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Best funds for long-term growth
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Eponym
Posts: 303 Forumite
Hi everyone.
I've asked this question at on another thread but as a new user I can't post the link. It's called "Advice needed on fund supermarkets for S+S ISAs" and you can get to it from my profile if you want to read it. However, since I added it on to my earlier thread about fund supermarkets it's not getting too many replies and I thought it might be better to start a new thread with a more accurate title!
That thread summarises my questions and thinking so far, but in a nutshell, I'm 24, living at home and saving for a house deposit. On top of that I have put some money aside for long-term (probably till retirement) investments. This is money I don't intend to touch except in dire need and I can afford to lose it.
The money was split between Jupiter China and Fidelity UK Moneybuilder index fund. However, I have transferred my investments to Hargreaves Lansdown as cash with the intention of changing the funds (the China fund has performed very poorly and the Fidelity tracker is not the cheapest tracker HL do - though I am now probably not going to use a tracker at all at the moment).
I think I am going to split the money in half and put 50% into Aberdeen Emerging Markets (possibly First State Emerging Markets Leaders, but probably the Aberdeen).
I am unsure what to do with the other 50%. I could go for one of the HSBC index trackers but I thought given my age and investment horizon it might be better to go for something with a better chance of high returns. (I realise my portfolio will be risky and will add lower-risk funds as time goes on).
Here are a few options I have been considering (accumulation units where applicable):
I am only looking for 1 fund other than the Aberdeen as I have little to invest at the present time. I want long-term growth and don't mind volatility.
I know you can't offer advice but any thoughts on which of these funds might best fit my circumstances and/or other funds which I haven't considered would be very welcome!
Thanks in advance!
I've asked this question at on another thread but as a new user I can't post the link. It's called "Advice needed on fund supermarkets for S+S ISAs" and you can get to it from my profile if you want to read it. However, since I added it on to my earlier thread about fund supermarkets it's not getting too many replies and I thought it might be better to start a new thread with a more accurate title!
That thread summarises my questions and thinking so far, but in a nutshell, I'm 24, living at home and saving for a house deposit. On top of that I have put some money aside for long-term (probably till retirement) investments. This is money I don't intend to touch except in dire need and I can afford to lose it.
The money was split between Jupiter China and Fidelity UK Moneybuilder index fund. However, I have transferred my investments to Hargreaves Lansdown as cash with the intention of changing the funds (the China fund has performed very poorly and the Fidelity tracker is not the cheapest tracker HL do - though I am now probably not going to use a tracker at all at the moment).
I think I am going to split the money in half and put 50% into Aberdeen Emerging Markets (possibly First State Emerging Markets Leaders, but probably the Aberdeen).
I am unsure what to do with the other 50%. I could go for one of the HSBC index trackers but I thought given my age and investment horizon it might be better to go for something with a better chance of high returns. (I realise my portfolio will be risky and will add lower-risk funds as time goes on).
Here are a few options I have been considering (accumulation units where applicable):
- Invesco Perpetual Income/High Income - but this is significantly invested in tobacco and I'm not keen on that for ethical reasons
- M&G Global Basics - seems like a good long-term bet, but probably some overlap with the Aberdeen?
- M&G Global Dividend - might be better long-term than the basics fund, with the dividend payouts adding to the holding?
- Newton Real Return - would be a great core holding with a wide variety of asset classes but it seems that HL don't do accumulation units for this fund
- Fidelity Special Situations - has crashed a bit lately and generally underperformed for the last year or so, which mught make it a good time to buy, but it is very heavily in the UK (about 90%)
- JPM Natural Resources - has also dropped a lot lately so may be a good time to buy that too
I am only looking for 1 fund other than the Aberdeen as I have little to invest at the present time. I want long-term growth and don't mind volatility.
I know you can't offer advice but any thoughts on which of these funds might best fit my circumstances and/or other funds which I haven't considered would be very welcome!
Thanks in advance!
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Comments
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Your selection is in some pretty strong funds, but I question why you want to invest in income with Invesco, when you are trying to build a growth fun. Perhaps Income is for later in life. Just worth considering.
Also JPM Natrual Resources is very voliatale, so if your happy with that then I think it's all good,0 -
Your selection is in some pretty strong funds, but I question why you want to invest in income with Invesco, when you are trying to build a growth fun. Perhaps Income is for later in life. Just worth considering.
