Building a Portfolio

jon3001

bendix wrote: »

In that case, you can be aggressive.

Decent allocations to smaller companies (both UK and international) are also worthwhile considering for the aggressive investor.

sva19

Thanks all yes using the Fidelity just to see asset allocation is best rather than its fund . Will research my own funds.

I also considered commodities, would buying into funds like Blackrock Gold be the right thing to do (Currently do)or would it actually have to be phyisical gold?

Property related funds - I heard than they can be a bit harder to sell? Or is it?
I consider putting a % of portfolio into a deposit for a buy to let property, say 15% would this be the same as putting 15% in property fund?

I not into Bonds and Gilts, I take it income funds will have some invested in this.

I'm considering an asset allocation that looks like looks like
35% UK (Will include smaller comps)
15% Europe (Will include small comps)
25% Global Equity, Emerging markets (China, latin and India) & Specialist (Natural Resources and Tech)
10% Commodities (Gold funds, See above?)
15% Property (Funds or actual property, see above?)

I am leaving out America directly for now, but will get exposure to it through the Global Equity funds anyway, correct?

Final question.
If I have 2 pension on pru Global Equity and one HL SIPPS (own funds), should the pension be included in the portfolio or should it be separate as I cannot touch it till retirement?

dunstonh

should the pension be included in the portfolio or should it be separate as I cannot touch it till retirement?

You should segment the portfolio for the objectives. e.g. if one chunk is going to be spent in 10 years time and another in 30 years then the risk levels can be different.

am leaving out America directly for now, but will get exposure to it through the Global Equity funds anyway, correct?

Asia? Or are you planning to bundle that in with emerging markets and specialist sectors?

I not into Bonds and Gilts, I take it income funds will have some invested in this.

Dont rule out their benefit on bringing the risk down and how they can be useful for portfolio rebalancing.

I consider putting a % of portfolio into a deposit for a buy to let property, say 15% would this be the same as putting 15% in property fund?

Commercial property works differently to residential property. Personally, i would keep any real property apart from an investment portfolio. Buy To lets are more of a commercial business and should be run as such.

I also considered commodities, would buying into funds like Blackrock Gold be the right thing to do (Currently do)or would it actually have to be phyisical gold?

Up to you. Personally, I would go with funds as its more liquid and allows greater choice. Digger would no doubt promote gold if he saw this thread

You clearly are aiming to be quite high risk with your portfolio with that allocation. Even on my risk 10 portfolios the specialist sector is 14% and Emerging Markets sector 9%. A total of 23%. You are going to 35%.

You are going to be on one big rollercoaster ride at times.

Linton

sva19 wrote: »

Thanks all yes using the Fidelity just to see asset allocation is best rather than its fund . Will research my own funds.

I also considered commodities, would buying into funds like Blackrock Gold be the right thing to do (Currently do)or would it actually have to be phyisical gold?

Funds or ETFs can do the same job with less hassle unless you are holding gold for when the End of the World comes and you have to take your family and rifle into the hills.

Property related funds - I heard than they can be a bit harder to sell? Or is it?
I consider putting a % of portfolio into a deposit for a buy to let property, say 15% would this be the same as putting 15% in property fund?

Any fund should usually be easy to buy and sell - your transaction is with the manager, not a matching seller/buyer. Property funds normally invest in commercial property, which is not the same as residential. Holding a property fund is a lot less hassle than a BTL!

I not into Bonds and Gilts, I take it income funds will have some invested in this.
Some do, and some dont - see the details in https://www.trustnet.com and morningstar. You can also get funds that specialise in bonds and/or gilts.

I'm considering an asset allocation that looks like looks like
35% UK (Will include smaller comps)
15% Europe (Will include small comps)
25% Global Equity, Emerging markets (China, latin and India) & Specialist (Natural Resources and Tech)
10% Commodities (Gold funds, See above?)
15% Property (Funds or actual property, see above?)

IMHO looks reasonable overall. The important thing is that you decide an allocation to achieve your objectives and then buy funds to meet the allocation, rather than buy funds on a whim. You can always modify the allocation later if it is failing to meet your aims.

I am leaving out America directly for now, but will get exposure to it through the Global Equity funds anyway, correct?

Should do - trustnet or morningstar will give the geographic spread for funds.

Final question.
If I have 2 pension on pru Global Equity and one HL SIPPS (own funds), should the pension be included in the portfolio or should it be separate as I cannot touch it till retirement?

I strongly believe that one portfolio should only have one job to do. It makes it much easier to manage the overall asset allocation between objectives and to buy the appropriate investments for each separate portfolio.

whiteflag_3

bendix wrote: »

In that case, you can be aggressive.

It's your call of course, but if I were in your shoes I would be having a balance of around 20% bonds and gilts, 10% property related funds and 70% shares.

nothing in life settlements then?

http://www.eeafm.com/life_settlements_home.asp - i know gartmore use this fund to diversify their portfolios.

whiteflag_3

dunstonh wrote: »

Dont rule out their benefit on bringing the risk down and how they can be useful for portfolio rebalancing.

Any chance you can clarify this statement ? If your rebalancing wouldnt you already have been holding bonds and gilts in the first place? Did you mean rebalancing or portfolio diversification?

sva19

Thanks for the responses.

Is there a website where when I set up my portfolio and add the funds , it will work out which sectors the funds is invested in? I have fidelity but its xray only has 3 catergoies see below.

I would also like more info on using bond and gilts in portfolio, how do they work, there growth always tend to be in single figures per year?

I plan to have 2 portfolios. 1) For children which will run for another 15 years to pay for university and weddings.

2) My own portfolio for 20 yrs which is toward my retirement.

The attachment is Portfolio 1 at present with Fidelity:- (cannot attach image so writing out)

Greater europe (inc uk, emerg euro and africa) = 28.48%
America (US, canada and latin) = 35.66%
Greater Asia (emerging asia , aus, japan = 35.86%

sabretoothtigger

Heres what the Fidelty thing said, its not far off what I have except I dont have bonds


Fidelity reference property as a held fund I think, it would be something different to include personal housing because its not a liquid situation normally


Cash and house are buffer zones and including them on a portfolio would raise risk and threaten liquidity also maybe.

Multi millionaire or professional portfolios would almost certainly include them but that would be set against a limited company loss not an absolute personal finance risk


Personally I dont hold bonds because I think currency risk is above par right now. So I'd rather have a fixed borrowing and/or more property.
Thats a bit contradictory but the investments should aim to pay the bills on the property and borrowings, assume a loss. Cash/bonds would lose even more on average from this point on I think

Write investments as assets and the others you have to keep as liabilities, cash you must keep for bills is a liability and/or depreciation writeoff

lemon26

sva19 wrote: »

Is there a website where when I set up my portfolio and add the funds , it will work out which sectors the funds is invested in? I have fidelity but its xray only has 3 catergoies see below.

I have joined www.morningstar.co.uk and if you go to the portfolio tab you can input the details of your portfolio (I found 'watchlist' easier) then save and select x-ray. Hopefully that'll bring up all the detail you want!

bendix

Lokolo wrote: »

I would only put 10% in Bonds and Gilts ^^ ... but thats just me

Sure, but I suspect you're 20 years younger than me . . . so that's entirely appropriate.