Archived article
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Cutting our losses on Lloyds

AJ Bell is an easy to use, award-winning platform Open an account
We've accounts to suit every investing need, and free guides and special offers to help you get the most from them.
You can get a few handy suggestions, or even get our experts to do the hard work for you – by picking one of our simple investment ideas.
All the resources you need to choose your shares, from market data to the latest investment news and analysis.
Funds offer an easier way to build your portfolio – we’ve got everything you need to choose the right one.
Starting to save for a pension, approaching retirement, or after an explainer on pension jargon? We can help.
Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Lloyds (LLOY) 24p
Loss to date: 62.4%
Original entry point: Buy at 63.93p, 19 December 2019
Our positive call on high street lender Lloyds (LLOY) has gone horribly wrong and, while we couldn’t have predicted the unprecedented events witnessed in 2020, we should have been quicker to respond to its poor performance.
We originally hoped the definitive election result and resulting political stability would lead to a positive domestic picture, supporting Lloyds’ share prices and underpinning its income appeal. Clearly December 2019 was a very different place from just a few months later when the Covid-19 pandemic hit.
The banking sector has been ravaged both by exposure to a rapidly deteriorating economic outlook in the UK – which has been served with a side dish of growing uncertainty over Brexit – and to falling interest rates as the Bank of England has sought to prop up the economy.
Lloyds’ profit was wiped out in the second quarter as it chalked up bad debt provisions of £2.4 billion.
If that wasn’t enough then the sector has effectively been prevented from paying investors the dividends they crave by the regulator.
The outlook remains weak and with talk of potential negative interest rates, it’s time to cut our losses.
SHARES SAYS: While we are having to swallow a big loss, it is hard to make a case for the picture improving much in the final quarter of the year and we think it is worth sparing ourselves from any further pain. Sell.
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
The value of your investments can go down as well as up and you may get back less than you originally invested. We don't offer advice, so it's important you understand the risks, if you're unsure please consult a suitably qualified financial adviser. Tax treatment depends on your individual circumstances and rules may change. Past performance is not a guide to future performance and some investments need to be held for the long term.
Our website uses cookies to give you a better browsing experience.
You can choose to accept all cookies, or control which we use by clicking 'Manage cookies'. To learn more, read our cookie policy.