More than a third of homes for sale are in postcode areas where house prices are falling, according to new analysis.

The combination of a high number of properties for sale and elevated mortgage rates is putting downward pressure on the housing market, the research by Zoopla found.

Annual house prices fell in 37 out of the 119 postcode areas the property portal tracks between September 2025 and September 2026, with the majority of these areas in southern England and London.

However, the picture is different in other parts of the UK, with property values rising by up to 5.8% in regions like Northern Ireland, Scotland and north west England.

Zoopla said house prices are rising in these regions as properties are generally worth less compared to the south of England and the impact of higher mortgage rates isn’t felt as strongly.

Richard Donnell, executive director at Zoopla, said: “The extra cost of mortgages has made home buyers more selective while greater choice of homes for sale has increased the scope to negotiate on price.

“The impact is being felt by sellers in southern England where house price falls are most concentrated as average prices continue to rise across the rest of the country.”

The postcode areas where house prices are falling

House prices fell in four regions in the year to September 2026, according to Zoopla’s analysis: London, south east England, east of England and south west England.

On a local level, just 10 out of the 37 postcode areas where property values dropped were outside the south of England and London.

House prices fell the most in west central London, steeply declining by 5.7%. They also fell by 4.3% in Llandrindod Wells, Wales.

In east central London, property values decreased by 3.8% in the year to September, and by 2.2% over the same period in Truro, south west England.

Zoopla’s analysis found 85% of homes in London and the south east of England are in postcode areas where property prices fell year-on-year.

Source: Zoopla

Stamp duty reform ‘could support buyers and sellers’

Donnell from Zoopla said the government could do a number of things to stimulate the housing market in the 2026 Autumn Budget.

He said the biggest boost it could provide would be to “create the conditions” for lower mortgage rates. If they went below 5%, activity would pick up again, he said.

Lenders have increased rates following conflict in the Middle East, which has contributed to inflation rising by 3.5% in the year to September.

The average two-year fix (on 27 October) is 5.97%, up from 4.83% on 27 February, a day before the US and Israel launched airstrikes on Iran, sparking the war.

Donnell also said another lever the government could pull is to reform the stamp duty land tax (SDLT) regime.

Zoopla research suggests extending the 2% rate to properties worth up to £500,000, from £250,000 currently, could save home movers up to £7,500 while similar reforms for first-time buyers could save them up to £6,000.

Donnell said SDLT changes “could support buyers and sellers, particularly in southern England where transaction costs are highest”.

How to sell your home in the current market

The first key thing to do to sell a home in a buyer’s market is to set the right asking price.

Zoopla analysis found that of the homes listed for sale between April and June 2026, 41% listed 5% or more below their estimated value found a buyer within 90 days, versus just 26% of those priced at least 20% above their estimated value.

It’s crucial to price well the first time around too. Zoopla also found just 19% of homes that had asking prices reduced sold within 90 days, compared to 41% of those where the sellers didn’t have to reduce the asking price.

How you present your home is also important. Tidying gardens, cleaning windows and ensuring outdoor spaces are well-lit will create a strong first impression.

Inside the home, make sure to declutter, check rooms are bright and spacious and address any minor issues such as leaking taps or flickering lights.

James Waight, head of sales at estate agent John D Wood and Co., said: “With competition between properties increasing, small improvements can make a real difference to how a home is perceived.”

Presentation of your home extends to how it will be perceived on estate agents’ and property portals’ websites too.

Waight added: “High quality photography, an engaging description and flexibility around viewings can help attract a wider pool of potential buyers. Sellers should also listen carefully to feedback from viewings and be prepared to respond if buyers consistently raise the same concerns.”

Investors looking for opportunities in emerging markets should look beyond the big Asian players in regions like Taiwan, China and South Korea.

That’s according to Adnan El-Araby, lead manager of the Barings Emerging EMEA Opportunities Trust (BEMO), which has been heavily investing in Eastern European, Middle Eastern and African securities markets, on the latest MoneyWeek Talks podcast, which can also be watched on YouTube.

Speaking to editor-in-chief Andrew Van Sickle, El-Araby highlighted how a significant amount of the MSCI emerging markets index is made up of countries in the East.

Taiwan and South Korea, both heavily involved in the artificial intelligence (AI) sector, make up around 50% of the index, with China and India comprising another 30% between them.

However, investing solely in these regions could mean you’re missing opportunities for above-benchmark returns in Europe, the Middle East and Africa (EMEA).

El-Araby said: “We felt that our shareholders and the investors in the trust can essentially capture a lot more alpha across the entire region of EMEA.

“When people speak about emerging markets, emerging markets is effectively Asia, right? So it’s 80% of the [MSCI] benchmark…so the other regions in emerging markets sometimes get left behind or become almost too small.”

Why it’s worth investing in emerging Europe

While Europe has gone through plenty of change in recent years, with Russia’s invasion of Ukraine and the coronavirus pandemic both destabilising elements, there are still opportunities for investors.

“A remarkable example would be Poland," El-Araby said. "It’s amazing what you can have when you have the human capital, the entrepreneurial spirit, low corruption and a government which is quasi-okay.

“And what they’ve managed to evolve and develop and deliver…the economy’s effectively at a developed market standard.”

Greece is another market worth exploring, El-Araby said, where the government takes a hands-off approach to innovation.

Hungary too, which is emerging from 16 years of rule under right-wing populist prime minister Viktor Orbán and whose new leadership is more pro-European.

“Hungary now has a real opportunity. It’s almost at those early stages of where Poland was several years ago.

“If the politics do move in the right direction, if even half of what the new government is looking to implement is genuinely implemented, then you’re going to see innovation, you’re going to see ambition come to the forefront and really capitalise on some of those opportunities.”

How Africa and the Middle East can offer something different

Further afield, and Africa and the Middle East also look interesting.

South Africa is the biggest country holding in the BEMO Trust, taking up 30%, with Saudi Arabia at 23% and the United Arab Emirates (UAE) at 12%.

The Government of National Unity in South Africa, appointed in 2024, has “delivered some economic growth”, said El-Araby, with retail bank Capitec one institution capitalising on a significant proportion of the population without bank accounts.

“You want to be invested in companies like that, where they’re moving away from the easy or the well-trodden path and can really see the opportunity across a very large country,” El-Araby said.

There are also opportunities across healthcare, renewable energy and tourism sectors for investors in the Middle East, namely Saudi Arabia and the UAE, despite tensions in the region.

El-Araby said: “The real dividend is twofold. One is the change in the mindset of the region and one that is where you have to proactively find a way to live with your neighbours, you have to find a way to work with each other.

“Two, I think the real economic dividend will be the large investments in infrastructure across the entire region…you’re going to be investing in defence.

“And you’re going to be investing in drone technology, and you’re going to be investing in data centres.”

About the podcast

MoneyWeek Talks is a podcast that helps you unlock the secrets to financial success. Editors Kalpana Fitzpatrick, Andrew Van Sickle and Cris Sholto Heaton are joined by influential guests – from CEOs and entrepreneurs to economists and fund managers – to share their top tips on managing money, investing wisely and building wealth.

Follow the MoneyWeek Talks podcast and get ready to make it, keep it and spend it with confidence. You can also watch the episodes on our YouTube channel.

The utilities and infrastructure sector has seen new structural growth drivers in the last few years. And the Ecofin Global Utilities & Infrastructure Trust (LSE: EGL), launched just ten years ago, gives exposure to the sector's long-term trends, solid protection from inflation and high degrees of predictability of future cash flows.

The bulk of our infrastructure was built in the era following World War II and now significant capital expenditure is required to renovate it after decades of under-investment. The US's Inflation Reduction Act of 2022 and Germany's €500 billion infrastructure programme aim to address the issue.

Furthermore, demand for electricity is accelerating after 25 years of decline and is expected to rise by about 50% in the next decade. Energy-intensive AI data centres are securing their power supplies through multi-decade procurement contracts, which are proving highly profitable for utilities. Such fundamental drivers are yet fully to be appreciated by equity markets and there are attractive entry points for undervalued companies with solid earnings outlooks. Three shares stand out to me as particularly compelling.

Three utilities and infrastructure stocks to consider

One of the most unfairly hit infrastructure stocks is Canadian developer Brookfield Renewable Partners (NYSE: BEP), down more than 20% since its highs at the end of May. The group operates a portfolio of high-quality renewable assets in North America and across the world and its strategy is to gather assets essential to energy security to meet growing demand worldwide. This includes nuclear assets in the US through Westinghouse, acquired in 2023. The group has developed a major franchise in batteries, with an 80GW development pipeline, reinforced by the 2024 acquisition of Neoen, and is well positioned to supply data centres. The firm also has one of the strongest balance sheets in the sector and we expect it to deliver earnings growth of about 15% a year over the next three years, with 90% generated from long-term contracts and with 70% of revenues inflation-linked. The stock offers a 5.5% dividend yield.

Greece's power transmission operator ADMIE (Athens: ADMIE) provides exposure to one of the fastest-growing markets in Europe. Its subsidiary, IPTO, Greece's sole transmission system operator, plans to double its regulated asset base by 2029. A $530 million equity issuance earlier this year provided the finance for this ambitious capital-expenditure programme. The regulatory framework provides a pre-tax return on equity of 9.8%, at the top end of the range of its European peers. The stock, down by more than 10% since late June, trades on a price/earnings ratio (P/E) of 14 times, with a 2.7% dividend yield. This looks attractive and growth in earnings per share (EPS) over the medium-term is expected to be 25%-30% a year.

Through its combination of flexible renewable-power generation and transmission assets, SSE (LSE: SSE), the UK-listed energy group, is well positioned to benefit from the energy transition. By 2030, 80% of group revenues are bound to be either regulated or fully contracted. SSE expects 25% annual growth in its regulated asset base over the 2025-2030 period via a fully funded £33 billion capital-expenditure programme. The stock trades on a p/e of less than 12 times and annual growth in EPS solidly in the double digits. Annual dividend growth is expected to be 5%-10% over the medium term. SSE looks like one of the cheapest stocks in the pan-European utilities sector.

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British engineering firm Tek4 is joining London's junior market, Aim. It’s particularly welcome, as the London stock market has spent much of the past decade shrinking. British companies have been taken private or, in some cases, tempted to list in New York instead. Too few new arrivals have replaced them, leaving investors with a dwindling choice of growing domestic businesses.

Tek4 is a small engineering company based in Leicestershire. It makes highly specialised equipment for some of the world's biggest manufacturers of jet engines and power-generating turbines. Its shares will begin trading on 26 October. But is Tek4 worth buying?

Tek4 helps solve tough engineering problems

Modern jet engines operate at extraordinary temperatures. The gases flowing through their turbines can be hotter than the melting point of the metal blades inside them. Nonetheless, those blades must survive thousands of hours of service without failure. The solution is ingenious. Engineers pump relatively cool air through hollow passages inside each blade. Thousands of tiny holes allow that air to escape across the blade's surface, forming a protective film between the metal and the scorching gases. This lets engines run hotter, improving efficiency and reducing fuel consumption. Making those holes is extremely difficult. Turbine blades are made from exceptionally tough alloys and protected by ceramic coatings. The holes must be drilled at precise angles, sometimes through walls barely a millimetre thick. Drill too far and the tool can damage the opposite wall inside the hollow blade, ruining an expensive component.

This is where Tek4 comes in. Its equipment uses electrical sparks to remove tiny amounts of metal with extraordinary precision, a technique known as electrical discharge machining (EDM). Sophisticated controls detect when the tool breaks through the blade wall and stop it before it causes damage. Other systems combine lasers with EDM, allowing manufacturers to drill through ceramic-coated blades without moving them between machines. For an engine manufacturer, the purchase price of such equipment is less important than its ability to produce thousands of accurate holes without damaging valuable components.

Tek4 was founded in 2002 by Jason Duffin, an engineer who had already spent years developing machinery for the turbine industry. He previously helped establish MJ Technologies, another specialist engineering business. Drawing on that experience, Duffin concentrated on solving the difficult manufacturing problems faced by turbine makers rather than competing in the crowded market for general-purpose machine tools.

That focus has given Tek4 an international customer base. Its customers include aerospace and power-generation companies such as Rolls-Royce, GE Vernova and Siemens Energy. Although based in Leicestershire, much of its sales go overseas, principally to America and Europe.

Customers also have good reasons to stay. Manufacturing processes for critical engine components must meet exacting standards. Once equipment and its operating procedures have been approved, switching suppliers can require expensive testing and disrupt production.

Tek4 also supplies maintenance, upgrades and specialist tooling. These relationships give it more durable earnings than investors might expect from a small machinery manufacturer.

Tek4 still has room to grow

Tek4 generated about £16 million in revenue in 2025, almost twice the previous year's figure, while reported profit more than tripled to around £4.2 million. It sold more than 40 machines during the year, with individual systems typically costing between £300,000 and £750,000. Such expensive equipment makes annual results inherently uneven. A handful of additional sales can transform revenue and profit, particularly given the fixed costs of running a factory. Equally, delays to a few orders can have a disproportionate impact on earnings.

New equipment accounts for most of the business, but servicing, maintenance and upgrades contribute a meaningful amount of revenue. This provides a more dependable income stream, as customers need to maintain their machines throughout their working lives. It also strengthens Tek4's relationships with customers and creates opportunities to sell additional equipment as their requirements evolve.

Demand is supported by rising aircraft production and investment in electricity generation. Modern engines require increasingly sophisticated cooling systems, while manufacturers are seeking ways to improve productivity and reduce waste. Tek4 plans to add a second assembly line at its Leicestershire factory, increasing production capacity substantially.

The company is also broadening its capabilities. In April it acquired Rugby-based InnoLas, a British specialist in advanced laser technology. This could strengthen its existing equipment and eventually open opportunities in other precision industries, including medical devices and semiconductors. But for now, its prospects rest chiefly on turbine manufacturing.

Why investors should buy Tek4

The listing will also give existing investors an opportunity to sell shares. Robin Womersley, a corporate financier and early investor, currently owns 56% of the business, while Duffin holds 34.5%. Duffin is expected to retain a substantial stake after the listing. His interests will therefore remain closely aligned with those of other shareholders.

Once trading on Aim, investors will need to assess the valuation alongside the company's earnings, growth prospects and the amount of capital, if any, raised for the business itself. There are risks. Tek4 operates in a narrow market, depends on a relatively small number of major customers and sells expensive equipment that buyers can postpone ordering. Its recent results have been impressive, but investors should not assume sales and profits will keep rising at the same pace.

Nevertheless, Tek4 has built a profitable international business around a difficult engineering problem, supported by specialist expertise that competitors cannot easily reproduce.

One flotation will not reverse years of decline in London's equity market. But Tek4 is a reminder that Britain still produces successful engineering businesses capable of competing internationally. The company looks a promising addition to the Aim market. Whether it becomes an attractive investment will depend on the price shareholders are asked to pay.

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JCDecaux (Paris: DEC) has become an unexpected winner of the global AI boom. The company, which owns thousands of billboards and other advertising assets worldwide, isn't the most obvious AI play. But thanks to its vast real-world estate, it's reaping the benefits of a shift in spending by advertisers. As the market has woken up to this potential, the shares have charged higher, rising more than 70% this year alone.

Why JCDecaux's advertising strategy is a success

JCDecaux operates in the so-called out-of-home (OOH) advertising market. As I mentioned in a recent feature, this is one of the few traditional advertising mediums that have seen demand from advertisers rise over the past decade. According to WPP, one of the world's leading advertising companies, OOH advertising revenue is expected to grow 5% to $57.5 billion globally in 2026, then grow another 5.3% in 2027. By 2031, the group has pencilled in a total market size of $73.7 billion. WPP calls this growth a “structural anomaly”: while other traditional advertising mediums, such as radio, TV and print, are shrinking as a percentage of global spending, OOH is holding its own.

In the $720 billion-a-year global advertising market, digital platforms get the largest share of spending. Platforms such as Facebook and Google account for half the market. These are designed to get users to click through to websites and buy products or services. Alongside these are AI platforms, such as ChatGPT and Gemini, that have started embedding advertisements into responses, a market expected to exceed $100 billion by 2031, up from only $5 billion today.

The thing is, no one really knows whether people are seeing the advertisements displayed on these platforms. Fraud is rife and more than half of all online traffic is now just AI bots. Estimates vary, but on average, figures suggest that as much as $1 of every $3 advertisers spend online is lost to fraud or non-human engagement. In some cases, that rises to $1.5 of every $3.

Advertising has always had some level of such “leakage”, but this level is unprecedented. OOH fills in this gap nicely. Advertisers can pick one location, say Bank Underground station in the City of London, and know they're in one place, with tens of thousands of people passing through every day. It's straightforward to target a particular audience in a given place with digital advertising, but there's never a guarantee that that person or digital device is where it says it is. It's hard to move a station, airport, or shopping centre, where the most lucrative OOH billboards tend to be located. Stadiums are another top play.

That's not to say OOH is winning at digital's expense. It's part of a toolkit. OOH is mainly used for visibility and brand building and helps drive awareness of the brand, increasing the likelihood you'll click a similar advertisement the next time you see it online. As analysts at Berenberg note, OOH enables the “critical need for brand differentiation as AI rapidly commoditises content”.

JCDecaux is a family success story

JCDecaux effectively created the market for outdoor advertising. In 1964, Jean-Claude Decaux invented the concept of “street furniture”, with bus shelters financed by advertising in Lyon (France). Two years later, it started rolling out the same concept across Europe. Since then, the business has grown alongside the advertising industry. It has worked with local governments, advertising agencies, clients, and world-leading designers, such as Norman Foster, to create street furniture and OOH advertisement placements that fit the environment, using space that would otherwise go unused.

Today, the founding Decaux family still owns a majority of the business (66% via JCDecaux Holding SAS) and it holds a 12% share of the global OOH market, making it the largest single player. France is still its largest single market with 17% of revenue generated in the country, followed by the UK (11%) and US (8%). The rest of Europe accounts for 30% of revenue, Asia-Pacific for 21% and the rest of the world 14%. Street furniture is the group's biggest revenue segment, making up just over 50% of sales and 66% of earnings before interest, tax, depreciation and amortisation (Ebitda).

Should you invest in JCDecaux?

Operating OOH assets is not particularly capital- or resource-intensive. The company has reported near 20% Ebitda margins for the past few years and Berenberg has pencilled in margin growth to 22.2% by 2028. While the group has some debt, it's manageable at 1.1x Ebitda. What's more, with free cash flow of €336 million in 2025, rising to €354 million by 2028, analysts believe the company is on track to wipe out its debt within the next three years.

However, that's unlikely as the group is hunting for deals in multiple markets, in the range of around €100 million – or around 50% of annual free cash flow after dividends. Even without these deals, Berenberg believes the group can grow its top line in line with the market over the coming years, with adjusted Ebitda rising faster – 6%-9% thanks to margin growth.

Even after running 70% higher this year, the shares trade at a relatively undemanding valuation of 17.1 times forward earnings and a free cash-flow yield of 6.6%. That does not appear to give any account for its growth or possible bolt-on deals. On Berenberg's 2028 estimates, JCDecaux is selling at 14.4 times earnings and a free cash-flow yield of 7.2%. The shares also yield 3%.

JCDecaux stands out for its rock-solid balance sheet, free cash flow and presence in a market that is full of AI-related risk, and seems to be holding its own against the digital onslaught.

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Our ETF portfolio has become a little over-exposed to tech, so it's time to introduce a new fund.

“Unprecedented” is a word that gets thrown around too easily, but make no mistake: the AI infrastructure boom that many investors are betting on would be unprecedented in scale – if it materialises.

Total spending based on the announced data-centre pipeline could amount to $10 trillion in the US between 2025 and 2032, according to a paper by Stijn Van Nieuwerburgh of Columbia Business School, which would be 3.6% of GDP. The previous record was the 2.2% of GDP spent on railways between 1870-1890.

This doesn't mean that it's impossible, but if expectations are not met, makers of chips and other hardware – who are earning huge profits from an incredibly tight market – may not enjoy as many years of limitless demand as forecasts currently suggest. And the recent jitters in data-centre and memory stocks are a sign that the cost of disappointment could be severe.

The most unexpected downside could be in emerging markets; almost 45% of the MSCI Emerging Markets is now in tech, mostly in hardware suppliers. At present, we have 10% of our MoneyWeek ETF portfolio in the iShares MSCI Emerging Markets ETF (LSE: EMIM). We also have 5% in WisdomTree True Emerging Markets ETF (LSE: WEMP) to tilt to traditional emerging markets (there's no China, Korea or Taiwan in that fund).

I have often said that if we start to worry more about the sustainability of the AI cycle, we need to keep an eye on our ETF portfolio's tech exposure via EMIM. Increasingly, we feel the urge to act on that, so we are going to cut the 10% in EMIM to 5%. This brings our headline emerging-markets exposure to 10%, but the real effect is to bring down the total tech exposure that is hidden in our overall emerging-markets position.

We can still have higher tech exposure if we want, but do so in a way that becomes explicit – eg, hold something like iShares MSCI Global Semiconductors (LSE: SEMI). Or we can dial it down altogether. Either are valid – the key is that we can see more clearly what we have chosen to do.

When we look at how different sectors are performing, it is clear the market's top anti-AI or risk-off trade is healthcare. You can see in the chart how it has moved broadly inversely to the tech-influenced markets indemerging-ex over the past year.

A change to the MoneyWeek ETF portfolio

This makes sense. Other defensives such as consumer staples are battling a number of problems, including changing tastes and weaker pricing power. Of course, healthcare is not risk-free either. Medical costs are a political issue. The patent cliff never goes away. Concentration is not low: Eli Lilly is 11% of the sector index. It is not cheap: on a forecast price/earnings ratio of 17.5, the MSCI World Health Care is at the same valuation as the overall MSCI World. However, demographics bode well for demand and earnings should be steady. It is attractive in its own way, as well as diversifying us from AI. So we will add 5% in Xtrackers MSCI World Health Care ETF (LSE: XWHS) to our portfolio.

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.

So-called frontier markets account for about a quarter of the world's population today, but only 5% of global GDP. A little over half of the world's eight billion people are in emerging economies and about 12% of the world's population lives in developed countries.

The US and North America as a whole account for only about 4.7% of the world's population. But the US stock market makes up around 73% of the MSCI World index. And, while the World Federation of Exchanges tracks about 58,200 listed companies worldwide, the Magnificent Seven technology stocks (Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta and Tesla) account for about 22% of global equity benchmarks.

Those figures speak volumes about the global influence of the US economy and financial system, but it also reminds us that there are other options out there for investors. Many frontier markets are chalking up growth rates in the mid- to high single digits and economies are opening up. Investors generally overlook these countries. But they really shouldn't.

One of the biggest success stories recently has been Vietnam. Its economy has been on a tear over the past five years as the trade war between China and the US has drawn in producers attracted by the country's low-cost labour and healthy infrastructure investment. GDP growth in the first nine months of the year hit 9%. To sustain growth, the government aims to invest $1.5 trillion in infrastructure by the end of the decade. Index providers didn't allow it to join emerging-market indices until the country pushed through major trade-settlement reforms and opened its markets to foreign investors. But on 21 September 2026, Vietnam officially became an emerging market when 27 Vietnamese stocks entered the FTSE Global All Cap index, with full integration phased in over 12 months.

Vietnam's growth and graduation underline one of the key trends that is set to shape the global economy over the next decade. As the Western world ages, emerging and frontier markets will play a crucial role in global economic expansion, contributing about 65% of global economic growth by 2035, according to S&P Global. Notably, frontier markets, particularly those in sub-Saharan Africa, will play a prominent role in this growth due to their favourable demographics.

What is a frontier market?

The term “frontier markets” was coined by the International Finance Corporation, the World Bank Group's private-sector arm, in the early 1990s, to serve as shorthand for the next generation of emerging markets. What constitutes a frontier market varies by the bank or NGO conducting the research, but generally, markets in this category have meaningful but still limited access to international financial markets and GDP per capita around one-third of the median level of emerging markets. That's not to say all frontier markets are low-income countries. Barbados and Bahrain are both classed as frontier markets by rating agency S&P Global and have estimated GDP per capita figures of around $30,000 (about 15% below Spain and Japan).

At the end of 2025, there were 56 frontier markets, up from 39 in 2012. The list has added previously unclassified countries as they've issued debt or made efforts to unlock capital markets. Four frontier markets (Bulgaria, Costa Rica, Panama and Romania) have become emerging markets since 2012 by attaining high-income status, but as the World Bank notes, only Vietnam has actually graduated from frontier market to developing market in the eyes of equity-index providers.

Around a third of frontier markets are located in Africa, which has long drawn investors seeking exciting, underdeveloped growth markets. But its reliance on the volatile commodity industry, along with limited internal investment and unsustainable growth, has often left investors disappointed. Now, it could be about to turn a corner, thanks to one man's vision.

One person lifts Africa's prospects as a frontier market

Africa holds about 30% of the world's mineral reserves, 8% of its natural gas and 12% of its oil reserves. It holds 40% of the world's gold and the largest reserves of cobalt, platinum and uranium, all key to the global energy transition, not to mention 60% of the world's uncultivated arable land. However, the continent has never really controlled its own resources. Money has flowed in to develop mines, then flowed right back out to shareholders in London and New York. Nigeria is a great case study. The US Energy Information Administration (EIA) notes that the country was one of Africa's top crude-oil producers in the 2000s, producing two million barrels a day. However, it lacked the refining capacity to turn this into usable fuel. Nigeria exported oil and then imported it back at market rates, losing wealth and exposing consumers to global oil-market volatility.

Africa's richest person, Aliko Dangote, has changed all that with his 700,000-barrel-a-day oil refinery in Nigeria. The $20 billion project keeps oil in Nigeria and lets it export refined products to other countries (its jet-fuel exports helped ease a global crisis following the closure of the Strait of Hormuz). The continent's largest oil refinery is listing its shares across Africa (on exchanges in Nigeria and Botswana), seeking to raise $1.6 billion from investors, with demand exceeding the offer by three or four times.

Dangote is looking to replicate this with a new refinery in Lamu, a coastal town in southeastern Kenya. Construction on the $16 billion refinery began in September. Tanzanian billionaire Mohammed Dewji has said he intends to invest $100 million in the project. Others are also moving into the region. Canada's Zimar Group signed a deal in August with Niger to build a $1.9 billion oil refinery and a petrochemical complex. France's TotalEnergies SE and its partners say they plan to invest $10 billion in Angola's oil sector over the next five years. China alone committed $33.5 billion to the region in the first half of 2026 under its Belt and Road Initiative.

Another example is fertiliser. It's no help having 60% of the world's uncultivated arable land if you don't have fertiliser to grow crops on it. The African Development Bank (AfDB) estimates that 80% of the fertiliser used on the continent is imported. Despite $15 billion invested in recent years to boost production, it's still not enough. Governments have now committed to tripling domestic fertiliser production and distribution by 2034.

This internal investment, driven partly by supply chains reconfiguring away from China, is fuelling the growth of the middle class in these countries. Rami Sidani, head of Frontier Investments at Schroders, notes that many companies “are benefiting from this expansion in the middle class, from this wealth effect that's trickling down and fuelling this domestic-consumption story”.

“Financial inclusion” is also a big part of the story. In many frontier markets, the vast majority of the population has historically been excluded from the banking system. That's changing rapidly with the adoption of financial technologies (fintech). Sidani cites the example of GCash in the Philippines. The company, which recently floated on the stock exchange with a $7 billion valuation, has become the country's go-to banking app. “Around 70% of the population in the Philippines has an e-wallet compared with around 40% who have deposits with banks,” he explains.

