It’s time for me to highlight three articles from Fool.co.uk that I’ve found particularly insightful over the past week. If you’ve missed them, I think they’re well worth reading, so don’t miss out!
First up this week, some wise words on the FTSE 100 (FTSEINDICES: ^FTSE) in this video by our senior analyst Nate Weisshaar and Jill Ralph. I think they’re right to encourage long-term investors to hold their nerve amid recent market volatility. We know that share prices can be volatile from one week to the next, but if we buy shares to own for several years, we shouldn’t really worried about the market’s short-term mood swings.
It was a busy week for Nate, who also penned this opinion piece on whether Lloyds Banking Group‘s (LSE: LLOY) (NYSE: LYG.US) shares could be expected to double again. Focusing on the underlying business is a speciality of our Global Investment Team, but this can be exceptionally difficult to normalise in the case of an unwieldy government-backed banking group. I personally worry that too many moving parts and speculative factors make Lloyds too difficult to realistically value as it undergoes its transition — but that is something of a matter of preference!
Meanwhile, Fool veteran Alan Oscroft analysed the state of the oil industry, and its two biggest London-listed players, BP (LSE: BP) and Royal Dutch Shell (LSE: RDSB). He declared both companies as “way too cheap”, with the potential to deliver handsome rewards for shareholders over time. While I think he could be right, I’ve never been tempted to invest in the oil giants myself. The economics of ‘Big Oil’ can be less than ideal over the long-term — capital intensity and overheads are proportionately high, while important depleting assets need to constantly be replaced, and even the oil giants cannot influence the price for their commodity-type produce. Returns from both companies could be satisfactory, but I’d prefer to invest elsewhere.
So which UK shares would we recommend looking at instead? If you have an interest in big-hitting FTSE 100 blue-chip shares to invest in for the long term, you should really check out the Motley Fool’s exclusive wealth report, “5 Shares You Can Retire On“.
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> Mark does not own any shares in this article.
