Transforming personal finance since 2011

#88 — "Start With Why..."


January 12th, 2023

By Andrew Craig

Reading time: ~ 10 minutes

Please note: This post is not intended for distribution or publication, directly or indirectly, to US persons or in or into the United States, any EEA member state, Australia, Canada, the Republic of South Africa or Japan or any other jurisdiction where it is unlawful to distribute this post.

If you follow Plain English Finance on social media or if we are personal contacts on any of LinkedIn, Twitter or Facebook, you may have seen my post from just before New Year, entitled "the world is much better than most of us think".

As I explained in that post, I have long advocated subscribing to a brilliant outfit called Future Crunch. They have a free email service which looks to share good news to your inbox on a regular basis.

Towards the end of each year they publish a piece called "99 Good News Stories You Probably Didn't Hear About in 20xx".

I have written a fair bit in the past about the extent to which both our mainstream press and our social media feeds suffer from an extraordinarily strong negative bias. As they say in the media industry "if it bleeds, it leads" and arguably never more so than today.

Future Crunch does its best to serve as an antidote to that negative bias. As they put it:

"The world didn't fall apart this year. You just got your news from the wrong places..."

To credit that position, they deliver no fewer than 99 news stories focused on...

"...uplifting human rights victories, extraordinary conservation wins, big milestones in global health and development, and an unprecedented acceleration in the clean energy transition."

It makes for encouraging reading and I would recommend the time it takes to at least skim through the piece.

What's your point?

The reason I'm taking the time to share their work to our wider email readership as well as just to our social channels is because of how relevant I believe their world view is to investment and, most particularly, to the likelihood of succeeding with investment.

I have written before that human progress is very likely the single most important investment theme of them all. In the long run, and certainly over a life-time of investing, we believe that the people who make the best investment returns force themselves to believe in human progress and invest accordingly.

There is a famous phrase often cited by many of the world's best investors:

"Pessimists sound smart. Optimists make money."

Put another way: "It pays to be bullish." Over long periods of time at least.

This isn't easy, however. One of our biggest challenges as investors (and, more generally, as human beings) is our inherent tendency to be bearish. The record of research into such things tells us that most of us are hard-wired psychologically and emotionally to be pessimistic and fearful.

This fundamental malfunction of human psychology is compounded still further by that strong negative bias in our press and social media.
It is all too easy to be fearful given the press is almost always painting a fundamentally negative and factually distorted picture of reality. To counter this, it is crucial to "Follow the trendlines, not the headlines" as former US President Bill Clinton put it some years ago.

I remember what it felt like in the tech crash of 2000 and then again in the global financial crisis of 2007 to 2009. It felt a great deal like it feels today. Back then if you lost your nerve and gave up on human progress and on long run stock market investment you potentially missed out on a huge amount of upside in the years that followed.

It could well be "different this time". Inflation is certainly a big problem - although to be honest, this has been brewing for a long time. The interest rate environment is certainly different and perhaps structurally and durably so, but I don't believe that any of this changes the fundamental underlying long run driver that is human progress and what that can deliver for all of us over time.

Inflation is high and the interest rate cycle may have turned. Doesn't that mean that it is even more important to be focused on something that might deliver above-inflation real returns over the long run?

At the coal-face

This is why we have spent the last eighteen months building our Conviction Life Sciences Company (CLSC). In our considered belief, the life sciences industry is at the very coal-face of human progress and one of the areas that we believe has a decent chance of delivering real returns in the years ahead as a result.

The CLSC team has spent several years looking at data points which run from the bottom left to the top right of a graph time and time again. This is because the science is progressing at an exponential rate and our belief is that value creation will follow - as it always has done in history and has done to a great extent already.

This won't happen smoothly, but this is why a long run approach to investment is almost certainly the best one to take based on the evidence of many decades. This is also why our Key Information Document gives a recommended holding period for CLSC of five years.

If you're interested in finding out more before we close the IPO on the 31st of January, please do check out the Company's website. Here you can find all the key information about the company, our press coverage and details on how to invest.

If you would like to hear the investment thesis in detail, please do consider watching the video of the full investor presentation which can be found on YouTube.

Before I sign off today, I just wanted to highlight the "How to Invest" section of the CLSC website in particular. This is because so many of you have been in touch over the last few weeks to share the fact that you weren't able to find the Company on your investment platform.

If this describes you, you can ensure you go to the correct page on your investment platform simply by clicking the relevant logo from our "How to Invest" page or by using these links to go straight through to Hargreaves Lansdown, AJ Bell or Interactive Investor, for example.


