Private Investor: Hedging, dogs and the incredible technology share bounce-back

I won't be attending the 3G mobile telephony conference in Cannes next week. I rather wish I were going along, and not just because it is being held in such a sumptuous location.

I won't be attending the 3G mobile telephony conference in Cannes next week. I rather wish I were going along, and not just because it is being held in such a sumptuous location.

For visitors to the Cannes conference will be reassured, I am sure, that 3G actually has a future. Those of us small investors who were caught up in the hype about 3G, and who kept faith with the promise of the new technology, need to have our confidence bolstered by the confidence that I am sure will positively ooze from the Côte d'Azur.

I note, for example, that last week there was a certain amount of gossip that LogicaCMG will be announcing good news on the day, namely contract wins for software and consultancy.

I know I have written about the Logica CMG bounceback before, and speculated about its likely sustainability, but it really is striking.

As of the time of writing, the portfolio is making some encouraging progress, thanks to the likes of LogicaCMG. The shares in it I bought during the tech downswing have gone up by 117 per cent, heartening indeed. Reuters and Cable & Wireless are also doing well, although I am sorry to see Vodafone stalling, partly as a result of its going ex-dividend and despite market relief that it had withdrawn from bidding for AT&T Wireless.

LogicaCMG is an interesting case in all sorts of ways, not least because it is another example of an Anglo-Dutch business partnership (Logica was British, CMG more Dutch). These have had mixed fortunes in recent times. Think of Royal Dutch/Shell: the UK end, Shell Transport and Trading has been a drag on my performance for a while. Think of LDV Vans, unquoted but of compelling interest to those of us who follow the fortunes of what's left of the British motor industry.

In fact, LDV is in encouraging talks with external partners about new models so we shall see what happens there. Maybe they'll float one day. In which case I'll buy a share, or more, as a momento. Well, we can all dream, can't we?

Yet I digress. I might as well mention the portfolio's dogs, lest it be though I am getting too wealthy. Notable equity hounds include the aforementioned Shell, Marks & Spencer, where the good news never starts, and most of the various American shares I've bought over the last couple of years, such as Coca-Cola. That's thanks to the incredible shrinking dollar.

Now, I think the main thing with the American market is not so much timing as being in that market for the long term. Most small investors have an understandable bias towards British stocks, but I think some hedging is needed.

Leaving aside the important point that lots of UK quoted stocks do have quite a considerable US or international exposure, there is still some "personal hedging" to be done. After all, if the UK economy goes down the tubes and your job with it, you don't want to be in a stock market that will be depressed at the same time, do you? That is a potential hazard we should all be aware of.

Of course, it could go spectacularly wrong. Some recessionary periods in he UK have been associated in the past with rising markets (on the expectation of an upturn) and vice versa, so there is nothing sure or scientific about this analysis. It's just that I suppose I do want to spread my investments across as wide and diverse a field as possible.

Today, in the era of low-cost, online stockbroking, buying US or European shares directly is a perfectly economical proposition. Indeed, European shares probably move in a more pronounced counter-cycle to UK ones, if you can bear thought of investing over there.

I cannot close this week without saluting Elizabeth Winkfield, who is aged 83 and from Devon. She has said at Barnstaple magistrates' court that she would rather go to prison than pay her council tax.

When I made my own little protest against the poll tax in 1990 or so, I drew short of risking a custodial sentence. She is a brave and principled lady who deserves everyone's support in her fight against this increasingly iniquitous tax. Pensioners across the land are having their lives made miserable by its unfairness.

Most of the fault lies with the government refusing to fund local councils properly and attempting to pass off yet another stealth tax as entirely the fault of incompetent, spendthrift local authorities.

It is precisely the trick Margaret Thatcher tried to get away with when we had the poll tax, and Labour ministers should remember what happened to her. I stand ready to contribute what I can to the Winkfield fighting fund. Her struggle is my struggle.

s.o'grady@independent.co.uk