISAs, what income you might realistically need in retirement, and whether there is a gap between the two.

“From there, you can look at what is within your control, whether that means increasing contributions where affordable, making the most of employer pension contributions or reviewing when you plan to retire,” said Megson-Harvey.

1. Prioritise pension saving

Pension saving should still be the primary vehicle for retirement saving at this stage. This is because of the incredibly valuable tax relief at your marginal rate – where the government essentially tops up your contributions by 20%, 40% or 45%.

Compounded over 15 years, this additional boost can lead to substantial extra savings – with the growth inside a pension remaining free of capital gains tax and dividend tax.

2. Salary sacrifice – use it before you lose it

Those who benefit from pension salary sacrifice arrangements get the most benefit of all, with extra savings on National Insurance and often employer top-ups, Andrew King, pensions specialist at wealth management firm Evelyn Partners, said.

Salary sacrifice is set to be capped at quite a low level of £2,000 per year from April 2029, so those with access to such schemes might consider “frontloading” their workplace contributions in the next few years, potentially also directing any bonuses into the pension scheme, King pointed out.

“Not only will they get the tax benefits of salary sacrifice but those savings can still benefit from compounding effects over a period of 15 years, and more if the pot remains invested into retirement,” he added.

3. Inheritances can work harder in a pension

Increasingly, King is seeing people receive inheritances well into their fifties and sixties as parents live longer. If they’re funnelled into a pension at this critical stage, these lump sums can go a long way to securing a comfortable retirement.

“Anyone who comes into a lump sum can take advantage of the substantial annual allowance of £60,000 and even three years of carry forward to turbo-charge a pension pot,” said King.

You can’t pay more into a pension than you earn in the current tax year, though, so if that is limiting, a big lump sum could be drip-fed into a pot over a number of years.

Investment strategies to consider if you’re 15 years from retirement

Investment choices are a growing concern of pension holders in the private sector as the vast majority are now saving into defined contribution workplace schemes – where the saver bears all the investment risk.

“Many people automatically think they should reduce investment risk as retirement approaches. While that can feel more comfortable, 15 years is still a long enough period for a significant allocation to shares and other growth assets,” said Lisa Caplan, director of Charles Stanley direct advice and guidance.

Growth remains important because inflation steadily reduces spending power over time. A pound today will not buy the same amount in 15 years' time; the Bank of England inflation calculator shows £1 of goods and services in 2011 costs £1.52 today as inflation has compounded at an average of 2.8% since then.

With one eye on growing your pot and the other on protecting it, an investment approach that can work well is the ‘three bucket’ strategy, said Caplan.

1. The first bucket contains long-term investments that are intended to remain invested for many years and focus primarily on growth.
2. The second bucket holds investments that aim to provide a mix of income and modest growth. This can act as a bridge between your long-term investments and your spending needs.
3. The third bucket holds cash and cash-like investments that can be used to fund withdrawals to cover your regular spending.

“The biggest mistake I see is becoming too cautious too early,” Caplan said. “With 15 years to go, investors still have time to recover from market setbacks and benefit from long-term growth.”

Another common pitfall is reacting emotionally to market falls. “Investors often move into cash after markets decline but then struggle to decide when to invest again. As a result, they miss part of the recovery and risk seeing their money lose value in real terms because of inflation,” Caplan said.

15 years from retirement – fund and investment trust ideas

With a 15 year time horizon, equities and bonds will still form the basis of most savers’ portfolios. But those in workplace pensions should check they are in an appropriate fund.

For instance, “lifestyling funds” will gradually switch you almost entirely into lower-risk bonds from age 50 or 55 – which can be far too soon, and cause investors to miss out on substantial gains.

Rob Morgan, chief investment analyst at Charles Stanley Direct, said for those happy to maintain an adventurous approach, a good-sized proportion of global equity exposure “makes sense”.

His top picks are:

1. JOHCM Global Opportunities fund

This offers a balanced share portfolio focused on durable businesses with strong balance sheets and consistent cash generation, he said, “which makes it worth considering as a core holding”, said Morgan.

“It can work on its own for those leaning towards being a bit more conservative, or alongside a passive strategy such as a global tracker fund or ETF such as Fidelity Index World or iShares Core MSCI World UCITS ETF,” he added.

2. RIT Capital Partners investment trust

With this investment horizon, Morgan also said it’s worth considering a multi asset approach that spreads risk across various asset classes. “RIT Capital Partners investment trust offers a ‘one stop shop’ across a wide spectrum of assets including selected shares and specialist externally managed funds,” he said.

Troy Trojan fund

For those wanting to keep things more conservative, Troy Trojan fund takes a flexible approach to preserving the real value of wealth against the ravages of inflation, said Morgan.

“This involves blending solid and reliable global companies with diversifying assets such as inflation-linked bonds and gold. The strategy is also available in Personal Assets Investment Trust for those that would prefer to buy shares rather than fund units.”

Don’t forget the power of passive

For those who want a more hands off approach, passive index investing can offer a neat solution – and one that has been endorsed by one of the most famous names in the finance world.

In 2013 Warren Buffett instructed the trustee managing his wife’s inheritance to put 90% of the cash into a low-cost S&P 500 index fund and just 10% into short-term government bonds.

The allocation decision underscores a broader investing lesson that diversification, low fees and long-term market exposure can matter more for building and preserving wealth than complicated portfolios or attempts to repeatedly beat the market.

By the time you reach your 70s, you may well already be retired, or at least thinking about it carefully. But does hitting your 70s mean you need to change your investing strategy or stop investing altogether?

While it is never too late, there are some important considerations to take into account when managing your investments in your 70s.

“While your working life may be coming to an end, your investing runway still has decades left to run, so don't ever feel like you've been aged out of investing,” said Darius McDermott, managing director at broker Chelsea Financial Services. “When you're relying on your portfolio for income, capital preservation and diversification have never mattered more.”

Adjusting your investment strategy to potentially reduce the risk can be a good idea.

Younger investors have decades for their investments to recover from stock market shocks that causes their portfolio to fall over the short term. But, If you’re in your 70s, you may not have that luxury: a steep cut to your portfolio value could seriously hamper your retirement plans.

So managing your risk is one of the most important considerations for investing in your 70s.

There are various ways you can limit the risks you’re taking without having to sacrifice potential capital growth.

Investing in your 70s: equities or bonds?

A key decision for any investor to make, regardless of age, is how much should they allocate to equities (stocks and shares) or fixed income (bonds).

Because bonds are often considered safer than equities, older investors tend to hold a larger proportion of their portfolio in the asset class. Some people subtract their age from 100 and allocate the resulting percentage of their portfolio to risk assets, such as equities, and the rest to safer assets like bonds.

So, for example, if you are 75, you might put 75% of your assets into bonds.

This still means that a quarter of your portfolio is exposed to the potential rewards of stock market gains, but the majority of it is reasonably protected in the event of a stock market crash.

This strategy isn’t foolproof though as bonds are not entirely risk-free. Bond markets and equity markets have also been relatively closely-correlated in recent years, meaning that both could crash at once.

So rather than allocating that 75% exclusively to bonds, it might make sense to consider it as a bucket to allocate to less risky assets in a broad sense. This could include commodities, certain defensive stocks, wealth preservation funds or even cash. Some top saving accounts pay as much as 5%. Alternatively, money market funds are a popular way to invest as they offer a low risk option – similar to cash, but the return can potentially be higher.

However, the impact of inflation means that playing it too safe can be a bad idea. “As inflation stays elevated, the cost of keeping your hard-earned savings in cash only grows, and while interest rates look attractive today, it would be unwise to bet your entire retirement income on them staying that way,” said Chelsea Financial Services’s McDermott.

Should you invest in defensive stocks in your 70s?

You don’t necessarily need to abandon stocks entirely in your 70s, but it pays to consider exactly what kinds of stocks and shares you’re buying.

For the most part, you’ll likely want to concentrate either on defensive sectors, value stocks, or income stocks (there is some overlap between all three of these).

