Cash In ISA & transfer to a high interest account?

jfhicks130

I have a maxi ISA "invested" with St James Place since March 07, the value has dropped to £5500. Whats the best thing to do, am considering cashing it in and placing it into a high interest account

turbobob

Its one option but there are disadvantages with doing it. For one you crystallise (i.e. make real) your loss which is only on paper at this point. You also lose the tax free ISA status.

Other approaches you could consider would depend on where its invested now, your attitude to investment risk and how long you want to invest the money for. They could include doing nothing and hoping it recovers. This is maybe not the best option if its all invested in below par funds or if its in funds that are too risky for you. Or you could look at moving your investments into different funds. Investments are for the long term and shorter term volatility should be expected (and is pretty much guaranteed at the moment!). If its all in equities, the sort of drop you have seen over 17 months or so (assuming you invested £7000) is not unusual.

jfhicks130

Thanks for the contribution, the unit trust spread is as follows, Equity Income - 19.7%, UK High Income -13.3%, UK & General Progressive -24.9% & Worlwide Opportunities -27.8%. I guess a view could be to increase the holding in the better producing unit trusts ie UK High Income and reduce others

turbobob

Its all in equity then and pretty heavily weighted towards the UK stock market. There are other asset classes that can help you to reduce the overall risks by diversifying. Things like fixed corporate bonds, gilts, property etc. Also geographic spread helps to diversify.

I was just having a look at their funds. The UK High Income fund seems to be a clone of the Invesco Perpetual High Income fund. This is one of the most popular funds out there and for good reason. The UK & General Progressive and Worldwide Opportunities funds don't seem great compared to peers in their sectors though.

If you are prepared to do your own research then an alternative might be to transfer the ISA to a fund supermarket like Hargreaves Lansdown. This would mean you can mix and match from thousands of funds instead of the handful available through SJP.

janken

turbobob wrote: »

If you are prepared to do your own research then an alternative might be to transfer the ISA to a fund supermarket like Hargreaves Lansdown. This would mean you can mix and match from thousands of funds instead of the handful available through SJP.

Have been in a supermarket fund for a couple of years and not doing great but the value is rising. To have any equity fund rising in the present environment is good so would again recommend this type of fund.