In Africa, the trend is even more pronounced. It used to take 18-24 months to open a branch in a rural area, says Sidani, but now consumers can access their money from their beds anywhere in the country.

Ahmed Awny, head of investments and portfolio manager of the Templeton Frontier Market Strategy, points to Safaricom and Vodafone, which launched M-Pesa, a mobile-phone-based financial services and money-transfer platform, in 2007 to piggyback on text-message technology for sending money. Nearly 20 years later, the technology has revolutionised financial services in Africa, and peers have sprung up all over the world: dLocal in Latin America; GCash in the Philippines; M-Pesa in Kenya; MoMo in Vietnam; Kaspi in Kazakhstan; and Airtel across Africa. The adoption of this technology has been as fast in frontier as in emerging and developed markets, if not even faster, because it has been taken up by younger generations, who are more aspirational, quick to adapt and to learn, says Awny.

How frontier markets are leapfrogging developed peers

Consumers in frontier markets are also leapfrogging their developed- and emerging-market peers in the rollout of AI. Cavan Osborne, a portfolio manager for Old Mutual in South Africa, notes that for this reason one of the most interesting sectors in Africa right now is telecoms. Five years ago, consumers sent messages and searched online using only a few bits of information per request; now, with AI search and AI tools, each request requires many more bits of data.

Sub-Saharan Africa is projected to see the fastest global 5G subscription growth, rising from roughly 30 million in 2025 to 370 million by 2031, according to the Ericsson Mobility Report. Mobile devices account for the vast majority of web traffic across African networks, driven by lower costs and a lack of fixed-line desktop infrastructure. In Nigeria, which has the most mobile users on the continent at more than 100 million, monthly mobile-data consumption surged from about 518,000 terabytes in early 2023 to more than 1.23 million terabytes by November 2025, an increase of roughly 140% in less than three years.

Airtel Money (LSE: AMC), the largest London initial public offering (IPO) since 2021, is one success story, says Osborne. The fintech was spun off from FTSE 100 firm Airtel Africa (LSE: AAF), one of the larger telecoms groups operating in Africa (others are South Africa's MTN, Vodafone, Orange and Dubai Etisalat). Osborne says it is growing by around 30% per year and most of the growth comes from “fees on payments, driven by new users as people switch to smartphones”. The mobile money business is “very capital light” and, despite growing at about 25%, pays out around 80%-90% of its earnings as dividends.

Osborne also highlights the opportunity in Africa's banking sector. “The [African] banks generally are quite simple,” he explains. “A lot of them just gather deposits and put them into government treasuries…where you could be getting 10%, 15%, 20% yields.” With a low cost base thanks to the rollout of technology and a lack of a need for a vast branch network, most lenders are quite profitable. From the bank's perspective, risk is also limited because the currency is hedged and default risk is generally low. That has helped make the banking sector one of Africa's best performers.

Such embedded structural hedges are vital for managing risk, says Awny. Take Vietnamese exporters. Vietnam's currency has been mildly depreciating over time, but for exporters, with a Vietnamese Dong-denominated cost base and exporting into a US dollar market, this has been a structural tailwind; or take Bank of Georgia, a subsidiary of Lion Finance (LSE: BGEO), which, like its peers in Africa, can adjust loan pricing to offset political and economic uncertainty.

Other markets are growing up too

Africa is seeing the most notable economic shift, but investors shouldn't overlook other regions. Awny points to central Asia, to Georgia, which is “now offering Eastern European governance, but at frontier valuations”, and Kazakhstan, home to world-class fintech platform Kaspi (Nasdaq: KSPI). Kaspi has 13 million active users in Kazakhstan out of a total population of around 18 million-19 million. The UAE is another example. It is technically an emerging market, but Sidani believes it's being “disregarded by the big global funds” and offers exposure to “multiple themes on the liberalisation and transformation of the economy”, including data centres and AI infrastructure.

Ten to 20 years ago, investing in frontier markets required a lot of legwork. Investors had to be on the ground, speak the language and be willing to do the work to find the best opportunities. That's no longer the case. Awny notes that many of these businesses are operated by managers of comparable quality to peers in New York or London. CEOs and their teams have also “cracked the manual on how to bring the equity story up to the level of the emerging markets”. “Today, if I take you to a company meeting in Ho Chi Minh City or in Hanoi in Vietnam, you will have the same level of spoken English, same level of detailed PDF presentation, as the one that you would have from Alibaba or from any company that you sit in front of in India or some of the developed markets,” says Awny. “The same is the case with Kenyan banks, Peru and Colombia, Morocco and Oman.”

Because operating in less efficient, less financialised economies adds friction, these companies also tend to have stronger balance sheets and higher returns, Awny notes. “Credit is not that easy; credit is costly,” he says, meaning most businesses must rely on internally generated cash flows. As a result, returns on equity and capital employed can be 300 or 400 basis points higher than the typical emerging-market company.

Much of the opportunity in frontier markets stems from their inefficiency and under-reporting compared with developed or emerging markets. But that opportunity also adds risk. Stocks in frontier markets are typically much less liquid than those in developed or even emerging markets. And while it has become easier to find information on businesses listed in these markets, transparency for the average investor is still poor. That's without considering trading restrictions. Hargreaves Lansdown and Interactive Investor, two of the UK's biggest trading platforms, don't offer direct share trading on any frontier markets, and only offer two or three emerging markets. Many of these countries themselves also place restrictions on international investors.

How to invest in frontier markets

For investors who want to invest directly, London offers a handful of names previously mentioned, such as Lion Finance and Airtel. Dangote Oil Refinery is pursuing a secondary listing in London, while Dangote Cement (the billionaire's first business) has appointed Goldman Sachs and UBS to offer about 10% of its shares in London via a secondary listing. Data from the LSE shows there are 110 African companies listed in London with a combined market value of $200 billion, but these include the likes of Old Mutual and Investec, both of which are based in South Africa. They offer frontier exposure, but you're also taking on extra risk. The National Investment Fund of the Republic of Uzbekistan (UzNIF) also listed in London this year.

Closed-ended vehicles are well suited to navigating the challenges of investing in frontier markets because managers don't face the risk of having to sell illiquid holdings at short notice to meet withdrawals. Jean-Baptiste Andrieux, an analyst at Kepler Trust Intelligence & Expert Investor, highlights BlackRock Frontiers (LSE: BRFI), which specialises in frontier markets and smaller emerging markets, excluding the largest markets by capitalisation (that is, Taiwan, South Korea, China, India, Brazil, Mexico and South Africa). Managers Sam Vecht and Emily Fletcher analyse macroeconomic cycles across the countries, then position the portfolio according to where they see the best stock opportunities.

Andrieux recommends combining frontier with smaller emerging markets, which are often underrepresented in emerging-market indices and funds. Redwheel Next Generation Emerging Markets, managed by James Johnstone and Victor Erch, is one option. There's also the Templeton Frontier Markets Fund, managed by Ahmed Awny and Bassel Khatoun, and the Schroder International Selection Fund Frontier Markets Equity, managed by Rami Sidani.

Neither the quality of management nor the quality of these companies' balance sheets is reflected in valuations. At the end of September, the MSCI World index traded at a trailing 12-month price/earnings ratio of 22.7, a price-to-book-value ratio of 4.1 and a yield of 1.5%. By comparison, the Templon Frontier's portfolio is trading at a book ratio of 2.1, and a 12-month trailing P/E of 10.2. Schroder Frontiers has a valuation of 9.9 times earnings. According to Morningstar, Redwheel's fund has the cheapest portfolio, trading at just 8.3 times historic earnings.

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Shareholders of Scottish Mortgage Investment Trust (LSE: SMT) have been on an extraordinary roller coaster. In the five years to November 2021, the share price almost quintupled before falling nearly 60% in the next 18 months. Since then, they have risen 150% to a new all-time high, putting them easily at the top of the performance table of global funds over three years.

Recent attention has focused on SpaceX, in which Scottish Mortgage invested in 2018 at a valuation of $31 billion. Following an initial public offering (IPO) in June, its market value is over $2 trillion and Scottish Mortgage has sold it down from more than 25% of the portfolio to 15%. Still, “we have no intention of selling out and expect to hold the shares for ten years”, says Lawrence Burns, who manages the trust with Tom Slater.

AI firm Anthropic is also heading for an IPO. It was 3.9% of the portfolio at 22 September but likely to rise to over 5% at the target valuation. TikTok owner ByteDance, which accounts for 4.4%, is likely to stay private, while payments firm Stripe, which also has no plans to float, is 2.9%. Overall, Scottish Mortgage’s decision in 2012 to invest in private companies has been amply vindicated. (The unlisted limit was later set at 30% of the portfolio, but the actual proportion is currently 22%.)

Why Scottish Mortgage Investment Trust cut exposure to Tesla

Scottish Mortgage also has a strong record in listed companies, including Nvidia and TSMC. It did well from Tesla, but sold out this year. “Tesla paved the way for decarbonisation in a key sector, forcing incumbents to keep up in the EV race,” says Slater.

“However, the competitive environment for Tesla has intensified significantly, particularly in China. There are long-term opportunities in Tesla's autonomous driving software and robotics businesses, but though these areas have the potential to be very large and profitable in the future, we believe we are being asked to pay too much for them.”

Moderna, which soared 22-fold between the end of 2019 and September 2021, was once Scottish Mortgage’s largest investment before it collapsed by 94% in the next four years. The company had developed a novel technology for the discovery of vaccines against a variety of conditions, including cancer. But it was the success of its Covid vaccine that sent revenues rocketing from $60 million in 2019 to $18.5 billion in 2021. However, sales collapsed as Covid demand fell away. Profits of $12 billion in 2021 turned into losses, while the company also became embroiled in a series of patent disputes.

Investors stampeded for the exit, but Slater and Burns held their nerve. The shares started to recover as progress in its respiratory vaccines gained momentum. Then in August this year, a phase III trial for a vaccine for late-stage skin cancer in combination with Merck's Keytruda drug produced very promising results, though experts advise caution. Moderna doubled on the news and is now nearly 4% of the portfolio.

Scottish Mortgage Trust embraces AI

The managers are optimistic about AI. “The companies leaning into AI are seeing greater and greater value,” says Burns. “The demand drivers will only get stronger; hyper-scalers (builders of data centres) can't afford to miss out. Companies are thinking about redirecting their entire processes around AI. The returns on hardware are fantastic and the technology keeps getting better. We are going to need a lot more compute if the potential continues to grow.”

At the cutting edge, the trust also has a small holding in PsiQuantum. But “we invest in growth, not pure technology so will have a small holding till our conviction in quantum computing increases”, says Burns. However, “there are lots of natural phenomena that are very hard to model with conventional computing”, so this area has huge potential.

After a strong run, holders of Scottish Mortgage Trust may want to trim their holdings, but the shares could have much further to go.

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In 2000, the UK stock market was the second largest in the world, accounting for 10% of the global total. Now, it constitutes just 3% and is either the sixth or ninth largest, depending on the source of measurement.

With an absence of growth stocks (technology accounts for just 1% of the All-Share index), an absence of issuance either from existing companies or new flotations, and a relentless stream of takeovers and emigrations, there is no doubt that the UK's position will drop further.

Floatations on North America's stock markets raised $138 billion in the first half of 2026, including $86 billion from SpaceX. A total of $30 billion was raised in the Asia-Pacific region and €7.6 billion in Europe, but just £577 million in the UK. This was treble the total for the first half of 2025, but three-quarters of it came from the National Investment Fund of the Republic of Uzbekistan. The imminent flotation of Airtel Money will raise more, but this is a spin-off from FTSE 100 constituent Airtel Africa.

Meanwhile, six FTSE 100 firms (Schroders, Intertek, Beazley, DCC, easyJet and Segro) have disappeared through takeovers this year, as have numerous FTSE 250 companies, including Tate & Lyle, Bodycote and Senior. Flutter Entertainment has moved its listing to New York as have Carnival and AstraZeneca, although the latter maintains a secondary listing in London. There have been persistent rumours that Shell will follow.

The UK stock market's cultural aversion to risk

The causes of the decline of the UK stock market go back to the late 1990s and the relentless programme of taxation, regulation and intimidation initiated by the Blair government, but continued by its successors. Gordon Brown's first Budget removed the tax credit on dividends from UK companies, then worth £5 billion a year, while privatised utilities were chased into ownership by private equity, foreign companies or both. Pension regulators pushed pension funds into reducing equity exposure and solvency rules introduced after the 2008 crisis removed insurance firms from equity markets.

At the same time, globalisation encouraged investors to invest overseas while the UK had much less to offer overseas investors. The long bull market in bonds provided investors with an attractive alternative to equities and many larger UK companies, following the mega-mergers of the late 1990s, became complacent.

For a while, London's stock market shrugged off these problems. Flotations continued. In the fall out from the bust in the technology, media and telecoms sectors and the subsequent commodities boom, Britain's “old-economy” companies prospered. The prospect of a more market-friendly government in 2010 appeared to promise better times after a decade in which the UK had suffered two of its worst four bear markets in a century.

Unfortunately, while the technology sector in the US started to recover with the flotation of Google in 2004, it continued to decline in the UK. DeepMind chose to sell out to Google in 2014 rather than float and UK investors rushed to cash out of ARM in 2016 and of Imagination Technologies in 2017. With pension funds and insurance companies “de-risking”, the pool of long-term capital available for backing new companies or supporting established ones disappeared.

Yet as Julia Hoggett, CEO of the London Stock Exchange, points out, Britain has no shortage of capital – the fourth-largest source in the world – of which £2 trillion is in cash deposits. The problem is that it is not allocated to generate growth. “We don't have an innovation problem,” she says, “we have a capital-allocation problem.” The UK has developed a cultural aversion to risk-taking and a persistent scepticism about technology, innovation and the market economy.

There are other problems, as Tim Campbell, CEO of Baillie Gifford, points out. More than 50% of UK-listed company shares are owned by passive funds, which take no interest in the companies in which they are invested. A further block is held by traders and hedge funds focused on short-term results. The lack of long-term shareholders makes a stock market listing unattractive. Companies prefer private equity, which offers more flexible financing, gives better incentives for management, lower taxation and lower corporate costs. Hence the UK is not the only market in which the number of companies is shrinking; the Wilshire 5000 index in the US has shrunk to around 3,500 companies from a peak of around 7,500 in the late 1990s.

The UK is waking up to the problem

The UK has at last recognised the issue. Listing regulations have been relaxed, pension funds have committed to invest more in the UK and the Treasury has made some minor tax concessions. However, this is tinkering and there is neither the appetite nor the funding from the government to go further.

The global bull market in equities rolls on, with the UK market keeping pace, thanks to takeovers, share buybacks and sharper management, yet UK investors continue to sell out. The Investment Association reports only one month of inflows into UK equity funds since July 2021, with outflows of £561 million in June, £1.6 billion in July and £615 million in August. Flows to the rest of the world, where investors see opportunities, are positive.

It's taken a generation to wreck the UK stock market and it will take a generation to rebuild it. Tax and regulatory concessions will help, but changing the anti-equity investment culture in the UK is a monumental task, not helped by the lack of growth-orientated listed companies. Average house prices peaked in real terms 20 years ago, while even the underperforming FTSE 100 has doubled relative to housing, but the UK public is in denial. Maybe with inflation and taxation eroding the value of bank deposits and the relentless hostility of governments towards the private rental markets the pendulum, in the absence of another bear market, will swing back towards equity investment in the UK. But there is no quick fix.

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What was the Big Bang?

The “Big Bang” was the sweeping deregulatory overhaul of the London Stock Exchange that took effect 40 years ago this coming week, on Monday, 27 October 1986. The Big Bang reforms were part of a programme of financial liberalisation pushed through by the Conservative government under Margaret Thatcher. They led to the transformation of the City over subsequent years and decades, making it more open, more competitive, more international and much richer. The reforms were driven by the realisation that the City had to change and modernise in order to survive and prosper – and they resulted in a radical and permanent cultural shift.

What did Margaret Thatcher change?

First, fixed commissions were abolished, meaning brokers were allowed to compete on price when it came to fees. Second, the centuries-old “single capacity” distinction between brokers and “jobbers” (market-making intermediaries) disappeared, allowing brokerage firms to become “dual capacity” stockbrokers and “stockjobbing” market makers, licensed to act both for clients and as dealers trading on their own account. Third, foreign ownership rules were relaxed, opening the way for major international banks to enter the market and/or buy existing British brokers. And fourth, the trading floor itself was transformed, with the old system of face-to-face dealing and “open outcry” trading (shouted prices) replaced by electronic systems. That allowed more business to be conducted more quickly, with greater volumes and across a wider range of markets. And all these big changes took place over a single weekend.

Did the Big Bang work?

Yes. In the short term the changes led to a surge in the volume of trading in UK equities and an influx of international banks into London. Traditional British stockbroking and market-making firms, often organised as partnerships, were bought up by much larger American, European and Japanese banks – a takeover boom that paved the way for London's growth into a financial centre to rival New York. Competition increased, transaction costs fell and market liquidity improved. At the same time, salaries for traders and investment bankers soared as institutions competed for scarce talent. In the longer term, the reforms drove a broader expansion far beyond stock trading, as the internationalisation of the City strengthened its position as a major centre for foreign exchange, international banking, bonds, derivatives, asset management and specialist insurance.

Was the Big Bang a success?

Broadly, yes. The UK's expanded financial sector generated well-paid finance jobs, vast pipelines of business for lawyers, accountants and consultants, and substantial tax revenues. It attracted overseas investment and enhanced Britain's international influence. The Big Bang reforms threw out old rules that meant bank bosses had to work from offices within ten minutes' walk of the Bank of England, paving the way for the City's eastern outpost at Canary Wharf. The regulatory revolution also boosted the democratisation and demystification that made it far easier for ordinary punters to access investment for a sensible cost. No Big Bang, no MoneyWeek. At the same time, the Big Bang undoubtedly helped entrench a model of British economic success, and uneven economic geography, that has always had its critics – that of a world-class financial centre sitting awkwardly alongside a broader economy characterised by persistently low levels of investment and productivity. Others argue that the deregulation and internationalisation of finance in the 1980s and 1990s sowed the seeds for the global financial crisis of 2007-2009.

How is the City of London doing now?

Pretty well. Famously, London has suffered a slump in initial public offerings on the stock exchange since the last flotation boom in 2021. By market capitalisation, the London stock market is now, at best, sixth in the world – though on some calculations, it's not even in the top ten. But doom-mongers should remember that stock trading is far from being the City's only suit, says David Smith in The Sunday Times. London leads in other financial sectors – notably foreign-exchange trading, interest-rate derivatives and speciality insurance – where no other centre comes close. Across a range of metrics and specialisms, it comes a very close second to New York and remains – post-Brexit – the “undisputed financial capital of Europe, with no other continental financial centre in the top ten”.

Is there any need to panic?

The City retains many core strengths that mean its pre-eminence is likely to persist: language, legal system, depth in accounting and consulting services, communication facilities and handy time zone (between Asia and America), diversity of markets and their infrastructures, diversity of counterparties, and institutional tradition, combined with continuing regulatory evolution. Important, too, is the diverse talent pool of people who would rather live in London than in Frankfurt or Amsterdam. Brexit knocked London's appeal as a place to float businesses, but in lots of other ways the City looks like “it's getting its mojo back” after a few years of uncertainty, says The Economist. Overall, the UK has the same number of people working in financial services now – about 1.1 million – as it did in 2017, accounting for a slightly bigger chunk of GDP (8% rather than 7%). As for the City (where the “EU decided not to take an axe to Europe's financial plumbing after all”), some 225,000 people worked in finance in 2024 – 36,000 more than in 2019. Another 181,000 worked in related fields such as law and accountancy, up by 51,000 over the same period. If that's what decline looks like, it's a decline worth celebrating.

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A bond crisis is heading France’s way, adding to Emmanuel Macron’s troubles as rioting sweeps through the country. However, if you're feeling particularly brave, French bonds do look like a bargain.

The French bond crisis has been simmering for years. The country has not run a primary budget surplus since the mid-1970s, it has been spending way more than it collects in tax revenues and a stagnating economy can no longer sustain the debt burden. Even from the UK, where the debt load is also hard to afford, the numbers are sobering. The deficit is expected to run at 5.4% of GDP this year even though there is no immediate crisis for the government to deal with.

The debt-to-GDP ratio has hit 121% and it would be higher if its share of all the money owed by the EU were added in. It will have to issue more than €300 billion of bonds in the coming year simply to keep the show on the road. The state already accounts for 57% of GDP, one of the highest levels of spending in the world, and there is little prospect of that coming down any time soon. The government already squeezes 45% of GDP out of its long-suffering taxpayers, again one of the highest rates in the developed world, meaning there is very little scope to push taxes any higher.

Meanwhile, the country is politically paralysed, with a divided parliament unlikely to pass a Budget, and with a presidential election due next year in which all the leading candidates are committed to yet more spending. It is a mess. So it is hardly surprising that the yield on French bonds has risen sharply. The ten-year yield is close to 5% and the spread with Germany, the key measure of country risk, has risen to levels not seen since the height of the eurozone crisis in 2011-2012.

Against that backdrop, the important question is whether the European Central Bank (ECB) will intervene. The treaties suggest it won't be able to. The ECB has mechanisms in place to calm “disorderly markets”, but before they can be implemented, a country needs to commit to a credible deficit-reduction plan. There is little sign of that, and it is hard to see a country like France putting up with the humiliation of using tools designed to rescue Greece and Portugal. ECB officials insist their hands are tied. France will have to sort itself out.

The ECB will intervene if the bond crisis escalates

They have to say that. In reality, in the midst of a serious crisis, the ECB will intervene. France is too important to the eurozone to be allowed to fail. It is still the second-largest economy within the zone, it is home to two of its largest banks and Paris is a major financial centre. If France were forced to restructure its debts, then the credit of the entire zone would collapse, plunging the whole of Europe into financial turmoil. It would be far too damaging to all the other countries inside the single currency to be allowed to happen. The ECB's own survival would also be at stake. If France fails, the euro fails, and the independent national central banks would reassert their authority.

So what will the ECB do? A “whatever it takes” speech from the bank's president is not likely to work a second time. Instead, the bank will probably come up with a new “support mechanism”. My best guess is that it will be in the form of loans to the French banks, which in turn buy government bonds. If the market senses the French banks are buying junk because they have been told to, they will sell them off instead and a bond crisis will have been turned into a banking crisis. There are no guarantees of success. But it may well be the best of a whole series of bad options.

That doesn't make French bonds a good investment. There is too much uncertainty and the economic outlook is bleak. But at some point the ECB will step into the market to start buying and bring yields back down again. It won't have any choice – it is just a question of when and how it happens.

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UK firms delivered over £28 billion in dividends in the third quarter of 2026, marking the highest payout since 2019.

The dividend total in Q3 2026 was up 14.1%, compared to the same time last year, providing larger payments for income investors, according to new data from financial administration firm Computershare.

Its dividend monitor report shows profit distributions were led by banks and mining firms – the sectors returned more than £8.3 billion to investors.

Underlying dividend growth in Q3 2026, which excludes volatile special dividends and exchange-rate movement, was better than expected, reaching 8.4%, the best third-quarter performance since 2019.

This quarter’s strong performance follows a record Q2 for UK dividends, during which UK companies paid out their all-time highest levels of dividends.

With two thirds of all dividends paid between April and September, strong growth during the second and third quarters will make up for a sluggish first quarter and an expected weaker final quarter.

Mark Cleland, CEO of issuer services at Computershare, said: “The pronounced strength of the third quarter has significantly boosted what is turning out to be a very positive overall picture for UK dividends in 2026.

“Resilient economic growth supported company revenues and profits, while higher-for-longer interest rates and the upswing in commodity markets have provided an additional boost to two of the UK market’s biggest dividend-paying sectors.”

Cleland warned that the fourth quarter of 2026 could see lower distributions, partially driven by drink giant Diageo’s announcement in February that it would slash dividends.

“However, with so much of the year’s dividend income already paid, we now anticipate dividends to finish comfortably ahead of 2025 and headline payouts to deliver their strongest annual growth since 2019,” he added.

What are the best sectors for dividends?

Mining was the best-performing sector for dividend growth, as payments soared nearly 90% – up from £2 billion in Q3 2025 to £3.9 billion in Q3 2026.

Higher commodity prices and stronger cash generation fuelled dividend growth from miners such as Rio Tinto, Glencore, Antofagasta and Fresnillo.

Meanwhile, the banking sector returned £4.4 billion to investors through dividends in Q3 2026 – marking a 24.5% increase from £3.6 billion in the same quarter last year.

Computershare said the strong dividend performance came after major banks increased ordinary payouts alongside ongoing share buybacks amid strong profitability and capital generation.

The top sectors for dividends are:

Source: Computershare

The top dividend stocks

The top five dividend stocks in the UK collectively delivered £8 billion to shareholders in Q3 2026, accounting for 28% of payouts in the quarter.

Rio Tinto led the way, followed by Shell, National Grid, Glencore, and British American Tobacco.

The top dividend stocks in Q3 can be found below:

Source: Computershare

What’s the outlook for income investors?

Strong dividend performance in Q3 has led Computershare to improve its outlook for 2026, which is set to be the best year for dividends since 2019.

Total dividends are expected to reach £93 billion, up 7.3% on 2025’s figure, while regular payouts (which exclude one-off payments) are forecast to reach £8.8 billion, up 4.8% on the year.

Computershare said the outlook has been improved due to stronger than expected UK economic growth and favourable stock market conditions.

Computershare said earnings across the wider market have remained robust and that it expects regular dividend payouts to finish the year comfortably higher than in 2025.

In times of rising inflation and interest rates, commodities can provide essential protection for investors’ portfolios.

“If you’re listening to the bond market today, it’s telling you ‘diversify,’” Evy Hambro, global head of thematic and sector investing at asset manager BlackRock, tells MoneyWeek Talks, which is available on all podcast platforms and YouTube.

Bond yields have soared over recent weeks, a classic sign that all is not well. Government deficits are rising higher and higher, but spending shows no signs of abating.

Interest rates are rising, and yet the stock market is trading at unprecedented heights.

“There’s an alarm going off, and people aren’t listening”

“It’s very clear to me that government bonds are telling you things aren’t healthy,” he said. “The annual deficits that governments are having to fund are growing, and that’s putting a lot of pressure on the financial system.”

Higher bond yields are the natural response to this pressure, as investors seek higher rewards for the higher risk perceived in lending to governments.

Governments are much less likely to default on their debts than businesses or other private borrowers. But what they often do instead, is reduce the real value of their debt through inflationary policies.

“How do you have some protection against that?” asks Hambro. “To me, it’s real assets. Real assets can be infrastructure, it can be commodities, it can be gold. Those are the kind of things that through time have protected purchasing power.”

Are commodities set to thrive?

Hambro believes that the current market setup sees us on the verge of a new commodity ‘supercycle’ – following previous iterations that have seen prices of the assets initially rise as demand ran away from supply, then fall after the investments to capture this opportunity meant supply caught up.

Infrastructure in the developing world is in increasing need of replacement, which strengthens demand for industrial metals. This dynamic is being further fuelled by the rise of artificial intelligence (AI).

“We’ve now gone into this period of very, very strong demand growth, driven by this incredible scale of investment around technology, AI, electrification and so on,” says Hambro. This has, he says, “exposed the fragility and the maturity of existing infrastructure in the developed world”.