Defensive sectors

Defensive sectors are those which tend to perform about as well during an economic downturn as during growth periods. Consumer staples, healthcare and utilities are three good examples: people don’t spend significantly less on shampoo, medicine or their water bill when the economy is doing badly, compared to when it is doing well, so stocks in these sectors tend to hold up well during a downturn.

Infrastructure stocks can also play a defensive role in portfolios as infrastructure companies tend to have fairly predictable income streams which can rise in line with inflation.

“A good satellite option is an infrastructure fund,” said McDermott. “First Sentier Global Listed Infrastructure rounds things out with inflation-linked income from real assets like toll roads and utilities, diversifying away from traditional bonds and dividends.”

Income stocks

If you’re approaching or are already in retirement, the income you generate from your investments is key, as this could well form the bulk of your spending money.

Income isn’t just about funding your retirement; it can form an integral part of growing your portfolio’s value.

James Lowen, co-portfolio manager of J O Hambro UK Equity Income, makes the case that income stocks could be preferable to bonds, because of the potential for dividend growth.

“In fixed income coupons [the amount that a bond pays its holder in interest] are flat; they don’t grow,” he said. In the equity market, on the other hand, dividends do tend to grow – and this counteracts the impact of inflation eroding returns from fixed income investments.

“When choosing between equities and fixed income, [it’s important] to understand one grows, one is flat in nominal terms,” said Lowen.

Value stocks

Whatever kind of stocks you’re buying, it’s important to pay attention to the price if you’re investing in your 70s (and, arguably, at any age).

“When you buy a stock… your starting valuation has a big determinant of what you ultimately make,” said Lowen.

Buying stocks that are trading at high multiples compared to their fundamentals can leave you exposed to higher losses if market confidence turns.

On the other hand, buying stocks at lower valuations can offer some protection against downside losses, and also potentially offers greater room for gains.

“If you pay a full price, where’s your upside?” says Lowen. Buying value stocks "protects your downside and creates your upside optionality”.

Can commodities protect your wealth in your 70s?

Commodities can offer some diversification from equities, which can protect your investments in your 70s. While bonds can become correlated with equities, this is less true of certain commodities; the climate is often a bigger driver of agricultural commodity prices than the business cycle, for example.

On the whole, though, “commodities are cyclical and volatile, tracking economic growth closely”, said McDermott.

Gold, for example, has become more correlated with equities this year, since gold prices and the stock market have both become especially sensitive to interest rate expectations.

“Higher real yields also make gold less attractive, especially for anyone relying on portfolio income, since gold pays none,” said McDermott.

Meanwhile, industrial metals like silver and copper are closely linked to the business cycle as both metals have substantial industrial applications, so demand tends to rise when economic activity is higher.

Which funds could make good investments in your 70s?

“When you’re choosing funds, you’ve got to understand what their track record is on income growth,” said J O Hambro’s Lowen. His fund invests in UK equities with the potential to grow income over the long term; the fund is forecast to yield 4.15% in 2026. It has achieved a 9% compound annual dividend growth rate over the 21 years since its inception, meaning it would have yielded 29% in 2025 based on the initial unit price.

You could also select City of London Investment Trust (LON:CTY) which has raised its dividend every year for 59 consecutive years – the longest record of annual dividend increases for any investment trust.

McDermott highlighted Capital Gearing Trust (LON:CGT) as an investment trust heavily focused on capital preservation, which has delivered a positive return in 42 of the past 44 years while aiming never to lose money.

“Absolute return funds are another option worth considering, using both long and short positions across companies to smooth returns and cushion against market falls,” said McDermott. “Here we like Janus Henderson Absolute Return and SVS RM Defensive Capital.”

Multi-asset funds can also offer exposure across several asset classes in a single holding: McDermott singles out Orbis Global Cautious and Jupiter Merlin Income Portfolio as lower-volatility options.

And to add bonds – which McDermott calls “the traditional ballast of any portfolio” – McDermott recommends TwentyFour Dynamic Bond, or Artemis Global High Yield Bond as a higher-yielding option.

Private landlords are increasingly looking to leave the rental market, including investors rethinking the buy-to-let property part of their later life income strategy. Offloading a buy-to-let portfolio in retirement may be the right decision, but experts have said it takes some careful planning to do right.

A total of 2.86 million unincorporated landlords declared income from renting property in 2023 to 2024, according to government figures, but many could be considering putting property on the market.

Around 40% of landlords in a recent survey by the website Property118 said they were intending to sell one or more of their properties in the next three years, with 27% of the 2,096 landlords asked planning to exit completely.

Why are landlords selling up?

Many of today’s retiring landlords entered the market in a very different regulatory environment and built portfolios during what was a golden era for private landlords. The landscape today looks very different.

“Higher taxes, mortgage interest restrictions, increased regulation, Making Tax Digital requirements and evolving tenant protections, including the gradual removal of Section 21 powers, have significantly increased both the cost and complexity of being a landlord,” said Isabella Galliers-Pratt, senior investment director at Rathbones.

The balance has shifted away from smaller private landlords towards larger, professional operators that are better placed to absorb these costs.

“Property can still provide a valuable source of regular income and a degree of inflation protection over the long term,” said Galliers-Pratt.

“However, landlords approaching retirement should assess whether those benefits adequately compensate them for the ongoing administrative burden, maintenance costs, regulatory obligations and tenant management responsibilities.”

Should I sell my buy-to-let portfolio?

For retirees, the key question is whether property remains the most efficient way of generating income in retirement.

“Many investors are surprised to find a diversified investment portfolio can offer greater liquidity and flexibility, while also providing comparable, and in some cases higher, levels of net income,” said Galliers-Pratt.

For many retirees, the decision to sell is more about simplifying their finances and reducing the demands on their time.

Matthew Beck, chartered financial planner at Smith & Pinching, said: “The hassle and cost of being a landlord is increasing, and in many areas yields are falling. Once you strip out tax, costs and the time it takes to run a portfolio properly, the actual returns many landlords get are a lot tighter than they look on paper.”

When helping clients in this position, he always starts with the same exercise: working out their real yield after tax, fees and maintenance, and comparing that figure to what the same capital could realistically do elsewhere.

“The answer is often an eye-opener,” said Beck. “This isn't a case for selling everything overnight, but it's a useful starting point in plotting a course that’s right for them.”

How to sell a buy-to-let property portfolio in retirement

If you’re a landlord who’s already weighing up an exit from buy-to-lets, the number of properties you own matters.

Selling an entire portfolio in one go to another investor can offer speed and ease, but as it involves selling to someone who's looking for a deal, the price you get is unlikely to be full market value.

Likewise selling a property with tenants in situ narrows your buyer pool to other buy-to-let investors, and this can make it harder to achieve a top price.

Selling a vacant property increases the pool of potential buyers and this could help you get a better price, said Beck, “but you need to weigh that against the gap in rental income you’ll have while it's empty”.

The supply of homes for sale outweighs buyer demand in some regions at present, so be prepared for it to take several months to sell.

Tax is the other thing to think about, and you should get proper advice before you decide to sell, not after.

Capital gains tax on residential property is charged at 18% within the basic rate band and 24% above it, and everyone gets a £3,000 annual exempt amount. Married couples and civil partners who own property jointly can combine this amount, meaning the first £6,000 would be CGT-free.

Any gain has to be reported and paid within 60 days of completion, which catches people out if they haven't planned for it.

Chartered financial planner Beck gave the example of one of his clients – a couple in their mid-70s with four buy-to-let properties worth a combined £1 million. Their portfolio brings in roughly £45,000 a year in gross rent.

“On paper that sounds healthy, but it's actually less than they need to enjoy this stage of their retirement,” he said. “They've told me they feel limited by having to live on what the rent brings in each month, and are ready to sell up.”

“Our aim is to bring down their tax burden and give them more money to spend in the years they actually want to spend it, while keeping the rest invested sensibly, rather than sitting idle,” said Beck.

The other thing landlords should factor in now is timing. In April 2027, rental income tax rates will rise by two percentage points across the board, which will squeeze the returns you make on BTL even further. “That's not a reason to panic sell, but it is a reason to re-run the numbers to see how it will affect you,” Beck said.

