We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
Changing ISA... current one losing money!
Options
Comments
-
I think maybe with knowing so little about everything we might be best to leave the money where it is. I do have another £1000 to invest though .... any ideas what might be best?
If this was the only investment you have then its eggs all in one basket. Single fund investing is poor quality investing. That is normal for tied agents at banks as they do not have the authorisation from their employer to portoflio build. They dont really have the skills either.
£7000 should have been at least 3 funds, ideally seven with £1000 in 7 different areas to give you decent diversification.
Leaving it alone is the easy option but it isnt the best option. You can get it transferred to a fund supermarket at no cost and get a better spread that is more suitable than you have currently.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Embarrassing moment..... Sorry guys I was wrong about us losing money, but thankyou so much for all of your help. OH had neglected to tell us that we had paid £250 for the man from Scottish Widows to buy our shares for us.... or something.
You paid an initial charge of around 3.5% to set it up.I really don't understand any of this but apparently we have a Momentum Income Portfolio Shareclass A accumulation.
It hasn't done that well with only 1.2% in the last year. See here;
http://www.trustnet.co.uk/ut/funds/chart.asp?unit=TSMIAA#calThe only way we check our balance is by looking at our online bank statement. I think maybe with knowing so little about everything we might be best to leave the money where it is. I do have another £1000 to invest though .... any ideas what might be best?
Leaving it where it is would not be the best option as dunstonh has already said. If you don't know what you are doing why not get some help from an IFA who can move your investment as dunstonh suggested?0 -
If this was the only investment you have then its eggs all in one basket. Single fund investing is poor quality investing. That is normal for tied agents at banks as they do not have the authorisation from their employer to portoflio build. They dont really have the skills either.
£7000 should have been at least 3 funds, ideally seven with £1000 in 7 different areas to give you decent diversification.
Leaving it alone is the easy option but it isnt the best option. You can get it transferred to a fund supermarket at no cost and get a better spread that is more suitable than you have currently.
But all seven areas ? (please explain!? which seven areas or which seven sectors there are many!) All are going down together at the moment in unison (as usual !) so what is the point of diversifiying ?Are U getting enough Vitamin D in your life!?0 -
erine, I suggest that you read Ok then - How do I choose a S&S ISA to get an idea of what a sector allocation is. There are also some suggestions there for how to get started while you learn your way around. Please do note that most of the lists of funds people in that discussion bought were high risk mixes with high long term growth potential but lots of ups and downs. You can use a different sector allocation if that's not for you.
There's nothing wrong with not understanding today. Just means an opportunity to learn something new.
The aim of the Momentum Income Fund is "The fund aims to provide a high level of income with some potential for growth by mainly investing in regulated collective investment schemes managed or operated within the Lloyds TSB Group. The Fund will primarily invest in fixed interest funds, with some exposure to equity funds". Translated, that means "not much chance for good long term growth but you're not likely to see it drop by 30% in one year then grow back over a few years either".
Unless you're planning to spend the money within a few years that's not really a good choice of investment. You can instead select a mixture that could drop by say 30% in a bad year but grow on average by 15% a year so that over five or more years you're likely to be significantly better off.
To see the difference, compare your fund with the INVESCO Perpetual Income Fund, one of the most popular funds of a type called UK Equity Income that's very popular with those who like medium risk. For each, select a time range of three years. See that the other one has lots of small and some fairly large ups and downs but is currently worth about 90% more than at the start. Yours has less ups and downs but is worth about 15% more instead of 90% more.
You can mix and match. Say you were to put half of the money in one like your current one and half in one like the other I've mentioned, you'd get middle sized ups and downs and middle growth rates.
What are your objectives and plans for this money?0 -
shokadelika wrote: »All are going down together at the moment in unison (as usual !) so what is the point of diversifiying ?
It's not usual for all of my 12 funds to be going up or down at the same time. Usually some are going up and some down. Different ones on different days. Sometimes UK or European funds are going down while US and emerging markets are going up. Some days the other way around. In the last month there were 6 days when all went down, 3 days when all went up and the rest were mixed. Greatest daily gain for the whole set was 1.99%, greatest daily loss was 3.55%. This is for a high volatility mixture.
Mine include some that have gained 60% in a year (with the potential to drop that much), others around 25% and a range in between. The averaging means that I don't see such extreme changes in value but do still get the growth potential of the areas that bounce around a lot.0 -
But all seven areas ? (please explain!? which seven areas or which seven sectors there are many!) All are going down together at the moment in unison (as usual !) so what is the point of diversifiying ?
The key sectors are:
UK
Europe
N America
Japan
Far East Exc Japan
Property
UK Fixed Interest
Global Fixed Interest
Global Specialist
Global Emerging Markets.
Within those you have sub sectors such as UK equity income, UK All companies, UK smaller companies etc. However, on 7k you have to ignore those to some degree and pick the 7 funds that average out to match risk profile.
