I have a SIPP with Hargreaves Lansdown, and I’ve just been reading a report they sent me this week looking at the shares that have been the most popular with their ISA and SIPP clients in the 2018-19 year so far.
You can find the report at the HL web site, and it contains some interesting insights into a few of the top picks, but here I just want to examine a few that are also among my favourite choices.
Big Oil
I rate our two biggest oil stocks, BP and Royal Dutch Shell, as among the very best investments there are right now, and both feature in Hargreaves Lansdown’s top 10 list of most popular FTSE 100 stocks.
For me, both are stunningly resilient companies, and came through the oil price crisis without having to cut their dividends by even a penny. In fact, Shell has never cut its dividend even once since the end of World War II. And BP’s cut in response to the Deepwater Horizon disaster was only short-lived, and the dividend came bouncing back pretty quickly.
Lloyds Banking Group also makes the list, which supports the views of a number of Motley Fool writers who see the bank’s shares as seriously undervalued now. Brexit fears are still weighing heavily on Lloyds, but I see a compelling upside.
For me it’s the combination of a low P/E rating of only eight, a big and well-covered dividend yield of 5.5%, the bank’s greatly strengthened balance sheet, and its refocus on the UK retail market that make Lloyds a buy. And it seems I’m in good company.
Risky digger?
That roller-coaster stock Sirius Minerals makes it into the FTSE 250 list, and I find that especially interesting. I like Sirius as an investment, but a company that’s not expected to produce any profits for a few years yet is not one I’d expect to be hugely popular among ISA and SIPP investors.
But maybe I’m underestimating the long-term horizon of UK stocks & shares investors these days, and perhaps the attraction of taking a bit of a risk with a portion of our investment cash.
Premier Oil, another stock I hold in my own SIPP, surprised me by making the list, as I’ve always seen it as still pretty risky with its debts that remain very substantial. Premier is still at some significant risk should we be hit by another oil price fall, and with production surpluses looking likely to grow, that’s far from impossible.
I’m actually still slightly down since I bought some in 2015, and I’ve doubted the wisdom of that purchase more than once in the time since I made it.
Faddish surprise
The one that surprises me most is Superdry, whose share price has slumped since the beginning of 2018. Presumably folks have been investing in the hope of a recovery, and I hope they get it. But there are very few fashion stocks that I think have a chance of becoming good long-term investments, and Superdry is not one of them.
What are your favourite ISA and SIPP stocks? You only have a few days to make up your mind if you want to make the 2019 ISA deadline.