“My advice to any landlord is: don't rush it, get proper tax advice before you do anything, and think as hard about what the money is for once it's freed up as you do about the sale itself."

Selling a buy-to-let portfolio checklist

Saif Derzi, property trading expert at Landlord Resource, said there are a few key things for landlords to consider before selling up.

1. In England, the tenant position is particularly important in 2026. Since 1 May, landlords have been unable to use Section 21 to seek possession of their property. If a landlord wants to sell and needs possession, they can use Ground 1A, but they only do this after the tenant has lived in the property for 12 months and the landlord has given them four months’ notice.
2. Selling a property portfolio should be based on whether the property is still delivering after mortgage costs, maintenance, insurance, management, tax, and the landlord's own time to justify the work and concentration of risk involved.
3. For someone entering retirement, compare the buy-to-let portfolio's net income with the income they could potentially generate from the net capital released by selling up, for example, if the money were invested instead.
4. Landlords won't necessarily need to sell everything. Disposing of the least profitable, most highly leveraged, or most management-intensive properties can be a way of releasing capital while retaining some rental income.
5. Look at the whole cost and process of selling, rather than just the asking price. Get a realistic valuation and check the mortgage balance, any early repayment charges, and the likely selling costs.

Buyers are returning to the UK housing market, but with a glut of stock available sellers will need to do all they can to shift their homes.

In its latest house price index, property portal Zoopla said searches on its website in July 2026 were 7% higher than July last year.

However, supply is outstripping demand. Zoopla said there were 5% more homes for sale on its portal in July 2026 compared to the same month in 2025.

Separately, property website Rightmove said the supply of homes on the market in July 2026 was close to a 12-year high.

Some estate agents believe we’re now firmly in a “buyer’s market” – defined as a period of high supply versus lower demand.

Why are we in a buyer’s market?

Tom Bill, head of UK residential research at estate agent Knight Frank, believes “uncertainty” is one of the biggest reasons we're in a buyer’s market.

He said fluctuating mortgage rates caused by the Iran conflict, speculation in the run up to last year’s Autumn Budget and fears over what could be announced in the upcoming Budget have dented demand and caused transactions to slow.

According to HMRC, there were 96,710 UK residential transactions in July 2026, 1% lower than July 2025 and 2% lower than June 2026.

“Things have been a bit stop-start over the last 12 months…and it’s causing buyers to hesitate and to think twice,” Bill said.

“There’s less speculation around this year than there was last year, but people are expecting more taxes on wealth and assets to come in the [2026] Budget because the government has a fairly limited room for manoeuvre.”

Meanwhile, a glut of flats are being put on the market.

Polly Ogden Duffy, managing director of estate agents John D Wood, said some of these flats were being sold by landlords leaving the buy-to-let market, in part, due to the Renters’ Rights Act coming into effect in May 2026 and an increasing tax burden.

Some 93,000 landlords exited the buy-to-let sector in 2025, with another 110,000 forecast to leave in 2026, according to lender Black and White Bridging.

“There are so many reasons today for landlords to not enter the buy-to-let market than perhaps five years ago,” Ogden Duffy said.

She also said homebuyers keen to swerve paying stamp duty twice may be sidestepping smaller apartments, which could be increasing the supply of flats in the market.

“[Buyers are] trying to avoid buying a one-bedroom flat and perhaps buying a bigger flat or a small house as their first purchase.”

High service charges and stagnant flat price growth in recent years were giving buyers extra reasons not to buy flats, Ogden Duffy said.

What could Andy Burnham do to help sellers?

Prime minister Andy Burnham ruled out scrapping stamp duty back in July, but experts say this would be one of the best ways to incentivise homebuyers and increase demand.

David Hollingworth, associate director at the broker L&C Mortgages, said: “Although we are in a more stable period [with mortgage rates]...stamp duty is a big cost that people will see as money to nothing, and it’s just another barrier to whether they should move.”

Scrapping stamp duty could help unlock some of the £5.5 trillion worth of UK housing wealth and galvanise the market, according to wealth manager Rathbones.

Their research suggests ditching the tax would lead to a further 300,000 housing transactions per year.

Ogden Duffy said even if the government didn’t want to scrap stamp duty completely, increasing the thresholds at which it is paid would stimulate the market somewhat.

Others have called for further solutions. Last month, Jason Honeyman, chief executive of property developer Bellway, said the government should introduce a deposit support scheme for first-time buyers to stimulate demand.

What can homeowners do to sell their homes?

Pricing your property accurately is one of the most important things you can do as a seller in the current market, Ogden Duffy said.

“If you are not pricing your property below your competition, you have to accept that you may not sell,” she added.

Recent research by Zoopla found 44% of UK homeowners listing properties for sale in the past three years didn’t sell them, with 34% of this group admitting they had priced their home too high.

Ogden Duffy said if you can’t afford to take the financial hit of a lower asking price, you could rent your property out – with so many landlords leaving the market, rents are being driven up, which offers an opportunity.

Average UK monthly private rent increased by 3.7% to £1,393 in the 12 months to July 2026, according to the ONS.

What if you don’t want to be a landlord or drop your asking price?

If you don’t want to drastically reduce your asking price and aren’t keen on renting the property out, there are other steps you can take to boost your home’s chance of selling.

Ogden Duffy said: “First impressions count, so in this day and age I wouldn’t be using an estate agent unless they had a professional photographer…a really good photographer is going to present your property in the best possible light, and [they] aren’t just taking photos.

“They can advise you to clear surfaces, help you reposition furniture [and] suggest times of day that would be better for light.”

Ogden Duffy also said listing your property on as many property portals as possible will increase your exposure, as will putting up a for sale board outside your home.

She recommended removing any “wildly eccentric” details from your home and trying to avoid being a seller in a chain of more than three people, which will increase the likelihood of delays that could lead to the chain collapsing.

Hollingworth said speaking to multiple estate agents for valuations can be useful when deciding what price to list your home at. For example, you could take all the valuations and work out what the average is.

He also said speaking to multiple agents can allow you to choose the one between all of them that is most enthusiastic about selling your home and will push for the best possible price.

Government debt markets have been around since the city-state of Venice issued its first bonds in 1171, but public debt only became tradable in the English-speaking world six centuries later.

Contemporaries held conflicting views about the development. Several leading members of the Scottish Enlightenment were downbeat. As government debt across the developed world escalates, their concerns are proving timely.

In his book, A Fabulous Debt: The Epic Story of How Bonds Built the Modern World, Financial Times journalist Robin ‌Wigglesworth explains how Britain's geopolitical ascendancy was inexorably linked to its public finances, and in particular its ability to issue vast quantities of low-cost debt.

Thomas Mortimer, an 18th-century financial writer, described the nation's bond market as “the standing miracle in policies, which at once astonishes and overawes the state of Europe”.

Not everyone was sanguine. In his 1752 essay Of Public Credit, the Scottish philosopher David Hume fretted about Britain's newfound tendency to “mortgage the public revenues, and to trust that posterity will pay off the incumbrances contracted by our ancestors”.

Access to the bond market, said Hume, allowed politicians to behave extravagantly without having immediately to raise taxes. “The practice, therefore, of contracting debt will almost infallibly be abused, in every government.”

Adam Smith, the economist who wrote The Wealth of Nations, claimed the issuance of long-dated public debt “has gradually enfeebled every state that has adopted it… When national debts have once accumulated to a certain degree, there is scarce, I believe, a single instance of their having been fairly and completely paid.”

Another Scottish contemporary, Adam Ferguson, opined that a permanent and unproductive national debt was “to be reckoned among the causes of national ruin”. In the decades after these warnings were issued, Britain's national debt kept expanding. No crisis appeared, however, and the country's prosperity grew apace.

Looking on the bright side

In his History of England (1848), Thomas Babington Macaulay mocked the debt doomsayers. He hailed Britain's “fabulous debt” as “the greatest prodigy that ever perplexed… statesmen and philosophers.

At every stage in the growth of that debt, it was seriously asserted by wise men that bankruptcy and ruin were at hand. Yet still the debt went on growing; and still bankruptcy and ruin were as remote as ever.”