Everything isnt going down. And those that went down have done so by different amounts. I invested some money on the 30th July after the initial drop and that is currently up, despite last week' falls. I will probably put some more in this week as there is some good value out there in my opinion.
Diversifying spreads your risk and gives you access to markets that offer greater returns at different times.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Our plan for the money is simply to put it away and leave it there for 10 yrs or so.... hopefully getting the best growth that we can from it.
Won't a financial advisor charge lots? How would I get to see one?
Thankyou for your ideas. Spreading investments sounds sensible rather than eggs in one basket. Scottish widows did offer medium risk investments.... OH chose low risk tho. To my mind is we're taking any risk t all it might as well be one with the potential to benefit significantly rather than this piddling 1% stuff.
I shall read the links so kindly provided:D0 -
Won't a financial advisor charge lots?
For IFAs, the average commission is 1.8% of the contribution. Average means some more, some less but that is your target figure if you do seek advice. Thats cheaper than the LloydsTSB tied rep.How would I get to see one?
www.unbiased.co.uk is the UK database of IFAs. You can postcode search (but dont filter by qualification as that is highly flawed due to different qualifications over the years at the same level. It eliminates equally or higher qualified individuals who have a different version).
The term IFA covers a multitude of skills or specialisations. So make sure an adviser you speak to is investment specialist. No point seeing a mortgage IFA or a corporate IFA. Single fund investing is a good way to spot the lower skilled or lazy advisers (with the exceptions of using fund of funds on small amounts).I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Have just been looking at the contract of purchase and we actually bought £6755 worth of shares initially and were charged the rest of the £7000. I really don't understand any of this but apparently we have a Momentum Income Portfolio Shareclass A accumulation. The only way we check our balance is by looking at our online bank statement. I think maybe with knowing so little about everything we might be best to leave the money where it is. I do have another £1000 to invest though .... any ideas what might be best?
Sounds like exactly the same situation as my Mum - she got caught by Lloyds when she inherited money after my Dad passed away. Not knowing any better bless her, she trusted the Lloyds 'adviser' (use that term loosely) to invest a considerable amount into various Scottish Widows funds.
Two years later and the value of the investment has dropped by around 2% and that's not including the 3.5% paid in initial charges. Feels like she was mugged to be honest.
To be fair the Lloyds adviser was very professional and wrote up a decent financial review for her suggesting she take a cautious approach to investing. Unfortunately the only suitable funds available for a cautious approach that he could recommend were of course with Scottish Widows and none of them were ever going to provide the returns she could have got even if she'd just put the money in a decent savings account.
This is not only in hindsight but given the fact that at the time she invested, the funds had only been around for a year or so - if that - and so they had no 'track record' or performance history to look at, nor any info on how the manager had handled the fund/added any value to it etc. Pretty gut wrenching only to find this out two years down the line. Like someone mentioned above, it's as though the money was just thrown into something that sounded suitable on paper and has been left there to dwindle away since.
Like you, my Mum invested in the Scottish Widows Momentum Portfolios Shareclass A fund - she also has money in Scottish Widows Managed Income Portfolio and the Cautious Solution fund.
Have to say you're probably quite lucky - out of the 3 funds the momentum has done roughly the best - funnily enough today my ma's investment in momentum is at exactly the same price as it was when she bought it!
End of day - stay well clear of Scottish Widows for funds. Since taking the reigns so to speak I've done a considerable amount of research and found that even the very best performing funds from SW are only just slightly above average performers over 1/3/5yrs - unfortunately for us they're mostly very high risk funds or at least not suitable for my Mum's risk profile anyway.
Also the initial charges and switching fees are extortionate in as much as you pay full whack and don't get any discounts like you do with sites/providers like http://bestinvest.co.uk/ or http://h-l.co.uk/ (still looking around myself, got cavendish and mmm chartwell to look at next, yay, fun(?)!)
I would say if you don't feel like sorting through/screening performance histories for hundreds of funds yourself or thinking about diversification etc then go for some independent financial advice. Some of the guys above (who are eminently more qualified than me!) are probably best to listen to as to where to go for that advice (like http://unbiased.co.uk or the http://fsa.gov.uk sites).
Oh one other thing was that you can check your funds balance on the Scottish Widows site here (you have to register at that url first) - although it's the naffest financial site I've ever seen to be honest. You only get to see the current price of your investments and that's your lot - no historical info about fund performance or anything else, much better to use http://digitallook.com//, http://morningstar.com/ or http://trustnet.com/.
You're best off taking your money out and legging it to an IFA IMHO :P
Good luck anyway!0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 351K Banking & Borrowing
- 253.1K Reduce Debt & Boost Income
- 453.6K Spending & Discounts
- 244K Work, Benefits & Business
- 598.9K Mortgages, Homes & Bills
- 176.9K Life & Family
- 257.3K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards