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Hi Reader, here's what you need to know for January 24th in 3:07 minutes.

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Today's big stories

Activist investor Elliott Management built up a beefy stake in Salesforce
Here’s how to pick the winning high-dividend stocks – Read Now
Citadel set a new profit record for hedge funds last year

Activists, Activate

What’s Going On Here?

Reports out on Monday show activist investor Elliott Management has got its teeth into Salesforce.

What Does This Mean?

Poor old Salesforce has hit a slump. Sure, the firm’s not quite moping around in its PJs all day and eating Ben and Jerry's from the tub, but it has let itself go: growth’s gone all slack, and the company’s market value has fallen to about half its 2021 peak. And now the down-on-its-luck firm’s caught the eye of activist investors – that’s plucky financiers who buy chunks of companies to dust them off, spruce up operations, and ultimately boost share prices. Big-name Elliott Management has reportedly grabbed a multi-billion-dollar slice of the Salesforce pie, following in the footsteps of fellow activist Starboard Value, which claimed a stake in October. That’s going to pile a whole lot of pressure on Salesforce’s management team, an idea investors seemed to like: they sent the firm’s shares up when news broke.

Why Should I Care?

The bigger picture: Activism’s on trend.
Elliott’s stake in Salesforce is part of a new wave of activist investing that’s sweeping hard-hit global markets. Case in point: by Bloomberg’s count, a massive 177 activist campaigns were announced last quarter – the most since 2018. And we’re not just talking about small fry: along with Salesforce, other giants like Disney and Bayer have been targeted in recent months too.

Zooming out: Unwanted attention.
Being courted by an activist investor is no bed of roses. After all, any activist’s main goal is to boost shareholder returns – and that doesn't always mean improving the company’s fate in the long run. In fact, research shows that a company’s value tends to spike the year after it’s targeted, only to drop off compared to its “untargeted” peers over time. And that’s not to mention the fact that activists tend to nix companies’ long-term investments and efforts at corporate responsibility…

You might also like: How you can work out what Salesforce is really worth.

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Analyst Take

How To Find Inflation-Busting Dividend Stocks

By Theodora Lee Joseph, Analyst

High-dividend stocks might not sound as thrilling as crypto, but these assets have a quiet excitement of their own.

And now that the gap between the S&P 500’s dividend yield and the US 10-year Treasury yield is the widest it’s been in two decades, stocks that can beat that yield have been drawing a lot of attention.

So, that’s today’s Insight: how to hunt for inflation-busting stocks – plus, a look at the ones I found.

Read or listen to the Insight here

All of the opportunity, less of the hassle

Picking out single stocks can be rewarding, sure, but it’s a lot of work.

That’s why a lot of investors opt for exchange-traded funds (ETFs): you can pick up a basket of shares, themed on a specific sector or investing theme, and cut out the stock-picking legwork.

You can get it all with ETFs: diversification, flexibility, and risk management. And with IG’s ETF screener, you can pick out the most inflation-resistant bundles too.

The ETFs in IG’s list have something in common: they’re popular ones that aren’t actively managed, meaning you can pick them up without paying mammoth fees.

Discover how simple stock-picking can be with IG’s ETF screener.

Find Out More

Your capital is at risk. The value of shares, ETFs, and ETCs can fall as well as rise, which could mean getting back less than you originally put in.