The error of the pessimists, said Macaulay, lay in their comparing national debt to that of an individual borrower. Since most of Britain's public debt was held by its countrymen, the nation was in effect borrowing from itself.

They also ignored that economic growth rendered the debt sustainable: “They greatly overrated the pressure of the burden; they greatly underrated the strength by which the burden was to be borne.”

The conditions that created a stable bond market in Macaulay's day have vanished, ‌however. Economic growth across much of the developed world has faltered. Excessive borrowing and spending by governments is partly responsible.

Bloated government spending is to blame for the collapse in productivity growth, according to Swedish economists Andreas Bergh and Magnus Henrekson. Hume expected that excessive debt would lead to debilitating taxes.

Government debt levels have risen inexorably since the financial crisis. Worldwide public debt has reached 94% of GDP, according to the International Monetary Fund. US federal debt is around 114% of GDP, reckons Fitch Ratings.

Economists Carmen Reinhart and Kenneth Rogoff concluded that when government debt breaches the 90% threshold, economic growth falters.

Hume would have agreed: “We have always found,” he wrote, “where a government has mortgaged all its revenues, that it necessarily sinks into a state of languor, inactivity and impotence.”

He cautioned that overseas investors owning big portions of a country's debt “render the public, in a manner, tributary to them”.

A large share of the national debt issued by the US, Britain and France is held abroad. For instance, a third of Washington's $40 trillion in borrowing comes from beyond its shores.

Whereas Britain in the 19th century was the world's top creditor, the US today is the world's largest debtor.

The Bank for International Settlements notes that rising geopolitical tensions could disrupt capital flows, threatening nations with large current account deficits.

After interest rates shot up four years ago, government borrowing costs soared. This wasn't a problem in Macaulay's Britain, where public debt was mostly financed with fixed-interest perpetual bonds.

By contrast, US public debt has a relatively short maturity profile, rendering it more sensitive to changes in short-term interest rates. Rising interest costs on a large stockpile of debt strain government finances.

The historian Niall Ferguson says the decline of a political superpower becomes evident when it spends more on servicing debt than on defence. The US breached this threshold two years ago.

Hume envisaged a day when an overburdened government would stop paying interest on its debt.

Since governments nowadays print the money in which their debt is denominated, an option not available in 18th-century Britain, formal default is unnecessary.

Instead, bondholders can be short-changed through inflation, financial repression and the management of long-term interest rates.

“The natural death of public credit,” said Hume, is inevitable when “overbalanced by a great debt”. The Scottish philosopher's timing was disastrous, but his principles remain sound.

A longer version of this article was first published on Reuters Breakingviews.

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Law Debenture (LSE:LWDB) is a unique investment trust. It is part equity income portfolio and part professional services company, all in one high-performing £1.7 billion wrapper.

It has been a stalwart of the MoneyWeek Investment Trust portfolio since September 2015, with the second-best performance of all the trusts selected. Over the past ten years the shares have produced a total return of 263%, versus 130% for the FTSE All-Share index. It has also outperformed its benchmark by a wide margin over one, three and five years.

This performance is by far and away the best of any trust in the UK equity income sector. The secret of its success is down to the independent professional services (IPS) business.

The success of Law Debenture’s IPS

The IPS business provides a selection of relatively mundane, but essential services focused around three groups: pension services, which provides pension trust services across the UK; corporate trust, a provider of trust and escrow services for transactions such as bonds and mergers and acquisitions (M&A); and corporate services, which provides company secretarial and entity management services.

Inflation-linked organic growth has been complemented by acquisitions – most recently the purchase of company secretarial unit Konexo in 2024 – have all helped IPS grow both top and bottom lines.

These businesses grew net revenue by 6% in the first half of 2026 – the ninth consecutive year of mid-to high-single-digit growth.

These businesses are relatively specialist, so they are difficult for customers to do in-house. They are also low-margin and only profitable at scale, giving incumbent providers a significant edge.

There are only a handful of peers: the four public comparables include London-listed JTC, which is in the process of going private.

Dividend support

IPS accounts for only 15% of Law Debenture's net asset value (NAV), but over the years, its profits have helped support around a third of the trust's dividend distributions to investors.

That gives James Henderson and Laura Foll, the managers of its equity portfolio, a huge advantage for their strategy.

While other UK equity income trusts need to prioritise owning dividend-paying shares to support their distributions, they can take a more flexible approach.

For example, in February 2020, Law Debenture built a position in Rolls-Royce, which then had to suspend its dividend during the pandemic. Other income trusts might have been forced to sell, but Henderson and Foll held on. The position has since generated a return of more than 1,100%.

Other examples include Marks & Spencer and Babcock. Both of these have been held for capital gains, despite their poor dividend credentials.

A strong first half

The portfolio – which accounts for 85% of NAV – is built around growth, income and value. There is also a higher percentage of smaller and medium-sized companies than you might usually find in a UK equity income trust, which reflects the solid foundation provided by IPS.

For example, in the first half, positive contributors in the investment portfolio included companies viewed as beneficiaries of AI, such as Ceres Power and Infineon Technologies. Henderson and Foll also added positions in LSEG and Relx, two previous winners that had sold off due to concerns about the threat of AI.

Strong performers during the period included Beazley, Senior, International Personal Finance, Schroders and Tate & Lyle – all of which received takeover offers, which is “further evidence of the valuation opportunity available in UK equities”, say the managers.

The trust's own shares have also been trading well. For the six months to the end of June, they produced a total return of 16.2%, as they moved from a 2.5% discount to a 1.7% premium on top of the underlying NAV return.

The quarterly dividend was increased by 6% to 8.875p. Based on the company's current target for the year, the shares currently yield around 2.9%.

Henderson is set to retire in June next year, with Foll taking over the portfolio as lead manager. Given her ten years' experience at Law Debenture – as well as 12 on the Global Equity Income team at Janus Henderson – it should be business as usual when she assumes sole command.

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The squabbling heirs running Delfin, one of Italy's biggest companies, have “trumped” the television series Succession, says The Times, proving that “truth can be stranger than fiction”.

The hit TV drama featured four siblings vying for control of their family empire. At Delfin – the €55 billion holding company behind Ray-Ban's owner EssilorLuxottica – there are eight heirs battling it out. And there's more at stake than fancy eyewear.

Delfin is a big financial power player and has substantial holdings in a slew of Italian banks and other financial institutions – including UniCredit, Mediobanca, Banca Monte dei Paschi di Siena and the insurer Generali – as well as de facto control of the international property group Covivio.

It is thus “one of corporate Italy's top power brokers”, says the Financial Times, and this paralysing family feud has sent ripples across the country's financial sector at a pivotal moment. Italian banks are currently waging an internecine chess game of consolidation. The outcome at Delfin could swing the balance.

Delfin founder’s best laid plans…

It wasn't supposed to end like this, says the Luxembourg Times. The family patriarch, Leonardo Del Vecchio – who built the largest eyewear company in the world from a small optical workshop in the Dolomite foothills – “spent years designing a governance structure” to protect his legacy before his death in 2022.

He hoped to head off disputes by dividing the family holding company equally between eight heirs: his six children by three different wives, his widow and her son Rocco Basilico.

Yet from the outset, there were squabbles over everything from dividends to the future of the group's portfolio.

Matters came to a head this year, when Del Vecchio's fourth child – 31-year-old Leonardo Maria – a “keen DJ… avid Ferrari collector” and “mainstay in gossip magazines” – started flexing his muscles, says The Times.

He proposed cementing his control over the group by buying out two of his siblings.

For a time it looked as though “Leonardino” might get his way, says The Observer. But he hadn't bargained on opposition from key members of the EssilorLuxottica board – notably chairman and CEO Francesco Milleri – and his LA-based stepbrother Rocco, who is “credited” with arranging “Ray-Ban's controversial smart-glasses partnership with Meta”.

Their critique, says the FT, was that the younger Leonardo was “not his father” and they warned against concentrating too much power in his hands.

The dispute rapidly reached courtrooms in Italy and Luxembourg.

While Rocco Basilico and another half-sibling challenged the proposed sale of Luca and Paola Del Vecchio's stakes, Leonardo Maria “contested Basilico's entitlement to his 12.5% holding”.

