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Losing thousands £££ Fast! Where to invest?

suzieemm
Posts: 45 Forumite
Hi all,
Does anyone know or can help a distraught investor where even my personal IFA seems unsure of what to do now I think?!!!
Back in 2007 I was advised to invest the 200K lump sum made from a property sale into a unit linked fund (can I say Axa) "Be Life Confident" (their heading) - I think not! I know we are in a recession but since 2007 I have never seen the investment rise in price and I am losing thousands and thousands each month and in one week the fund lost £2,200.19! What is the fund invested in - all types of Property - (say no more)! I have now lost over £70,000.00 in all - almost half of my investment!
We keep being told to hold fast, sit tight and the valuation will rise and it is only a 'paper' loss. As far as I can see the valuation says it now stands at £116,000.00 or so, and as I see it, I have 'lost' that money! They say I haven't 'lost' that money until I withdraw my investment but if we get another year of recession my money will be standing at zero and I have lost the lot! I am in my retirement and do not have many years to make up the downfall but if I move the money now I have definitely lost £70,000.00. After a long period of denial I contacted my IFA who now is telling me to invest in the stockmarket as it is low (having originally told me in November last year to "sit tight" and the fund will go up). As things have got progressively worse I think he now knows that we should have moved the money out when I was at a £30,000.00 loss only. If I now do that the money is gone, I do not have the time to wait to see the investment increase but hopefully need to jump in somewhere which will show some sort of increase - if only small, rather than losing my total investment.
Please could some kind sole advise some solution which might be preferential to losing these vast amounts of money each week and cut my losses - a whole £70,000.00 of them, or not do anything because of this immense loss if I withdraw. My IFA advises that he thinks property will move up slower than will the stockmarket.
The more advice from knowledgeable people I can get will be very appreciated!
Does anyone know or can help a distraught investor where even my personal IFA seems unsure of what to do now I think?!!!
Back in 2007 I was advised to invest the 200K lump sum made from a property sale into a unit linked fund (can I say Axa) "Be Life Confident" (their heading) - I think not! I know we are in a recession but since 2007 I have never seen the investment rise in price and I am losing thousands and thousands each month and in one week the fund lost £2,200.19! What is the fund invested in - all types of Property - (say no more)! I have now lost over £70,000.00 in all - almost half of my investment!
We keep being told to hold fast, sit tight and the valuation will rise and it is only a 'paper' loss. As far as I can see the valuation says it now stands at £116,000.00 or so, and as I see it, I have 'lost' that money! They say I haven't 'lost' that money until I withdraw my investment but if we get another year of recession my money will be standing at zero and I have lost the lot! I am in my retirement and do not have many years to make up the downfall but if I move the money now I have definitely lost £70,000.00. After a long period of denial I contacted my IFA who now is telling me to invest in the stockmarket as it is low (having originally told me in November last year to "sit tight" and the fund will go up). As things have got progressively worse I think he now knows that we should have moved the money out when I was at a £30,000.00 loss only. If I now do that the money is gone, I do not have the time to wait to see the investment increase but hopefully need to jump in somewhere which will show some sort of increase - if only small, rather than losing my total investment.
Please could some kind sole advise some solution which might be preferential to losing these vast amounts of money each week and cut my losses - a whole £70,000.00 of them, or not do anything because of this immense loss if I withdraw. My IFA advises that he thinks property will move up slower than will the stockmarket.
The more advice from knowledgeable people I can get will be very appreciated!
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Comments
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Most people expect the stock market to do better than property over the next few years but the stock market is hardly a sure bet. But there is quite a good chance of good stock market gains as we may be at the bottom now, property may keep tanking for a couple of years more. So personally I would get out of your property fund and find a relatively low risk equity fund. You need to be able to invest for abother 5 years minimum if need be.
I hope you have a separate decent cash buffer.0 -
keeping a eye on this thread what do the clever people who know lots more than i do think of the IFAs choice to start with in 2007.