Copper is one of the commodities most impacted by this trend, given its central role in electrification; the price of copper has risen nearly 17% so far this year.

Competition for these resources is intense, given their strategic importance. Nations are now viewing access to them as a national security concern.

“There’s a bit of a war going on for access to commodities as a result,” says Hambro.

China’s effective monopolisation of rare earth minerals – critical components in most modern technologies – is a case in point.

“There was a story from last year when president Trump went to China to discuss tariffs, and had to come back saying he’ll be unable to put tariffs on China because they’re going to turn off the rare earth supply,” says Hambro. “All the automotive companies in the US said, ‘whatever you do, don’t lose that supply, because there’s no production without it.’”

How much gold to hold, and why

As well as other real assets, in Hambro’s view, portfolios should contain an allocation of approximately 10% to gold.

He compares this allocation to insurance. Every year gold underperforms, you’ll top it up by selling off some of your other assets that have outperformed.

This feels like a waste of money in the same way that buying insurance you don’t use can.

“But if you don’t have insurance, when something goes wrong it’s very painful,” says Hambro.

Gold has a track record of holding its purchasing power: it’s often said that an ounce of gold has bought a men’s suit for 2,000 years.

So during periods when inflation is high and other assets are falling, gold can act as an insurance policy for your portfolio.

About the podcast

MoneyWeek Talks is a podcast that helps you unlock the secrets to financial success. Editors Kalpana Fitzpatrick, Andrew Van Sickle and Cris Sholto Heaton are joined by influential guests – from CEOs and entrepreneurs to economists and fund managers – to share their top tips on managing money, investing wisely and building wealth.

Follow the MoneyWeek Talks podcast and get ready to make it, keep it and spend it with confidence. You can also watch the episodes on our YouTube channel.

For investors in healthcare stocks, the Worldwide Healthcare Trust is a one-stop shop. It is run by experienced academic and industry professionals, all with scientific and healthcare backgrounds. We take a bottom-up approach to stock selection, focusing on innovation and growth, resulting in a portfolio of “best ideas”.

Three healthcare stocks to consider

Nothing has been more innovative or had a greater impact on human health recently than the 20-year-old class of drugs known as the GLP-1s. Years of pioneering work by Eli Lilly (NYSE: LLY) has resulted in a metabolic medicine that is better, stronger and safer than ever before. The weight loss and blood-sugar control offered by tirzepatide (brand names Mounjaro and Zepbound) are best in class, but that is not what we are excited about. It is the multitude of other health benefits that is likely to drive future growth. These include relieving cardiovascular, kidney and liver disease, sleep apnea and arthritic pain, and perhaps will extend to cognitive benefits, mood disorders, addiction, cancer, inflammatory disorders and even disease prevention.

Eli Lilly remains at the forefront of this innovation and its offerings include recently launched oral versions, next-generation injectables that should increase efficacy (retatrutide) and tolerability (eloralintide). We are at the dawn of an era of new “super medicines” that will treat and prevent disease, ease ageing and promote longevity.

Bayer (Frankfurt: BAYN) may be best known for aspirin, but for investors the company has become synonymous with the long-running legal issues hanging over it due to its Roundup (glyphosate) product. This may be obscuring a significant transformation in Bayer's underlying businesses. In pharmaceuticals, Bayer is entering a new period of growth. Demand for newer products for prostate cancer (Nubeqa – darolutamide) and kidney disease (Kerendia – finerenone) continues to grow strongly. The lead asset in its pipeline of new drugs, asundexian, has been shown to reduce the risk of recurrent stroke by 26% in patients who are at risk and is now under regulatory review. Bayer also operates one of the world's largest agricultural businesses and has a pipeline of innovative new products. Importantly, the Roundup saga may finally be approaching a resolution and a proposed settlement could remove much of the uncertainty that has weighed on the shares for years.

CareDx (Nasdaq: CDNA) is evolving from a transplant-focused diagnostics company into a broader, high-growth precision-medicine platform. Its core “AlloSure” franchise is the leader in donor-derived, cell-free DNA testing for organ-transplant surveillance and is benefiting from increasing clinical adoption and expanding testing volumes. Growth momentum is already visible, with second-quarter revenues up by more than 50% and earnings by over 500%.

Importantly, CareDx is now leveraging its expertise in highly sensitive molecular diagnostics. The acquisition of Naveris brings “NavDx”, a blood-based test for viral-mediated cancers, opening a speciality oncology opportunity that management estimates represents a $5 billion addressable market. With accelerating organic growth, expanding margins, new opportunities in oncology and cell therapy, and a streamlined portfolio following the divestiture of its Lab Products business, we believe CareDx is at a turning point and has the potential to compound revenue and earnings at attractive rates for years to come.

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US insurance company Lemonade (NYSE: LMND) was founded just over a decade ago. It uses AI at every stage of the insurance process, from selling policies to dealing with claims, though it still employs human staff, arguing that this helps cut administrative costs.

While it is true that AI is undoubtedly going to change the world, not every AI-related share is a compelling investment. To make a success of AI, a company must pass several tests.

First, it has to come up with a way of doing something more efficiently. Next, it must find a way to make money. It will need to fend off competition, both from incumbents and new entrants into the sector. Finally, even firms that meet all these criteria can become poor investments if the shares rise so far that they become overvalued.

Lemonade is still losing money

Lemonade says it spends approximately 5% of the money it earns from premiums on handling claims, as opposed to the 9% figure typical for the industry as a whole in the US.

Lemonade also believes that AI can significantly accelerate operations, with over half of claims paid out instantly and most policies sold in under 90 seconds. Lemonade is undergoing a period of rapid growth, with sales increasing from $94 million in 2020 to $738 million in 2025. Revenue is expected to keep expanding at around 30% a year.

But the company continues to lose money, with estimates suggesting that – at the very least – it will be in the red both this year and in 2027 (though management believes that the firm may start to achieve positive earnings before interest, taxes, depreciation and amortisation – Ebitda – in 2027).

The competition is catching up to Lemonade

Another difficulty is that while Lemonade may be ahead of the technology curve today, other companies are catching up by pouring large sums into AI. For example, rival Allstate announced this summer that it is launching ALLIE (Allstate's large language intelligent ecosystem), while other major competitors such as State Farm plan to use AI too.

And while Lemonade argues that its status as an AI-driven company will always give it an advantage over companies built around legacy systems, it also has to compete with other AI-driven companies, notably Root.

Lemonade could begin to turn a consistent profit and fend off competition from both new and old rivals. But investors still have to acknowledge that its valuation is relatively expensive.

It trades at 3.7 times sales, more than four times the 0.83 times sales that Allstate, a profitable and fast-growing company, sells for. Moreover, Root, which operates a similar tech-driven model but manages to turn a profit, only trades at 0.48 times sales. Furthermore, Lemonade's recent share-price performance suggests that investors are starting to sour on it. The stock has fallen by more than 50% from its 52-week high and has lagged the wider market over one, three, six and 12 months.

It is also below both its 50- and 200- day moving average. I would therefore go short at the current price of $46.46 at $45 a share. Put the stop-loss at $67.46, which gives you a total downside of £945.

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Coupang (NYSE: CPNG) was founded by South Korean-born, US-raised entrepreneur Bom Kim. Having experienced America's customer-focused retail culture, he believed South Korea's dense cities and digitally connected population made it an ideal market for a modern logistics network.

South Korea may be a technological powerhouse, yet for a long time its retail sector lagged behind. The blame lay with the chaebols, the family-controlled conglomerates such as Hyundai that emerged after the Korean War and came to dominate the economy. Protected from foreign competition for years, they faced little pressure to improve service or convenience. That left a gap for Coupang.

Kim initially founded a Groupon-style business in 2010, but in 2012 he abandoned the online-coupon model in favour of logistics. The company began building warehouses and acquiring its own delivery fleet. At the time, venture-capital investors preferred asset-light software companies to capital-intensive infrastructure projects, leaving Kim struggling to secure funding.

The strategy required immense scale to become viable, resulting in years of heavy losses. Rather than relying on third-party couriers, Coupang adopted a direct-inventory model. It buys inventory outright and stores it within its own network. To make this work, Coupang developed proprietary software to predict localised demand, positioning inventory close to consumers before orders had even been placed. That reduced delivery times, improved efficiency and made rapid delivery economical in densely populated cities.

How Coupang went global

For the first few years, Coupang burned through cash and at times looked as though it might not survive. But in 2015, the investment firm SoftBank invested $1 billion, giving it the breathing space to keep operating for several years despite its mounting losses. The funding allowed Coupang to continue building fulfilment centres and refining its software. SoftBank's investment encouraged further backers before Coupang listed in New York in 2021. By then, the logistics network had reached sufficient scale for revenues to outgrow costs. Annual losses became progressively more manageable before the business turned profitable in 2023. This demonstrated that an automated infrastructure platform could generate attractive returns once the investment phase was complete.

Coupang now has more than 100 fulfilment facilities supported by proprietary software. Management has shifted its focus from building the network to increasing its utilisation by layering new services on top of the existing infrastructure. With the warehouses, software and delivery fleet already in place, additional transactions carry relatively little incremental cost. Every extra order offers the potential for higher profitability.

The first major extension was the WOW membership programme. Similar to Amazon Prime, it offers unlimited deliveries and free returns for a modest monthly fee. Members also receive Coupang Play, including live sport. The combination encourages customers to concentrate a greater share of their spending on the Coupang app, strengthening loyalty and encouraging repeat purchases.

Other expansions include Coupang Eats, launched in 2019, using the group's logistics for restaurant delivery. Fulfilment and Logistics by Coupang, introduced in 2022, allows third-party merchants to use the company's distribution network. Rather than simply selling goods, Coupang increasingly earns service revenues from businesses that depend on its infrastructure. In 2024 it acquired luxury marketplace Farfetch. The deal gives Coupang access to affluent consumers and the high-margin luxury segment, while extending its reach beyond South Korea and its core mass-market retail business.

Coupang faces headwinds – can it bounce back?

Building infrastructure on this scale also creates vulnerabilities. When millions of households depend on a single platform, failures can become costly. In 2021, a fire destroyed Coupang's Deokpyeong fulfilment centre, wiping out 16 million items. Regulatory problems have also emerged. In 2024, the Korea Fair Trade Commission imposed a 162.8 billion won (£92.4 million) fine after finding Coupang had manipulated search algorithms to favour its private-label products over third-party merchants.

The most damaging blow came in 2025 with South Korea's largest data breaches. A former employee gained unauthorised access to personal data affecting more than 33 million customers. The incident prompted management changes and a 1.7 trillion won (£1.2 billion) customer-compensation programme through platform credits and vouchers, rather than cash payments. In June, regulators imposed fines totalling £300 million over the breach and separate data-handling violations. The penalties were lower than feared.

The fallout extends beyond cybersecurity. In April, South Korea designated Bom Kim as Coupang's controlling shareholder, potentially subjecting it to stricter rules applied to conglomerates such as Samsung. The financial impact is now evident. Second-quarter sales rose 4%, but the firm fell to a loss of $160 million even excluding fines. Its shares have lost more than 60% since last year's highs. Political tension and weaker profitability have overshadowed a sophisticated e-commerce business. Coupang trades on an enterprise value-to-sales ratio of just 0.7, reflecting legitimate concerns over corporate governance, regulatory uncertainty and profitability, but placing little value on a logistics network that would be extremely difficult to replicate. If management can restore trust and recover margins, today's valuation could prove unduly pessimistic.

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US market analyst Harry Browne developed a simple portfolio strategy in the 1980s that he believed would generate returns in all market conditions. The strategy – which he called the Permanent Portfolio – allocates equal portions to stocks, long-dated bonds, gold and cash. Holdings are rebalanced back to their target weights annually.

Browne developed this idea at a time when inflation was running hot and yields on Treasuries were hitting all-time highs. Gold was hovering near record levels and US stocks were also setting records. There are obviously some similarities to the world we're in today.

The assets were designed to add protection in all possible economic scenarios. Cash provides the liquidity buffer for the portfolio and reacts quickly to rising interest rates. Long bonds will underperform when rates rise, but should provide a hedge against recession scenarios, deflation and falling rates. Gold is the traditional chaos hedge, while equities provide exposure to economic growth and, alongside gold, act as an inflation hedge.

Browne's thesis for his portfolio was relatively simple. By combining four uncorrelated assets into a simple portfolio structure, everyday investors should find it easy to manage without paying for outside help or racking up additional fees. Automatic rebalancing also means investors buy more exposure to assets when they become cheaper and then benefit from the recovery. At the same time, expensive assets are sold, top-slicing to remove exposure and take profit.

Does the Permanent Portfolio strategy work?

Exchange-traded fund (ETF) research firm JustETF has a back-test of Browne's strategy on its website, with some tweaks to the holdings to adapt it for European investors. The stock component is any MSCI World ETF (the index is over 70% US stocks these days anyway). The long bond component is in the iShares Euro Government Bond 15-30yr ETF (Amsterdam: IBGL). Cash is the short-term euro cash rate, via the Xtrackers II EUR Overnight Rate Swap ETF (Frankfurt: XEON), while gold is the Gold Bullion Securities (LSE: GBSS).

From January 2007 to June 2026, the portfolio produced a cumulative return of 234% compared with 434% for a 100% equity portfolio and 279% for a traditional 60% stocks and 40% bonds portfolio. That's around 6.4% annualised versus 9% and 7.1% respectively. However, the Permanent Portfolio achieved this return with volatility of just 6.3% compared to 8.6% for the 60/40 portfolio and 13.5% for the equity portfolio.

In 2008, when equity markets lost nearly 50%, the portfolio's drawdown barely touched 5%. The worst performance came in 2022, as inflation rocketed. During the year, the portfolio had its worst drawdown in two decades, falling just over 10% as central banks belatedly began to raise interest rates and long bonds sold off. In short, the portfolio has protected holders from short-term losses quite well, although with lower long-term returns than from stocks (as financial theory would dictate).

A UK spin on the Permanent Portfolio strategy

A UK version of the portfolio has also fairly well, particularly during the market- regime shift we've seen over the past five years. Using the Royal London Short-Term Money Market Fund as a proxy for cash, the Vanguard UK Long Duration Gilt Index Fund for long bonds, Vanguard FTSE All Share Index for shares and GBSS for gold, the portfolio has returned a compound annual growth rate of 5.8% over the period. Long gilts have declined around 48%, but a 132% jump in gold prices has offset that. Cash has added a nice buffer due to rising interest rates and the FTSE All Share has added around 70% including dividends. The portfolio's weighted average cost is 0.17%. Both those returns and fees compare quite favourably to many ready-made and actively-managed wealth-preservation funds on the market.

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TikTok is full of chartists performing technical analysis. Investment banks used to employ them. Robert Edwards's and John Magee's Technical Analysis of Stock Trends, a book first released in 1948, is still going strong with its eleventh edition. It is considered by some to be the Bible of the discipline, yet today, an aspiring graduate interview candidate would be advised not to mention having read it.

Institutional certification numbers tell a similar story. The Chartered Market Technician Association, a body dedicated to the art of chart reading, counts about 2,500 active charterholders. Meanwhile, the CFA Institute is a global organisation setting standards for investment professionals; it runs the Chartered Financial Analyst (CFA) programme.

The group's syllabus has become the de facto industry standard and it has 200,000 charterholders. It dropped technical analysis as a standalone chapter, although not for lack of space; the famously extensive curriculum spans thousands of pages.

Nevertheless, millions of individuals, amateurs and professionals alike, continue to rely on charts. Here we ask what led the finance industry to fall out of love with them and whether old-school technical analysis still has anything to offer.

Why technical analysis fell out of favour

Technical analysis in its purest form means making buy and sell decisions based on the trading behaviour of others. The guiding premise is that the market for anything is like a shoal of fish. Price ticks and volume bars are clues around the edges that, when used wisely, can give valuable insights into the probable direction of the next move.

The received wisdom on why the practice gradually lost relevance is that computers took over. Nobody had to look at charts any longer because flicking through screens and printouts had become obsolete. Desktop computers proliferated. The Python programming language appeared in 1991 and began to make data science widely accessible.

Charts are limited to two, or possibly three, dimensions of data. Statistical techniques were able to cope with as many as the available computing power supported. People now had a choice when it came to seeking alpha (a return on investment on top of the performance of a benchmark index); they could hire a chartist to hand-draw lines, or they could have a “codesmith” mix and match a bewildering number of factors in near-infinite combinations across thousands of instruments through innumerable time periods.

The first serious limitation of this theory is oversimplification. Horses and the car coexisted for decades until World War I reshaped logistics. E-mails and self-service have similarly not done away with legions of white-collar relationship managers. Why only the chartists?

Second, it is of limited value. Not every investor has access to data pipelines, computer models and a team of statisticians. If technical analysis is better than a placebo, many people would still have a use for that information because in getting from A to B, someone else's Ferrari does not make it pointless to own a Ford Fiesta.

History supports this principle. Jesse Livermore, the thinly veiled subject of Edwin Lefevre's best-selling fiction Reminiscences of a Stock Operator, made (and lost) his fortune several times over between the 1890s and the 1920s. His final winning streak came during the Wall Street Crash of 1929, when, as millions lost their shirts, he made enormous profits from correctly calling the top.

So envious were some that Livermore became a hate figure with a need for bodyguards. More importantly, he was often able to trade successfully using little more than ticker tape – the same price and volume information that forms the bedrock of contemporary technical analysis.

Academics versus the chart

Wisconsin is the world's single-largest source of cranberries. Illinois is home to 85% of American canned-pumpkin production. It was decades after Livermore's time, from these agricultural heartlands of the American Midwest, that peer-reviewed validation of chart-based trading strategies would arrive. In 1992, William Brock, Josef Lakonishok, and Blake LeBaron published a paper with a troubling conclusion for the efficient-market hypothesis.

The price history of the Dow Jones index from 1897 to 1986 provided surprising support for some very simple technical-analysis strategies based on moving averages and trading-range breakouts. Predictive chart reading was supposed to be one notch above newspaper horoscopes. Their analysis of just under a century's worth of data begged to differ.

A year later, a separate and now landmark study by Narasimhan Jegadeesh and Sheridan Titman of UCLA determined that momentum also matters. Financial disclaimers were wrong. The idea spread and the citations piled up. Past performance was a direct predictor of future returns, or so it seemed.

The main reason the argument was never fully settled to everyone's satisfaction was data dredging. Try enough infinitely configurable combinations of useless moving averages, trend patterns, Bollinger bands, or breakout windows, and something will eventually back-test to perfection.

Academics grappled with this issue until, in September 2000, the economist Halbert White invented a measure of data-mining bias which he called the Reality Check method. The drawback was that it relied on an accurate record of all the failed attempts to find a profitable strategy.

It went against self-interest to do this, however, because each dead end documented would make any final breakthroughs seem less profound, and therein lay the problem. Computing had become cheap and the maths was solid. The incentives for honesty remained unchanged.

More fundamentally, it was quickly becoming apparent that if so many different studies were possible, then there was clearly no unified concept of “technical analysis” to begin with. How long was a moving average, a holding period, or a piece of string? Some technical indicators are in fact subjective to the point that even committed proponents lovingly mock their likeness to psychiatric Rorschach ink-blot tests. The classic head-and-shoulders pattern is a case in point.

It appears everywhere and nowhere; sometimes the right way up, other times upside down. The researchers of the 1990s were using rigid models to assess the inherently flexible, inconsistent and at times contradictory behaviour of chartists. It was the parable of the blind men and the elephant, only with trades.

Time horizons also remained a topic of disagreement. Where the shoal of fish might be ten seconds from now seemed more predictable than where it may end up in a year, but some proponents argued the contrary. They cited long-term trends as being far less random and more powerful than short-term volatility.

In practice, forecasters tend to play it safe by wording their prophecies loosely. Gold, for instance, formed a triple top between 2011 and early 2022. The monthly MACD indicator was in negative divergence. In chart speak, this means a sell-off was imminent. The reports were circulated. The big calls were made. They were correct over six months, pointless after a year and horrendous beyond.

After counting the votes and correcting for data-mining biases, mainstream finance did reach a tentative consensus. With the requisite ifs and buts, technical analysis, used well and in the short term can outperform buy-and-hold in the pockets of the market that are immature and inefficient. A simple near-term momentum capture strategy in niche small-caps might do something useful. Calling the top of the market based on Elliott Waves covering a forty-year plot of the S&P 500 is impossible to test against an apples-to-apples sample of similarly long time periods throughout history.

Enter the quants

The computational forces that enabled the analysis of large datasets in academia throughout the 1990s had another, more ostentatious effect. They triggered a golden age for hedge funds. Before its spectacular collapse became the subject of several books, Long-Term Capital Management (LTCM) commenced operations with what, in today's money, was seed funding of around $2.2 billion.

The elevator pitch was that Myron Scholes and Robert Merton were involved. These soon-to-be Nobel laureates were two out of the three names who both literally and figuratively wrote the book on the hitherto intractable challenge of how mathematically to model the value of convoluted financial derivatives. Charts were out. Parabolic partial differential equations and elaborate arbitrage trades were in. The first three years together delivered annualised returns of around 35%.

Finance did not, however, divide neatly into econometric wizardry on one side and dusty charting on the other. The prestigious likes of LTCM were risky products that remained restricted to an exclusive set of institutional and ultra-high-net-worth clients. For everyone else, the rapid spread of internet connectivity made public participation in financial markets easier than ever. Gone were large minimum account sizes and unaffordable commission rates.

Online brokerage platforms had arrived and with them mass-market access both to charts and questionable dotcom stocks alike. Now investors could make their own decisions about trading ranges and breakouts. Financial-services firms had to find new ways to demonstrate value and justify their existence, let alone their fees. Fate was on standby, about to lend them a hand.

The revenge of the analysts

First came the Asian financial crisis of 1997. It was bundled with the hallmarks of crony capitalism, specifically eye-watering leverage, absurd cross-holdings and wafer-thin bank capital reserves. Its economic fallout was a key driver of the Russian sovereign-debt crisis one year later, which in turn blew up LTCM.

There followed the dotcom crash of 2000, then catastrophic accounting scandals at Enron in 2001, WorldCom in 2002 and Parmalat in 2003. Each episode meant the unravelling of a popular blind belief, whether in the Asian Tigers, automatic post-communism prosperity, visionary CEOs, or the vast riches that would flow from anything being put online.

This short calamity-rich period highlighted the importance of both financial analysis and due diligence – something neither lines on a chart nor a catchy jingle could ever be a substitute for. Quality-oriented fund managers talked about how their portfolios had weathered the storm through resilient and well-proven business models. Value-focused ones were proud of not having bought things at any price.

There was a macabre parallel with the academic debate on data trawling; put all of finance through a series of crises and there will always, by definition, be survivors. In his 2001 bestseller Fooled by Randomness, Nassim Nicholas Taleb was at pains to point out that they may not necessarily all be geniuses.

A strange new afterlife for technical analysis

Much of what technical analysis was invented to do lives on today under different umbrellas. Testable momentum signals, for example, are integral to quantitative finance and factor investing. The more discretionary aspects of chart reading, however, were never rebranded. They are today to finance what Reddit has become to cutting-edge AI – full of nonsense, inappropriate to quote in the boardroom, but nevertheless a source of knowledge too valuable to discard. Were such charting tools truly redundant, they might long since have been retired as a feature of the expensive Bloomberg terminals that power the industry.

A glossary of key terms in technical analysis

Basic chart mechanics

Volume Bars

Vertical bars showing how many shares or contracts were traded during a given period. Chartists use volume to gauge the market's conviction behind a price change or a specific trading level.

Trading Range

Over time, a financial instrument might fluctuate in price between relatively consistent upper and lower boundaries. The lower boundary is support, where increased buying tends to emerge; the upper is resistance, where additional selling tends to appear. A move beyond either boundary is called a breakout or a breakdown.

Mathematical indicators

Moving Average

The rolling average price of a security over a specified number of periods. This smooths short-term fluctuations, making trends easier to identify. Crossovers between moving averages of different lengths are often treated as trading signals.

Bollinger Bands

A moving average with upper and lower bands, all calculated from recent prices and overlaid onto a chart. The bands widen when price volatility increases and narrow when trading is calm. This helps to identify prices that are unusually high or low relative to prevailing levels of volatility.

Momentum

The tendency of prices to keep moving in their existing direction. Momentum indicators measure the strength or rate of price changes. This helps to distinguish persistent trends from those losing force.

MACD Indicator

Short for Moving Average Convergence Divergence. This indicator, typically shown in a separate but aligned panel below the price chart, consists of two fluctuating lines. The MACD line represents the difference between short- and long-term moving averages of the price. The signal line is a moving average of the MACD line itself, smoothing out its fluctuations. Crossings between the lines are read as signs of strengthening or weakening momentum.

Chart patterns and theories

Triple Top

When prices reach approximately the same high three times without breaking through. Traditionally, this is interpreted as a bearish reversal, especially if the price then breaks down through recent support levels.

Divergence

A pattern in which price and a technical indicator move in conflicting directions. Bearish divergence occurs when prices make higher highs while a momentum indicator makes lower highs, suggesting that the upward trend may be weakening.

Head and Shoulders

A reversal pattern featuring three successive peaks, with the middle peak higher than the other two. A fall below the line joining the intervening troughs, known as the neckline, is traditionally seen as bearish. Turned upside down, the pattern is an inverse head and shoulders. A break above its neckline is deemed bullish.

Elliott Waves

A theory proposing that market prices move in recurring sequences driven by investors' collective psychology. Its classic formulation identifies five waves in the direction of the prevailing trend followed by three corrective waves. Identifying and counting them involves considerable interpretation.

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Demand among Star Wars memorabilia collectors for the franchise's screen-matched lightsabres has gone galactic.

In September of last year, the lightsabre from the original Star Wars film from 1977 broke the record for a prop from the franchise, when it sold for $3.6 million with Propstore in Los Angeles. Fittingly, that record was in turn broken by (spoiler alert) his son Luke Skywalker's lightsabre, still held in the (prosthetic) hand Darth Vader cut off in The Empire Strikes Back, the sequel from 1980. It sold for almost $3.8 million earlier this summer with Dallas-based Heritage Auctions.

The auction duel of the lightsabres isn't over yet. Now, it's the turn of Darth Vader's weapon from The Empire Strikes Back (1980) and Return of the Jedi (1983). The prop used in the making of both films is headlining Heritage Auctions' The Ultimate Star Wars Auction sale on 12 November, where the starting bid, including the 25% buyer's premium, is $1 million. In fact, the prop leads a whole line of lightsabres spanning the various sequels and spin-offs that followed over the years since the early 1980s – along with Boba Fett's carbine blaster (starting bid $125,000) and various other props, scripts, drawings, toys and posters.

A museum of Star Wars memorabilia

The spate of Star Wars sales is hardly surprising. Collecting film memorabilia has morphed from being a slightly nerdy fan obsession to becoming serious business. The broader market is expected to grow at a compound annual growth rate (CAGR) of 5.6% to 2030 – from $3.1 billion in 2024 to $4.4 billion, according to a report last year from Strategic Market Research. At the end of August, Propstore featured several Star Wars items as part of its Entertainment Memorabilia sale and, last spring, the auction house sold C-3PO's head from The Empire Strikes Back for just over $1 million, including the buyer's premium.

