Register free for our breaking news email alerts with analysis and cutting edge commentary from our award winning team. Registration only takes a minute.

Tesla to blockchain: 8 wealth managers' 'dumb' investments

We asked eight wealth managers where they think the most foolish places to invest are.

Earlier this year technology and trends expert and Mark Stevenson told an audience of wealth managers at Citywire South West that oil was one of the 'dumbest' places to invest.  

In an emotive talk, Stevenson (pictured), said that people should get out of fossil fuels if they really care about their children. 

On the back of this, we asked eight wealth managers what they thought was the 'dumbest' investment in current market conditions.  

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Earlier this year technology and trends expert and Mark Stevenson told an audience of wealth managers at Citywire South West that oil was one of the 'dumbest' places to invest.  

In an emotive talk, Stevenson (pictured), said that people should get out of fossil fuels if they really care about their children. 

On the back of this, we asked eight wealth managers what they thought was the 'dumbest' investment in current market conditions.  

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

John Goodall

Research analyst, WH Ireland, Manchester


‘Tesla is a great concept and an exciting story but not one that will necessarily translate to a successful investment. The price tag, a $46 billion (£34.4 billion) market capitalisation at the time of writing, is indicative of the broader speculative environment that the Nasdaq has come to represent. 

‘With no profits and negative cash flows as far as the eye can see, the valuation is difficult to justify. The company has been plagued by operational issues: setbacks on the Model 3 production and a number of fatal accidents have damaged confidence. As of yet, there is no sign of the “game-changing” $35,000 entry level Tesla promised over two years ago.

‘With Tesla’s bonds heading lower, as investor fret about the company’s ability to finance its rapidly growing debt pile, and competition in the sector heating up, it is time for equity investors to check out. If not an outright “dumb” investment, the risk is certainly off the scale!’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Jon Wingent

Head of portfolio specialists, Lloyds Bank Private Banking, London 


‘For me, that’s an easy answer: cryptocurrencies. Following years of doing absolutely nothing, the most well-known crypto, bitcoin, is an example of a modern day ‘tulip rush’. Having peaked in December 2017 at over $19,000, less than six months later, it’s worth 40% less.

‘However, investors do ask about it and I would suggest that investing in a decentralised digital asset which has historically been linked with the dark economy – and could be one hack or lost encryption key away from losing all value – is not the smartest move.

‘At the peak of the frenzy of capital flow into crypto and regular ICOs, Warren Buffett put it quite simply: “I can say almost with certainty that cryptocurrencies will come to a bad end.”’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Caroline Simmons

Deputy head of the UK chief investment office, UBS Wealth Management, London


‘Given the heightened volatility we’ve seen in markets recently, we know that some investors are panicking about the returns they can expect over the coming months and years.

‘We agree that the road ahead will be more difficult to navigate than what is behind us, and returns will likely be lower. However, we don’t believe a pick up in volatility signals the end of the bull market.

‘Accordingly, the cost of being uninvested remains high. Global growth is still good, earnings growth is strong and equity market valuations remain appealing relative to cash and fixed income.  

‘So while investors need to manage risk carefully, this is not a time to jump to cash. We advise our clients to position their portfolios for long-term growth, which means fully diversifying and reconsidering sources of income.’

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Robert Feather

Senior investment manager, Myddleton Croft Investment Managers, Leeds 


‘I would say gilts, JGBs and bunds or any bond that locks in a negative real yield. The amount of duration baked into the system after years of QE and record low interest rates is unsettling.

‘Using the 10-year gilt as an example, which currently carries around nine years of duration, a 1% rise in interest rates loses you nearly all the income you would receive throughout the life of the bond.

‘Many investors unfortunately miss the fork in the road where the future is markedly different from the recent past. When this eventually comes, as it is beginning to in the US, there are a lot of people who are going to be heading for the exit at the same time.

‘I can think of numerous alternatives I’d rather own that also afford effective tail risk protection, but don’t carry the same overvalued status.’ 

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Andrew Gilbert

Investment manager, Parmenion – Edinburgh

'As a DFM, we focus on managers which consistently outperform the peer group with an equivalent or lower risk, i.e. they add value without having taken extra risk to achieve it and therefore have the skill, resource and necessary process to increase the likelihood that it’s repeatable in the future. 

'As such, the dumbest place is to invest is in a high cost active manager that is inconsistent, frequently underperforms and adopts a higher than average risk.  Clearly, this is not in any investors’ interests and if the vehicle is also illiquid, then you might not even be able to withdraw your capital in the future!'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Nigel Rawlings

Investment manager, Malloch Melville, London

'For me, the dumbest place to put your hard-earned cash is in cryptocurrency. I know, I know, you could have “made” loads in cryptos in 2017 (funny how they are quoted in dollars) but let us take a step back.

'Consider the answers to these simple questions: Can you eat them? Can you feel them? Do they look nice? Do they grow into something beautiful? Are they environmentally friendly? Can you spend them (except when buying something illegal)? Are they backed by any government or reputable organisation? Do they have any asset backing? Do they pay a dividend or a rate of interest? Can they be stolen? Are they volatile?

'I could go on but you get the point, I hope. Yes, of course, for as long as the hype goes on you might be lucky enough to make money from cryptocurrencies – provided that you cash out at the right moment, whenever that is – but the odds are heavily stacked against you.'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Alex Davies

CEO and founder, Wealth Club, Bristol

'People come to us with investment opportunities all the time. Increasingly the mention of blockchain is thrown in, as though it is going to have a magical effect on their company’s value and transform the industry they are in.

'In reality, I suspect most people using the word don’t even know what it is. This is eerily reminiscent of the dot-com bubble when any company with a website could be worth millions.

'In my view, while blockchain might be good for certain things, the value to many normal businesses is overstated; in fact, there probably isn’t a value at all. Compared to traditional methods, blockchain can be less scalable and use huge amounts of energy while bringing very few, if any, advantages. Investors beware.'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Ben Conway

Senior fund manager, Hawksmoor Fund Managers, Exeter

'Anywhere you haven’t researched enough. The caveat emptor principle is as relevant in making investments as it is anywhere else. The key is to have done as much due diligence as possible so that you are aware of the risks you are taking at the time you make the purchase.

'Anyone, even the most experienced and talented of investors, can be made to look silly by the subsequent performance of an investment after purchase. The important thing is not to let an investment fail due to a lack of homework.

'Retaining a sense of humility is vital: recognising that the future is always uncertain and that your investments can always go wrong however much preparatory work you do. That is why we run very diversified portfolios, with each holding never being allowed to dominate performance, and each having a margin of safety.'

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
1 Comment Play CEO Tapes: Buxton to Gilbert - ‘my Glencore quandary’

CEO Tapes: Buxton to Gilbert - ‘my Glencore quandary’

Do not miss the first two minutes of this film as Richard Buxton shares how he has been challenged by a client for owning shares in a certain company.

Play CEO Tapes: the huge opportunities for asset managers

CEO Tapes: the huge opportunities for asset managers

From tech disruption, retirement and poaching, the CEO discuss the opportunities for their businesses in this episode.

Play CEO Tapes: 'we're just a bunch of white dudes sitting here'

CEO Tapes: 'we're just a bunch of white dudes sitting here'

In our brand new series, eight CEOs discuss how the industry could do a better job for female fund managers.

Read More
Wealth Manager on Twitter