Important Information

Andrew Craig is a director of Plain English Finance Limited ("Plain English Finance") which is authorised and regulated by the Financial Conduct Authority (564876) with its registered office at Stag Gates House, 63/64 The Avenue, Southampton, Hampshire SO17 1XS, United Kingdom.

This post, which has been issued by Plain English Finance, is a financial promotion and is not intended to be investment advice. This post is intended for UK residents only.

The purpose of this post is to provide summary information regarding the Company and is for information and discussion purposes only; it should not be considered an offer or solicitation of an offer to buy or sell shares in the capital of the Company. In particular, this post does not constitute an offer to sell, or the solicitation of an offer to acquire or subscribe for shares in the capital of the Company in any jurisdiction where to do so would be unlawful.

This post is an advertisement and does not constitute a prospectus or an offer in respect of any securities and is not intended to provide the basis for any decision in respect of the Company. An investment decision must be made solely on the basis of the prospectus issued by the Company (especially the risk factors set out therein) and which is available on the Company’s website at www.clsc.uk, subject to certain access restrictions.

Plain English Finance does not make any recommendations regarding the suitability of any product for you and the information provided here should not be considered as investment or other advice or a recommendation to buy, sell or hold a particular investment.

To reiterate, investments mentioned herein may not be suitable for you and you must make your own independent assessment and rely on your own judgement (or that of your financial adviser) in order to determine whether any particular investment represents a suitable investment opportunity for you on the basis of your personal circumstances, tax position and available financial resources and the legal, regulatory, tax and investment consequences and risks of investing. If you are in any doubt about the information here or on our or the Company's websites please consult your financial or other professional adviser.

The Company operates under the Companies (Guernsey) Law 2008, as amended, and is not regulated as a collective investment scheme by the Financial Conduct Authority of the United Kingdom. Your capital is at risk with this investment. The value of shares and a return from them is not guaranteed and the share price can fall as well as rise due to stock market movements. When you sell your investment you may get back less than you originally invested. The price of shares in the Company is determined by market supply and demand and may be different to the net asset value of the Company.

Past performance is not a reliable indicator of future results. Forecasts are not a reliable indicator of future performance. Investments in the Company are subject to risks associated with investments in the biotechnology sector. This post may include statements that are, or may be deemed to be, "forward-looking statements". Forward-looking statements are subject to risks and uncertainties and, accordingly, the Company’s actual future financial results and operational performance may differ materially from the results and performance expressed in, or implied by, the statements. These forward-looking statements speak only as at the date of this post and cannot be relied upon as a guide to future performance.

The Ordinary Shares have not been and will not be registered under the United States Securities Act of 1933 (as amended) (the "US Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered or sold within the United States or to, or for the account or benefit of, US Persons (as defined in Regulation S under the US Securities Act ("Regulation S")), except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction in the United States. In addition, the Company has not been and will not be registered under the United States Investment Company Act of 1940, (as amended) (the "US Investment Company Act"), and recipients of the Prospectus will not be entitled to the benefits of that Act.

This post is not for publication or distribution, directly or indirectly, in or into the United States of America. This post is not an offer of securities for sale into the United States. No public offering of securities is being made in the United States.

The offer and sale of Ordinary Shares has not been and will not be registered under the applicable securities laws of any member state of the EEA, Canada, Japan or the Republic of South Africa. Subject to certain exemptions, the Ordinary Shares may not be offered to or sold within any member state of the EEA, Canada, Japan or the Republic of South Africa or to any national, resident or citizen of any member state of the EEA, Canada, Japan or the Republic of South Africa.


Important Disclaimer

Plain English Finance Limited has used all reasonable efforts to ensure the accuracy of the information contained in this communication at the date of publication.

An English language prospectus for the VT PEF Global Multi-Asset Fund is available on request and via www.plainenglishfinance.co.uk/funds.

Investors should read this document in conjunction with the fund's Key Investor Information Document and the relevant application form before purchasing shares in the fund. Full details of each of the risks and aims for the fund can be found in the Key Investor Information Document which are available from us or at www.plainenglishfinance.co.uk/funds.

Past performance is not a reliable indicator of future performance. The value of investments and any income from them may fall as well as rise, the return may increase or decrease as a result of currency fluctuations, and you may not get back the amount of your original investment.

Plain English Finance Ltd. does not make any recommendations regarding the suitability of this product for you and the information provided should not be considered as investment or other advice or a recommendation to buy, sell or hold a particular investment. If you are in any doubt about the information in this email or our website please consult your financial or other professional adviser.