Perhaps the real question ought to be, where do you put it all? George Lucas, the creator of Star Wars, has come up with the answer – at least as far as his collection goes. Last month, the sprawling, futuristic-looking Lucas Museum of Narrative Art opened in Los Angeles. It cost a reported $1 billion and took 15 years to build “one of the most conspicuous and intriguing museums to launch this decade anywhere in the galaxy”, says The Economist. The way the market is going, should Lucas ever find he needs to build a new wing, he could simply sell a few more items from his Star Wars collection to fund the expansion.

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South Frederick Street, Glasgow

A duplex penthouse in a sought-after city-centre development with two large terraces overlooking the city. It has floor-to-ceiling windows, a large open-plan living area and a bespoke kitchen with tiled floors and underfloor heating. 2 bedrooms, 2 bathrooms, reception.
Price: £550,000+ Savills 0141-222 5875

Apartment 51, The Cooperage, Dorchester, Dorset

A contemporary penthouse in a circular development in Brewery Square. It has floor-to-ceiling windows, an open-plan kitchen and a living room leading onto a wraparound terrace with far-reaching views. 3 bedrooms, 3 bathrooms.
Price: £1.1m Strutt & Parker 01392-914200

Prince Albert Road, Regent’s Park, London NW1

A penthouse in an outstanding location opposite both Primrose Hill and Regent’s Park, with an outdoor kitchen on a landscaped roof terrace offering 360-degree views over London. It has stone and wood-clad walls, a spiral staircase, an open fireplace and six balconies. 3 bedrooms, 4 bathrooms, 2 receptions, open-plan kitchen, gym, garage, lift.
Price: £9.75m+ Savills 0203 043 3600

Shenley Tower, Blenheim Mews, Shenley, Hertfordshire

A duplex penthouse in a converted Italianate water tower with panoramic views across the Hertfordshire countryside. The flat has wood floors, double-height ceilings with floor-to-ceiling arched windows and three balconies. The contemporary interiors include a fitted kitchen with Smeg appliances and a wine fridge. 2 bedrooms, 2 bathrooms, breakfast kitchen, study, reception, underground parking.
Price: £775,000 Fine & Country 01727-229799

Fitzroy Avenue, Broadstairs, Kent

A penthouse in a new development with panoramic views across Botany Bay. It has an open-plan kitchen and living area with patio doors leading onto a covered balcony. 2 bedrooms, 2 bathrooms, roof terrace, lift, 2 allocated parking spaces.
Price: £750,000 Fine & Country 01227-479317

East Wing Penthouse, Heytesbury Park, Warminster, Wiltshire

A penthouse in a Grade II-listed Georgian house built in 1782 set in communal parkland gardens. The flat is accessed via a communal entrance hall with a glazed dome, tiled floor and a grand staircase. It has a sitting room with a semi-circular bow wall and an open fireplace. 3 bedrooms, 2 bathrooms, reception, dining kitchen, 2 garages, communal gardens.
Price: £695,000 Strutt & Parker 01722-344010

Netley Castle, Netley, Southampton

A duplex penthouse in a Grade II-listed, 16th-century castle beside Southampton Water with direct access to the beach. It has contemporary interiors, a bedroom in an octagonal turret, two balconies and a roof terrace. 4 bedrooms, 3 bathrooms, 2 receptions, kitchen, sun room, mezzanine library area, garage, 3 acres of communal gardens, use of the castle’s great hall.
Price: £1.1m Hamptons 01962-842030

Ratcliffe Wharf, Narrow Street, London E14

This penthouse apartment is situated in a converted warehouse beside the River Thames and has a balcony and access to three roof terraces that command views towards Tower Bridge and Canary Wharf. The flat has exposed brick walls, floor-to-ceiling windows, contemporary interiors and a modern wood-burning stove. 4 bedrooms, 3 bathrooms, open-plan dining kitchen/living area, lift, communal entry.
Price: £2.9m Knight Frank 020-3823 9944

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“The gambling known as business looks down on the business known as gambling”, said the American author and journalist, Ambrose Bierce. Yet gambling is a big business: the gambling sector could achieve global annual sales of $700 billion by 2028, according to the World Health Organisation (WHO). At the same time, it is undergoing unprecedented disruption.

A key positive change is the rapid liberalisation of gambling laws in the US. But while demand may be growing, “the problem is who keeps the money, as more of every dollar goes to the state, and the most profitable bets are moving to prediction markets”, says Joao Mourato, former professional gambler and now head of iGaming Product at VIP-Grinders, a poker and iGaming affiliate. However, investors should not overlook the industry.

The gambling industry is booming in the US

There are several pockets of strong growth in the gambling industry around the world, such as in Turkey and Eastern Europe. But “by far and away the biggest story in the global gambling industry has been the decade-long boom in the United States”, says Dan Wasiolek, a senior equity analyst for investment platform Morningstar. Ashley Akin, senior contributor at proprietary trading group Prop Firm App, says US commercial gambling revenue reached $78.7 billion in 2025, with sports betting up 22.8% to $17 billion and online casinos 27.6% to $10.7 billion.

Jamie Gold, who won the 2006 World Series of Poker (WSOP) Main Event, argues that while there “has always been a massive interest in gambling” in the US, it was restrained by the fact that “there were just not that many legal or seemingly legal opportunities for betting, especially online”. Yet when the US Supreme Court effectively struck down the federal ban on sports betting in 2018, leaving the matter up to individual states, a large number of them quickly bowed to public pressure and legalised betting. The upshot? People “now have instant access on devices and unlimited markets to place a wager on”.

Adam Small, founder of digital media group Third Planet Media, thinks the explosion in demand was also driven by the fact that once gambling became legal, the mainstream media, “particularly sports media, felt empowered to put gambling content into broadcasts at an unprecedented level”. So, now when “you watch a baseball game, you can track your bets on screen and are regularly shown betting odds on not just the game outcomes, but also what will happen [when the next player bats]”. This has created a cycle where more betting means more coverage, leading to more betting.

How long can this boom continue and how far can it go? Gold argues that “we're not even close to the peak”. While the vast majority of states now allow some form of gambling, far fewer have no restrictions at all. At the same time, a few major holdouts, notably California and Texas (which together account for 20% of the US population), still also ban most betting, including sports betting. If those two states changed their mind, however, “it would mean major growth for the industry”.

Overall, Wasiolek is moderately bullish, although he admits that there is considerable uncertainty about how the industry will grow. However, even in the US states where gambling is now legal, you would expect “good, or even single-digit, growth”. So, if you then add to this the “handful of additional states that are expected to allow online casinos or sports betting in the near future”, the industry's medium-term prospects in North America look very encouraging.

Competition from prediction markets

One big reason investors have soured on many gambling stocks, especially those related to US online bookmakers, is down to the uncertainty generated by competition from prediction markets. Prediction markets are essentially a new form of betting exchange, which match punters on either side of the bet.

However, unlike British betting exchanges such as Betfair, they are regulated as financial products by the Commodity Futures Trading Commission (CFTC). This allows them to bypass state regulations and “gain direct access to America's financial infrastructure, including integration with every broker, every trading platform, every fintech app”, says Edwin Dorsey, founder of investment newsletter The Bear Cave.

While this designation is being contested, with a coalition of 39 states supporting a legal challenge arguing that prediction markets should be regulated at the state level, Dorsey argues that they have the potential to bring genuine economic benefits. For example, instead of insuring your property against hurricanes, which can be “very expensive and very inefficient and lead to disputes involving adjusters, lawyers, and potentially litigation”, residents in a state such as Florida could simply bet on whether a hurricane will occur in their own area.

J. Christopher Giancarlo, the Chair of the CFTC between 2017 and 2019, argues that prediction markets can also bring other benefits. For example, he thinks that the incentive it gives those taking part to be right “gives [these markets] the potential to be more accurate in predicting the outcome of events like elections than polling” does. While he acknowledges that while they aren't infallible, and will need to be regulated properly, they are so accurate that “once prediction markets catch on, we'll be using them to judge the probability of events, just as we use weather forecasts to predict the weather”.

Of course, the big question is how prediction markets will affect more conventional betting companies. Some people are pessimistic about the latter. “If running a sports-betting operator means paying high ‘sin' taxes and dealing with heavy regulatory burdens, while running a prediction market means relatively little oversight and being taxed as a financial-services provider, it's hard to see how the former can compete with the latter,” says Small. Mourato says prediction markets offer a better experience, including not limiting successful gamblers' bets (something bookies in general are notorious for).

There is increasing evidence that prediction markets are already starting to steal customers from betting outlets (known as sportsbooks in the US), says Mourato. Betting consultancy H2 Gambling Capital estimated that prediction markets took about 27% of legal US sports-betting volume in the first month of the World Cup, up from 9% at the start of the year. Worse, they are also starting to make inroads into the more profitable areas, such as parlay bets (bets that only pay out if two or more events happen), “which typically yield sportsbooks 22 cents on each dollar wagered, compared with only six cents for straight bets”.

However, others are more optimistic that prediction markets and traditional betting firms can coexist. Russ Mould of investment platform AJ Bell thinks that most of the people attracted by prediction markets “tend to be those who were more used to spread betting on CFDs or financial markets”, and is less convinced that they can attract people “more interested in a wager on a three-mile horse race”. Wasiolek notes that while the major US sports-betting companies briefly saw their revenue fall at the start of the year, possibly due to competition from prediction markets, revenue has managed to bounce back. He also notes that some, such as DraftKings, are even launching their own prediction markets. Overall, he expects them to keep growing, but at a slower rate than previously.

Leo Barker, VP Commercial-EMEA of OpticOdds, one of America's leading sports-data providers, thinks “it's too simplistic to view prediction markets purely as a threat to sportsbooks, as [they] are also introducing an entirely new audience to the idea of trading on real-world outcomes”. He thinks the bigger story is convergence, whereby “consumers increasingly expect to move seamlessly between sports, financial markets, entertainment and other real-world events”. So, the question “is less whether prediction markets replace sportsbooks and more how the two categories evolve alongside each other, particularly as regulators determine where the lines between them ultimately sit”.

Regulation is on the rise

Another factor weighing on gambling shares has been a sense that while the US may be loosening regulation, elsewhere the regulatory tide is shifting against the sector. Darragh McGee, an associate professor in the Department for Health at the University of Bath, thinks this is long overdue. In his view, the gambling industry has been able to rebrand itself “as just another leisure activity”, while aggressively promoting products that encourage addiction. This doesn't just affect the increasing number of problem gamblers, but also those around them. McGee cites research claiming that every gambling addict has a negative effect on up to eight people around them, and that the total costs to society far outweigh the tax revenue generated by the sector.

Rather than an outright ban, McGee hopes for an approach “that would permit gambling, but not rapaciously promote it in the manner that we currently see”. However, whether you agree with him or not – Mould thinks “it is easy to see why the industry's behaviour has upset some people” – McGee believes that the mood has definitely changed. So investors need to be aware that “ineffective disclaimers” on bookies' websites won't be enough to satisfy public opinion and the amount of tax and regulation will only increase. Government action isn't the only risk. Several Facebook-style class-action suits against the leading US gambling companies are in the pipeline.

“[Heavy] regulation doesn't stop people gambling, but just moves them to unlicensed sites that offer worse value and fewer protections,” according to Mourato. Still, he agrees about the overall direction of travel in the regulatory backdrop. He notes that the UK increased the rate of remote-gaming duty from 21% to 40% in April 2026, while online-betting duty will rise from 15% to 25% in April 2027. In 2023, Australia introduced a National Self-Exclusion Register, whereby people concerned about their gambling can block themselves from online-betting outlets for at least three months. Online gambling with credit cards was banned a year later.

Mourato even thinks that outright bans of certain betting products aren't off the cards. For example, European regulators have launched action against prediction markets (which remain banned in the UK), while Brazil banned gambling by presidential order a few weeks ago. Overall, he thinks that regulation represents the biggest threat to the industry outside the US. He is so worried about further changes “that I don't own any gambling shares myself”.

However, others think the risk of regulatory crackdowns has been overstated. Sergio Paulino, founder and CEO of All Bettors, a prediction platform, says that Brazilian president Lula's decision to ban gambling was a “political stunt” that didn't prevent (and might well have caused) his poor showing in the first round of the presidential election, demonstrating that such moves have limited electoral appeal. Wasiolek suggests that while both additional regulations and tax rises “may hit revenue for a few quarters”, their long-term impact will be limited. Gambling companies are increasingly geographically diversified, allowing them to shift investment towards expanding operations in more friendly jurisdictions.

Regulation could even create opportunities for systems that can help companies and platforms detect problem-gambling behaviours, says Marc Fernandez, chief strategy officer of Neurologyca, a neuroscience and AI firm. For example, since technology “can now pick up on signs that someone's stressed or not thinking clearly, a platform could step in at the right moment, maybe with a quick ‘take a breather' prompt or a temporary limit, just for the person who needs it, and leave everyone else alone”. The same signals can “also help spot people trying to game or manipulate the markets, which is another big worry for regulators”.

Casinos will continue to cash in

Whatever happens to online gambling, there is a general agreement among experts that physical casinos won't disappear any time soon. It's “been proved that online availability of gaming does not take away from the profitability of live gaming”, says Jamie Gold. As an avid poker player, sports bettor and casual casino player, Gold still enjoys “all ways of playing” and his trips to live casinos “have not gone down because of online” casinos.

Christina Lindley, a former professional poker player and founder of VPRG Consulting, similarly “does not see online gambling eliminating physical casinos”. She was recently at G2E (the global gaming expo) in Las Vegas “and the floor was full of technology designed to improve casino operations, retention, and customers' experience”. At the very least, this suggests casinos are optimistic enough about their future to keep investing in new equipment.

Casinos will remain attractive, even in a digital age, because “many people go to casinos for entirely different reasons than they gamble online”, says Adam Small of Third Planet Media. Modern casinos are not just about gambling, “you can get a meal, have some drinks, see a show and, at the nicer casinos, you can even go shopping and go to the spa”. Las Vegas's casinos have shifted their business model from gambling towards general entertainment. They now make so much money from the latter and convention activity “that gambling now only accounts for a third of revenue” – a model that regional casinos are also looking to emulate. While this doesn't make them recession-proof, as there is evidence that higher fuel prices are leading people to cut back on trips, he thinks the casino industry “should roughly follow the growth of the US economy”.

Gambling investments to buy now

One of the big winners from the US gambling boom has been DraftKings (Nasdaq: DKNG). Originally, it focused on fantasy sports leagues (where people would predict which players would do best in return for cash prizes). However, after the regulatory changes in the US, the group pivoted to online betting, running digital sportsbooks and online casinos.

Sales grew nearly tenfold between 2020 and 2025. While the share price has recently taken a beating owing to fears about prediction markets, it now offers its own, and Wasiolek thinks the stock is underpriced at 22 times expected 2027 earnings.

While Wasiolek prefers DraftKings, he also thinks that there is value in Flutter Entertainment (NYSE: FLUT), which has seen its share price fall by 66% in a year. Like DraftKings, Flutter has also experienced strong growth, with revenue nearly tripling since 2020.

While Flutter admits that it sees prediction markets as a net negative, it has engaged with the sector by acting as a market maker (it also owns the UK betting exchange Betfair). Even though both its revenue and earnings are expected to continue growing strongly in the short term, Flutter trades at a bargain-basement level of 10.5 times 2027 earnings.

Value investors may also like Entain (LSE: ENT). Sports betting makes up around 75% of sales, with the rest from online casinos. Entain's share price has fallen by half in the last year, pushing the company out of the FTSE 100, owing to concerns about tax rises and regulatory changes in the UK.

However, while AJ Bell's Russ Mould doesn't have an overall view on the company, he thinks that it “certainly has [the] potential to be a cash-generative business”. It currently trades on a 2027 price/ earnings (P/E) ratio of seven and offers a dividend yield of 5%.

When it comes to physical casinos, Wasiolek is very positive about Las Vegas Sands (NYSE: LVS). Contrary to what its name implies, Las Vegas Sands does not in fact operate any casinos in the US, instead focusing on the Chinese region of Macao and on Singapore.

Wasiolek acknowledges that both areas can be very volatile, but their relatively high rates of medium-term growth, as well as restrictions on the numbers of overall licences (and therefore potential competitors), should ensure healthy long-term prospects. Even though revenue is still growing strongly, Las Vegas Sands trades on a 2027 P/E of 11 with a yield of 3.5%.

MGM Resorts International (NYSE: MGM) owns at least 17 gambling resorts in the US and elsewhere, including properties in Brazil, the UK, China and Japan. But unlike Las Vegas Sands it also has exposure to the sports-betting and online-gaming markets through BetMGM and MGM Digital.

Revenue continues to grow strongly, while there is still a chance that it could become an acquisition target again. MGM also looks promising from a value perspective, as it trades as just under 15 times 2027 earnings.

Many of the operators of prediction markets, such as Kalshi, are currently unlisted. However, online-trading platform RobinHood (Nasdaq: HOOD) recently branched out into prediction markets. Although these account for only a small portion of revenue, they are growing at a rapid pace.

Sales grew tenfold year on year in the second quarter. While RobinHood is priced aggressively at 38 time 2027 earnings, revenue has grown fourfold since 2020 and is expected to keep expanding by double-digits.

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Bond yields and geopolitics are ever present for investors. But that brings its own challenges, as it can often be difficult for us to recognise things that surround us and shape our thinking to the point where they go unremarked.

There is an old parable repeated by David Foster Wallace in Infinite Jest, which, in his version, goes something like the following: two young fish are swimming along and run into an older fish. “Morning, boys. How's the water?” asks the older fish. The younger fish nod, swim on, then one turns to the other: “What the hell is water?”

Bond yields are rapidly rising

Bond yields are rising fast. Ten-year gilts are at 5.4%, ten-year Treasuries at 5.2%. German and Japanese bond yields are also at two-decade highs. Many investors now view these bonds as attractive – although the fact that yields are still trading there tells us that money is not yet flowing back into them in a big way.

To decide whether they are good value, we need to consider what has pushed bond yields up. Is it fears of higher inflation, worries about government finances, growing supply of long-term corporate debt, or expectations of robust growth driving higher short-term rates? However, we must also consider whether our sense of what's normal could also be misleading us.

Ten-year gilt yields are well above their average of 3.3% since 2000. Yet for much of that time, they were held down by central-bank intervention. Many analysts and managers working today will have spent most of their formative years in a low-yield environment, and will instinctively feel that 5% is exceptionally and unsustainably high. Yet if we look back further, the picture changes. The average since 1980 would be 6%, while the average since 1960 – including the inflationary 1970s – would be 6.9%. So whether yields are exceptional depends on what you think is normal.

When does geopolitics matter?

My second example comes from a recent seminar, where an experienced institutional investor argued that geopolitics doesn't matter. Yes, markets react to events in the short term, but these rarely had lasting consequences, he noted.

Yet such individual events were mostly fluctuations within a steady environment. Always remember that every investor working today has spent most, or all, of their career in the post-Cold War era, with the expectations for trade, security and capital markets that peace created. We are clearly in a different geopolitical regime today – and that will have consequences.

We will be discussing the implications of this at our MoneyWeek Wealth Summit on Friday, 6 November in London. But to stretch the parable a bit: the fish often learns what water isn't very abruptly, when it gets hooked by the fisherman. Investors want to avoid the same outcome.

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Seoul is booming, but much of the global property market has stalled. The South Korean capital recorded real house-price growth exceeding 10% over the past year, according to the 2026 edition of the UBS Global Real Estate Bubble index. The AI-chip boom has sent a wall of money flooding into Korea.

Lisbon and Madrid are also property hotspots. In Switzerland, ultra-low interest rates are keeping Zurich and Geneva eye-wateringly pricey. However, the wider picture is one of stagnation. Across the 23 global cities analysed by UBS, residential property prices increased by an average of just 0.5% in real terms over the past 12 months.

Canada has seen the biggest retreats, with Vancouver and Toronto recording 10% declines in real terms as the country cracks down on foreign buyers. Most US cities also saw real-term declines, except for AI hub San Francisco. Germany is glum, with Frankfurt and Munich seeing inflation-adjusted drops of nearly 4%.

Just two cities are flagged by UBS as showing “high” bubble risk: Zurich, and Tokyo. Inflation-adjusted prices in the Japanese capital have surged by around 50% over the past seven years, the result of buyers' increasing leverage and a nascent pick-up in wage growth.

London saw a 1% year-on-year decline; prices in the capital have dropped 15% since 2021 in real terms. Prospects for a recovery remain hampered by “stretched affordability”.

Beyond London, UK house prices are also stagnant. Lloyds reports that the average home cost £298,441 in September, almost the same as 12 months before. The average cost of a five-year fixed-rate mortgage has hit 6%.

The global property market is being overshadowed by stocks

Property doesn't seem to be the “path to wealth” it once was, says The Economist. The average house in England is “now worth less in real terms than it was two decades ago”.

Global household wealth increased by $40 trillion in 2025, according to calculations by the McKinsey Global Institute; about 57% of those gains came from stock markets, with property accounting for just 15%. In the US, stocks overtook property as a share of household wealth in July, the first time that has happened since World War II.

Still, there are advantages to buying outside bubble conditions. “Average market exuberance is now well below the levels observed before interest rates began rising in 2021,” says UBS.

Underlying demand for urban housing is “robust”, as shown by the fact that “rents have broadly kept pace with income growth” over the last five years. In London, rents are still “close to record highs”, a symptom of a “persistent housing shortage”.

On a medium-term view, property “in most cities is likely to provide inflation protection”. Just don't expect your house to make you rich.

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AJ Bell has slashed the fee on its ready-made personal pension, making it one of the cheapest fee-wise on the managed personal pension market.

The investment platform has today (14 October) reduced its annual charge from 0.45% to 0.35% for investors taking a hands-off approach.

The 0.35% fee is all-in, covering administration and investment charges, with investors facing no additional charges on transactions.

AJ Bell launched the ready-made personal pension in 2024, and now offers investors the choice of five growth funds based on their risk appetite.

AJ Bell manages the investments for you which can be helpful for those who are time poor or new to investing and don’t want the responsibility of managing their investments.

The ready-made pension also lets savers track down old pension pots and consolidate them into a single account.

Mahdi Shabir, lead insight analyst at Boring Money, a website providing advice on saving and investing, said: “AJ Bell's pricing change is both compelling and illustrative of the increased competition in the ready-made pension market.

“Following price reductions from both Moneybox and Hargreaves Lansdown in the past 12 months, AJ Bell has thrown down the gauntlet by reducing fees from 0.45% all-in to 0.35% for its ready-made pension.”

Is AJ Bell’s ready-made personal pension worth it?

Following the fee change, AJ Bell’s ready-made personal pension is now one of the cheapest own-brand managed pensions on the market.

However, the higher the value of the portfolio, the less competitive it becomes fee-wise.

For portfolios worth £20,000 or less, its fees are the lowest out of the major providers offering similar products, including Aviva, Fidelity and Hargreaves Lansdown, according to analysis by Boring Money factoring in platform and ongoing fund charge fees.

However, based on a portfolio of £50,000, interactive investor’s (ii) managed pension is cheaper on an annual basis.

Based on a portfolio size of £300,000, AJ Bell’s ready-made pension is more expensive than similar products from Monzo and PensionBee.

Source: Boring Money, looking at the most aligned ready-made pension product offered by mainstream providers, factoring in platform fees and ongoing fund charge fees, excluding transaction costs. **no regular savings plan assumed

Beyond fees, AJ Bell’s ready-made personal pension comes with five growth funds to choose from depending on your risk profile.

However, ii has 10 different investment portfolios to choose from depending on what level of risk you’re willing to take.

Should you consolidate your pension pots?

AJ Bell’s ready-made personal pension also comes with a free pension-tracing service included. You can then consolidate these pots into one with AJ Bell.

Consolidating pension pots can make it easier to track investments and see whether they are performing well, as well as reduce what you’re paying in fees.

Shaun Yates, direct to consumer managing director at AJ Bell, said: “Many people have accumulated several pension pots over the course of their career and it can be surprisingly easy to lose track of them.

“Keeping on top of multiple accounts often leaves people unsure whether their savings are working as hard as they could be.”

It’s worth double-checking you won’t lose out on valuable benefits that come with a pension before consolidating it. For example, it’s generally not worth giving up a defined benefit (DB) scheme pension.

Check for any exit fees which may be incurred from ditching a pension pot as well.

The rise of the so-called “experience economy” offers a welcome alternative to our increasingly digitised life. It promises highly curated, in-person experiences offering the sense of community and direct physical engagement with the world that has been stripped from the daily rhythms of life.

It is a truism that people's lives are increasingly digitalised, but the data still retains the capacity to shock. UK adults spent 4.5 hours per day online in 2025, according to Ofcom. For 18-to-24-year-olds, the figure was six hours and 20 minutes, mostly on their smartphones. And it's not as though we are spending these digitalised lives with others. A significant number of people work remotely, at least some of the time. Over 40% of UK workers spend part of their week working from home.

More unsettlingly, when we are online, we often consume content that isn't even generated by a fellow human being. The marketing platform Ahrefs recently conducted a remarkable study showing that almost 75% of new websites contained significant AI-generated content. The machines aren't just delivering entertainment; they're creating it.

But as investors, we know that when something becomes abundant – screen time, digital content, isolation – something else becomes scarcer, and, typically, more valuable. Today, some of that scarcity seems to be migrating towards the experience economy.

An “experience” might be a trip to a concert or a sports match. It might be dining at a restaurant whose kitchen offers a special menu, or taking a trip to a beach with the softest sand and the bluest water. This isn't new. Business strategists Joseph Pine and James Gilmore coined the phrase “experience economy” in 1998, with the idea that companies could command pricing power through events that engaged consumers on a memorable, emotional level. But the forces that created the need for such an economy have only become stronger over the last quarter of a century.

What is the experience economy?

The evidence for an experiential boom in spending is already widespread. In its 2026 State of the Consumer report, consultancy McKinsey highlighted that the global experiences market between 2023 and 2025 grew more than three times faster than spending on non-essential goods. Mastercard recently found that 88% of British consumers would be happy to redirect their spending on things towards experiences.

Michelle Evans, data group Euromonitor's Global Lead on Retail & Digital Consumer Insights, says there is a broad rotation among consumers from “owning more to experiencing more”. The trend has been building for over a decade, but has accelerated since Covid.

It seems to be a reaction to digital saturation: “In an increasingly digital world, consumers are placing greater importance on experiences that improve wellbeing, create memories, strengthen relationships and feel genuinely human.” And young consumers, those most exposed to digital lives, are leading the rotation.

Live music and sports are among the purest embodiments of these experiential urges. Think of Taylor Swift's Eras Tour, the 149-concert extravaganza in 2023 and 2024, which became an economic phenomenon in its own right. It was the most financially successful tour of all time, generating over $2 billion in direct box-office sales, more than twice its nearest rival.

How Swifties are fuelling the experience economy

Twenty-two million people joined the virtual queue to buy tickets for Swift's Singapore concert, almost four times the country's population. The vast majority of these would-be attendees were planning to fly in from overseas; they were going on a musical pilgrimage. The quasi-religious nature of this fandom is underlined again by the fact that in Philadelphia over 20,000 ticketless fans stood outside the stadium during the concerts, night after night, just to be physically close to the Swiftian phenomenon.

A similar devotion characterises live sports. According to entertainment analytics firm Two Circles, 79.4 million fans attended ticketed professional sports events in the UK in 2025, 1.7 million more than the year before, and this despite a 5% increase in ticket prices. Attendance levels are far above pre-Covid figures.

When the Premier League first started, in the early 1990s, stadium utilisation rates sat at 70%. In the 2024-2025 season, that had risen to 98.8%. There is a sense in which attending a concert, or a Premier League match, is not just entertainment; it is a way for people to forge their identities and feel part of something larger than themselves.

