What Investment ISA?

dave1983_2

Hi Ed, I wouldn't know where to start with investments etc so I thought it more prudent to go to a recommended IFA and seek his help - so far I am happy with the service received. He's also doing a pension for my girlfriend so that helps keep costs down.

Lokolo, he is offering an annual review of my investments but I also have the ability to manage them online and move them as I see fit to do so - through Fidelity Funds Network. Why do you ask? How risky are the two £25 per month funds? What would thoughts be if I was to leave them for 10 years - would that change the risk?

Lokolo

Ok with funds each sector has its own risk, some more risky than others.

Generally it goes:

Gilts -> Bonds -> Equities -> Foreign Equities

So you have one in Bonds, one in 2 in equities and one in foregin equities. The ones you are putting £25 a month into are higher risk than the others.

If you are leaving them in for 10 years, and you are happy with risks, then what you are doing it quite good, maybe putting more into some UK equities I suspect next year though.

However with the annual review what the IFA should do is rebalance your portfolio. So if it ends that your India fund goes up 200000%, and the others not so much, your portfolio would then end up with a lot of the money in the India fund. So the IFA would then sell some units in the India fund and buy in another area, making things more equal.

You may also find at the annual review he swaps your £25 a month funds, to spread risk a bit more.

To be fair I don't think the selection is poor (and this isn't advice), personally I agree a bit with fg22 and I would have preferred and Emerging Markets fund rather than India as at least an emerging markets fund would give you more exposure to other markets rather than just India.

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However, you did say you have control and can swap if you like so you can always go for it for 6 months, see how things are, then if you are not happy, then change things around a bit.

dave1983_2

Thnaks once again for your time Lokolo! I am happy with the risks for the time being as I don't stand to lose a huge amount, after all, 100% of £25 is only £25. What you say about re-balancing is totally correct and was discussed that if the India fund goes brilliantly I can shave the profit and move it to safer funds.

My portfolio will hopefully grow over time and will be rebalanced at the annual reviews so hopefully things should go alright! I am now thinking of adding a further two £25 p/m investments, one into the Jupiter Financial Opportunities and the other into a collective emerging nations fund.

Thanks once again and have a good weekend!