Funds...why bother

campins

Hail the new tag...latiboys :rotfl: :rotfl: :rotfl:

campins

And some more againnnnnnn........Latiboys you really have got something to answer for :eek: :eek: :mad: :mad:

rl290

Well, it really depends upon which funds you invest in, and whether you review their performance (both against peers and in absolute terms) regularly. While I have invested for the long term, since the credit crunch hit I have swapped my funds many times to reflect the changing investor sentiment - the result is that I now hold four funds, up c.60%, c.12%, c.5% and c.3% respectively over the period that I have held them.

Basically, I pick the sectors I think will do well (following advice from many places) and then spend a few hours looking at all the available funds in these sectors and select the ones that appear to be the best to me (long-term management, who have produced top-of-sector results in the past, etc...). The result has been a result far better than what I would have achieved by picking my own shares...

campins

So really, you are your own fund manager. Why are you paying management charges then

campins

rl290 wrote: »

Well, it really depends upon which funds you invest in, and whether you review their performance (both against peers and in absolute terms) regularly. While I have invested for the long term, since the credit crunch hit I have swapped my funds many times to reflect the changing investor sentiment - the result is that I now hold four funds, up c.60%, c.12%, c.5% and c.3% respectively over the period that I have held them.

Basically, I pick the sectors I think will do well (following advice from many places) and then spend a few hours looking at all the available funds in these sectors and select the ones that appear to be the best to me (long-term management, who have produced top-of-sector results in the past, etc...). The result has been a result far better than what I would have achieved by picking my own shares...

After four months of trading the fund is up 34%

rl290

campins wrote: »

So really, you are your own fund manager. Why are you paying management charges then

On the contrary, my point is that I have picked the sectors and industries that I like. However, I am wise enough to know that there are much better stock pickers out there than me... so I am happy to pay them 1% or so for their services. In today's environment, I am only invested in two types of funds:

a) Those that can also short stocks/indices
b) Those that are allowed multiple asset holdings - equities, bonds, cash, gold bullion

Given that my fund investments are equally spread between the UK, European, US and Japanese market, I think you'd agree that there is no way I could run a portfolio as well as the experts...

R

a7man

This is an endless rant by someone who clearly doesnt understand funds properly. You expect someone to do all the work for you and you dont want to do it all yourself. If you want your portfolio looked at on a frequent basis pay an IFA a monthly fee.

Because your fund over the last 10 years hasnt performed well you are blaming everyone but yourself...surely you should have noticed it was performing badly before 10 years had passed and switched funds?

campins wrote: »

So really, you are your own fund manager. Why are you paying management charges then

The fund manager manages the underlying asset portfolio in the fund, this is what the fund manager is for. Unless you are a v experienced investor or someone who works in the industry you will not have the ability to research the market like fund managers who do it for a living. They spot opportunities and make investments based on the funds objectives.

Its yours or your IFAs responsibility to choose a good fund and sector, and change funds if performance is not as expected.

brasso

One problem is that most fund managers -- particularly those linked to pensions and endowments are excessively cautious. They have to be, otherwise their investors would give them hell if things went wrong.

If we want more risk, there is every chance we will see gains, sometimes spectacular gains. I made very decent profits when the BRIC funds were turning in 30%+ annual increases. Of course, I went round telling everyone how astute I was -- a bit like the OP is doing on this thread. I started to believe my own BS, and eventually got things wrong by deciding to move most of my gains into safer blue chip stocks like, erm banks and property. I got out after taking quite a hit, with my total pot about 80% of what I started out with. It's at this point that I think, hmm, perhaps I should have given it to a fund manager and banked a steady 5 or 7% a year.

Risk-takers love to crow about their gains, but go strangely quiet when they slip up -- as they always do.

I still like risk (I've just bought some RBS), but there's a lot to be said for a conservative approach.

campins

Well the point of the fund was to pay off my mortgage after 25 years. There were simply financial goals set out and no mention of where the money was invested. so moving to another fund wasn,t an obvious option, still, latiboys should have spotted the shortfall And offered alternative options to correct the shortfall. Remember I am to all intent and purposes a man in the street and not a financial expert so the expectation that I will interviene and take corrective measures is a bad joke at best.

dunstonh

One problem is that most fund managers -- particularly those linked to pensions and endowments are excessively cautious. They have to be, otherwise their investors would give them hell if things went wrong.

Just going to tweak that statement if I can....

Pensions are just a tax wrapper. They can invest in identical funds to ISAs and unit trusts. What you are actually saying (and you are right) is that where internal insurance company funds are used, you tend to find that the cautious funds are actually often very good but the equity funds are often rubbish.

You often find that quality portfolios have the insurance companies funds in the property and fixed interest sectors but external funds for the equities.