This matters economically. AI may be able to commoditise digital content, but it cannot replicate the experience of standing next to 60,000 people at Anfield. “Travel, wellness, live events and community-based experiences all benefit from the fact that they are difficult to replicate digitally and often become more valuable as consumers spend more of their lives online,” says Evans.

Economist Alex Imas has argued that as AI makes some forms of production abundant, scarcity will not disappear, but will relocate towards what he calls the “relational sector”, where the human element itself contributes to the value of the product. As investors, we want to be in the businesses of monetising this relocated scarcity.

There are several ways we can invest in the experiential economy. Live Nation Entertainment (NYSE: LYV) is the world's largest live-entertainment company, operating concert promotion, venues and ticketing services. It is positioned between consumers and the increasingly valuable experiences they are seeking. Concerns over competitive practices have dogged the stock. A federal jury earlier this year found it operated a monopoly, and it is unclear how this will be rectified.

The experience economy is safe from AI

However, the underlying business, protected by exclusive, multi-year venue and artist contracts, remains structurally difficult even for AI to disintermediate. The extraordinary demand for the sort of experiences it facilitates was illustrated by the collapse of Ticketmaster's system under the weight of 3.5 billion ticket enquiries for Taylor Swift's Eras Tour.

Airbnb (Nasdaq: ABNB), the world's largest platform for booking alternative accommodation, is another interesting play on the experiential economy. The company has a valuable set of inventory consisting of millions of homes across the world, which it has spent almost 20 years building. While its product (accommodation) isn't scarce, Airbnb's value lies in facilitating the increasingly valued experience of global travel, taking a healthy commission in the process.

A third way to play consumers' strong desire to invest in live experiences is TKO Group (NYSE: TKO), a firm roughly split between the UFC, the world's leading mixed martial-arts business, and WWE, the dominant player in the world of professional wrestling. These distinct, but related, businesses are near-monopolies in their respective domains.

TKO Group differs from Airbnb or Live Nation. It is not an intermediary; it owns the product itself. Live sports are perfectly placed to resist the commoditising effects of AI. Their essence is that they are unique and occur in real time; even if you cannot be there in person, you must be sitting in front of a screen as the event unfolds. The fact that there is no algorithmic substitute for their product gives them low price sensitivity.

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Judges Scientific (Aim: JDG) was once a favourite of the London market. Over the years from March 2004 to March 2024, the shares rose 10,300%, compared with a return of just 160% for the FTSE All-Share excluding dividends. But since reaching an all-time high in 2024, the shares have lost nearly two-thirds of their value. Investors have clearly lost patience with the group, which once commanded a valuation of 40-plus times forward earnings. However, the issues seem to be more cyclical than structural, and the underlying business model is far from broken.

How Judges Scientific profits from niche industries

Judges Scientific isn't really one single business. The group operates as a collection of businesses acquired over time and owned under one holding company. Former CEO David Cicurel founded and seeded the firm in 2002. It started as an activist investment company, but shifted direction shortly after its initial public offering in 2003 (priced at 95p per share vs the recent peak of 12,000p).

Rather than buying stakes in public equities, Cicurel decided the business would achieve better returns by acquiring whole companies, particularly small firms serving a niche in key scientific and testing end markets. The first entity acquired under this new regime was Fire Testing Technology, which specialises in measuring how different materials react to differing levels of fire and heat. With $3 million in annual sales and an earnings before interest and tax (Ebit) margin of 25%, the deal became the blueprint for further acquisitions.

Cicurel and his team continued to build Judges Scientific with similar acquisitions. The template they used and continued to use hasn't really changed. Judges acquires small, usually owner-operated entities, and leaves them to it. It provides the capital and funding to develop new technology or processes, while the underlying businesses continue to focus on what they do best – serving their customers with small, but vital tools and products.

A key metric for the group has always been return on tangible invested capital (ROTIC), a measure of profit for every £1 invested in tangible assets. For Cicurel, any business with a ROTIC below 20% was a no-go and, as a group, Judges has tended to earn a ROTIC of 20%+ across the 23 core businesses it owns today.

Why is Judges Scientific struggling?

After nearly two decades of near-continuous growth, Judges Scientific's growth story stalled in 2024. After its Geotek subsidiary reported delays to a key high-margin project, sales ended the year 2% lower. In November of that year, the firm also issued a profit warning, the only one in its history. Profit fell 21% for the full year. Still, three new businesses were acquired across the holding firm and via subsidiaries as the group continued to execute on its acquisition strategy.

In 2025, clouds continued to gather. These included the hit to global research spending following US budget cuts, higher operating expenses and a slowdown in orders from China. North American revenue fell 25% overall. Net profit declined from £22 million in 2024 to £21 million in 2025. At the end of November 2025, Cicurel also announced he would step down as head of the business in February 2026, to be succeeded by former group business development director Tim Prestidge. The group's long-standing CFO also said he would step down in September 2027. Investors didn't hang around to find out how Judges would navigate the transition. Stock sales pushed prices down 50% from their all-time high in 2024 to the end of 2025.

Unfortunately for the new CEO, the outlook doesn't look set to improve anytime soon. Revenue in the first half of the fiscal year fell 21% year on year to £55.7 million, with adjusted pre-tax profit down 75%. Order intake fell 12% in the first half, driven by lower demand from the US and China and softer sales from renewable energy customers. However, Judges says momentum has picked up since the period ended, with order intake running just 1% behind the levels of the prior year.

Judges Scientific is priced for perfection

Judges Scientific's underlying business performance tells one story, but it's also worth noting that the shares have rerated substantially over the past two years. In 2024, before the recent sell-off began, the shares traded at a forward price-to-earnings ratio (P/E) of around 43, a premium multiple by any yardstick. After the recent decline, the shares are trading at just 19 times forward earnings, a much more realistic multiple, but arguably still a bit high for a zero-growth business.

Still, it's clear the company is suffering from cyclical, not structural issues. Underlying end markets are robust and demand for scientific equipment hasn't vanished. Granted, it will take time for funding to return to the sector after budget cuts, but Judges' underlying businesses are still investing, developing the cutting-edge kit that'll be required when funding returns.

What's more, Judges Scientific has the cash to buy peers that might also be struggling and don't have access to the same capital reserves. The group has also extended its banking facilities to 2030, which will underpin its ability to keep growing through its buy-and-build strategy. Net debt of £41 million is equivalent to roughly 1.9 times earnings before interest, tax, depreciation and amortisation (Ebitda), giving headroom for further borrowing. Most of Judges' end markets are highly fragmented, served by smaller owner-operated businesses that may not survive alone.

Analysts at Berenberg say the group's margins will stabilise and sales will improve next year as funding and spending recover. They've then pencilled in a small recovery in 2028, before growth really returns in 2029. Based on these forecasts, now could be a good time to start accumulating shares in this one-of-a-kind business, which is going through a rough patch.

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“CryptoDad” J. Christopher Giancarlo is a lawyer who was chairman of the CFTC between 2017 and 2019. He is the author of CryptoDad: The Fight for the Future of Money, and his latest book, The New Adventures of CryptoDad: The Quest for Financial Freedom in the 21st Century, will be out in October.

Matthew Partridge: How did you became known as “CryptoDad”?

J. Christopher Giancarlo: When I first became chairman of the US Commodity Futures Trading Commission (CFTC), I felt that at some stage we would be called upon to make rules for cryptocurrencies, so I worked hard to understand the area, including doing some synthetic bitcoin mining in the chairman's conference room. Around that time, the Chicago Mercantile Exchange asked us about the listing and trading of crypto derivatives. While we gave it additional regulatory scrutiny, we eventually greenlit the launch of bitcoin futures in the face of furious opposition from Wall Street and global regulators.

I was therefore summoned to justify our decision in front of a US Senate committee. While I submitted a 60-page briefing document to the committee beforehand, I made a big show of pushing my papers away and telling the committee that I was approaching them as both a regulator and a father. I then explained that I had three college-age students whom I had tried to interest in the stock market. However, all they wanted to talk about was crypto, and I argued that we owed it to this generation to build a sensible regulatory regime so that they are not ripped off.

As a result, I was dubbed “CryptoDad” by the industry. The name stuck; I like it and use it. But what I'm most proud of is that eight years after we gave the go-ahead to bitcoin futures, that market is deep, liquid and, most importantly, well regulated by a competent federal regulator. There has been no market manipulation.

Matthew Partridge: You call Donald Trump the first crypto president. Why?

J. Christopher Giancarlo: Crypto is one example of his administration's belief that the only way for the US to cope with its debt mountain is through unleashing innovation and securing strong economic growth. So crypto is just one technological innovation, along with nanotechnology, biotechnology, drone technology, rocket technology and AI, that will help the US grow out of its debt load. Trump was also clever enough to recognise that the Biden administration had squandered its political advantage with the crypto generation by suppressing innovation in the field.

Matthew Partridge: Do you think the crypto industry has enough momentum to withstand a possible change in the balance of political power?

J. Christopher Giancarlo: The Trump administration's message to the crypto community is that if they stand by it, the president will do everything possible to ensure that even if the Republicans lose the White House in two years' time, the roots of crypto innovation will have become so deep that they can't be pulled up by the opposition. Whether this will actually happen is another matter. Still, I would say that crypto is no longer a political dividing line between the parties. Data centres and the development of AI are far more contentious.

Matthew Partridge: You talk about property records as being one of the “killer apps” of the crypto revolution. What exactly do you mean by this?

J. Christopher Giancarlo: Property is one of the most analogue financial assets. For one thing, many property records are still stored on physical paper. During the Great Chicago Fire, all the property records were housed in a building that went up in flames and it took decades to figure out who owned what. What's more, many systems have complicated rules, such as 100-year leaseholds in the United Kingdom. Even in the US, many property buyers have to take out insurance against ownership claims from other people. Establishing ownership of the title can be difficult, especially the further back you go.

Putting all these records on the blockchain [the digital ledger underpinning a cryptocurrency], as my county in New Jersey has done, will greatly reduce ambiguity around ownership, while speeding up the selling process by allowing for easy transfer of titles. It will even allow people to sell fractional shares in property. Most importantly, it will make it much less onerous for people to borrow money against their property, which will be transformational, given that property is one of the biggest assets in most people's portfolios.

Matthew Partridge: What is the Digital Dollar project?

J. Christopher Giancarlo: When I left government, I believed that eventually every major economy would put its currency on a blockchain-based system and tokenise the instrument [making a digital version of its currency, similar to bitcoin]. I therefore founded the Digital Dollar project to focus on the answers to three questions.

Firstly, how do we future-proof the dollar by putting it on the blockchain? Secondly, how do we do so while retaining, if not enhancing, the dollar's status as a reserve currency? But the third and perhaps most important mission is to make sure that the dollar is future-proof and put on a blockchain in a way that secures free enterprise, free trade and individual privacy.

This is important, as China's digital yuan is a digital modernisation, but it's also meant to be a way to control its population. The European approach to its digital euro doesn't purport to be an instrument of control, but does seem to be a surveillance tool. Agustin Carstens of the Bank for International Settlements has even talked about using a digital single currency to track every euro. By contrast, I believe that government shouldn't be able to know what you do with your money unless there is a probability that you're up to something illegal.

Getting that balance right is crucial, so we founded the Digital Dollar project to work on those three elements – and we've now secured continuous funding from our benefactors through 2028. We take no view as to whether that digital modernisation of money should be done by the private sector or the public sector. The Trump administration is clear that this modernisation will take place through private stablecoin operators. [Stablecoins are cryptocurrencies linked to real-world assets such as the US dollar or gold.] Congress has passed the Genius Act, which legalises the modernisation of the dollar through the private sector.

Matthew Partridge: Are there any countries other than the US that are doing interesting things with crypto?

J. Christopher Giancarlo: I think Japan will become a leader in private-sector, non-dollar-based stablecoins. Singapore and the United Arab Emirates have been very innovative in their licensing regimes. However, while Europe has passed the comprehensive Markets in Crypto-Assets Regulation (MICA), this has not unleased the wave of innovation that it hoped it would, and has largely been overlooked by other regulators. I'm also a bit disappointed by the UK, which was ahead of us ten years ago.

Matthew Partridge: What should the UK do to regain its position at the forefront of crypto?

J. Christopher Giancarlo: I would use an Italian word, coraggio, which means courage. I think that since Brexit, for whatever reason, the UK has been unwilling to take risks when it comes to financial innovation. My approach is to let innovation flourish, but make sure the regulator is just one step behind and well equipped with some of the best minds available to help it understand the sector's innovations.

Matthew Partridge: Bitcoin and crypto generally have become mainstream assets in recent years. Do you think that means the huge price gains we've seen in the last decade are much less likely in future? Is crypto likely to begin behaving more like a currency than an investment?

J. Christopher Giancarlo: I think the triple-digit percentage gains we've seen are probably a thing of the past. When it comes to a new technology, the outsized gains for investors often come early. So as the asset class matures, the scope for 100%-plus gains dwindles.

The same thing happened with the internet revolution 25 years ago. The big gains for companies such as Cisco Systems and Microsoft were in the early years. And you see that in all new technology revolutions; the biggest gains in the AI companies came about two years ago. That's why investors are always looking for the next new thing.

Matthew Partridge: What is the latest thing in financial technology (fintech) that could become the next crypto?

J. Christopher Giancarlo: Decentralised financial markets. Markets used to be closed on weekends, so if an event occurred on a Saturday, you couldn't hedge your position until Monday morning. Well, along comes a decentralised exchange called Hyperliquid, with its own specialised blockchain, and suddenly people are trading within minutes of a Saturday event. Traditional exchanges are now starting to operate 24/7, because the decentralised exchanges have revealed demand on weekends.

The same thing is happening with so-called perpetuals. Futures contracts used to be dated, with the parties settling up at a particular time. But now perpetual futures allow you to hedge a position indefinitely; you just continue to fund the margin. Again, that began in many offshore markets. Decentralised exchanges are forcing traditional markets to up their game.

Matthew Partridge: You've said that crypto is a young person's financial revolution. Do you think it still has a role to play in a low-risk portfolio of someone who is retired, or close to retirement?

J. Christopher Giancarlo: As you age, you move from equities to debt and ultimately cash, and the biggest risk becomes inflation. Since bitcoin is anti-inflationary, with many people seeing it as the equivalent of gold, it certainly has a place in such a portfolio. More broadly, I think the traditional financial system served the second half of the 20th century very well. But times are changing, and the current system has proved slow and expensive. Moreover, crypto is another element of how the internet has changed how we communicate with each other.

What I would say to the older generation is that the new generation, which grew up trading tokens on video games and has never set foot in the bank branch, is going to bring this new system with it, so there's no going back, and everything of value is ultimately going to be tokenised and put on a blockchain. Instead of fighting the trend, you should learn about it and consider putting some crypto in your portfolio to protect you against the one trend that, unfortunately, doesn't seem to be reversing: Western governments debasing their money.

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 Beacon, Countisbury Hill, Lynmouth, Devon

A house built in 1904 on a wooded hillside for a shipping magnate who wanted to observe his ships passing in the Bristol Channel. It has a lookout room offering 180-degree views towards the Welsh coast. 7 bedrooms, 5 bathrooms, 2 receptions, coach house, 10.2 acres.
Price: £2.5m Jackson-Stops 01271-325153

Glen Doll Lodge, Glen Clova, near Kirriemuir, Angus

A renovated Victorian former shooting lodge dating from 1872 on the edge of Glendoll Forest at the foot of Craig Mellon. It has open fireplaces with wood-burning stoves, 8 bedrooms, 7 bathrooms, 3 receptions, kitchen, 2-bed cottage, stone bothy, 0.7 acres.
Price: £875,000 Savills 01738-477525

High Mote, Elsdon, Northumberland

A renovated former farmhouse within walking distance of a village, set in large gardens with extensive views over the Northumberland National Park. It has beamed ceilings, wood-burning stoves, a kitchen with an Aga and a range of outbuildings. 4 bedrooms, 2 bathrooms, 2 receptions, conservatory, separate home office, outbuildings, 3.37 acres.
Price: £740,000 Finest Properties 0330-111 2266

Kirby Knowle Castle, Kirby Knowle, Thirsk, North Yorkshire

A renovated, Grade II-listed, 13th-century castle largely rebuilt in 1653 and set on high ground with far-reaching views across rural Yorkshire. It has ceilings with ornate mouldings, open fireplaces, a bespoke dining kitchen and grounds bordered by stone walls. 8 bedrooms, 9 bathrooms, 3 receptions, library, cinema, wine cellar, gym, 2-bed cottage, parkland, woodland, 65.6 acres.
Price: £7m Savills 01904-617820

Ty Fry & Ty Fry Isaf, Peniel, Denbigh, Denbighshire

Two independent residences with far-reaching views over the Vale of Clwyd. Each property has a wood-burning stove and a bespoke kitchen. Ty Fry: 3 bedrooms, 2 bathrooms, dining room, open-plan kitchen/living area. Ty Fry Isaf: 4 bedrooms, bathroom, reception, 2 loft rooms, barn, 26.24 acres.
Price: £950,000 Fisher German 01244-409660

Lower Carhullan, Askham, Cumbria

A renovated stone barn with striking views of the Lakeland Fells and the Pennines. The interiors include high ceilings, exposed stonework, underfloor heating, a wood-burning stove and a bespoke breakfast kitchen with an Aga. 3 bedrooms, 3 bathrooms, reception, dining kitchen, utility, store, laundry, boot room, detached 1-bedroom annexe, gardens, paddocks, 3 acres.
Price: £750,000 Finest Properties 01228-583109

Pollanaich, Nedd, Drumbeg, Sutherland

This traditional croft house is situated on a hillside overlooking a loch, an island and the surrounding mountains. It has been extended to include a tower room accessed by a spiral staircase, which commands panoramic views. The gardens lead down to a boat shed with a sedum roof. 4 bedrooms, 3 bathrooms, kitchen, dressing room, 3 receptions.
Price: £575,000+ Galbraith 01463-224343

Monte Cielo, Malvern, Worcestershire

A renovated, Italianate-style property dating from 1870 in a commanding position on the eastern slopes of the Malvern Hills. An external staircase leads to a roof terrace that affords panoramic views across the Severn Valley and Bredon Hill. It has feature fireplaces and terraced gardens leading down to an oak-framed hut that is currently used as a summer kitchen. 4 bedrooms, 3 bathrooms, 3 receptions, balconies, garage, gardens, 1 acre.
Price: £1.35m Knight Frank 01905-574 6884

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Energy security is becoming one of the world’s hottest topics as constrained supply pushes oil prices higher.

You’d be forgiven for thinking US president Donald Trump’s return to the White House in January 2025 would have spelled the end of the sector. ‘Drill, baby, drill’ was a cornerstone of Trump’s re-election campaign, and he has been proactive in promoting fossil fuels over renewables – even going so far as to halt the development of several renewable energy projects that were already under construction, citing ‘security concerns’.

“The administration has directly paid developers to simply stop: close to $4 billion across deals with TotalEnergies, Golden State Wind, Bluepoint Wind, Invenergy and RWE since March 2026,” said Angeline Ong, senior investment analyst at trading platform IG. “The main aim, as it is understood by the markets, is to discourage the expansion of wind energy in favour of fossil fuels.”

This has led to corporate retreat from renewable energy projects. “BP cut annual transition spending to $1.5-2 billion, more than $5 billion below prior guidance, and scrapped its target to shrink oil and gas output by 2030,” said Ong. “Shell has leaned harder into liquid natural gas while holding oil output flat and trimming low-carbon spending.”

However, the S&P Global Clean Energy Transition Index returned 9.3% in the 12 months to 7 October, and 5.3% in 2026 to date. These figures mask a decline since 2 June, at which point the index was up 43.9% year-to-date, but the potential, at least, for a rally is there.

The International Energy Agency says renewables are on track to overtake coal and become the largest source of electricity generation in 2026, and projects that renewables’ share of global electricity generation will increase from 33% in 2025 to 37% in 2027.

So is the investment case for renewables over, or do its recent struggles present a buying opportunity?

Why have renewables risen this year?

Ironically, another Trump policy decision has put renewable energy back on the agenda this year.

“The conflict [in Iran] reminded everyone of how the theme has developed over the last few years,” said Charlie Wright, investment director at energy investment specialists Foresight Group.

“The primary objective of renewables is decarbonisation, and that is still obviously very important,” he continued. “But in the aftermath of the Ukraine conflict and now [the conflict in Iran] reminds everyone that building domestic renewables is also about energy security and reducing our reliance on imported fossil fuels, whose prices can be affected by events far outside our control.”

Energy prices have risen dramatically in the UK this year. Between 27 February (immediately before the Iran war) and 6 October, the price of Brent Crude oil rose by 38.8%. This has led to diesel prices breaching £2 per litre for the first time in recent days.

“Just from an energy security perspective, the more domestic, low-cost generation we have can only be a good thing,” said Wright.

Renewable energy is a broad category, and different components might be set differently from others. Solar power could, for example, be more resilient than other forms due to its centrality to artificial intelligence (AI) infrastructure.

“Solar and battery storage is likely to be built because they're the fastest thing to bolt onto a data centre that needs power yesterday,” said IG’s Ong. “This is why the S&P Global Clean Energy Transition Index is up over the past year even as US offshore wind developers are being paid to stop building.”

Is now a good time to invest in renewable energy?

The rally over the first five months of the year shows that there is still life in renewable energy. Since 2 June, though, the S&P Global Clean Energy Transition Index has fallen 26.8%.

Renewable energy is undoubtedly facing challenges, not least higher inflation and interest rates – which according to Ong are particularly challenging for capital-intensive projects like wind farms, which have long construction timelines. Ong added, though, that “solar and battery storage are comparatively insulated because build times are much shorter, which is part of why they're thriving on the AI-demand tailwind”.

Foresight’s Wright says that in the UK over the last two years “there have been more headwinds within core renewables (wind and solar) than at any time over the last 10-15 years”. These include lower power prices than had been assumed when many historical projects were assessed, as well as some weaker years for wind and solar generation.

“There’s been a combination of both project-specific underperformance issues as well as more macro, power price-related issues that have generally meant the asset classes perhaps haven’t performed as well as investors would have liked,” said Wright.

Regulatory changes have also provided headwinds. In January, the UK government announced that the renewables obligation (RO) scheme, which incentivises energy companies to use renewable energy sources, will account for inflation using the consumer prices index rather than the (usually higher) retail prices index it had previously used. This means the subsidies that renewable energy projects will receive will be lower over the long term.

Wright views these setbacks as minor though.

“Wind and solar are still absolutely fundamental asset classes for decarbonisation in the UK,” he said. “Whether it’s hitting net zero targets or getting anywhere near it, a lot of wind and solar still needs to be built.

“So it’s still an enormous investment opportunity, but along the way there will be some peaks and troughs in investor sentiment to those asset classes.”

How to invest in renewable energy

Renewable energy investments share many of the advantages of traditional infrastructure or utilities investments, but given the sector is still in a relatively early stage, there is the potential for greater growth over the long term than these sectors are known for.

Whether any given renewable energy project would function as an income investment or a growth investment depends, in Wright’s view, on the point at which you invest.

“If you’re buying into an operational wind or solar project, that would be a greater focus on income,” he said. “You’d be buying into the yield that asset is going to produce over a number of years, but I don’t think you would really look at that as a growth opportunity.”

Investing earlier in the project’s life cycle, though, offers greater opportunity for capital growth – though there is of course greater risk the earlier you invest.

If you decide to invest in renewable energy, there are two main routes in.

One of these is through listed companies directly involved in the sector. Some of the largest of these are Vestas Wind Systems (COPENHAGEN:VWS), First Solar (NASDAQ:FSLR) and Nextpower (NASDAQ:NXT).

You could alternatively invest in the renewable energy sector via funds or investment trusts that target it.

There are various tracker funds and exchange-traded funds (ETFs) that track the S&P Global Clean Energy Transition Index, such as the iShares Global Clean Energy Transition UCITS ETF (LON:INRG).

Actively-managed funds tracking the sector include Guinness Sustainable Energy or the Polar Capital Smart Energy Fund.

Wright is co-lead manager of Foresight Environmental Infrastructure (LON:FGEN), an investment trust that invests in private renewable energy infrastructure projects. It holds 39 assets located across the UK and mainland Europe.

Other investment trusts such as Greencoat UK Wind (LON:UKW) or NextEnergy Solar Fund (LON:NESF) can offer targeted exposure to specific forms of renewable energy.

The MSCI Emerging Markets index has become distorted. Three tech heavyweights – Taiwan Semiconductor, Samsung Electronics and SK Hynix – now account for almost 30%. As a result, Taiwan and South Korea make up nearly half the index, and Asia totals 80%, while tech is 44%.

Returns have been strong lately, driven by the tech names – up 90%, 238% and 422% respectively in the last year. Still, this is not what investors think they are getting when they buy into emerging markets.

How to find domestic growth in emerging markets

Fortunately, there are trusts that offer more diversification. Utilico Emerging Markets (LSE: UEM) invests in infrastructure, utilities and related assets so it has no exposure to the tech giants. The geographic balance is also very different: Brazil is 22%, other Latin America 17% and Eastern Europe (including Greece) 9.5%. UEM is notably underweight China with just 9% there, mostly in Hong Kong, versus 20% in the index. “We find China very difficult, as regulations can change overnight,” says co-manager Charles Jillings.

Stock selection is key as “mismanagement can destroy a good asset”, he says. “If we can't find value in a country or sub-sector, we don't invest.”

The largest holding is Orizon Valorização de Resíduos, a Brazilian waste management company, followed by International Container Terminal Services, which is based in the Philippines but operates in 19 countries.

The spread of the portfolio is further shown by holdings that include internet infrastructure company Korea Internet Neutral Exchange, Grupo Aeroportuario del Pacífico, which operates airports on Mexico's Pacific coast, and Piraeus Port in Athens.

This gives UEM much higher exposure to domestic growth in emerging markets than the global, tech-focused index, often at attractive valuations.

Sonatel, a leading mobile phone company in West Africa, growing at 12%-13% a year thanks to rising customer spend but is trading at just 2.7 times cash flow, says Jillings.

The lack of tech means UEM has lagged the MSCI Emerging Markets over one and three years (though is still up by 14% and 34% respectively) but has returned 9.5% per year since 1995, ahead of its benchmark. The shares are on a 10% discount to net asset value (NAV) and yield 4.3%.

Back smaller stocks in emerging markets

Mobius Investment Trust (LSE: MMIT) offers a different angle, investing in “dynamic small and mid-sized companies” rather than the giants. The £136 million portfolio, which holds just 25-30 stocks, has minimal overlap with the MSCI Emerging Markets index.

While MMIT still has 38% of the portfolio invested in Taiwan and Korea and 31% in technology, this has been reduced in favour of industrials and financials. China accounts for less than 3% of the portfolio – an underweight that resulted in 22% underperformance of the MSCI Emerging Markets Mid Cap index last year but has been rewarded with 12% outperformance this year.

Meanwhile, India has risen to 28% this year. While foreign investors have been selling, domestic investors have been buying, notes lead manager Carlos von Hardenberg. The Nifty 50 index now trades 10% below its 2024 peak, even though economic growth is still 7.5%-8%, inflation is just 4% and interest rates are 5.25%. The rupee has lost 10% in the last year, but this is benefiting exports and import substitution.

