Any thoughts on my portfolio?

dunstonh

The "problem" with strategic asset funds is that the asset content can vary widely. So, the manager can swing the holdings right through the risk profiles at different times based on their opinions (subject to fund constraints, if any). They are usually not for the cautious person.

The fund in itself is an investment strategy all-in-one but its one based on opinion rather than structure.

Rollinghome

Ian_W wrote: »

There is no hard and fast rule that I'm aware of that says you should hold equity and bond funds separately - QuietDragon takes that view, I take a different view, neither is right or wrong - just diffent opinions, probably cos of different goals so you have to decide for yourself. If your aim is still to provide downside protection, what's changed?

I'm a litle puzzled too at why anyone would say "This is a fund type I wouldn't touch - one that mingles equities with bonds". It would rule out most cautious/balanced managed funds and a lot more besides. Would be interested in the reasoning for that.

Within an ISA you may have the disadvantage of not being able to reclaim the tax on the bond interest element though presumably that can also work the other way with a fund like Perpetual Monthly Income Plus.

I'm also wary of that type of fund but the Artemis offering at least has the advantage of being without the greedy performance bonus of most Ab Return funds going for it. (Against it is that it was heavily pushed by H-L. :rolleyes:) Ultimately it's a blind act of faith in the manager but that goes for a lot of funds whatever they call themselves.

QuietDragon

Rollinghome wrote: »

I'm a litle puzzled too at why anyone would say "This is a fund type I wouldn't touch - one that mingles equities with bonds". It would rule out most cautious/balanced managed funds and a lot more besides. Would be interested in the reasoning for that.

I want a tool to do something well, and in general I think that tools specifically designed to do one thing well do that one thing better than a more general tool ever can.

Take, for example, the knife block in my kitchen. It has quite a few knives in it:

Peeling knife
Vegetable knife
Small chopping knife
Medium chopping knife
Small cleaver
Large cleaver
Boning knife
Tomato knife
Scalloped knife (bread knife)
Carving knife

First thing to say is that all of the tools in this collection are knives - they all have a general purpose of cutting things - but they all have a specific purpose for which they are designed. The knife's designers make no claims that a peeling knife is an appropriate tool for (say) slicing a melon in half, or that a large cleaver is an appropriate tool for delicately slicing a tomato.

There are two circumstances when, using this analogy, you wouldn't buy a set of kitchen knives:

1: if you could only afford to buy one knife for your kitchen;

2: if you either couldn't be bothered to learn about the knifes and their uses (ie, you weren't prepared to spend your time on such an endeavour) or you could not appreciate the need for different knives for different purposes.

In both of these cases, you would go to the cookware store and buy the first general purpose knife you could find - probably a 9-inch chef's utility knife. It would serve you reasonably well, cutting firm fruits and vegetables easily, meat fairly well, and many other comestibles passibly.

"Cautious/balanced managed funds" are probably the a chef's utility knife of the investment world.

Me personally, in some areas of my life I love specificity. I enjoy the research into the pros and cons of things (TVs, DVD players, funds, kitchen equipment, PC components, etc.), and then I love the acquisition of such things. And in those things that catch my attention, I shy away from generality and focus down on the specific.

Example... I read various news and economic reports that China is heading for 8%-10% economic growth in 2010 and possibly 9%-11% for several years thereafter. I grab myself a piece of the potentially expanding China pie with Jupiter China and Invesco Perpetual HongKong and China.

I am also made aware of the growth potential of India in the coming 20 years, so I grab a bit of Jupiter India (Thanks Lemon) :T.

I am lead to believe that the Chinese industrial juggernaught is going to need raw materials in ever increasing qualities, so I get First State Global Resources A, and the world's energy production for the next 20 years is surely a hot ticket, so I grab Investec Global Energy A.

I look at the growth predictions for the various areas of the world, and I note sluggish growth in the UK but dramatic but exceptionally turbulent growth potential in Asia-Pacific and South American markets, so I grab some Baillie Gifford Emerging Markets Growth A and Invesco Perpetual Latin American.

I grab a handful of different bond products to round out my portfolio:

AEGON High Yield Bond A - higher risk, higher yield (9.45%)
Invesco Perpetual Corporate Bond - medium risk, medium yield (5.39%)
Old Mutual Global Strategic Bond - low-medium risk, medium yield (4.94%)

Hope this explains my positioning on the various fund styles. It's actually been quite instructive to me just typing it out. I'd be interested in others' views on their fund picking behaviours.

Lokolo

QuietDragon. Where do you read all this info?

QuietDragon

Lokolo wrote: »

QuietDragon. Where do you read all this info?

This is my information toolbox. Is this what you were wanting to know?

investorwords.com US-biased online financial glossary.

ft.com In-depth articles, and some fab short videos.

money.cnn.com American-biased articles, but many of which are interesting.

fidelity.co.uk Some good articles, but biased noticeably towards Fidelity's own products.

morningstar.co.uk Seeminly completely independent analysis of funds, and some utterly essential fund analysis and comparison tools.

fool.co.uk Vociferous shouting from a load of sharepickers.

trustnet.com Somewhat like Morningstar.