However, by 'running for the hills' I am breaching my normal 'sell' rule which is intended to encourage me not to 'grab profits' - but wait until capital gains exceed five times the current income. But I think the situation is sufficiently abnormal to exercise some discretion here.
OK, we are being assured that any increase in the UK bank base rate will be slow and gradual - but the direction of travel is now clear: returns on cash will increase, thereby reducing the attractiveness of the returns from investments with fixed yields. One indicator is the Ratesetter (my favourite peer-to-peer lender) current rate for people willing to lend over 5 years: it has moved up to 6.2%. Not bad for almost risk-free lending.
My latest sale from the DIY Income Investor portfolio is Aviva's 8 3/4% Cumulative Irredeemable Preference Share (AV.A). I bought this in 2012 (just over two years ago) at 114p and it has built up a juicy 22% capital gain. It's been a nice little earner but - as I said in the introduction - I am just not sure that the price will remain so buoyant. (I sold my ordinary shares in Aviva earlier this year - only just recovering what I paid for them.)
I don't think anyone really knows what to do for the best in the current market - and I am faced with an increasing cash pile to reinvest. I'm actually looking forward to the time when the peer-to-peer lenders like Ratesetter will be eligible for ISAs and SIPPs, so that I can park some cash with them. But this may still be some time away, given how slowly the wheels of government regulation turn.
[Sale price £1.4025]
I am not a financial adviser and the information provided does not constitute financial advice. You should always do your own research on top of what you learn here to ensure that it's right for your specific circumstances.