Since mid caps have lagged large caps, returns of 33% over one year and 44% over three years are behind the MSCI Emerging Markets index, but mid caps are due a catch-up. The portfolio should offer 23% operating margins for the portfolio and annualised earnings growth of more than 45% over the next five years, estimates von Hardenberg. The shares trade on a 10% discount to NAV and yield 1%.

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.

If you can lock in near-6% income on a bond portfolio, why expose yourself to the risk of a nasty stock market sell-off ? A growing number of ordinary UK investors are concluding just that, with Hargreaves Lansdown reporting a 38% year-on-year rise in the number of users holding individual gilts – UK government bonds.

The great government bond yield blow-out has been most prominent in long-duration instruments such as the 30-year gilt, which now yields 5.94%. But don't let that lure you in. As James Baxter of Tideway Wealth notes, the government has avoided new issuance at such eye-watering rates.

Instead, you would have to buy a gilt that was issued a few years ago at a lower coupon and that is now trading at a discount to the par value. While the mathematics are slightly complicated, the takeaway is that a chunk of that tasty 6% return comes as a capital gain when the bond redeems at par value, say in 2055. Most of us will be long in the tooth by then.

While the state of the public finances might lead you to think that the UK is at risk of default, that isn't a realistic prospect; the Bank of England can always print more pounds. Instead, the real dangers for bond buyers are interest-rate risk (higher rates tank bond valuations in the secondary market) and the risk of inflation that erodes the real value of the fixed income.

Are index-linked gilts (linkers) a solution to the risk posed by inflation? Probably not, says Christian Mayes for Morningstar. Linkers tend to have longer maturities than nominal gilts, leaving them more sensitive to higher interest rates. Indeed, linkers got crushed in 2022 because the damage from higher interest rates outweighed the benefits of built-in inflation protection.

A niche strategy for bonds

The renewed popularity of gilts rests in part on a rather niche tax strategy. While coupon payments are subject to tax outside an individual savings account (ISA), gilts are exempt from capital gains tax (CGT). That makes short-dated bonds trading at a steep discount to par attractive. Anna Macdonald of Hargreaves Lansdown highlights a 0.125% coupon bond currently trading for £94.78 and maturing in January 2028. That gives a mostly tax-free yield to maturity of 4.2%. For higher-rate taxpayers who have already exhausted their other allowances, such gilts are a low-risk place to put surplus cash. An understandable impulse, given all the talk of stock market bubbles.

But there are opportunity costs. Avid gilt buyers may be passing up better opportunities in the stubbornly cheap UK stock market. True, for income-seekers the FTSE 100's 3% dividend yield is less appealing than the ten-year gilt. But at 7.4%, the earnings yield (the inverse of the price-to-earnings ratio) comfortably outstrips the ten-year gilt, notes Russ Mould in The Telegraph. Stocks still look the better value proposition.

Yes, markets can crash. But equities also offer the opportunity for capital gains and, perhaps crucially in the current setup, a degree of protection against inflation.

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Landlords are leaving the market in their droves as a host of factors squeeze the buy-to-let (BTL) market.

Around 44,000 BTL homes were sold by landlords across the UK between the start of July and mid-September, according to property data company TwentyCi.

Per day, 562 homes left the sector on average, the highest rate since 2016, the analysis suggested.

Separately, a recent report by trade body the National Residential Landlords Association (NRLA) found 60% of single property landlords are no longer sure they will be in the market by the end of 2027.

The report said rising costs, government policy and an increasing administrative burden were dampening the mood across the market.

Chris Norris, chief policy officer at the NRLA, said: “Successive governments have assumed that landlords can permanently absorb costs and sustain losses whilst remaining in the market.

“This approach has led to one standout outcome: a reduced supply of available rented accommodation, narrowing choice for tenants across the private rented sector.”

There are still opportunities in the BTL market though, including for professional landlords willing to take a hands-on approach.

Why are so many landlords leaving the market?

For years, the buy-to-let market typically offered capital growth and a steady income that could outmatch any savings account – the Bank of England base rate stayed below 1% between 2009 and 2022.

But landlords have been hit with a number of legislative changes over the last 10 years which have made their lives harder.

From April 2017, tax relief that individual BTL landlords could claim on their mortgage interest was slowly eroded through section 24 of the Finance Act 2015. When mortgage rates started rising in 2022, this policy really started to hit.

Before the changes, landlords could deduct 100% of mortgage interest from rental income before paying tax.

However, between 2017 and 2020 landlords gradually had this tax relief reduced to nothing and they now get a tax credit of 20% on mortgage interest payments instead. The reduction in this tax relief has led to higher tax bills for landlords.

Suzanne Smith, former solicitor turned landlord and author of The Good Landlord Handbook, said: “If you were only paying 2% on a mortgage and you couldn’t offset all your financing costs against the rental income, it wasn’t a big issue for landlords.

“But with interest rates going up and people paying 5% or 6%, it has had more of an impact.”

More recently, the introduction of the Renters’ Rights Act, large parts of which came into effect in May, have made the logistics of being a landlord in England much harder.

This includes making it harder for landlords to evict tenants following the abolition of section 21 or so-called ‘no fault’ evictions.

Landlords also can’t say no to a tenant requesting to have a pet live with them and can only request one month’s rent in advance.

Meanwhile from April 2027, higher rates of tax will apply to income made from property in England, Wales and Northern Ireland. The basic rate will be 22%, the higher rate 42% and the additional rate 47%. Currently, income tax rates apply.

David Fell, lead analyst at estate agent Hamptons, said: “Each of these things on their own are not necessarily a deal-breaker for landlords, but, collectively, I think it’s a lot harder to make money than it was two years ago."

Are there still opportunities for landlords?

Despite the challenges, there are still opportunities for landlords in the BTL market.

Smith, who has four rental properties, said she focuses on getting families into her properties for long-term lets, which is one way to avoid periods without any rental income.

She also said long-term lets allow her to build up trust with tenants over time.

She properly references prospective tenants to make sure they can keep up with rent, as well as ensuring her properties are suitably renovated and have an EPC rating of at least C.

“People still need homes, and not everybody can afford to buy a home, and there’s not enough social housing,” Smith said.

“Tenant demand is what makes this asset resilient, because people need somewhere to live and [if] you can provide a good service, provide this need, and comply with the rules, then you’ll be fine.”

Research suggests other landlords are taking this hands-on approach. Polling by BTL lender Rely Mortgages found 55% of landlords are spending more time thinking about the tenant experience while 59% have spoken directly to tenants to better understand their needs.

Landlords could find joy in other parts of the housing market too.

Recent research by The Cumberland Building Society found 88% of mortgage brokers had seen an increase in holiday let mortgage enquiries over the previous 12 months.

A holiday let is different to a BTL as it’s used to offer shorter-term, rather than long-term, stays.

The benefit is that you can make money from holidaymakers staying in the property, potentially realise a capital gain when you sell up down the line and also have a place to stay if you need a holiday.

But there are drawbacks, for example you’ll generally need a bigger deposit for a holiday let than a BTL and may have to cover cleaning costs in between each guest.

Is it still worth being a landlord?

If you’re looking at BTLs from a purely financial perspective, you may find better gains elsewhere.

Analysis by wealth manager Quilter looked at how much you could have made from BTL versus the stock market over the last 20 years.

Its research suggests the net profit on a rental property bought for £154,927 in June 2006 would be £191,619 over 20 years. This is based on, as of June 2026, a capital gain after tax and costs of £83,170, and includes house price growth and net rental income of £108,448.

Over the same 20-year period, if someone had invested £154,927 into UK equities in June 2006, their investment would now be worth £592,130, according to Quilter, a gain of £437,203.

If someone had invested the same amount into global equities it would be worth £1,200,219, making for a capital gain of £1,045,292. Both these calculations are based on no deductions for fees and tax.

Investing comes with risk and returns are not guaranteed.

There is also the added financial and administrative burden that comes with being a landlord in the current market.

In this context, Smith said BTL is not something landlords can simply treat as passive income anymore.

“Anyone who thinks it is passive income should sell up when their tenants leave because being a landlord carries a lot of risk,” she said. “I recently had a six month void [on a property] because I was doing a kitchen and other work…it’s a lot more risk being a landlord than it is putting money in a bank.”

She added: “I think that the people who will do well in the future are those who treat it as a business. It means keeping proper records…doing repairs properly, using an accountant and of course providing a great service to tenants.”

What major changes do landlords need to deal with in the current market?

Renters’ Rights Act

The Renters’ Rights Act has added an administrative burden on landlords and local authorities now have the capacity to issue fines to those who break the rules.

However, there are ways to ease the logistical burden and ensure you’re following the new legislation.

Kim Lidbury, group director at trade body for estate agents Propertymark, said keeping accurate records was “particularly important” under the new rules and property management software could help with this.

New EPC ratings from 2030

Landlords will need to ensure rental properties have an EPC rating of C or above by 2030 under the Minimum Energy Efficiency Standard (MEES).

Landlords will also need to meet this C rating under a new framework that factors in multiple metrics instead of one. This new framework is set to be rolled out from the second half of 2027.

While the framework is changing, it’s worth getting ahead and trying to ensure your property meets a C rating under the current framework.

Making Tax Digital

HMRC is rolling out Making Tax Digital (MTD) for income tax in phases, with landlords earning over £50,000 a year from rental income now having to use the new system.

Landlords with an annual turnover of £30,000 or more have to start using the system from April 2027 while landlords with a yearly turnover of at least £20,000 will be affected from April 2028.

Lidbury said: “Those affected by Making Tax Digital should also ensure they have appropriate digital systems for maintaining accurate financial records.”

A new space race means plenty of enticing prospects for investors, says Mark Boggett, chief executive officer and co-founder of investment firm Seraphim.

Speaking to MoneyWeek’s contributing editor Cris Sholto Heaton on the MoneyWeek Talks podcast, which you can also watch on YouTube, Boggett explained how space used to be the preserve of only the very richest countries, but this is changing.

SpaceX (NASDAQ:SPCX) has been one of the biggest catalysts in bringing the costs of launching satellites into space down substantially over recent years.

“It’s now possible for every country to participate in space, because you can build satellite constellations now for low-millions of dollars,” said Boggett. “As a consequence, this has led to another space race.”

Countries are no longer prepared to sit out the space opportunity, he added, but are instead rapidly building up their own sovereign capability when it comes to accessing space.

Like space itself, the opportunities for investors are vast and varied. Some sound like concepts straight out of a science fiction film.

Boggett highlights companies developing the technology for nuclear power, cell towers, artificial intelligence (AI) data centres and even solar farms that can operate in space.

“One of the reasons I came into space investment in the first place is around solar farms in space,” Boggett said.

“We’re still having wars about oil…that seems very last century. To protect our planet and for the climate consideration of the future, we have to find alternatives.”

“There really isn’t a sector that’s not going to be impacted by this”

This new space race is having a far-reaching impact.

“The way we think about space is not as a sector at all, in the same way people don’t think of AI as a sector,” said Boggett.

“AI is facilitating capability that’s impacting every theme and every industry you can think of – space is exactly the same.

“It’s…driving mega themes like defence, like climate and sustainability, like smart cities, food security and then every industry that sits below that: retail, oil and gas, mining, logistics.

“There really isn’t a sector that’s not going to be impacted by this.”

How space has come into focus during the Ukraine war

Space’s impact on the defence sector has been felt acutely during the ongoing Ukraine-Russia war.

Ukraine has used SpaceX’s satellite internet network Starlink to provide off-grid internet access, allowing for battlefield communications, and has leant on aerospace and data company ICEYE’s microsatellite system to scan territories from above and see if soldiers or ships are being moved along key battlelines.

“We’re really at the tip of the iceberg of defence and how space is leveraging its capabilities,” Boggett said.

For more on the opportunities in space, watch MoneyWeek’s full podcast with Mark Boggett on YouTube, or wherever you get your podcasts.

About the podcast

MoneyWeek Talks is a podcast that helps you unlock the secrets to financial success. Editors Kalpana Fitzpatrick, Andrew Van Sickle and Cris Sholto Heaton are joined by influential guests – from CEOs and entrepreneurs to economists and fund managers – to share their top tips on managing money, investing wisely and building wealth.

Subscribe to the MoneyWeek Talks podcast and get ready to make it, keep it and spend it with confidence. You can also watch the episodes on our YouTube channel.

We last updated the MoneyWeek ETF portfolio in July, when we added one new position, bringing in WisdomTree True Emerging Markets (LSE: WEMP) to balance the growing technology tilt in our long-standing iShares Core MSCI Emerging Markets (LSE: EMIM) position.

We now have 15% in emerging markets, which sounds high – but the Korea and Taiwan element (which is around 50% of EMIM) is now a play on the AI investment cycle to such an extent that it no longer seems to make sense to think of them as subject to the classic emerging-market trends. Combined, we have about 10% in emerging markets and about 5% highly geared to AI capex. The latter is something to keep in mind if the AI boom ends and we want to cut exposure.

There has been plenty of volatility since then in geopolitics and in markets, especially in bonds. However, most of these developments have had relatively little bearing on the portfolio because we were already positioned cautiously towards them. For example, our bond holdings are very short-dated, precisely because we were concerned about the risk of longer-term yields getting untethered.

That said, our real-estate holding Xtrackers FTSE Developed Europe Real Estate (LSE: XDER) is struggling. Higher energy costs, higher inflation and higher interest rates over the medium term will harm sentiment and stall the wider economic recovery in general, while also pushing up refinancing costs and lowering valuations for this sector in particular. Four years from the point when rates began lifting off the floor, investors still seem to get rattled whenever they are reminded that today's rates are likely to be the new normal.

What we're changing in the MoneyWeek ETF portfolio

To my mind, there is value in European real estate – the number of takeovers in the sector (especially in the UK) suggests that trade buyers see opportunities where public markets don't. However, it's not at all clear when sentiment might change. We don't want to sell out entirely, but there is a case for taking it from 10% to 5% while we see how it develops. Like everything else in the MoneyWeek ETF portfolio, this is not a decision made in isolation: when you look at the positions, we are at the top end of medium risk at a time when caution may be wise.

We could consider adding a fund like iShares Global Infrastructure (LSE: INFR). There is much going on in this once-sleepy sector (see issue 1320). That said, this is also selling off as long bond yields rise. For now, what stands out is that the underlying bonds in iShares $ TIPS 0-5 GBP Hedged (LSE: TI5G) offer a 2.8% real yield with limited interest-rate risk at a time when higher inflation is a growing threat. So we will temporarily add 5% from XDER plus the remaining 5% from our uninvested cash to this, taking it to 20% in total.

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.

Our fund, JSS Sustainable Equity – Strategic Materials, invests across the whole value chain for strategic materials. Around 70% to 80% is invested in upstream mining companies. The remainder goes to recyclers, mining equipment manufacturers, battery producers and advanced materials companies. These businesses benefit from the same structural trends, but their earnings often swing less than those of miners.

I score every commodity each month on five factors: the marginal cost of production, inventory levels, the economic cycle, the supply-demand balance and trade barriers. This framework helps us to invest when prices are low. I then rank mining stock by operating cash costs, execution track record, jurisdictional risk, balance-sheet strength and valuation. This is augmented by detailed mine-by-mine valuation models, allowing us to stress-test valuations.

The fund is classified under Article 8 in the EU's SFDR sustainability regulations, meaning we promote environmental or social characteristics, which is relatively rare in the mining sector. For us, sustainability is closely linked to returns. Poor relationships with local communities, regulators, or governments can result in mine delays, higher costs, or loss of a licence to operate. Strict environmental and social standards therefore help protect returns. Here are three of the stocks we like.

Three strategic materials stocks for your portfolio

Acerinox (Madrid: ACX) is a Spanish stainless steel and speciality alloys producer. Through its Haynes International business, the company builds high-performance alloys designed to withstand extreme heat and pressure. These specialised strategic materials are used extensively in aircraft engines and industrial gas turbines. Furthermore, they serve critical aerospace applications such as rocket nozzles and pumps aboard vehicles exploring the frontiers of space.

Wheaton (LSE: WPM) is a streaming company rather than a traditional miner: it provides upfront financing to mining companies in exchange for the right to purchase a portion of their future gold and silver production at predetermined prices. The attraction is the business model. Wheaton does not operate mines itself, so it avoids much of the exposure to rising wages, energy prices, equipment costs and operational problems that can squeeze traditional miners. This gives it a structurally different and, in my view, lower-risk exposure to precious metals. I also see a robust pipeline of future growth.

Large copper projects often contain valuable gold and silver byproducts. These create opportunities for companies like Wheaton to provide financing through streaming agreements. Wheaton can participate in the growth of new mines without taking on the full operational risk of owning and running them.

Freeport-McMoRan (NYSE: FCX) is one of the world's largest copper producers, giving investors exposure to what I see as a critical commodity for the coming decade. Copper is essential for electrification, power grids, data centres and heavy industry. Demand is likely to rise, while supply is proving hard to bring online quickly. That gap between demand and supply could support prices. US trade policy may also favour domestic producers over time. Freeport's giant Grasberg mine in Indonesia is ramping back up. This follows a disruption last year that cut output. Restored production offers a path to growth. The company also carries meaningful gold exposure alongside copper.

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.

ASML (Amsterdam: ASML) is the only commercial supplier of EUV lithography systems – machines that sit at the heart of the modern semiconductor industry. An extreme ultraviolet (EUV) lithography system is roughly the size of a double-decker bus, weighs roughly 180 tonnes and costs more than €180 million. It fires lasers at tens of thousands of microscopic droplets of molten tin every second, creating a plasma that emits light at a wavelength of 13.5 nanometres. That light is used to print the extraordinarily fine patterns from which the most advanced computer chips are made.

In 2025, ASML recognised revenue from 48 EUV systems and generated €32.7 billion of sales overall, including €8.2 billion from servicing and upgrading its installed base. The Dutch company does not manufacture every component itself. Instead, it coordinates a network of specialist suppliers that has taken decades to assemble. German company Carl Zeiss makes the mirrors at the heart of the optical system. Trumpf supplies the lasers used to generate the EUV light, while other specialists provide components ranging from wafer stages to sensors and software.

Its customers include TSMC, Samsung and Intel, companies with the scale and expertise to develop much of their own technology. Yet when it comes to leading-edge lithography, they have little choice but to buy from ASML. The machines are expensive because the economic cost of falling behind in semiconductor manufacturing is greater still. So how did a struggling Dutch start-up build a position that has become so difficult to challenge? And can that advantage survive the next stage of the industry’s development?

How ASML grew from humble beginnings to industry leader

ASML was established in 1984 as a joint venture between Philips and ASM International. The two companies brought different capabilities to the new business. Philips had already developed the PAS 2000 lithography system, while ASM International specialised in semiconductor manufacturing equipment. The timing was difficult. The company entered a competitive market dominated by established American and Japanese companies and initially had few customers. It also struggled financially. ASM International eventually withdrew after struggling to justify continued investment in a business that was consuming cash, while Philips was cutting costs. ASML survived because its management and shareholders continued to back the technology and because Philips provided further support.

ASML spent its first decade building the business and developing its technology. Rather than trying to make every critical component itself, ASML worked with specialist suppliers and concentrated on integrating their technologies into a complete lithography system. The breakthrough came in the 1990s with the development of the PAS 5500. Its productivity and resolution helped ASML win the customers it needed to become profitable. The company went public in 1995, giving it access to the capital needed to expand its research and manufacturing operations.

The approach mattered because lithography was becoming too complex for one company to master every discipline itself. ASML could concentrate on integrating the system while drawing on specialists in optics, lasers, metrology and other fields. The strategy eventually produced a decisive lead over its two big rivals, Nikon and Canon. But the biggest test was still to come. EUV had been discussed for years as the technology that might allow chipmakers to keep shrinking transistors, yet turning the idea into a machine capable of high-volume production proved difficult. ASML and its customers spent years developing the technology, with Intel, Samsung and TSMC helping to fund the effort.

In 2012, those customers committed €1.38 billion of research and development funding to ASML’s next-generation lithography programme and took minority stakes in the company. Intel alone committed €829 million of R&D funding alongside an investment of up to 15% in ASML. The arrangement illustrates how dependent ASML’s customers had become on its technology. They were helping finance development because the machines would determine how far their own manufacturing could advance. The result was to bring EUV into commercial production, but by then ASML had spent decades building the supplier network, engineering expertise and relationships needed to make it work.

ASML’s competitive moat

That combination forms ASML’s competitive moat – the technology, expertise and relationships that make the business difficult for rivals to challenge. Its position in EUV was therefore built long before the first commercial machines were sold. To understand why ASML can charge hundreds of millions of euros for a single machine, one must consider the economics of modern semiconductor manufacturing. A cutting-edge fabrication plant, or “fab”, can cost more than $20 billion to build and equip. Much of that investment goes on the machinery inside it, with lithography scanners among the most expensive tools.

For a company like TSMC, the economics of a fab come down to how many useful chips it can produce, how quickly, and for how much. Smaller transistors allow more computing power to be packed onto each wafer – a thin disc of silicon on which chips are made – while higher throughput and better yield improve the economics of the plant. This is why lithography matters. The machine prints the patterns that become the transistors and other structures on the chip. If those patterns cannot be printed accurately enough, the economics of the entire fab suffer.

That gives ASML an unusual position. Its customers include some of the world’s largest companies and most buyers of that size would have considerable bargaining power over suppliers. When it comes to leading-edge lithography, their options are much narrower. TSMC, Samsung and Intel cannot simply switch to another supplier offering an equivalent EUV system. A more capable machine can also allow a chipmaker to produce more wafers from an expensive fab, while improvements in accuracy and yield can increase the proportion of those wafers that become saleable chips. The return from a lithography investment therefore depends on the additional output and yield it enables, rather than simply on the purchase price. This helps explain why ASML’s customers have been prepared to commit capital years before they receive their machines.

The company now sells its low-NA EUV systems for roughly €180 million and high-NA ones for more than €350 million. NA means numerical aperture, a measure of the optical system’s ability to resolve very small features. The higher the NA, the more detail the machine can print. Customers continue to buy the machines because the cost has to be weighed against the price of falling behind. EUV system sales reached €11.6 billion in 2025, while ASML’s gross margin was 52.8%. Those figures suggest that customers have little choice but to accept the price of staying at the leading edge.

Customers cannot treat an ASML machine as a one-off purchase. Once a fab is built around its equipment, maintaining and upgrading that equipment becomes part of the production process. ASML continues to service its machines throughout their working lives, helping customers maintain performance and install upgrades. Its installed-base business therefore grows as the number of machines in operation increases, creating a source of revenue alongside new system sales.

How ASML stays ahead of the game

Why can’t another company simply build an EUV machine and compete with ASML? The answer lies in how much has to work together for a lithography system to operate in a semiconductor fab. ASML acts as the system architect, drawing on a network of specialist suppliers that has developed alongside the company. ASML then has to integrate all of the high-precision parts into a machine that can operate reliably in production. Precision matters because an error that would be invisible to the human eye could make a machine unusable for leading-edge production. This is very hard for a competitor to replicate. Roughly 80% of ASML’s bill of materials is sourced from its global supplier network. A rival would have to recreate that network, integrate thousands of precise components and persuade the world’s leading chipmakers to install an unproven machine in their most valuable factories.

ASML also has an advantage that is harder to see. Every machine it installs adds to its practical knowledge of how its technology behaves in a real production environment. ASML has about 10,000 customer-support employees working around the world to keep its systems running. That operation is a continuing relationship with customers after the initial sale; engineers work with chipmakers to maintain performance, solve problems and install improvements. A machine can be designed on a drawing board, but making it run reliably, at high throughput and with the precision required for commercial chip production, is a different problem. Each generation provides information that can be fed into the next one.

ASML therefore remains the company best placed to develop whatever lithography technology chipmakers require next. But that position does not make its earnings immune to disruption. Geopolitical restrictions can limit where it sells its machines. The semiconductor cycle can cause large swings in orders. Changes in chip design could reduce the industry’s reliance on successive generations of lithography.

Threats to ASML’s dominance

China accounted for 29.1% of ASML’s sales in 2025, although much of this was mainstream semiconductor equipment rather than the EUV systems at the centre of its monopoly. Export controls have already restricted the sale of some of ASML’s systems and the provision of certain services to Chinese customers. Losing access to part of the Chinese market reduces revenue, but avoids giving Chinese chipmakers access to an alternative source of EUV machines.

There is also geographic concentration beyond China. Taiwan accounted for 25.5% of ASML’s 2025 sales and South Korea another 25%. ASML has customers and suppliers in both markets, leaving the company exposed to tensions over Taiwan and the Korean peninsula. A serious disruption would affect semiconductor production well beyond ASML itself.

The nearer-term risk is more familiar. ASML sells relatively few machines at very high prices, making the timing of customer capital expenditure critical. It recognised revenue from 327 new and refurbished lithography systems in 2025, compared with 418 in 2024 and 449 in 2023. Its largest customer accounted for 23.9% of sales and its two largest customers for 38%. A major customer delaying a fab or moving its spending into a different year can therefore produce a significant swing in ASML’s results.

The more fundamental threat is technological. ASML’s business depends on chipmakers continuing to invest in new generations of process technology. The company itself acknowledges that customers could delay adoption of new technologies if the economics do not justify the cost, or shift towards architectures that rely less on lithography. The price of each technological advance is rising. High-NA EUV machines cost hundreds of millions of euros, while chipmakers can also improve computing performance through chiplets, advanced packaging and architectural changes. If these approaches deliver better returns than simply shrinking transistors, the industry could become less willing to pay for each successive generation of lithography.

For now, there is little evidence that this is displacing leading-edge lithography. AI is increasing demand for advanced logic and memory, and ASML says growth in both markets helped drive demand for its EUV systems in 2025. This remains the most important long-term question hanging over the investment case. Export controls can reduce sales, a semiconductor downturn can defer orders and customers can become more selective about expensive new technologies. So far, none has emerged at commercial scale as a way of displacing ASML’s leading-edge lithography technology.

The outlook for shareholders

For shareholders, ASML offers a combination of growth and recurring revenue. In 2025 it generated €32.7 billion of sales, a 52.8% gross margin and €9.6 billion of net income. Installed-base management revenue, mainly servicing and field options for machines already in customers’ fabs, reached €8.2 billion, up 26% on the previous year. The outlook has strengthened since then. ASML reported €9.3 billion of sales in the second quarter of 2026, with a 54% gross margin, and raised its full-year revenue guidance to €43 billion-€45 billion, up from €34 billion-€39 billion at the start of the year. It says AI-related investment is driving demand for advanced chips and customers are accelerating expansion plans.

The longer-term opportunity remains substantial. ASML’s modelling puts its 2030 annual revenue opportunity at between €44 billion and €60 billion, with gross margins of 56% to 60%. Those figures are an opportunity range rather than a forecast, but the rapid increase in 2026 guidance shows how quickly the business can scale. AI is helping to drive that growth.

AI should still be viewed as an accelerant rather than the foundation of the investment case. The more durable thesis is that computing demand continues to rise and chipmakers need increasingly capable manufacturing equipment. ASML does not need every future semiconductor application to be an AI application for its long-term case to work. ASML remains a capital-equipment company and its earnings are therefore exposed to the spending decisions of its customers. Even a customer convinced of the long-term need for additional capacity can delay an order for a year. The result is an earnings profile that is more cyclical than the competitive advantage might suggest.

Are ASML shares worth buying?