Beating a retreat

After a punishing stand-off, it looks as though Leonardo Maria has conceded defeat, says Il Sore 24 Ore.

This week, he quit as chairman of Ray-Ban and chief strategy officer of EssilorLuxottica – claiming he intended to devote himself to new entrepreneurial projects. His parting shot, says Euronews, is that the company his father founded has “lost its soul”.

“I keep talking to people in the company. I did it when I was a store manager and I have never stopped doing it,” wrote the founder's son. But today, “the enthusiasm is not what it was. The sense of belonging is not what it was. The distance can be felt. And people sense it before the markets. Always.”

The departure of LMDV, as he is known in the company, from his executive roles may or may not end “the infighting at Delfin”, says The Times. But it is “a warning to Italy's legions of family firms facing generational change”.

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Does a fresh lick of paint in the kitchen increase the value of the house? Or a heated towel rail in the bathroom? Or an attractive water feature at the back of the garden?

We learned this week that the government is planning to appoint teams of inspectors to visit people's homes, and decide whether the owner has to pay the new “mansion tax”.

An extra levy will be imposed on homes worth more than £2 million, on a sliding scale going up to beyond £5 million.

It is meant to come into force in April 2028, but it is already proving a lot trickier than ministers seem to have realised.

Earlier this year, HMRC said it was hiring hundreds of inspectors to help with the valuation of everyone's home.

They will all have powers to enter a property to assess what it might be worth.

We can see what the authorities are getting at. If you simply rely on previous sale prices, it takes no account of how a house might have been improved, and lots of homes may well slip through the net.

There is a catch, however. It illustrates that while a mansion tax might appeal to the class warriors on the Labour backbenches, it is going to be very difficult to implement in practice.

There are three big problems. Firstly, going through a large house and trying to figure out how much each “improvement” or “feature” has added to its value is a huge task, and one that will take several years, at a minimum, of training before the “value police” are ready to start work.

It is a huge undertaking, from a state machine that can't build a new railway, or reservoir, or any extra houses. It is hard to believe it is all actually going to happen, and even if it does there will be years of delays as there is with every other government project.

A mansion tax could create a legal quagmire

Next, many of the valuations, quite rightly, will be taken to court.

The Office for Budget Responsibility (OBR) gave us a glimpse into the legal train wreck heading towards us earlier this year with a forecast that 20% of valuations would be challenged in court and that 40% of the legal cases would be successful.

The courts are going to be clogged up for years deciding how much individual homes are worth, creating huge backlogs and crowding out time that should be spent on far more serious issues.

Even worse, the top end of the British housing market is now in freefall, in part because of the looming mansion tax.

In Westminster, prices are down by 25%; in Kensington and Chelsea, 15%. Those falls are starting to ripple out into other boroughs and into the leafy commuter suburbs as well.

With those kinds of price declines, homes are going to drop below the £2 million threshold in huge numbers. The inspectors will have to change valuations constantly, and some owners are going to be heading back to court every year to try and get the tax removed.

Finally, the tax will only raise tiny sums anyway. The OBR has already downgraded its forecasts for the amount of revenue it will raise from £400 million in its first year, rising to £435 million by 2030-2031.

But it also warned that revenue would fall by £370 million before April 2028 because of reduced stamp duty, capital gains tax and inheritance tax receipts as households sold or downsized.

In other words, once all the costs are taken into account, the mansion tax may not end up raising any money at all.

All those expensive inspectors, with generous holiday allowances and gold-plated public-sector pensions that will stay on the government's books forever, will have been employed for absolutely nothing.

Those are just the practical details. The government still needs to deal with the moral issues.

What will it do about elderly homeowners, for example, who might not be able to sell a big house, but also can't afford to pay the extra tax on it?

Will it be able to face down the inevitable political backlash?

And given that the top 10% of earners already pay 60% of all the income tax collected in Britain, how can it justify yet more taxes on people who are already paying for most of what the state does?

And if the tax does cost more to implement than it raises in revenues, as it almost certainly will, how can it justify the drain on public finances at a time when the deficit is already soaring out of control?

The tax has not come into force yet. But it is already turning into a disaster.

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Targa Resources owns and operates natural gas pipelines, gas plants, liquefied petroleum gas (LPG) export facilities and crude oil terminals across the US. In mid-August, its shares rose 10% after it announced a 20-year midstream deal with ExxonMobil to build and operate a portfolio of energy infrastructure assets for the oil and gas giant.

Targa's deal is the latest in a series of multibillion-dollar projects recently commissioned by oil giants and governments to help move oil and gas around the world.

Targa Resources (NYSE:TRGP) is a midstream energy group, playing a vital role in the energy sector. These businesses link upstream companies, which drill and extract the raw product, and downstream businesses, which refine and sell it to consumers.

Most oil and gas majors manage this part of the process themselves, but in markets such as the US, where thousands of smaller producers in oil fields need to connect to major refining and storage hubs, midstream firms are a vital part of the chain.

Growth in the pipeline market

The $65 billion Targa is just one such company in the industry. The firm was founded in 2003 and has grown steadily through organic growth and acquisitions. In 2004, it purchased midstream natural-gas operations from oil major ConocoPhillips and in 2005, it acquired an asset from energy supply business Dynegy. In 2007, the company listed as Targa Resources Partners LP, using the money from the initial public offering (IPO) to seal more deals.

Over the following two decades, Targa secured 20 further agreements, encompassing joint ventures, partnerships, asset sales and stake sales in key infrastructure assets.

Today, the group owns and operates assets across New Mexico, Oklahoma, Texas and Louisiana. It is active in the key oil-production regions of the Permian, the Bakken Three Forks Shale, Eagle Ford Shale and Fort Worth Basin.

The Permian has become one of the most important oil-producing regions in ExxonMobil's portfolio. When the group sealed the $60 billion deal to buy Pioneer Natural Resources in May 2024, it doubled its footprint in the region and laid out plans to drive production to two million oil-equivalent barrels per day (boepd) by 2030, up from the 612,000 barrels Exxon produced from the region in 2023.

Production hit a record boepd in the second quarter and is now close to 1.8 million as the group continues to grow at a breathtaking pace.

Exxon's total Permian production consists of between 70% and 75% liquid hydrocarbons (crude oil and natural gas liquids) and 25%-30% natural gas. This needs somewhere to go, and that's where the deal with Targa comes into play.

Exxon has agreed to so-called natural gas liquids (NGL) dedications with Targa, whereby it is legally committed to using the company's midstream assets for transport, processing, or fractionation (a physical and chemical separation process) of NGL production from its key fields in the Permian region.

Following these commitments, Targa has announced three new natural-gas processing plants in the Permian Delaware: Wrangler, Ranger, and Ranger II, with a combined capacity of approximately 825 million cubic feet per day.

The plants are expected to be operational in the first half of 2028, with scope for up to five additional processing plants. It also announced plans to build a new, approximately 70-mile, natural-gas pipeline called Bull Run II, supported by take-or-pay commitments (whereby producers buy a fixed amount of capacity and pay whether they use it or not).

To meet these commitments, Targa has upgraded its expected capital spending for the year from $4.5 billion to $5 billion. The business spent $2.1 billion on growth and maintenance capital in the first half of 2026, up 23% from the same period in 2025.

A new gold rush

Despite substantial efforts by policymakers over the past two decades to wean the world off its addiction to hydrocarbons, there has been no let-up in the relentless march of the oil and gas industry.

Pipelines and midstream assets are an often overlooked part of this market, but the conflict in the Middle East has highlighted their importance to the global economy.

With the Strait of Hormuz closed to shipping, pipelines across the Middle East have become critically important for the region's oil and gas producers.

In the past two months, the United Arab Emirates has announced plans to open a new pipeline alongside its existing Habshan-Fujairah pipeline, doubling its capacity.

Meanwhile, America, Iraq and Qatar have also announced plans to upgrade a pipeline from Iraq to Syria, and Chevron is in talks to build a series of them from Iraq to Syria and Turkey.

