Comparing these 2 funds

Cardinal-Red

I am, slowly but surely (!) building a balanced portfolio of funds inside my H-L S&S ISA.

I put aside a set amount every month split into equal values, buying units in a basic FTSE tracker, an emerging markets fund, the Artemis Retail fund, and also Blackrock Gold and General.

I want to look somewhere else as I have nearly 40% of my funds in Emerging Countries.

I have been thinking of a 'commodities' fund - and identified this one:

http://online.h-l.co.uk/funds/security_details/sedol/3183511

(JP Morgan Natural Resources (Acc) Units)

But looking at the fund, I am worried that this would be a massive exposure to mining, when combined with my Blackrock fund, and that I own some shares in the Petropavlosk mining company.

Would you guys agree with this? And if so, are there any 'commodities' funds with less of a focus on mining, or is this an inevitable element of commodities?

cheerfulcat

Have you looked at the Junior Oils Trust?

Cardinal-Red

I did look at that one, but thought it cast its scope a little narrowly for my liking. I do want Oil companies included, but would like exposure to some of the bigger companies as well rather than what looks like the smaller exploratory companies in this fund. Does look like a good punt for slightly higher risk element of my portfolio, thanks. :beer:

LongTermLurker

Consider that most oil exploration and commodity funds are highly exposed to emerging markets. Even though the JPM fund "appears" to be focused on the West, you have to look at where those companies operate - e.g Anglo-American: "The company aims to deliver production growth via four major strategic projects: the Barro Alto nickel project in Brazil, expansion of its Los Bronces copper operation in Chile along with two recent discoveries nearby and finally, the Kolomela iron ore mine in South Africa."

Which emerging markets fund do you have? Is it BRIC, regionally focused or global?

You don't look to have much in the UK, Europe and Bonds markets. That would balance you out somewhat.

What on earth is the Artemis Retail Fund? http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results?companyid=401&tab=prices&x=12&y=9&sectorid=&tab=prices shows several funds, all "retail" (as opposed to "institutional", I think), but you don't say which fund or sector.

Cardinal-Red

Hi, thanks for your reply, very interesting reading.

In terms of emerging markets, I own two funds, one is the Invesco Perpetual Emerging Countries fund (14% of my fund and shrinking as buying no more units) and the Aberdeen Emerging markets fund (around 3% and growing as it gets 20% of my monthly subscription right now). Both of these are global funds.

Sorry about the confusion over the Artemis fund. It is this one:

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/a/artemis-income-retail-accumulation

Seems exposed to big UK bluechips mainly (80% of holding is in the UK) so I consider this (7% of my funds) and my FTSE tracker (18% of my fund) which I think is enough for the UK?

You're right about the European element though as I've looked at it now there is not much there. Perhaps that should be the area to look at next - but as I look at my portfolio I am tempted to stop investing in the emerging markets funds, as with the Asian and Pacific growth funds I have from L&G, I am starting to think this is a large exposure in my portfolio.

LongTermLurker

Cardinal-Red wrote: »

Hi, thanks for your reply, very interesting reading.

In terms of emerging markets, I own two funds, one is the Invesco Perpetual Emerging Countries fund (14% of my fund and shrinking as buying no more units) and the Aberdeen Emerging markets fund (around 3% and growing as it gets 20% of my monthly subscription right now). Both of these are global funds.

Sorry about the confusion over the Artemis fund. It is this one:

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/a/artemis-income-retail-accumulation

Seems exposed to big UK bluechips mainly (80% of holding is in the UK) so I consider this (7% of my funds) and my FTSE tracker (18% of my fund) which I think is enough for the UK?

You're right about the European element though as I've looked at it now there is not much there. Perhaps that should be the area to look at next - but as I look at my portfolio I am tempted to stop investing in the emerging markets funds, as with the Asian and Pacific growth funds I have from L&G, I am starting to think this is a large exposure in my portfolio.

I have the Artemis Income. I've only recently added it, but it looks good. I've also just bought into the Aberdeen EM.

Do you use the Fund Analysis tab? It gives good insight into each fund. Also, when you're logged in, you can use the Portfolio Analysis tool to show the bird's eye view of your whole ISA.

If you have 40% in EMs, that is quite adventurous - could be good for growth, but as someone said in another thread, it's akin to "strap yourself in and hang on to the rollercoaster". I wouldn't necessarily add natural resources to the pile at this point, as you already have a lot of EMs along with the Gold & General.

I've had some decent returns from Europe and High Income bonds.

cashbackproblems

Iv been looking at a few funds at it seems if your prepared to take a risk like with oil/mining funds you will be rewarded.

However iv already invested in some dodgy companies so looking for something safer and found this Invesco Perpetual Monthly Income Plus Accumulation Units, they invest in solid uk companies who pay good dividends

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/i/invesco-perpetual-monthly-income-plus-accumulation

Any opinions?

mr_fishbulb

Cardinal-Red wrote: »

I have been thinking of a 'commodities' fund - and identified this one:

http://online.h-l.co.uk/funds/security_details/sedol/3183511

If you want a fund which invests in pure commodites, rather than the companies that do well off the back of commodities, you could look at the Marlborough ETF Commodity Fund.

To throw another fund into the mix, I currently hold the First State Global Resources Fund. Similar to JPMorgan one but I chose it as it had a larger exposure to Latin America.

mr_fishbulb

cashbackproblems wrote: »

Iv been looking at a few funds at it seems if your prepared to take a risk like with oil/mining funds you will be rewarded.

However iv already invested in some dodgy companies so looking for something safer and found this Invesco Perpetual Monthly Income Plus Accumulation Units, they invest in solid uk companies who pay good dividends

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/i/invesco-perpetual-monthly-income-plus-accumulation

Any opinions?

Over 3 quarters of that fund is in the form of bonds, so it's not actually investing in the companies the same way as the Invesco Perpetual High Income fund does (also managed by Neil Woodford).

The income you would get from that Monthly Income Plus one would mainly be from bond coupon payments, rather than dividends. I'm not saying it's a bad fund, just that it operates in a different manner from what you suggested.

cashbackproblems

mr_fishbulb wrote: »

Over 3 quarters of that fund is in the form of bonds, so it's not actually investing in the companies the same way as the Invesco Perpetual High Income fund does (also managed by Neil Woodford).

The income you would get from that Monthly Income Plus one would mainly be from bond coupon payments, rather than dividends. I'm not saying it's a bad fund, just that it operates in a different manner from what you suggested.

Are you sure? As the monthly income plus (which i provided the link for) seems to be pay dividends and monthly payment at 6% whereas your one is 3.89%, or am i missing something? Maybe the High Income Accum has capital growth as well?

Sorry for all the q's just so many to choose from and each one has different companies and rules!

bendix

Yes, Inv Perp Monthly Income Plus is predominantly invested in corporate bonds, although it does have a number of defensive stocks such as GSK, AZ etc.

I don't think you completely understand the nature of the fund - it clearly says in its asset allocation list that it is invested in bonds 77%.

It holds these bonds and they pay an underlying dividend. Becuase you have chose the accumulation option, these are not paid to you as income. Instead, they are reinvested (ie accumulated).

Bond funds can fall and rise in capital values just as much as share funds. In fact, there is a school of thought that with interest rates so low and likely to rise, the best time for investing in these has passed (if you want capital appreciation).