ASML shares have generally commanded a premium valuation because investors recognise the quality of the business. At roughly €1,700 a share, the stock trades on around 35 times consensus 2026 earnings and 25 times projected 2027 earnings. Those multiples can look reasonable if earnings grow rapidly. ASML is now aiming for €43 billion–€45 billion of revenue in 2026, up from €32.7 billion in 2025, while analysts expect further earnings growth in 2027. The valuation leaves less room for disappointment. A weaker semiconductor cycle, slower high-NA adoption or further restrictions on China could cause investors to reassess the multiple even if ASML’s competitive position remains intact.

The question for a long-term investor is whether earnings can grow fast enough to justify the high price. If growth falls short, the multiple provides another source of downside. More attractive entry points are likely to come when the semiconductor cycle turns down and investors focus on near-term orders rather than the decade ahead.

The investment question is whether the future earnings from ASML’s competitive position justify the price of the shares. A business can continue to compound while its shares fall if investors have already priced in too much of that growth. ASML has spent four decades building one of the most formidable competitive positions in the global economy. The investment case now depends on whether it can turn that position into enough future earnings to justify the premium investors are being asked to pay today.

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With Personal Assets Trust (LSE: PNL), Capital Gearing (LSE: CGT) and Ruffer (LSE: RICA) all losing value after inflation, many investors who turned to wealth preservation trusts over the past five years will have been disappointed.

In that time, UK inflation – as defined by the consumer price index (CPI) – has averaged 5% per year, or 27.5%. Meanwhile, Personal Assets is up 20.8% on a net asset value (NAV) basis to the end of August or 3.85% per year. Ruffer has gained 20% (3.7% per year) and Capital Gearing has returned 11.5% (2.2% per year).

The key selling point of these trusts is to protect wealth in all market environments. You would not expect them to outperform during such a strong bull market for stocks, but even so, these returns look underwhelming set alongside simple, low-risk alternatives. For example, the Royal London Short-Term Money Market Fund has returned 3.7% per year over the past five years.

Long-term readers will know that Personal Assets Trust has been a core holding in the MoneyWeek investment trust portfolio since its inception in 2012. It was included because its defensive mandate complemented the other, equity-heavy trusts in the portfolio. And historically, managers Sebastian Lyon and Charlotte Yonge of Troy Asset Management have done a good job of protecting capital. The trust has returned 62.7% on a NAV basis (versus inflation of 41.7%) over ten years, and 247.4% (versus inflation of 66.7%) since Troy took charge in March 2009. So why have recent returns been weaker?

Personal Assets Trust is trailing the bull market

Personal Assets Trust invests across a range of asset classes. At present, stocks are about 40% of the portfolio, inflation-linked bonds roughly 30%, conventional bonds about 20% and gold around 10%. This has varied significantly – in the latest quarterly report, the managers note that the percentage in stocks has varied between the low-seventies in 2009 and the low-twenties in 2022.

This points to the first headwind; the equity allocation has been relatively low at a time when stocks are booming. To make matters worse, the trust favours cash-generative, high-quality equities, but we are not in a market that favours such stocks or offers much help to stockpickers.

Instead, the top-ten tech stocks account for over 40% of the US S&P 500. US equities account for over 70% of the MSCI World. The result of this concentration is that big tech accounted for 53% of the market's return in 2025, says JPMorgan. It is all but impossible for Troy's strategy to keep up in this scenario.

A higher-for-longer interest rate environment

At the same time, we have moved into a higher-for-longer interest rate environment. Personal Assets Trust did well in the zero-interest-rate environment of the 2010s and early 2020s, but cash is now a higher hurdle to beat. To make things trickier for bond investors, longer-term bonds have plunged as long-term expectations for interest rates have risen. This applies to both conventional bonds and inflation-linked ones.

Personal Assets Trust currently holds very short-dated bonds with an average duration of 2.5 years (a bond's duration is the weighted average time to receive all the promised cash flows, both interest and principal). So its portfolio is far less exposed to higher rates than a typical bond fund. Still, this positioning may make it hard to earn much more than a near-cash return from its bonds in the short term (although short-dated inflation-linked bonds should quickly pass on any inflation spike).

The timing of the 2021-2022 inflation surge, rapid rate rises and unruly market adjustment in response means five-year records should be interpreted with caution. Three-year returns look better (22.7%, versus 8.8% for CPI). Still, investors – including us – need to watch these trusts to see if they will now bring what they promise to a portfolio again.

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Norwegian arms manufacturer Kongsberg Gruppen (Oslo: KOG) is likely to benefit from a big increase in defence spending. The Nato summit in Ankara in July 2026 reported that European allies and Canada had invested more than $139 billion in core defence requirements over the previous year, together with $50 billion of new procurements and a commitment to expand manufacturing capacity. In addition, the allies pledged $70 billion of military equipment, training and support to Ukraine for 2026, with at least that amount again for 2027.

At the 2025 financial year-end, Kongsberg’s order backlog was NKr157 billion (£12.4 billion); the chief executive officer said that, in his ten years in the job, he had never seen such high demand.

Kongsberg 's focus on growth

In February 2026, Kongsberg announced that it had spun off its maritime division as a separate listed company (Kongsberg Maritime) to concentrate business on the three higher-growth divisions. Defence Systems is the largest division (47% of revenue) with Missiles & Aerostructures (30%) and Discovery (23%) together accounting for 53% of revenue.

Then, in June 2026, Kongsberg announced it had completed the acquisition of Zone 5 Technologies, a Californian company that is the market leader in affordable, mass-producible munitions. These include long-range strike and interceptor missiles. Zone 5 will add to Kongsberg’s existing US business since Zone 5 has won US contract including one for the US Air Force’s AGM-188 FAMM (Family of Affordable Mass Missiles).

In September, Kongsberg also acquired Sonatech of California, an underwater acoustics specialist whose technology will be used in Kongsberg’s autonomous underwater vehicles. In July, Kongsberg won a $100 million contract from the US Air Force for stealth air-to-surface Joint Strike Missiles (JSMs), which can be carried internally in the F35-A fighter; deliveries are scheduled up to 2030. The JSM has also been selected by Australia, Canada, Germany, Japan and Norway.

Kongsberg’s results for the three months to the end of June 2026 were the first without the maritime division and showed revenues up 31% from the same period in 2025, rising to NKr10.4 billion. Earnings before interest and tax (Ebit) were up 48.9% to NKr1.67bn and the Ebit margin rose to 16.1%. The order intake for the second quarter rose by 164% of second-quarter revenue, taking the order backlog to NKr157 billion.

New growth drivers for Kongsberg

In the second quarter of the year the Defence Systems division saw strong demand for air defence and counterdrone systems. An agreement was reached with partner Raytheon to start deliveries of the NASAMS air defence system to Kuwait. The Missiles & Aerostructures division was awarded JSM missile contracts totalling NKr10.9 billion to Canada, Germany and the US. The Discovery division also won contracts, including one for the monitoring and protection of critical subsea infrastructure.

The growth drivers for Kongsberg are, firstly, the large and increasing order backlog, which is driving increased investment in new and expanded production facilities. Secondly, acquisitions, new product development and capacity expansion is supported by cash outflow of NKr3.7 billion in the second quarter.

The existing Norwegian missile plant is being supplemented by new factories in Australia and the US, with expanded production of subsea technology in Norway. The Australian and US missile facilities will be operational in late 2027, with full-rate production by 2028, so will contribute to the 2029 revenue target of NKr100 billion by 2029 – 2.3 times the projected revenue for 2026 – rising to NKr150 billion in 2033.

Kongsberg's earnings are on the rise

Kongsberg Gruppen has a market capitalisation of NKr275 billion at the recent share price of NKr312.7, with a one-year price target of NKr396.4. The forward dividend yield is 0.7%.

The balance sheet is strong with cash and equivalents of NKr4.9 billion at the end of the second quarter of this year, compared with loans and lease liabilities of NKr2.1 billion.

Analysts predict 2027 revenues of NKr64.2 billion, a 49% increase over 2026. Earnings per share are projected to rise to NKr11.2 in 2027, a 52% increase over 2026. The contributors to the projected revenue growth of more than three times by 2033 include the Zone 5 and Sonatech US acquisitions and new missile factories in Australia and the US.

There is also the NKr16b billion contract signed with Poland in January 2026 to provide counter-drone (C-UAS) batteries, forming a multi-layered anti-drone wall as part of Poland's East Shield initiative for protection against Russia. Further contracts for C-UAS could follow if other European nations follow this Polish initiative.

At the recent share price of NKr312.7, the price/earnings ratio for 2027 is 27.9. If Kongsberg hits its 2029 revenue target of NKr100 billion and earnings per share rise only proportionately to revenue, then the 2029 p/e would be 18.3.

Kongsberg is a growing defence company with a massive order backlog of 3.6 times annual revenue, substantial sales in the important US defence market, significant sales in Asia and is playing an important part in upgrading European defence capabilities to counter the threat of Russian aggression.

The company plans to more than treble turnover by 2033 and is investing in both acquisitions and new production facilities to achieve this. Directors have significant shareholdings. The chief executive officer holds 250,000 shares and two executive vice-presidents together hold 230,000 shares.

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Pennington House, Lymington, Hampshire

A Grade II-listed house dating from 1735 set in formal gardens and parkland. There is a large walled kitchen garden and a stable courtyard. 8 bedrooms, 5 bathrooms, 2 receptions, library, wine cellar, office, coach house, 2 cottages, 2 lakes, woodland, 42.4 acres.
Price: £8.25m Knight Frank and Savills 01590 630 303

Alderton Hall, Montford Bridge, Shrewsbury, Shropshire

A Grade II-listed country house with formal gardens including a tennis court and a stable yard with an all-weather manège and paddocks. 6 bedrooms, 5 bathrooms, 2 receptions, study, garden room, wine cellar, swimming pool, 9.7 acres.
Price: £2.5m Savills 01952-239511

Castleton, Lexington, Kentucky, USA

An equestrian estate founded in 1793 by John Breckinridge, a US senator and attorney general under Thomas Jefferson. It has extensive stables, horse barns, indoor schools, fence-and-rail paddocks and prime land used to breed thoroughbred horses. 7-bed main house, formal gardens, further 9 dwellings, 952 acres.
Price: $57.5m Bluegrass Sotheby’s International Realty +1 859 983 9933

Ladyswood House, Malmesbury, Wiltshire

An Edwardian country house built in 1905 with large gardens and grounds and extensive equestrian facilities including stables, an indoor sand school and outdoor manège along with further outbuildings. The interiors have high ceilings, leaded-light windows and period fireplaces. 6 bedrooms, 4 bathrooms, 3 main receptions, garden rooms, 3-bed apartment, staff flat, swimming pool, 60 acres.
Price: £9.5m Strutt & Parker 01285-653101

Hoddern Farmhouse, East Sussex

A Grade II-listed property with equestrian facilities currently let out as a livery yard that include 28 boxes, a sand school and fenced paddocks. 7 bedrooms, 4 bathrooms, 3 receptions, office, cellar, barn, stores, workshop, mature gardens, 27 acres.
Price: £2.45m By Design Homes 07873-831564

The Sanctuary, Shobrooke, Crediton, Devon

A country house with equestrian facilities including an indoor sand school. The house has the original tiled floors in the entrance hall, grand fireplaces with carved wood surrounds, wood panelling, stone mullioned windows and a large breakfast kitchen with Aga. 11 bedrooms, 6 bathrooms, 2 receptions, billiards room, 3-bed lodge, indoor pool/gym, office, garden, pasture, woodland, 60 acres.
Price: £5.75m Strutt & Parker 01392-914200

Warenton Farm, Belford, Northumberland

A farmhouse with an attached cottage in landscaped gardens that include stables. Inside there are wood floors, the original fireplaces with wood-burning stoves and a large open-plan dining kitchen room with bespoke cabinetry and range cooker. 3 bedrooms, 2 bathrooms, 2 receptions, utility,garage, greenhouse, garden room, pasture, 5.6 acres.
Price: £950,000 Finest Properties 0330-111 2266

Craigluscar Farm, Dunfermline, Fife

A C-listed traditional stone farmhouse with equestrian facilities that include stables and a tack room and indoor riding arena. The restored farmhouse has beamed ceilings, exposed stonework, open fireplaces and a large dining kitchen with an Aga. 4 bedrooms, 2 bathrooms, 3 receptions, utility, 2 sun rooms, cloakroom, further outbuildings, gardens, paddocks, cattle-handling pens, grazing land, 56.1 acres.
Price: £1.25m+ Galbraith 01738-451111

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The relentless rise in government bond yields – the cost of countries’ borrowing and the pressure that puts on their finances – has become headline news. A crisis in which governments will be forced to slash public spending to reduce their deficits and stop the relentless rise in ratios of government debt to GDP is widely predicted.

But it is rare for crises to be widely predicted, and, if they are, they never unfold as expected. In the popular narrative, “the bond vigilantes”, a term coined by Ed Yardeni in the 1980s to describe investors who keep governments in check when deficits, debt and inflation threaten, will boycott government bond markets. This will force yields higher (reflecting falling prices) and trigger a fiscal crisis that forces governments to act.

“I used to think that if there was reincarnation, I wanted to come back as the President or the Pope... But now I would like to come back as the bond market. You can intimidate everyone”, quipped James Carville, the chief political adviser to Bill Clinton. In those days, bond investors had been battered by decades of persistent inflation and rising government bond yields.

Today, they are worried by four factors: rising inflation, led by rising oil and gas prices; the inability or refusal of governments to control budget deficits; escalating levels of national debt; and the impact of inflation, deficits and rising bond yields on the economy and markets, threatening a spiral of bond yields reminiscent of the 1970s.

In fact, oil prices in real terms are little higher than their average this century ($95 a barrel for Brent). The rise in petrol prices has been exacerbated by a shortage of refining capacity thanks not just to the Middle Eastern war but to the destruction of refineries in Russia and Ukraine. Wholesale natural gas prices have risen much more than the oil price, but new supplies of liquefied natural gas (LNG) are coming on-stream.

Oil exports are increasingly circumventing the blockade of the Strait of Hormuz which, in due course, is likely to be lifted, enabling LNG exports to resume. The best cure for higher oil and gas prices is higher prices, which encourage increased supply and discourage demand.

Why government bond yields have risen

Higher energy prices have pushed up the rate of inflation but without a wage-price spiral, of which there is no sign even in the UK, inflation will soon drop down again. Wage pressures are muted in the UK’s private sector and everywhere in the US and Europe. In the US, strong productivity growth is keeping labour costs down. The difference between the yields on conventional and index-linked government bonds shows that expectations of inflation for the years ahead remain moderate, and the inflation data supports this.

So why have bond yields risen? Real interest rates were negative between 2019 and 2022 but have now risen above 2%, against a long-term norm of 1%. Perhaps there is an inflation-risk premium or an insolvency-risk premium. More plausibly, the investment boom in the US has increased the demand for capital relative to supply, pushing up the cost of debt while governments are also borrowing heavily. In time, real yields should revert to the long-term average.

If the yield on medium-term government bonds is higher than the growth rate of nominal GDP (inflation plus real growth), the ratio of debt to GDP is falling. That is the case in the US, but not in the UK, where inflation is higher and growth lower. The ratio of government debt to GDP in most developed countries rose sharply in the aftermath of the 2008 financial crisis and again during Covid. As economies recovered from Covid lockdowns, the ratio fell and the trend has been broadly flat or gently rising since.

Meanwhile, private-sector debt relative to GDP has fallen, so total debt-to-GDP ratios are either flat (US and France) or falling (UK and Germany). Rising budget deficits with no attempts at restraint would mean that debt ratios would rise remorselessly and lead, eventually, to a fiscal crisis, but that is not inevitable. As the Greek solvency crisis of 2010 showed, a crisis in one country can have a salutary effect on other threatened countries; “bond vigilantes” may not be needed.

The current level of pessimism suggests that the sell-off in bond markets is overdone. Oil and gas prices will come down, inflation will fall, capital spending in the US will tail off, real interest rates will subside, fiscal deficits will be brought under control and indebtedness relative to GDP will fall.

A straw in the wind is that the recent increase in interest rates in the US led to a fall in bond yields – reliable bullish indicator. The US Federal Reserve, but not the Bank of England, realises that raising short term rates demonstrates inflation-fighting credibility and will thereby bring down bond yields. That is positive for the housing market as US house buyers (and, increasingly, those in the UK) borrow long term.

UK ten-year gilts yielding over 5% and, especially, 30-year gilts yielding nearly 6% look good value, but with one caveat. Every period of Labour government in the last 100 years has resulted in a devaluation of sterling. Is this time really different? Charles Gave of Gavekal advocates instead 30-year Japanese bonds, yielding 4% with a seriously undervalued currency.

The ratio of Japanese government debt to GDP looks intimidating at 230% but 90% of it is domestically owned. Moreover, research co-authored by Stanford professor Hanno Lustig says that the government’s liabilities net of its massive holdings of domestic and foreign equities and bonds have fallen to just 65% of GDP. A good alternative is to buy shares: lower bond yields will boost equity markets and even the UK stock market derives 70% of its earnings from overseas, providing protection against devaluation.

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Aim, the London Stock Exchange's market for smaller or growing companies, is in the doldrums. Hit by negative sentiment towards UK small caps, plus tax reforms that have reduced the attractiveness of many Aim stocks, London's junior stock market has struggled to keep its head above water. The FTSE Aim 100 index, which charts the share-price performance of the largest companies on the market, currently stands at around 3,650. That compares with a peak of almost 6,550 in September 2021.

In fact, the malaise goes back even further. Looking across the whole of Aim, returns over the past ten years are near zero, compared with a 60% gain from the FTSE All-Share index over the same period. And it's not only investors who feel disenchanted; far fewer companies now see a compelling case to list their shares on Aim. In 2007, some 1,700 businesses had Aim quotes, while today the figure is barely above 600.

For all that, “I remain an Aim bull,” says Alex Game, a fund manager in the Economic Advantage team at Liontrust. “We like to back businesses with high levels of founder and manager ownership. These are entrepreneurial companies focused on [growth] and many of them are high-quality businesses, in market leading positions with well-capitalised balance sheets.”

“There's also a diversification angle,” adds Eustace Santa Barbara, co-manager of the IFSL Marlborough Special Situations, UK Micro-Cap Growth, Multi-Cap Growth and Nano-Cap Growth funds. “We're now seeing… the potential perils of holding just a handful of household-name, mega-cap businesses that dominate their indexes and can leave investors at the mercy of market shocks.”

Aim is under domestic pressure

To decide whether you share such optimism, you must first understand why Aim has underperformed in recent times. That is partly explained by the difficult macro environment the UK has faced, with ongoing challenges such as elevated inflation, driven by higher food and energy prices, depressed domestic demand amid the cost-of-living crisis, and political instability. Smaller companies, which tend to have less international activity, are more exposed to these domestic pressures.

It is also a reflection of the bias in the smaller companies sector towards growth stocks. These are companies where investors are betting on the long-term prospects of the business, rather than performance right now. When interest rates rise – and the rapid climb from a base rate of near zero five years ago to above 5% was unprecedented – investors tend to avoid such stocks. They calculate they will need much higher returns to compensate them as they wait for jam tomorrow.

Such worries have prompted a flight of capital. Funds investing in UK small caps have seen withdrawals of £6.1 billion, according to analysis by Hargreaves Lansdown. Most of that cash has gone overseas. Aim, moreover, is at the sharp end of this perfect storm. It's home to many of the smallest listed companies in the UK and features a disproportionate number of growth stocks. No wonder investors have steered clear. That said, Aim has also been hit by problems specific to it.

Above all, the decision by the government in its first budget in 2024 to reduce the value of a key tax incentive for Aim investors has had a significant impact. Many Aim shares qualify for Business Property Relief (BPR), a tax break intended to encourage investment in small businesses – by entrepreneurs starting their own companies, but also by investors backing the ventures. Until April, BPR meant that once you had held qualifying Aim shares for two years, there would be no inheritance tax (IHT) to pay on the assets following your death. This was a powerful incentive to consider Aim stocks, particularly since they can be held inside an individual savings account (ISA), sheltering them from all tax charges on income and capital growth.

Since April, however, BPR has fallen from 100% to 50%. This means the value of Aim shares bequeathed to your heirs could now attract an IHT charge, assuming your estate is valued above the £325,000 threshold at which the tax becomes payable. The rate charged would be 20%, rather than the usual 40%, but the tax bill could still be significant. Importantly, the change applies both to any new investments you make on Aim and to Aim assets you already hold. This has seen some investors opt to sell out – the Tax Efficient Review says investors in specialist Aim portfolio services have sold roughly £170 million worth of shares this year, around 10% of the value of assets held in these services overall. Such sales represent a brake on Aim's potential, even before you factor in reduced future demand for stocks now the IHT tax break is no longer so attractive.

Aim shares are going cheap

Other Aim-specific concerns include something of a dearth of exciting new businesses coming to the market. In today's investment environment, there are more sources of growth capital available to early-stage businesses than when Aim launched 30 years ago. The plentiful supply of venture capital, private equity and even debt finance means companies don't necessarily need to jump through the administrative and regulatory hoops required for a stock market listing to raise money. Corporate governance concerns still worry some potential Aim investors, too. The point of a junior market is to enable less mature companies to secure a public listing even if they are not ready to meet all the requirements of a traditional stock exchange. The London Stock Exchange therefore imposes fewer responsibilities on would-be Aim businesses. Unfortunately, this light-touch approach also increases the potential for governance failures and criminality. The LSE has periodically tightened the rules, but scandals at firms such as Langbar International, Globo and African Minerals continue to cast a long shadow.

All of which explains why Aim has struggled. But as Game points out, the market has been through difficult periods before – and then bounced back. “Aim does go through these spells and right now we're at the nadir of the market,” he says. “But performance is cyclical: throughout its history, there have also been times when Aim has performed really well.”

Santa Barbara adds: “It's easy to claim Aim's glory days are long gone, but it's impossible to argue with Aim's proven track record as an engine of growth. The founding principle of the market – to provide the most promising smaller companies with access to capital and ongoing finance – still applies.”

It's certainly possible to make the case that Aim now looks very cheap. Valuations of UK small caps generally look attractive. The price/earnings ratio on the FTSE Small Cap index is currently 10.6, compared with 15.0 for the FTSE 100 index of large companies, for example. Comparative data for Aim is not available, given issues such as the lack of revenues and profits at some businesses, but many stocks are on low valuations by all historical comparisons. “Private equity has been acquiring Aim companies at quite a pace, suggesting sophisticated investors believe many of these businesses are fundamentally undervalued,” says Jonathan Moyes, head of research at investment platform Wealth Club. What the market needs, then, is a catalyst for a change of sentiment. Investors need a reason to look at Aim afresh – and to decide whether those valuations now represent opportunity. One such catalyst could be lower interest rates. The Bank of England's Monetary Policy Committee cut rates six times during 2024 and 2025 and was widely expected to make further cuts before the Iran war saw energy prices spike.

That prompted the MPC to step back from cuts, but a decisive end to the crisis could prompt looser monetary policy. It helps that early expectations of an inflation spike have so far proved overly-pessimistic.

Another potential game changer would be an influx of new companies that excites investors to return to the market. Initial public offerings (IPOs) have been in short supply on all markets in recent times, but more private companies do now appear to be thinking about going public. That includes potential new entrants to Aim, adds Moyes. “Companies raised around £3.3 billion in the first seven months of 2026, compared with just £1.6bn during the whole of 2024,” he points out. “A significant proportion of this year's fundraising came from one very large transaction, and that activity has been driven by secondary raises rather than new listings; nevertheless, capital is flowing again.”

The LSE is trying to do its bit. It has already unveiled plans aimed at reducing the costs of listing on Aim and at making it easier to raise capital. Greater political stability, particularly once the fiscal and monetary plans of the Andy Burnham-led government become clearer following next month's Budget, could also support an increase in Aim IPOs. Aim may not need seismic shifts in sentiment to change the direction of travel. The market for shares in many Aim companies is illiquid – there are fewer buyers and sellers – so even small shifts in mood can have a significant impact. This is one reason why Aim has often proved volatile, but that can work in investors' favour as well as against.

Aim is a stock-picker's market

One other important point is that Aim investors don't need the whole market to change gear – just the companies in which they are interested. Investment experts agree Aim is an active stock-pickers' market. It's natural to focus on the performance of the market overall, but the qualities of individual firms vary enormously; the dispersion of returns at a stock-specific level is much wider than on other markets. The focus on flat returns over ten years overlooks individual success stories. Indeed, says Game, “Aim has probably generated more ten-baggers than most other developed markets.” Recent examples include healthcare software company Craneware, which joined Aim almost 20 years ago and has since delivered total returns of around 1,500% – an annualised return of about 16%. Defence technology business Cohort has generated annualised returns of roughly 14% over the same period.

Mortgage Advice Bureau is another example. It moved to the main market earlier this year having listed on Aim in 2014. Over its 12 years on Aim, the business returned more than 400%, or roughly 15% a year.

None of which is to suggest Aim, as a market in general, is guaranteed to rebound from its current lows. And there is certainly plenty of scepticism. “The problem in the UK is that very few investors are interested in smaller companies – and even fewer are interested in the spicier end of small cap that Aim represents,” says Ben Yearsley, a director of Fairview Investing. “Some exciting IPOs in the small-cap space might help, but companies are staying private for longer; and while there have been Aim floats, managers who invest in the market say quality has often been lacking.”

The counter argument is that in an improving interest-rate environment and a market where IPO activity seems to be picking up, IHT reforms could clear the decks for a new conversation about the merits of Aim. “Tax relief was never enough on its own to sustain a healthy market,” argues Moyes. “If valuations start to recover, investors will be coming for the investment story first, with a bit of inheritance tax relief as the icing on the cake, rather than the other way round.”

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On Monday, the average price of diesel in the UK crossed the £2 per litre threshold and is set to go a lot higher still. The cost of diesel has risen by 54% since the start of the Iran war and is climbing higher all the time. Motorists stuck with diesel cars are starting to feel the full effect of the shortage of the fuel and so will all the haulage companies who rely on it to fuel their vehicles.

Why? The Strait of Hormuz has been largely closed to traffic, putting a squeeze on oil supplies. Refining capacity across the Persian Gulf has been badly hit by the conflict, with shipments of refined products falling by up to half over the past few months.

Ukrainian drone strikes deep within Russia have taken out a lot of that country’s capacity, and while the main purpose has been to knock out supplies to Russia’s army and inflict maximum economic damage, it means the world has less diesel than ever. Russian oil might be officially sanctioned in the West, but a lot of it was finding its way onto the world market.

Add all that up and supplies were already getting squeezed. It may be about to get a whole lot worse. With prices soaring in the US as much as anywhere else, Donald Trump is coming under pressure from Republican congressmen and senators to impose a 90-day ban on US diesel exports. It’s understandable that political leaders think keeping the domestic market supplied should be the priority. But if that happens it could escalate into a global diesel crisis.

Britain would then be facing a very bleak winter. We have only an estimated 42 days’ supply of diesel in storage to cope with any kind of emergency, the lowest buffer of any major developed country. We import a third of the diesel we consume from the US. It’s hard to see how we can buy much more on the open market. Our European neighbours have only slightly higher reserves than we do and are unlikely to want to help out.

Britain may run out of diesel

The harsh truth is that we may simply run out of diesel. If so, the price will soar and the government may well have to step in, with a ruinously expensive subsidy scheme and probably some form of rationing as well. It will have to make sure the emergency services are supplied and that the most important industrial users stay open.

