Choosing Hargreaves Lansdown funds

gadgetmind

OK, so everyone recommends HL, but how do I choose some good funds? I'm going to be putting 2x full ISA allowance in there every year, and will be treating this as a long-term/retirement thing.

They have sooo many funds, and choice is good, but I don't want to spend hours researching this and just going in circles. The multi-manager funds look good for this situation, but I understand that costs are higher.

Is there a sensible basket of 5-10 funds I should go for, at least to start with?

Ian

Mini_Bear

I think it totally depends on your risk profile: age, pension arrangements, mortgage, family etc.
I am a 25yr old female with very little outgoings so pump a lot into rather high risk funds. I look at high risk, emerging markets and special situation stuff. I am not planning to touch the cash for at least 10 yrs.
For you personally its worth looking at whether you want income or growth and your risk profile. The main thing i would think would be diversification so don't put all your cash into UK stock funds, and definately look at past performance of funds.
Unfortunatley there is no hard and fast rules (eg 25% Euro equity, 10% US t-bills etc)
Also consider feeding the cash in monthly rather than yearly dumps as you will benefit from pound-cost averaging.

gadgetmind

I'm late forties, have a mortgage free house that I'll be happy to live in for the foreseeable future, and any move would be a downsize. Pension is sorted via a fairly well funded SIPP. Investment wise, we have cash ISAs, various S&S ISAs, and even some ISAs that started life as PEPs!

Pension and the larger ISAs are spread across sectors and different countries (Selestia/Skandia with auto-balancing) , and I'm wanting to do that in HL. I really don't intend to touch this until retirement and we have cash savings with various levels of access as a buffer.

Regards feeding money in, I'll be transferring in approved share options (no CGT, yay!) so my view is that I'm probably better diversifying as quickly as possible.

I may also try and do some stock-for-stock transfers of existing S&S ISAs to HL once everything is up and running. Some of them are in good schemes but some ... less so.

Ian

Lokolo

Couple of things I use.

- https://www.fidelity.co.uk/investor/guidance-planning/plan-portfolio/myplan-portfolio-quickstart.page?

to plan my portfolio, so I have a rough idea where I want to invest.

- http://www.morningstar.co.uk/uk/fundscreener/default.aspx?lang=en-GB

I then use this to screen out the funds I would be interested in.

Then depending on how much I have to spend, I'll buy into 1 or 2 funds at a time until I have put £1k in, then switch. Although I stopped after 2... now going onto my third.

StevieJ

You could always go for their fund of funds, less work but more expensive.

dunstonh

MM funds are generally poor. Thats a good basis to work on. Fund of Funds can be better and there are a small number of standout funds that are ideal for the lazy investor. However, as you say, you will pay more for them as you are paying for someone to do the work that you dont want to.

If you are not going to be an active investor then picking a random selection of funds is almost certainly going to be the worst option over the long term.

debbie42

I've recently bought some funds with some "spare" ISA cash that I had. We have a decent pension provision, and no debts, so any ISA allowance used by myself tends to be on the "riskier" investments. My OH favours trackers. The bulk of my S&S ISA is all in shares, but I wanted more of a diversification, hence the fund picks.

I'd be happy enough to actively manage them, if I knew how . What is meant by that, though? As I've said, it's a niche investment plan (mainly global emerging markets etc.), and I suppose this inclination may change, over time, but on a more managed basis, what's to be done?

Lokolo

debbie42 wrote: »

I've recently bought some funds with some "spare" ISA cash that I had. We have a decent pension provision, and no debts, so any ISA allowance used by myself tends to be on the "riskier" investments. My OH favours trackers. The bulk of my S&S ISA is all in shares, but I wanted more of a diversification, hence the fund picks.

I'd be happy enough to actively manage them, if I knew how . What is meant by that, though? As I've said, it's a niche investment plan (mainly global emerging markets etc.), and I suppose this inclination may change, over time, but on a more managed basis, what's to be done?

God knows! I have 2, one has under performed (he decided to very much track the FTSE rather than attempt anything, which hasn't done very well). But I'm not going to sell it yet, in the hope it gets better. Although I'm not at a loss yet.

dunstonh

I'd be happy enough to actively manage them, if I knew how . What is meant by that, though?

Check they still meet objectives periodically and rebalance them so they remain consistent with your risk profile. The latter is most important as research shows that rebalancing funds at least annually leads to higher returns of the long term. i.e. 5 funds of £1000 each will start to go out of sync with each other. One may be £1200, another £800 etc. So, you bring them back to equal share but taking the money out of the ones that have gone up the most and put it into the ones that have gone down or not up as much.

If you are active and working to an active sector allocation, then you may also revise your allocations periodically. i.e. on larger portfolios property may now account for 15% of your portfolio but 2 years ago you had no allocation to property or just 5%. That sort of information though tends to come from acturies for use by IFAs and institutional investors. Fund managers in fully diversified portfolio funds may also use that sort of information as well.

gadgetmind

Maybe I need to play with the HL site and see how easy all of this is.

I guess I'll need to nominate a fund or two to kick off with. Recommendations? If I swap a few days later, do a lose anything (other than possible rise/full of value of fund)?

Ian

bendix

You don't need to pick funds straight away (or at all, even). You can simply put the cash in and it sits there on your balance as cash, until you decide what you want to invest it in.