According to The Economist, citing information from Global Energy Monitor, an oil data and research firm, 12,300 kilometres of pipelines are currently under construction worldwide, with an additional 20,100 kilometres proposed.

Taken together, these additions represent nearly a 10% increase over the 350,000 kilometres of pipelines currently in operation worldwide.

The most cost-effective way to get oil and gas from production fields (usually located inland or in deep water) to refineries and key export markets is by tanker.

Transporting each barrel of oil on the world's largest seagoing tankers can cost as little as a few dollars a barrel. But when it is impossible to use tankers to transport them, producers have no choice but to turn to other methods such as rail, road or pipelines.

A large-diameter pipeline that can carry around one millions barrels of oil per day costs, on average, about $5 million per kilometre, or $5 billion for a 1,000 kilometre pipeline.

That's assuming the pipeline is laid over relatively flat terrain. If mountains, rivers and lakes get in the way, costs can rise significantly.

The significant upfront capital cost is why midstream companies and pipeline owners turn to take-or-pay agreements.

Under these agreements, customers purchase a minimum amount of transport capacity on the pipeline and pay a fee for this capacity, often indexed to the price of oil over an extended period (frequently a decade or more).

The company has to pay to use this capacity whether or not it has oil to transport. This dramatically reduces the risk inherent in the project for the pipeline-operating company and its lenders.

Pipelines require a lot of capital to start, but the long-term economics are hard to argue with.

Data compiled by The Economist shows that the cost of transporting oil via a pipeline is, on average, around $5 per barrel. The cost rises to $18 per barrel when oil is transported via road or rail.

At the height of the US-Iran conflict earlier this year, some reports emerged of companies in central Africa paying as much as $200 a barrel, with $50 of that covering transport costs alone.

No wonder, then, that there is heavy investment in expanding pipeline networks to cut costs and improve reliability. In East Africa, for example, a 1,500 kilometre pipeline is under construction to transport oil from Uganda to the Tanzanian coast.

Argentina is building a 440 kilometre pipeline to connect its key oil fields in the centre of the country to the Atlantic.

There is a growing opportunity for investors. Because returns from pipelines are relatively stable and predictable, thanks to pre-agreed take-or-pay contracts, private infrastructure funds have flooded into the market.

According to McKenzie, a consultancy, assets under management across private infrastructure funds have rocketed to $1.6 trillion in recent years.

This year, global investment group KKR finished raising money for its largest-ever infrastructure fund with a total value of $19 billion. It's almost certain a large chunk of this will go to pipeline projects. Blackstone and Brookfield are also getting in on the action. KKR, Blackstone and Brookfield have signed a $16 billion deal with Kuwait's oil company for a stake in the country's pipeline network.

Don't be tempted by partnerships

The midstream sector is particularly strong in the United States thanks to a quirk of US tax law.

Midstream firms can be structured as master limited partnerships (MLPs), which are pass-through entities much like real-estate investment trusts (REITs).

MLPs pay no taxes, so they can distribute much more of their cash flow to investors. Investors then pay tax on these distributions. Over the past decade, many former MLPs have transitioned to C-corporations (a standard limited company) following a change introduced by the 2017 Tax Cuts and Jobs Act.

The changes have opened these companies to a wider range of investors, but yields have fallen because dividends are now paid out after corporate tax; in the partnership model the tax liability falls on the investor.

As a rough guide, the Alerian MLP ETF currently yields 7.4% on a trailing 12-month basis, while the Alerian Midstream Energy Dividend UCITS ETF, which has strict limits on MLP exposure, yields just 3.6%.

The Alerian Midstream Energy Dividend UCITS ETF has enforced limits on exposure to MLPs owing to K-1 tax constraints – the reason why these MLPs are unsuitable for all but the most sophisticated investors. A Schedule K-1 Federal Tax Form is issued by US partnerships to report a partner's share of its income, losses, capital gains and dividends.

In short, they are a nightmare for non-US investors. Even smaller domestic US investors generally avoid partnerships to avoid the added administration these tax requirements create. Very sophisticated investors who want exposure to these businesses may use total return swaps or other synthetic instruments instead, rather than becoming entangled in the web of compliance. Don't be tempted by a high yield on a US midstream MLP.

Fortunately, plenty of other options exist for investors to play this theme. Kinder Morgan (NYSE: KMI), the largest natural gas-pipeline operator in the United States (and a former division of Enron) consolidated its various MLPs into a single traditional C-corporation in 2014 in order to lower its cost of capital and appeal to a broader range of local and international investors. Many of the company's peers have since followed suit.

A tailwind from AI

Kinder Morgan reported record net income of $867 million in the second quarter, up 21% from the same period last year.

Around $660 million of new projects coming on stream helped boost the company's top and bottom lines, including Tennessee Gas Pipeline's (TGP) Cumberland Project, designed to serve a new gas-fired power plant in Tennessee.

The company said it had a construction backlog of $9.7 billion at the end of the quarter, with an additional $400 million of projects not included in the official backlog, but sanctioned to proceed.

Natural-gas projects made up 92% of the backlog, and 60% of those projects are designed to support local power generation and distribution. The company believes it will outperform expectations by 5% for the year, with adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of $9 billion and a 12% rise in adjusted earnings per share.

Kinder Morgan, like other US midstream companies, is benefiting from increasing demand for power across the US driven by the AI boom. According to Goldman Sachs Research, domestic power demand from data centres is projected to more than double from 31 gigawatts (GW) to 66 GW by 2027, consuming over 8.5% of total US peak summer electricity.

To keep up, companies are commissioning new natural-gas power plants, which can be brought online in a few years and located next to data centres; pipelines are needed to connect these facilities to production zones.

Kinder Morgan may be the largest natural-gas pipeline operator in the sector, but peer Enbridge (Toronto: ENB) is worth nearly twice as much.

It plans to spend between C$10 billion (£5.3 billion) and C$11 billion this year, with half of that already spent in the first six months. It is constructing the $4 billion Sunrise expansion of its British Columbia pipeline (adding 140 kilometres of new pipeline in addition to upgrading the capacity of the existing pipeline) and spending $1 billion relocating a pipeline in Wisconsin.

Williams Companies (NYSE: WMB), the second-largest pipeline group after Enbridge in market value, has raised its spending guidance for the acquisition of Momentum Midstream. It is now projecting spending between $7.3 billion and $7.9 billion in 2026.

Enterprise Product Partners is spending around half as much, with capital spending earmarked at between $2.9 billion and $3.4 billion, net of asset sale proceeds.

Key projects include two new gas-processing plants in the Permian Basin, illustrating the growing importance of natural-gas processing and transportation.

Enterprise Product Partners is the fastest-growing of the large midstream companies, but it is also still structured as a partnership. It reported a 19% increase in adjusted cash flow from operations in the first half to $2.5 billion, as well as a 28% increase in net income, thanks primarily international demand for US natural-gas liquids and crude oil.

Energy Transfer also set several all-time record volumes, notably in natural-gas liquids transportation volumes, which increased 13%, and exports, which increased 25%. Distributable cash flow rose 32% to $2.6 billion. Enbridge, Williams and Kingdom Morgan are all trading at roughly the same valuation, with a price/ earnings ratio (p/e) in the low 20s and a yield between 3% and 5.5%.

The Alerian Midstream Energy Dividend UCITS ETF (LSE: MMLP) offers exposure to all three companies, plus 16 others, with Kinder Morgan, Williams, Enbridge and Targa comprising around 40% of the fund. Investors also get synthetic exposure to the Alerian MLP index.

The picks-and-shovels plays

Infrastructure provides a steady, predictable return. But if you want something offering a bit more excitement, consider the companies providing the picks and shovels to help build future pipelines. Companies worthy of research include Caterpillar (NYSE: CAT), Tenaris (NYSE: TS), MasTec (NYSE: MTZ) and Primoris Services Corporation (NYSE: PRIM). Caterpillar is a broad-based play on the health of the US economy. The company reported record revenue of $20.5 billion in the second quarter, up 24% year on year – the first time Caterpillar has reported more than $20 billion of revenue in a single quarter.