The bigger problem, though, is that the diesel crisis will painfully expose how far we have run down our industrial resilience and capacity. As recently as 1995, Britain was a net exporter of diesel. We had our own oil wells and our own refineries, allowing us to export to the rest of Europe, and indeed the world. Unfortunately, that is no longer the case. We are down to only four refineries. Over the past 15 years, five have closed, with diesel imported instead. The North Sea oil industry has been relentlessly run down, with licences refused for new drilling and environmental activists allowed to tie up developers in constant legal battles. Windfall taxes make it very difficult to make any money in the oil industry anyway.

That makes a difference. North Sea output won’t affect the global price of oil by itself. But in an emergency, a country with its own oil and its own refineries can always ensure it is supplied with fuel. It can place restrictions on exports and ensure the domestic market keeps running. You can’t do that when both the oil and products refined from it are imported from abroad.

Britain has been steadily deindustrialising for the past 20 years. Punitive taxes, an obsession with net-zero targets and some of the most restrictive planning laws in the world have made this a very hard country to make things in. We can see the evidence for that across a whole range of industries. Cement production is back down to levels last seen in the 1950s. Car production is down to early 1960s levels. Much of the petrochemicals industry has closed down. The list goes on. Domestic capacity has been steadily replaced by imports because it is simply too expensive to operate in the UK.

If we face severe shortages this winter, and perhaps even rationing, it will expose the folly of 20 years of running down basic industrial capacity. If you can’t make stuff any more, then you are left completely exposed to whatever crisis may erupt in another part of the world. The price for that will be very high.

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US stocks continue to climb despite rising interest rates and squealing bond yields. The S&P 500 index has risen another 12% so far this year, with the technology-focused Nasdaq 100 up a fifth. Thank “a golden period” for company profits, says Iain Snedden of Aegon Asset Management. S&P 500 earnings rose 50% year on year in the second quarter, an “incredible number” that you usually only see during a recovery after a recession.

While mega-cap tech stocks remain in the vanguard, the boom is broad-based. Energy firms are raking in money from rising fuel prices, while banks are throwing off cash because of higher interest rates. The AI boom is also supporting strong performance at industrials, whose expertise in power management and construction is essential for the data centre build-out. Earnings growth has been so explosive that valuations have actually fallen. The S&P 500 trades on a forward price-to-earnings ratio of 19, down from 23 a year ago.

You don’t usually see valuations falling in a bull market, says Ben Carlson on his blog, A Wealth of Common Sense. Why are investors marking down companies even as they deliver superb growth? It is probably a mixture of three things.

Firstly, it prices in an assumption that the current AI splurge – and the associated profits – won’t last forever. Secondly, it reflects concerns that higher inflation may ruin the party. And thirdly, with bond yields rising, equities face stronger competition from fixed-income securities.

Donald Trump’s claim that America is the “hottest economy in the world” isn’t far wrong. The Atlanta Fed’s GDPNow tracker estimates that GDP grew at an annualised pace of 5% in the just completed third quarter. The latest PMI business survey shows activity running at the highest level in more than five years. Fuelled by “fiscal largesse”, “booming business investment” and “near-zero interest rates” after you adjust for inflation, the world’s largest economy “is building a powerful head of steam – and risks overheating”, says Mike Dolan for Reuters. That could require interest rates to climb much higher, but it is far from clear whether that would kill the bull market in US stocks.

For all the talk of government debt, households and businesses are not very leveraged, says Max Kettner in the Financial Times. Net interest payments at US companies have fallen to a “more than 20-year low”. That reduces private-sector sensitivity to interest-rate increases.

US stocks are partying like it’s 1999

There is precedent for US stocks to rally despite rising bond yields, says Sam Goldfarb in The Wall Street Journal. The 1994 yield surge, which was caused by Alan Greenspan raising rates, initially sent the S&P 500 down 8%. But it then recovered because a strong economy continued to support corporate earnings. AI-fuelled spending and hopes for a deal with Iran has many US investors feeling similarly optimistic today. That said, this could also be like 1999. Back then, rising yields initially left markets “choppy”. Shares then rallied, reaching a dotcom peak in March 2000, only to subsequently fall 49% by late 2002.

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The gap between earnings and house prices has fallen to an 11-year low, but higher mortgage costs continue to squeeze buyers.

The average UK home now costs 7.3 times median earnings, down from 7.6 in 2025 and is at its lowest point since 2015, according to new research by Lloyds Bank.

Lloyds data showed the average UK house price rose by 0.5% to £299,131 between the second quarter (Q2) of 2025 and Q2 2026, while median earnings went up by 4.5% to £40,790 over the same period.

But higher mortgage rates resulting, in part, from the conflict in the Middle East are counteracting this trend, meaning owning a home is still a challenge for many.

According to data firm Moneyfacts, the average two-year fixed-rate deal is 5.93% as of 1 October, up from 4.83% on 27 February, the day before the US and Israel began strikes on Iran, which led to global oil prices surging.

Lloyds suggested the average monthly mortgage payment rose from £1,100 to £1,157 between Q2 2025 and Q2 2026.

Andrew Assam, mortgages director at Lloyds, said: “There are some encouraging signs for people looking to buy a home. Wages have continued to rise while house prices have remained relatively stable, helping to narrow the gap between earnings and house prices.

"However, affordability remains stretched for many households.”

Affordability improves for first-time buyers

Incomes relative to house prices have improved for first-time buyers, according to Lloyds.

The bank said the average property price for first-time buyers rose by 0.3% to £239,681 between Q2 2025 and Q2 2026.

The average UK first home now costs 5.9 times median earnings, down from 6.1 in 2025. This is the lowest the figure has been since 2015.

Lloyds acknowledged, though, that saving for a deposit still remains a significant challenge for first-time buyers, who typically need to save around £24,000 to get on the ladder with a 10% deposit.

Higher borrowing costs are also an issue, with the average monthly repayment rising from £1,100 to £1,150 between 2025 and 2026.

According to Lloyds’s figures, the average first-time buyer mortgage payment now accounts for around 34% of income compared with 41% for those renting.

Prime minister Andy Burnham has made getting people on the property ladder for the first time a key priority, recently announcing the Your First Home scheme.

The equity loan scheme means first-time buyers will be able to get a home with a 2.5% deposit, backed up with a 20% loan from the government.

Affordability pressures persist in London and the South East

London and the South East remain the least affordable places to buy a home based on local house prices relative to median incomes, Lloyds’s research found.

The house price to income ratio fell from 10.9 to 10.3 in Greater London and from 9.7 to 9.1 in the South East between 2025 and 2026 – meaning both areas became more affordable.

Areas where house prices tend to be lower generally saw less dramatic improvements in affordability.

The house price to income ratio in the North East, for example, dropped from 5.1 to 5.0, while in the North West it fell from 6.5 to 6.3 and 6.0 to 5.8 in Yorkshire and the Humber.

Northern Ireland was the only UK region where homes became less affordable between 2025 and 2026.

House prices rose by 7.4% in the region compared to a 3.7% rise in median earnings, meaning the average house now costs 6.0 times median earnings versus 5.8 times last year.

Tom Bill, head of UK residential research at estate agent Knight Frank, said: “The house price gap between London and the rest of the country continues to narrow as more affordable parts of the country see stronger growth.”

Bill believes that this dynamic will eventually see demand gravitate back towards London and South East England, re-starting the housing cycle again.

“The recent mortgage rate spike has only just begun to hit, which will keep a lid on activity and prices for the rest of this year, something that will affect highly-leveraged borrowers, like first-time buyers, hardest,” he added.

The cheapest areas to buy a home relative to earnings are in Scotland, according to Lloyds’s research. In Inverclyde and Aberdeen, the average home costs 3.5 times earnings in both areas as of Q2 2026.

The most expensive areas to buy a home relative to earnings are in Elmbridge in Surrey and Kensington and Chelsea, London. Buyers in these areas need to earn 17.4 and 17.3 times the median UK salary respectively to buy the typical home there.

Source: Lloyds Banking Group/Office for National Statistics (ONS)

Fund flows from UK retail investors were positive during August for the tenth consecutive month, but some sectors have seen outflows.

Latest data from the Investment Association (IA), an industry body representing the UK’s fund managers, shows UK-based investment funds registered £894 million in net sales to retail investors during August, in marked contrast from the £1.8 billion in outflows registered in the same month last year.

“Despite the summer break typically slowing flows and a worsening outlook for price inflation… investors kept their cool and carried on investing through the warmer weather,” said Miranda Seath, director, market insight & fund sectors at the IA.

^{Source: The Investment Association}

August’s positive figure brings the total net retail fund flows in the first eight months of 2026 to £13.8 billion.

Monthly net retail fund flows have been positive ever since October 2025, which saw £4.6 billion in outflows.

Which asset classes were the most popular in August?

While investors were net buyers of funds in general during August, though, there were significant differences between funds targeting different asset classes.

Fixed income and mixed asset funds were the most sought-after, registering inflows of £656 million and £749 million respectively.

Equity funds, though, saw £478 million in outflows during the month. While that sounds like bad news for the stock market, it actually represents a substantial slowing of outflows compared to July, when nearly £2 billion of capital flowed out of equity funds.

^{Source: The Investment Association}

Money market funds saw net outflows of £728 million in August following three consecutive months of positive flows.

Which equity fund sectors saw the biggest outflows during August?

Equity funds across the board showed net outflows during August, and besides global funds – which registered net inflows of £568 million – no individual sector saw significant positive flows during the month.

However, the £459 million that left equity funds in August was an improvement following three consecutive months of £1.4 billion+ outflows (peaking at £1.86 billion outflows in June).

Funds investing in UK stocks saw the biggest outflows during August, with £615 million leaving this sector. Again, though, this was an improvement compared to July, when £1.65 billion left the sector.

Flows into North American funds turned negative, from £201 million inflows in July to £363 million outflows during August, while outflows from Asian funds accelerated from £49 million in July to £114 million in August.

There were modest positive inflows for funds targeting European and Japanese stocks, with these sectors netting inflows of £40 million and £25 million respectively.

Should you invest in funds?

Funds offer a versatile approach to investing across almost any type of asset class. They can work in a wide variety of market environments, as evidenced by the inflows and outflows across different sectors the August data reveals.

The IA noted that it is natural for uncertainty to creep into decisionmaking when it comes to buying funds.

“Market conditions alone do not determine investor behaviour,” said the IA’s Seath. “The domestic policy environment plays an equally critical role. With the Autumn Budget fast-approaching, it is worth remembering that policy stability is a fundamental pillar of investor confidence.

“In October 2025, the last full month before the previous Budget, UK retail investors withdrew £4.5 billion from investments, including £1.4 billion from UK equities, amid concerns about reported tax changes,” she added.

If you are new to investing in funds, it is worth considering that some funds are better for beginners than others. You should do your research thoroughly and consider where any given fund fits with your overall goals and risk tolerance before diving in.

Investors appear to have piled into both crypto and gold in the later part of this summer.

Gold was a standout asset during 2025 with gains of 64% during the year, though the price of gold has fallen off in 2026 after hitting an all-time high of $5,595 on 29 January.

Similarly, cryptocurrencies (crypto) endured a challenging start to the year. The price of Bitcoin, the largest and most influential cryptocurrency, fell 28% between the start of the year and 31 July, while Ethereum, the second largest, fell 37% over the same period

However, there has been a partial recovery in August and September, particularly in crypto markets; across these two months, gold gained 2% and Bitcoin gained 33% (as of market close on 28 September).

“Record inflows into Bitcoin and gold exchange-traded products (ETPs) have fuelled the rally in both assets recently,” said Francesco Paganelli, principal, manager research at Morningstar.

Paganelli added that August saw the strongest inflows into gold ETPs in five years, while the recent spate of buying marked “a sharp turnaround for global Bitcoin products”.

What are the similarities between gold and crypto?

It makes sense that gold and crypto markets sometimes move in tandem since there is some overlap in the investment case for both asset types.

In theory, both function as stores of value or a means of exchange that, unlike fiat currencies, have a finite supply. Only so much gold has been and ever will be mined, while most cryptocurrencies have scarcity built into their design. There will, for example, only ever be 21 million Bitcoin produced (the process by which they enter circulation is known as ‘mining’).

That means both asset classes can be viewed as a hedge against inflation; if the value of a currency (particularly the US dollar) shrinks, it takes more of that currency to buy a given amount of gold or crypto.

By extension, both are sensitive to changes in interest rates (again, particularly in the US as both asset classes are usually priced in dollars). If expectations for higher US interest rates increase, it is reasonable for gold and crypto prices to fall, because there is a higher likelihood that US inflation will be lower – and vice versa.

“A common driver appears to be the de-dollarisation trade, whereby investors seek to reduce their reliance on US dollar-denominated assets,” said Morningstar’s Paganelli. “After years of exceptional US equity market performance, many portfolios have become increasingly concentrated in dollar-linked exposures.

“At the same time, rising government bond yields are making bonds less effective as a safe haven, prompting some investors to look elsewhere for assets they perceive as alternative stores of value.”

However, the two are not perfectly correlated. Historically, Bitcoin has tended to perform in risk-on market conditions, while gold has done better in risk-off environments. 2026 has been an exception to that rule – the gains that gold made last year and the outsized impact that interest rate expectations have had on price movements this year have made it behave more like a risk-on asset.

How to invest in gold and crypto

You can buy a wide range of funds or ETPs that give exposure to gold and crypto prices individually. The rules for crypto ETPs are evolving; as of April 2026, crypto ETPs can only be held in an Innovative Finance ISA (IFISA), not a stocks and shares ISA – though as of October 2025 they are eligible to be held in a self-invested personal pension (SIPP).

One product that offers exposure to both assets in one is the 21Shares Bitcoin Gold ETP (LON:BOLD). The ETP invests in both gold and Bitcoin, and adjusts the balance between each asset based on their inverse volatility, meaning the amount of risk you are exposed to from each is equal. As with other crypto ETPs, BOLD can only be held in a SIPP or an IFISA.

As of 28 September, BOLD’s underlying assets were allocated 53.1% to gold and 46.9% to Bitcoin.

Before buying either gold or crypto, though, you should consider where each fits into your portfolio and your risk appetite.

“History shows that crypto's sharp rallies can be followed by equally sharp reversals,” said Paganelli. “With both gold and bitcoin experiencing elevated volatility in recent months, investors should be particularly disciplined about the size and timing of any allocation to either asset class.”

MoneyWeek has always been a strong supporter of investment trusts, largely because they offer their managers freedom to take a longer-term view when constructing their portfolios. Other characteristics such as the ability to use gearing (borrowed money) or the chance for investors to buy at a discount to the value of their assets can help to improve returns, but it’s their “permanent capital” that is most valuable.

If you are investing directly into sectors such as property, infrastructure and private equity – where you can’t simply sell assets in a few days because your investors suddenly want their money back – the need for permanent capital speaks for itself.

However, even with listed investments, sectors such as smaller companies often suffer from high volatility and limits on how quickly you can buy and sell holdings. No high-conviction investor wants to be at the mercy of rapid inflows and outflows, so investment trusts are a natural structure for such portfolios. And in today’s short-term markets – where sentiment hinges on quarterly results, monthly data and what feels like daily geopolitical upheavals – there’s much to be said for a structure that encourages a long view, whatever you are investing in.

Investment trusts have been around since 1868, with all the ups and downs that implies; they can surely help investors navigate this age of rapid change as well. That said, the past few years have been difficult. Discounts soared, bringing pressure both from opportunistic activists and disgruntled shareholders. This was partly due to external factors, but it’s fair to say the sector was due a shake-up. Some boards had been too complacent. There was a clear need for consolidation. The failure to reach new investors was becoming critical.

Thankfully the outlook is now improving, and we hope this special supplement makes clear why the diversity of investment trusts to choose from should ensure a bright future.

~ Cris Sholto Heaton

Artificial Intelligence (AI) has received bad press in recent weeks. Major AI models from OpenAI and Anthropic have been caught hacking other companies and even the Australian government, ‘going rogue’ and leaving their testing environments in the process.

Meanwhile, debates around the environmental impact of AI technology are heating up, with protests centred on data centres and their water usage.

Some are calling for a pause in the technology’s development. But concerns around AI safety are unlikely to hinder AI spending, says Jessica Inskip, director of investor research at stockbrokers.com, in the latest episode of MoneyWeek Talks, which you can also watch on YouTube.

Speaking to MoneyWeek's digital editor-in-chief Kalpana Fitzpatrick, she said: “I don’t think they’ll slow down spending, because they could redirect that spending elsewhere. The debates might even fuel the spending.”

Inskip says that debates around how energy-hungry AI is are fuelling attempts by firms to reduce power usage. She said: “In the US, our infrastructure is incredibly outdated in regards to the grid, and so a lot of the capex spending is going towards updating that infrastructure so it can support [AI].”

Water usage has also been a significant flashpoint over the environmental impacts of AI, with critics pointing towards the huge cooling demands AI data centres have. But firms are thinking of innovative ways to approach this issue too.

“We see that even with the water usage [debate]. There's new [data centres] that bring in water one time and then cool themselves. Now we're exploring data centers in space. Google has a project where they're taking their TPUs into space. [Others] are looking at even the ocean where it's very very cold because of the cooling that's needed.”

Inskip believes the concern around AI safety will in fact accelerate spending, not least because the technology is driving returns for its investors.

The beneficiaries of the AI boom are not just investors. Inskip claims that despite many locals being opposed to the building of data centres, they can actually be a boon for local economies.

“The environmental concern is very evident, and I completely agree with that. I actually visited an area where some data centres were and I remember seeing signs for rallies against these centres.

“But on the flip side, [the town] where this data centre was, the economy all of a sudden started booming. It’s like we had the industrial revolution or the railroads – it starts creating jobs,” she claimed. “You’re building these data centres and you need electricians and construction workers. So there is certainly good and bad with it.”

How investors can benefit from the AI boom

AI firms are now at the heart of many investors’ portfolios, with AI-linked stocks representing around half the S&P 500, a stock market index comprising 500 of the largest firms in the United States.

Many people will hold tech giants like Nvidia or Google’s parent company Alphabet, but Inskip feels that IBM (NASDAQ:IMB) may have slipped under the radar for investors.

AI firms can be broadly put into two groups: the ‘picks and shovels’, meaning the firms that are creating artificial intelligence, and the firms that are driving adoption.

For corporate adoption, IBM is an interesting stock pick, according to Inskip. She said: “On the enterprise side in the US we have IBM. A lot of financial institutions are very embedded with their data, and if you're a financial system or a healthcare system and you’re incorporating AI, you’re highly regulated so you’re going to want guardrails.”

These clients would not want AI agents to gain access to unauthorised and confidential data, nor would they want their confidential data to train any other models and potentially leak. This is the market IBM is targeting.

“So IBM is already embedded with their mainframe systems. They have a consulting arm which means they’re in the room when executives are making decisions from shareholder pressure over what is your AI strategy, and IBM is already there.

“What I love about IBM is they don’t have their own [AI] model. They partner with all of them.”

For more on the opportunities and dangers from the AI boom and why Inskip is bullish on Nvidia, watch MoneyWeek’s full podcast with Jessica Inskip on YouTube, or wherever you get your podcasts.

About the podcast

MoneyWeek Talks is a podcast that helps you unlock the secrets to financial success. Editors Kalpana Fitzpatrick, Andrew Van Sickle and Cris Sholto Heaton are joined by influential guests – from CEOs and entrepreneurs to economists and fund managers – to share their top tips on managing money, investing wisely and building wealth.

Subscribe to the MoneyWeek Talks podcast and get ready to make it, keep it and spend it with confidence. You can also watch the episodes on our YouTube channel.

Prime minister Andy Burnham has delivered a welcome lift to beleaguered UK housebuilding stocks ahead of the first Autumn Budget of his tenure with the announcement of a new scheme, which some analysts say could boost housebuilder profits by as much as 70% over coming years.

Hopes that UK housebuilders could benefit from a Burnham boost were vindicated when markets opened on 28 September, following the announcement of the Your First Home scheme aimed at helping first-time buyers get onto the property ladder. The equity loans scheme means you only need a 2.5% deposit, and can get a support of 20% from the government. But, to be eligible, you must purchase a new build from a housebuilder that is part of the scheme.

Shares in Persimmon (LON:PSN) and Barratt Redrow (LON:BTRW) rose around 16% and 13% respectively amid the news.

“The UK government's new equity loan scheme could be the catalyst the UK homebuilding sector has been waiting for,” said Jack Fletcher-Price, equity analyst at investment research company Morningstar. “While the finer details will matter, anything that lowers the deposit barrier for first-time buyers should translate into stronger demand, higher reservation rates and a healthier market for new-build homes.”

The FTSE 350 Household Goods & Home Construction Total Return Index gained around 11% on 28 September, following the announcement of the new scheme. In the 12 months prior to its announcement, the index had fallen 13%.

What is the Your First Home scheme?

The Your First Home scheme aims to enable more people to buy their first home. It is similar to the Help To Buy scheme the Conservative government introduced in 2013 and which ran until 2023, with a second iteration introduced in 2021.

The new scheme will enable first-time-buyers to purchase a new-build home with a deposit of just 2.5% of its value, and to borrow up to 20% in a government-backed equity loan.

As well as being limited to first-time buyers, regional price caps will also limit the value of properties that can be bought using the scheme.

“The previous Help to Buy scheme supported more than 387,000 new-build purchases, with the vast majority of those by first-time buyers,” said Aarin Chiekrie, equity analyst at wealth manager Hargreaves Lansdown, “so a well-designed replacement could meaningfully lift demand and give builders confidence to start more sites.”

Chiekrie cautioned, though, that exact details of the scheme will be unveiled at the Autumn Budget on 28 October and that, until then, some buyers may choose to hold off, “so sales are likely to remain subdued in the meantime”.

What does Your First Home mean for UK housebuilder stocks?

While it is still a month until the full details of the scheme are announced, markets have been quick to assume that UK housebuilders will benefit from higher demand for new-build homes.

At its peak, the previous Help To Buy scheme supported around 40% of new-build transactions according to a research note from investment bank Peel Hunt. The analysis forecasts a 10% uplift in sales volumes by 2028 alongside a 200 basis point increase in gross margins. That could lead to an increase in earnings per share (EPS) of around 70% for the sector.

“We expect the biggest impact to be on sales volumes rather than house prices,” said Morningstar’s Fletcher-Price, “with Persimmon particularly well placed given its high exposure to first-time buyers.”

He added that Barratt Redrow “trades at an excessive discount to the peer group” and could therefore be an appealing option for value-focused investors.

Analysts at Peel Hunt, meanwhile, believe that Persimmon could see the smallest EPS increases among the sector and that Crest Nicholson (LON:CRST) and Gleeson (LON:GLE) could see the largest rises.

There will also be benefits along the housebuilder supply chain. Brick manufacturers Ibstock (LON:IBST) and Forterra (LON:FORT) derive around 60% of revenue from new builds, according to Peel Hunt, and as such could be key beneficiaries.

For years, cash had to apologise for itself. It was safe, certainly, but the return was miserable.

Cash can now look investors in the eye with a promise of return that beats inflation.

The best one-year savings accounts pay about 5%, with no stock market drama and no risk of waking up to find your investment has fallen sharply. It is a fair question to ask: are shares worth the risk at all, or is saving better than investing?

The answer starts with time. Cash is for money you may need soon and shares are for money you can leave invested for years, accepting short-term falls in pursuit of greater long-term growth.

What does the evidence show?

Some of the best-known historical evidence gives surprisingly different answers. Barclays Private Bank says UK shares beat cash in 91% of rolling 10-year periods since 1899, meaning every possible 10-year stretch, each starting a month or year apart.

Paul Lewis, presenter of BBC Radio 4's Money Box, found something very different in research published in 2016. Across rolling ten-year periods between 1995 and 2016, a FTSE 100 tracker beat the best savings accounts only half the time.

Lewis set shares a harder test than Barclays does. He used the actual returns from a FTSE 100 tracker after charges and compared them with the best one-year savings account available each year. Barclays uses three-month Treasury bills instead, partly because they provide a consistent measure of cash stretching back more than a century.

Using the best available savings rates, rather than Treasury bills, gives cash a stronger showing. Timing matters too. For investments starting on the first of any month from October 1999 to September 2001, cash beat the tracker over every holding period Lewis could measure, up to 15 or 16 years.

What happens with more recent data?

I applied a similarly demanding test over a different period. My own analysis starts in December 2000, as far back as the relevant MSCI sterling total-return data go. I compared the MSCI UK and MSCI World indices, after a 0.2% annual charge, with cash rolled into a new one-year fix each year. For cash, I used the Bank of England's average one-year fixed savings rate plus an allowance for best-buy accounts.

Over rolling ten-year periods to August 2026, UK shares beat cash 91% of the time. Global shares did so 90% of the time, so going global barely changed the odds.

The period contains only two non-overlapping decades, the same limitation as Lewis's data. The analysis confirms Barclays' result on fresh data rather than replacing it.

Why does time matter?

Ten years is only one horizon. Barclays found that UK shares beat cash in 70% of rolling two-year periods since 1899, rising to 91% over ten years. A 70% chance of beating cash is also a 30% chance of falling behind, which is exactly the risk that makes cash the safer home for money with a date on it.

Even ten years offered no guarantee. Cash still came out ahead in about one period in 11. The percentages are historical frequencies, not forecasts.

And cash has a time problem of its own.

In July 2008, the Bank of England's average one-year fixed savings rate was 6.06%. A one-year fix guarantees that rate for one year only. After that, you take whatever rate is available when you renew.

For money held over 15 or 20 years, that means renewing again and again at rates nobody can know in advance. The same Bank of England average stayed below 2% every month from January 2013 to August 2022. Best-buy savers did better, but faced the same broad decline.

Rates may rise as well as fall. Today's rate cannot be locked in for decades.

How much cash do you need?

When Lewis published his research in 2016, I was sceptical. Cash paid next to nothing then, and I saw little reason to hold more of it than necessary.

My view has shifted. My wife and I are very likely to move house within the next two years, probably to a more expensive area. We also want to travel much more than we have and already have several destinations in mind. Those are foreseeable calls on our money, even if we cannot put exact dates or amounts on them yet.

So I now keep more in cash, though most of my wealth remains invested in shares. This is not a retreat from equities so much as a clearer division of labour.

MoneyHelper, a UK government-backed financial guidance service, suggests three to six months' essential outgoings as a rule of thumb, while wealth manager Hargreaves Lansdown says money you may need within five years should generally be kept in savings rather than invested. Investing that money is a real risk: from December 2000, global shares fell 41% and did not regain their starting level until March 2006.

For retirees, Hargreaves Lansdown suggests keeping one to three years' essential spending in cash. These rules of thumb give you two useful buckets: money for emergencies, and money for foreseeable spending. The harder question is what to do with everything left over.

What is the cost of staying in cash?

In my test, £10,000 invested in a global tracker from December 2000 to August 2026 grew to about £67,600 after charges. Rolled through one-year fixes over the same period, including an allowance for best-buy rates, it reached about £25,000. The global tracker ended with more than two and a half times as much as cash.

A UK tracker reached about £41,800 – or around 1.7 times as much as cash despite no exposure to US shares. US strength helped widen the gap between the UK and global results, while sterling weakness also gave the global result a modest boost.

The lesson is not that cash is bad. It is that once your needs are covered, holding more of it has an opportunity cost that compounds.

Work out what you are likely to need soon and keep that in cash. For money you will not touch for many years, accept the short-term falls that come with shares.

Then look at what is left. If it is still sitting in cash, ask why. If the only answer is that today's rate feels reassuring, that is not enough.

The mistake is letting a one-year rate decide where long-term money belongs.