Also JPM Natrual Resources is very voliatale, so if your happy with that then I think it's all good,
Thanks Sorcerer. I know it's an income fund but I would have gone for the accumulation units, using the dividend payouts to buy extra units automatically.0 -
Thanks Sorcerer. I know it's an income fund but I would have gone for the accumulation units, using the dividend payouts to buy extra units automatically.
Sure, you have the acc units but it is not a growth fund at all in its fundamental investment remit. That is what we are trying to say
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Your selection is in some pretty strong funds, but I question why you want to invest in income with Invesco, when you are trying to build a growth fun. Perhaps Income is for later in life. Just worth considering.
QUOTE]
But as has been said you can have the units as accumulation . So if fund is a strong one generally couldnt you choose it and do this? Or is it a case of no income fund likely to be that brilliant when you really are only after long term growth? What about a five to ten year time frame, would it then be different? Or if you had substantially more money to invest than the original poster?
I have given appropriate thanks as am finding this thread and the posters original one very useful.
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Jegersmart wrote: »Sure, you have the acc units but it is not a growth fund at all in its fundamental investment remit. That is what we are trying to say
I am very much a newbie in all of this, so I'm not sure what you mean by 'fundamental investment remit'. Could you explain please? Thanks!
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M&G Global Basics - seems like a good long-term bet, but probably some overlap with the Aberdeen?
This is a long-term buy and hold for me.
I dislike "real return" and "absolute return" funds. I prefer simple funds that do one thing well rather than trying to be a "portfolio in one fund". One exception is that I hold Ruffer Total Return, but I'm drawn to their contrarian ways.Newton Real Return - would be a great core holding with a wide variety of asset classes but it seems that HL don't do accumulation units for this fund
I also hold Troy Trojan (and the Personal Assets IT equivalent) as capital preservation vehicles, but I'm maybe closer to retirement than you.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Dividends have been a great part of the total return over the years, so reinvesting those generated by an income-oriented fund is a valid strategy.
Newton Real Return has only an income option for its retail share class. It does have a wide investment remit - and without being a fund-of-funds vehicle.Living for tomorrow might mean that you survive the day after.
It is always different this time. The only thing that is the same is the outcome.
Portfolios are like personalities - one that is balanced is usually preferable.
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Ark_Welder wrote: »Dividends have been a great part of the total return over the years
For dividend income, I mostly use direct share holdings. With FTSE yields averaging about 4%, and with most high income funds having the same core holdings, do I really need to give them half the yield to buy Vodafone and Glaxo for me?
The argument for income oriented Investment Trusts is slightly better. Many do have more growth in their make up, they do retain some income to cover future lulls (which means I don't need a 2-3 year cash buffer), their fees are lower, and they can gear. (I regard the latter as a mixed blessing, but their track records suggest you're perhaps best trusting them more then me!)I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
gadgetmind wrote: »For dividend income, I mostly use direct share holdings.
The advantages of a fund or IT, though, are diversification, no switching costs, and no CGT issues (outside and ISA, and until the fund is sold). Oh! and for investing in a spread of foreign dividend-paying shares too!
The majority of my equities 'funds' are, in fact, investment trusts - been my preference for a good few years too.Living for tomorrow might mean that you survive the day after.
It is always different this time. The only thing that is the same is the outcome.
Portfolios are like personalities - one that is balanced is usually preferable.
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Ark_Welder wrote: »The advantages of a fund or IT, though, are diversification, no switching costs, and no CGT issues (outside and ISA, and until the fund is sold). Oh! and for investing in a spread of foreign dividend-paying shares too!
Yes, CGT is a perennial and painful dance for us, but ISA limits are ISA limits, so you do what you can. And I do agree regards using funds to access specialist areas, smaller companies, and certain overseas markets, which is why I hold a few.The majority of my equities 'funds' are, in fact, investment trusts - been my preference for a good few years too.
I'm tending towards holding funds in HL S&S ISAs but having the bulk of our non-pension holdings in direct equities and ITs. Initially we'll be going for growth ITs, but my projections show that in 8-10 year's time, we'll be using "Bed and ISA" to move there to more income oriented ones in ISAs.
The point at which we won't be using our full ISA allowance is currently projected to be post death, however, black swans abound.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0
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