Meanwhile, the company's order backlog hit a record of $72.1 billion, that's not just related to its diggers. While Caterpillar is widely associated with earth-moving and construction equipment, it also operates the SPM oil and gas brand and manufactures equipment for gas power plants. This energy and transportation division increased sales by 17% year on year. While the stock has dipped recently, it is still trading at 25 times projected 2027 earnings.

Tenaris is one of the more interesting companies in the area. It supplies tubular steel used to make pipelines worldwide. Sales fell 4% in the second quarter, mainly because shipments to customers in the Middle East were postponed owing to the conflict.

Lower deliveries to Kuwait and Iraq were, however, offset by higher sales to Venezuela and Argentina, along with the start of delivery of offshore line pipes to the Sakarya Black Sea development in Europe.

The company reported a $3.6 billion net cash position at the end of June, compared with a $19bn market capitalisation. The stock is on a forward p/e of 13.9.

MasTec and Primoris are two of the largest engineering construction contractors in North America. The latter is more focused on utilities, while the former has a big pipeline and energy business. Still, both recently reported record second-quarter sales and record order backlogs.

MasTec reported a record 18-month backlog of $21.4 billion; of this total, $1.8 billion was allocated to its pipeline segment, while Primoris achieved a record total backlog of $13.9 billion (comprising $7.7 billion in the utilities segment and $6.2 billion in energy).

MasTec recently acquired The Superior Group to expand its services into datacentre infrastructure and trades at the higher valuation of the two (21 times 2027 earnings versus 14 for Primoris). That's because Primoris reported a loss for the second quarter, despite record sales. The losses stemmed from cost overruns on six renewable-energy projects. All of these will be complete by the end of the year, which should draw a line under the situation.

This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.

The Old Mill, Linztford, Rowlands Gill, County Durham

A Grade II-listed former paper mill on the banks of the River Derwent. It has exposed stonework, wood floors, a wood-burning stove and a large kitchen with an Aga. 3 bedrooms, 2 bathrooms, reception, double garage, studio, riverside terrace, gardens, 0.34 acre.

Price: £700,000 Finest Properties 0330-111 2266

The Stack, Trelyon, Truro, Cornwall

A five-storey, Grade II-listed former engine house dating from the 1800s overlooking a valley. It has granite walls with arched doorways and a wood-burning stove. 3 bedrooms, 2 bathrooms, dining kitchen, reception, terrace, workshop, studio, gardens, 0.6 acres.

Price: £895,000 Rohrs & Rowe 01872-306360

Lakeland Cottage, Spark Bridge, The Lake District

This converted 1850s bobbin mill was originally one of the oldest continuously operating industrial sites in the country. The gardens include a pond and a bridge over the river that leads to a pavilion. 4 bedrooms, 3 bathrooms, 3 receptions, study, orangery, dining kitchen, balconies, garages, gym, greenhouse, outbuildings, workshop, private riverside jetty, grounds.

Price: £1.995 million Fine & Country 01539-733500

Rhydlewis, Llandysul, Ceredigion

A mid 17th-century mill in west Wales that was rebuilt in 1811. The former mill has solid stone walls and a full-height living area with a vaulted ceiling with exposed wooden rafters, timber panelling, a Danish wood-burning stove and large glass doors that open onto a substantial balcony that overlooks the garden. 2 bedrooms, bathroom, open-plan kitchen/living area, mezzanine, parking, gardens, grounds.

Price: £350,000 Savills 0292036-8915

The Old Foundry, Panxworth, Norfolk

A former iron foundry and smithy dating from 1869 on the edge of a village. It has double-height ceilings with a mezzanine, exposed beams and a large fitted kitchen. 4 bedrooms, 3 bathrooms, reception, study, office, roof terrace, gardens.

Price: £550,000 Sowerbys 01603-761441

Royal Mint Street, London E1

A penthouse apartment in a converted Victorian factory originally constructed in 1890 for the tobacco manufacturers Thomas Bear & Sons. It has a dual-aspect kitchen and reception with double-height vaulted ceilings, exposed brickwork, the original cast-iron columns, timber floors and Crittal windows. 3 bedrooms, 2 bathrooms, office/bedroom 4, open-plan kitchen/dining room, share of freehold.

Price: £2.25 million Knight Frank 0203-597 7687

The Old Fire Station, Worcester

A top-floor apartment in the award-winning Old Fire Station development in the centre of Worcester. The flat has an open-plan interior with wood floors and modern fittings. It comes with its own private balcony that commands views over Worcester Cathedral and also has access to a communal roof garden. 2 bedrooms, bathroom, open-plan kitchen/ living area, parking.

Price: £260,000 Allan Morris 01905-612266

The Wheelhouse, Canterbury, Kent

A Grade II-listed former industrial building dating from the 18th century just outside the city walls in the Nunnery Fields conservation area. It has a 32ft vaulted drawing room with a log-burning stove and a 36ft sitting room with a vaulted ceiling, exposed timber beams and a Juliet balcony. 6 bedrooms, 3 bathrooms, 4 receptions, study, conservatory, breakfast kitchen, greenhouse, garage, courtyard garden.

Price: £900,000 Strutt & Parker 01227-473700

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CVS Group (LSE:CVSG) is an example of how temporary uncertainty can create attractive investment opportunities.

For the past three years, the UK's largest listed veterinary services group has traded under the shadow of the Competition and Markets Authority's (CMA) investigation into the sector.

Investors feared the regulator would impose remedies severe enough to undermine the industry's profitability, pushing the shares down to 13 times earnings – a ten-year low.

Yet during that period, the business continued to compound earnings at an attractive rate. Revenue and profits kept growing, the firm expanded internationally and management kept investing in the business.

With the CMA's process now largely complete, investors have a chance to judge CVS Group on its operating performance rather than regulatory uncertainty.

Since listing in 2007, CVS Group has delivered uninterrupted revenue and Ebitda growth, a record few UK-listed companies can match, and one that helps explain why the shares historically commanded a premium valuation.

Few industries offer the resilience of veterinary care. People may postpone replacing a car or renovating the kitchen when finances come under pressure, but pet owners are unlikely to delay treatment for a sick pet. Demand therefore tends to remain resilient through economic downturns.

The industry's long-term outlook also remains favourable. Advances in veterinary medicine mean treatments once confined to specialist centres – including MRI scans, orthopaedic surgery and oncology – are becoming increasingly commonplace.

Add the millions of puppies and kittens acquired during Covid now reaching the age where healthcare spending accelerates, average spending per pet looks set to continue rising.

CVS Group has spent more than two decades building a business designed to benefit from those trends.

What started as a consolidator of independent veterinary practices has evolved into an integrated healthcare network spanning 500 sites, including general veterinary practices, specialist referral hospitals, diagnostic laboratories and an online pharmacy.

That integrated model creates meaningful competitive advantages. A routine consultation can lead to specialist diagnostics, orthopaedic surgery or oncology treatment without the patient leaving the CVS Group network.

Rather than referring work elsewhere, the company retains a greater share of each pet's lifetime healthcare spending while improving utilisation of its specialist facilities. It also makes the network more attractive to both clients and clinicians, reinforcing the advantages that scale already provides.

How CVS Group is cementing loyalty

Roughly 500,000 owners pay monthly subscriptions via The Healthy Pet Club, covering vaccinations, parasite treatments and routine health checks.

The subscriptions provide recurring revenue, and encourage owners to visit their vet more regularly – increasing customer loyalty while creating opportunities for higher-value diagnostics and treatment.

CVS Group has also invested heavily in recruitment, training and retaining veterinary professionals.

While labour shortages affect much of the sector, the firm's scale enables it to offer clearer career progression and more opportunities for clinical specialisation than independent practices can provide.

That should help support future growth and reinforce its competitive position.

The story does not end in the UK. Australia today resembles the UK veterinary market of 15 years ago – fragmented, independently owned and offering considerable scope for consolidation.

In three years, CVS Group has acquired 57 practices generating £80 million of annual sales, with the same disciplined acquisition strategy that proved successful in the UK.

Since the CMA announced its investigation, the company's valuation has steadily fallen even as the underlying business has continued to grow.

