Question about Investments .

montycat_2

Not sure what I am trying to say but ,here goes .
How do I understand how well my investment is doing ?
Probably sounds daft but ,I don't understand the graphs .
I am particularly referring to this .
http://www.trustnet.com/life/funds/chart.asp?unit=NUGUA

What does the red line indicate please?
What does Unit and Sector refer to ?
Thankyou in advance .

Rickycowslip

hi Montycat. Must admit I like the graphs on Trustnet as they like to 'benchmark' investment, ie. show how an investment is doing relative to what it should be doing.

On the chart you refer to, I assume you have money in the Nationwide fund. This is the blue one, and the chart is saying that since launch (which appears to be sometime last year) it has grown in value by 3.5%.

now as Eddie Izzard would say "is that good ?" (see fruit in supermarket sketch). Well compared to a normal savings account its probably about average, but if the stock market had risen say 20% in the same period then its not so good.

The Red line is therefore the benchmark - Trustnet's choice of the most similar generic investment to the Nationwide one which would allow you to judge how well yours is doing. And its suggesting your investment's not doing as well as it could, but not by a lot so no need to worry. Looks like your investment is slightly less risky than the average 'cautious' fund, hence it will not grow as fast when things are good, but equally shouldn't fall so far when things are not

hope this helps...

Rickycowslip

sorry forgot the Unit and Sector bit. The Unit is your investment (ie the blue line) the Sector is the benchmark (ie the red line)

montycat_2

Thanks.My fund is with the Norwich Union .I only opened it in November .Is this a useful tool to keep track of it then ?

Rickycowslip

dunno where I got Nationwide from !
Yes I've been using Trustnet for years to keep track of funds. However, I tend to keep my low risk market based funds in a tracker like M&G as they tend to have the lowest management charges (0.3%)

jonesMUFCforever

montycat wrote:

Thanks.My fund is with the Norwich Union .I only opened it in November .Is this a useful tool to keep track of it then ?

Whilst it is always a good idea to keep track of any investments - stocks and shares should be viewed as a long term investments ie 5 years and beyond.If you are going to be worried about any blip on the stock exchange then it may not be the best thing for you.

montycat_2

I am not at all worried about it ,I just like to be nosy .lol.Thanks for the advice .
My advisor explained that all to me when I went to him .

dunstonh

It should be noted that the benchmarks are not a good guide in themselves to how your fund is doing. You could have more downside protection than the sector average and that would tend to hamper growth more than a riskier version in the same sector.

Also the fund in question is a life fund. Trustnet are the best free source of info on life funds. Morningstar are much better on unit trusts and OEICs.