200k just one fund comments please:cool: hard as nails on the internet . wimp in the real world :cool:0 -
I'm not particularly knowledgable in the area of investment, and certainly not the property sector, however I will make some comments fwiw. No one imho should have advised you to put £200k into one fund, and certainly not one that focused on a single sector of investment, nevermind the fact that it was a highly overbought sector in 2007, so there may be some recourse there, but that's by the by.
My experience of IFA's in general is like everything else in general, you get good ones and bad ones, I'd be inclined to suggest you try and find a good one and seek some professional advice for this situation. I have no idea when the property market will recover, whatever sort of property it is.
As for the stockmarket that has imho some more work to do on the downside, possibly as much as 30% from current levels. I really would suggest you look for professional advice as to how best to extracate yourself from this situation.Hope for the best.....Plan for the worst!
"Never in the history of the world has there been a situation so bad that the government can't make it worse." Unknown0 -
My lump sum capital is spread far and wide across a number of funds, equities, fixed rate deposits etc etc a well balance portfolio. Have I read this right that the whole lot was put into one fund alone?Liquidity is when you look at your investment portfolio and **** your pants0
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Same thoughts as above - I cannot believe you were advised to place £200k into 1 fund!! You could have a case of mis selling - especially as he also put you into 100% unit linked so close to retirement.
If I were you I would now diversify but keep an element of property. The stockmarket is v low so I would have some money in there if you dont need it. He is right about the paper loss, but this is just a cop out - whether the fund will grow back to its original levels & how long should be the key thoughts.
You obviously chose a bad IFA and it might be worth seeing a fee paying chartered IFA who will have a lot more knowledge and respect in the industry.Living the good life spending all my money but loving it!!0 -
What was the purpose of this lump sum? E.g.: was it to provide a retirement income and has that income remained solid despite the fall in capital value?
As others have said - a significant lump sum should have been spread over a variety of asset classes and funds. I'm probably targetting a couple of dozen different sectors.
A complementary way to mitigate downside risk is to phase investment into risky assets rather than invest in one go. E.g. over a period of 12-24 months.
This is basic stuff I've read on websites and in books. I would hope a paid professional to know at least this much.
I wouldn't 'sit tight'. You need a better portfolio.0 -
I wonder if your IFA seemed unsure when he recommended this investment.
I am sure the regular IFA's on here will have an opinion.
70K is a large chunk to lose.0 -
I read it as the proceeds from a property sale being put into an Axa fund - possibly a managed fund, rather than it being in one sector. I've had Axa (and other) funds in the past which invested across a wide range of sectors and countries.
Not qualified to judge the advice, just adding thoughts.0 -
Well to give some perspective £70k down of £200k is about 35% drawdown. If you had invested in the S&P500 in 2007, depending on which month it's highs were around 1550 and it currently stands at 774 which is approximately a 50% drawdown, and that's after a 15% bounce this last week, so there is something to be said for the fact that it was a very bad time to begin investing.
Now it is still bad advice assuming we understand the story correctly to be invested in one fund investing in one asset class, and whilst the S&P500 a lot more diversification than you appear to have had it is by no means representative of a fully diversified portfolio, however I think it should serve to illustrate that 35% is not the worst loss you could be holding, and that without a hedging strategy this particular downturn would have been hard to hide from.Hope for the best.....Plan for the worst!
"Never in the history of the world has there been a situation so bad that the government can't make it worse." Unknown0 -
Thanks wombat42
Not sure what you mean by a 'cash buffer'.
I am a bit loath to go into the stock market now as I do believe it was at around 3500 or so a few weeks ago but it has gone up since so would hope it might drop to that again but who knows. The longer I wait though with my Axa property funds the more I am losing daily, and into the thousands per week so I need to do something fast.
Do you have any ideas on a good low risk equity fund? My IFA mentioned going into Fidelity - do you think that is good? I don't need the money at the moment and want to see it rising and rising but don't want to see it all go down the drain either as it is now but to hold on to it and at 63 I don't have lots of years to make up the loss and would like to enjoy some of it before I 'pop off'.0
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