The Investing Show podcast The Investing Show

An inflation panic has sent interest rate expectations soaring in the UK, even as the US Federal Reserve is tipped to stall. 

Base rate is now forecast by some to climb as high as 6 per cent as the Bank of England battles stubborn inflation, rather than peak near its current level of 4.5 per cent.

Rate expectations combined with rising gilt yields have sent shockwaves through the mortgage market, as lenders rapidly pull and reprice deals. The average two-year fixed rate mortgage has now hit 5.9 per cent.

But while the mortgage market apple cart has been well and truly upset by much higher rate expectations, what does this mean for investors?

On this episode of the Investing Show, Richard Hunter and Simon Lambert discuss what interest rates on both sides of the Atlantic may mean for investors and look at the shares that could do badly and those that could do well. 

Venture capital trusts offer the opportunity to invest in some of Britain's most exciting small growth companies and a juicy 30 per cent income tax break.

By pooling investors money in investment trusts run by specialist managers, VCTs offer a way to spread your risk while backing the small firms that could become the next big thing, with previous examples including Zoopla, Depop and Five Guys.

But they say you should never let the tax tail wag the dog, so before putting money into a VCT you need to make sure it is right for you.

On this episode of the Investing Show, Simon Lambert and Richard Hunter are joined by Bestinvest's Jason Hollands, who explains what you need to know about VCT investing - and talks through some of the offers out there.

Commercial property has had a rocky ride over recent years, but is it now a great value investing opportunity with the power to beat inflation?

On this episode of the Investing Show, Simon Lambert is joined by the manager of TR Property Investment Trust, Marcus Phayre-Mudge, who explains why he thinks a careful approach to backing retail, warehouse and office real estate could deliver rewards for years to come.

The market for offices was written off by many during the pandemic but has rebounded strongly for landlords who can offer quality.

Marcus says that there are two elements that he believes will drive the office market for years to come: demand for high quality space ‘to tempt staff back in’ and demand for more energy efficient buildings, to allow companies to save money and deliver on environmental pledges.

He says: ‘We expect a green building supercycle’.

The fund manager, whose trust holds shares in listed property companies across Europe, says that what ties the philosophy behind TR Property’s diverse investments together is looking for quality management in those businesses – something that he says is key to success.

Marcus explains the issues investors need to consider before buying into commercial property, including why an investment trust is a better way forward than an open-ended investment fund, many of which have been forced to lock in investors during turbulent periods.

He also talks through where he sees the best opportunities and how he sees retail and office space changing, including the demand for better quality premises for shops and businesses keen to attract shoppers and workers to bricks and mortar.

Like many property trusts and funds, TR Property had a tough 2022, with a 35 per cent share price fall, but the trust has climbed 8.5 per cent since the start of the year. Shares currently trade at an 8 per cent discount to net asset value.

TR Property has averaged a 9.48 per cent total return over the past decade and has a dividend yield of 4.37 per cent, according to Morningstar data. It has an ongoing charges figure of 0.58 per cent, but also a performance fee can apply.

Impax Environmental Markets has spent two decades scouring the world for companies that can help deal with the challenges the planet faces.

Long before the recent trend for green investing and ESG funds emerged, its managers were earning their spurs by tracking down disruptive companies with a difference.

And this has proved to be a highly profitable strategy for the investment trust's long-term investors, with a total return of 75 per cent over five years and 311 per cent over ten years, according to Association of Investment Company figures. 

Yet, Impax has not been immune from the storm for growth stocks and is down 5.9 per cent over the past year, with shares falling to a 5.19 per cent discount to net asset value. 

But what are environmental markets and what does Impax look for in a company? On this episode of the Investing Show, Impax Environmental Markets' senior portfolio manager Jon Forster joins Simon Lambert and Richard Hunter to explain more.

He also reveals some of the fascinating things that the companies Impax invests in do, from the UK company helping industrial users make better use of steam, to firms helping reduce the impact of agriculture while improving its yields.

The FTSE 100 has started the year on the front foot and investors are watching closely to see if it can hit a new record high.

The UK’s blue-chip index led the way among main global stock markets last year, keeping its head above water and delivering a respectable total return including dividends of 4.7 per cent.

After a strong finish to 2022 and good start to 2023, it is now up 14 per cent on its October lows at 7,860, within a whisker of its all-time closing high at 7,877.

So why has the FTSE 100 been performing so well and can it continue its run throughout this year? On this episode of the Investing Show, Simon Lambert and Richard Hunter take a look back at the scorecard for the Footsie and other major markets last year and look forward to what may happen this year.

Inflation has dominated consumers and investors' minds over the past year, as the dramatic rise in the cost of living has eaten into incomes and share prices.

Official data shows that inflation is still running hot and central banks are continuing to hike interest rates to combat it, but there is also an expectation that inflation will start to fall away dramatically next year.

Will inflation subside, can it stay low, and will this help households and investors? 

Tom Becket, of Canaccord Genuity Wealth Management, joins Simon Lambert and Richard Hunter on this episode of the Investing Show to explain why he feels inflation may prove stickier in the UK than in the US and markets will remain volatile, but bold investors looking for value could profit.