Australia has emerged as a meaningful contributor to earnings, the group has strengthened its market position and sales have continued to rise.

Management used the period to strengthen the business and diversify future sources of growth. CVS appears stronger today than when the regulatory review began, yet the share price continues to reflect much of the uncertainty.

That valuation gap is difficult to justify. Businesses capable of generating resilient cash flows, delivering consistent double-digit earnings growth and reinvesting capital over long periods rarely trade on just 13 times earnings. For much of the past decade, investors were prepared to value CVS Group at more than 20 times.

That premium was not simply a reflection of optimism. CVS Group combined resilient end-market demand with dependable double-digit growth, strong cash generation and repeated opportunities to reinvest capital at attractive returns.

Those characteristics remain largely intact today. If anything, the Australian expansion has broadened the opportunity to deploy capital at attractive returns.

Wage inflation remains a challenge across the veterinary profession and continued investment in clinicians may weigh on margins in the near term. Australia must still demonstrate that it can replicate the success of the UK business over a longer period. A rerating may therefore take time.

However, those risks appear broadly reflected in the current valuation. The CMA investigation depressed CVS's valuation for much of the past three years. It did not stop the business from growing.

If the market begins to focus on the latter rather than the former, today's valuation may prove an attractive entry point.

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What's the current situation with adult social care?

A few years ago a parliamentary committee memorably summed up the adult social care system in England as “unfair, confusing, demeaning and frightening” – and that remains a good summary.

A central problem is the “care lottery” involved in a complicated patchwork of funding rules, means-testing, local-authority decisions and private providers – with families taking up the slack.

Whereas a patient with cancer receives free state-funded treatment on the NHS, someone with dementia must fund long-term care costs themselves if they have assets worth more than £23,250 – so even modestly wealthy individuals can be forced to sell their homes to fund residential-care costs, which can easily top £100,000, or indeed multiples of that for the most unfortunate.

Addressing that unfairness in a way that's acceptable to taxpayers, those requiring care and those eager to protect hard-gained assets is a problem that has so far proved unsolvable.

What about quality of adult social care?

The squeeze on funding for local authorities, which provide social care, has led to a “fragile and fragmented market of providers”, says the Financial Times– leading to even lower pay levels, problems in recruiting and retaining staff and huge variations in quality.

As the population ages, demand is growing – at present only 42% of requests for help can be met. But it's not just about age: half of council care budgets go toward care for working-age adults, whose care needs can last much longer.

Overall, two million people have unmet care needs because they can't afford help, while more than 30,000 died last year while waiting for a social-care package, such as residential care, to be provided.

Under this badly functioning system, unpaid family carers absorb enormous personal costs, while delayed discharges owing to gaps in social care account for almost one in ten hospital beds, adding costs and stress onto the NHS.

What has Andy Burnham announced?

Andy Burnham has reconfirmed Labour's pledge to reform and rebuild adult social care in England via the creation of a National Care Service.

So far, though, that is very much an aspiration, with no fixed plan on how to achieve it – nor a clear picture of what that service will look like.

Burnham has also begun cross-party talks, and last month launched a “big conversation” with the public to get buy-in for whatever funding model is ultimately proposed.

And he has asked Louise Casey, a cross-bench peer, to bring forward delivery of her Independent Commission, begun under Starmer, to the summer of 2027.

Haven't we been here before?

Many times. Ominously, even Andy Burnham himself has been here before. As health secretary in 2009, Burnham floated a national-care scheme to revitalise and fund social care in England.

The Conservatives promptly branded the funding model – a levy on estates – a “death tax”, a label that stuck. But even so, Labour went into the 2010 election with a very familiar sounding policy – the creation of a National Care Service implemented in phased stages.

Under the Conservatives, a series of white papers were promised, but successive PMs failed to take action, with Theresa May's attempt at the 2017 election backfiring spectacularly with voters.

Labour accused her of planning a “dementia tax”; in fact she'd proposed a rather promising state-sponsored equity-release scheme that protected assets up to £100,000.

What are the funding options?

The phrase “National Care Service” suggests a universal NHS-style service free at the point of use and paid for out of general taxation. But the Health Foundation estimates the costs at £18.5 billion a year – and the UK's delicate fiscal position, demographics and low-growth economy make such a scenario highly unlikely.

More money will be needed, either via some form of hypothecated tax, or some form of compulsory social insurance that caps liabilities and pools risks – a model that works well in Germany and Japan. Here, civil servants have produced a model where workers over 34 pay an extra 1.8% income tax (above a £6,240) threshold to fund a national Later Life Care Fund.

Separately, Burnham has mooted scrapping inheritance tax and introducing a 10% levy on all estates, not just the largest 5% or so. Such a system would be simple and potentially raise large sums, but it's a tough sell politically and open to the “death tax” accusation.

So what's the solution?

Britain can't afford a “blank cheque” National Care Service that pours resources into a “taxpayer money hole”, says Eamonn Butler on CapX. But it urgently needs a “targeted safety net against genuine catastrophe”.

The first stage of any resolution will surely draw on the 2011 Dilnot report, says the FT: impose a lifetime cap on individuals' contribution to care costs and raise the assets threshold for making them pay. Such a cap would remove the threat of crushing expense that would overwhelm all but the very wealthy. And it would “create an insurable risk against which consumers could take out private insurance, avoiding having to sell their homes in their lifetime”.

The second plank, says Bloomberg, should be to “make more private provision workable”, for example by more stringent regulation that facilitates transparency and comparability, and by ensuring no one is penalised insuring themselves. “New financial instruments – from auto-enrolment pensions with a social-care component to annuities attached to home equity – could play a role if carefully regulated.”

In terms of funding, there “will be fights over thresholds, taxes and who gets what. So be it. The option Burnham can't afford is the one governments have been choosing for decades: pretending the bill disappears if nobody opens it.”

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During Covid, Halfords (LSE:HFD), briefly benefited from the expectation that everyone would become a cyclist. Many people were making changes to their lives, such as adopting a pet, buying an exercise machine, or taking up a new hobby.

Shares in the firms that served these sectors surged, but once the lockdowns ended, many of these interests dwindled, causing the shares to fall back.

Even today, Halfords’ share price is still down 50% from its record peak in May 2021. But recently it has started to take off again and this time the increase could prove sustainable.

Halfords makes its money from selling accessories and providing repair services for bicycles and cars; it accounts for about half of all bicycles sold in the UK. It operates 370 stores, 496 garages, 21 mobile hubs and 92 commercial depots in the UK and Ireland.

Although overall sales have grown at a solid rate, increasing by around 40% since 2021, this conceals the fact that profitability has been far less consistent, due to higher costs and the overstocking of bicycles.

Normalised earnings per share are now less than half the level reached in 2021.

Halfords brings in a new broom

The good news is that Halfords' problems led to the appointment of new CEO Henry Birch last year. Birch has come up with a turnaround strategy based on three ideas.

In the short term, Halfords has worked hard to boost margins by keeping costs under control. It has also taken steps to improve its digital platform, making it easier for its customers to book services and sign up for regular plans.

However, the most interesting part of the new strategy is that Birch has been trying to shift Halfords' business more towards cars, which now comprise around 80% of sales.

He wants Halfords to focus on car repair and maintenance. One reason for this is that this part of the company has more growth potential than the stores owing to the greater opportunities for upselling (offering customers more and pricier products and services).

Another big advantage is that it is much harder for drivers to delay essential repairs than the purchase of accessories, making the division more resilient to the economic cycle.

Already this strategy seems to be paying off, with last year's pre-tax loss becoming a comfortable profit in the year to April 2026. Like-for-like sales (those from existing business units) are also growing at a healthy rate, while gross margins have improved too; Halfords recently upgraded its profit guidance for the next year.

Despite all this, the stock's valuation remains cheap at 12 times 2028 earnings and barely the value of the company's net assets.

The shares also offer a very solid dividend yield of 4.4%. Furthermore, they have soared 75% since 1 May, and they trade above both their 50-day and 200-day moving averages.

Go long at the current price of 232p at £15 per 1p. Put the stop-loss at 167p, which gives you a stop loss of £975.

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