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Fund managers
Comments
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i run my portfolio like a business, if some IFA suggested I buy UTs i would want to know the 3% fees are worth it. I would want to know that i get a benefit for the considerable annual fees. Can you understand that?
it just seems strange that so many people invest in UTs. They have high charges and under deliver on performance. I just guess some people are born to be poor....
But that must mean that you shop at Aldi yes? Because shopping elsewhere means you are paying extra for no difference in your view.
The bit I have highlighted is just pure ignorance. You've even said that some managed funds beat it, so to say that all UTs have high charges and under deliver is a pure lie. The funds, all bar one which I got rid of, have beaten the index. Because of this, I plan on choosing the right managed funds and making the "3%" charges worthwhile.0 -
For the actual 5 year performnace.......
5-year return of HSBC FTSE100 tracker: 1.6%
arithmetic average 5 year return of 8 sectors: 31%
Now what about some numbers showing I am wrong. Actual numbers not some selective quote from a journalists summary of a US academic paper.
You're not wrong. The last 10 years have been terrible for the FTSE, which is why your 5 year figures for it are so bad. However, there's no particular reason why the FTSE can't go on a tear over the next 5 or 10 years and jump to the top of your list. Taking full advantage of this will require some good timing, however indexers are even less likely to believe that market timing than they are in the benefits of stock picking.
I don't think any passive investors puts all their money in just one index - you can capture a lot of the extra return you quoted by having a portfolio of index funds that covers the other areas in your list.
Passive investing makes more sense the longer your investment horizon is. Results over the last 5 years, whilst interesting, shouldn't have that much influence over anyone following this strategy. In fact, 5 years of subdued returns sounds to me like a brilliant time to load up on tons of cheap funds and wait for the recovery - I personal am finding this latest recession to be a real boon because everything is cheap.0 -
Darkpool (not you) is claiming that a FTSE tracker investment strategy is a good one as all sector/share selection on average must fail in performance terms especially taking into account charges. My numbers show that for the past 5 years where detailed data is available a FTSE100 tracker approach is actually far worse performing than almost any combination of a random selection of funds from the available niche equity sectors.
It also calls into question the attitude that a FTSE100 tracker is a sort of safe average vanilla investment.
no, what i'm saying is a tracker is a better investment than a UT in the same market.0 -
But that must mean that you shop at Aldi yes? Because shopping elsewhere means you are paying extra for no difference in your view.
The bit I have highlighted is just pure ignorance. You've even said that some managed funds beat it, so to say that all UTs have high charges and under deliver is a pure lie. The funds, all bar one which I got rid of, have beaten the index. Because of this, I plan on choosing the right managed funds and making the "3%" charges worthwhile.
i don't mind paying for quality, but UT investors are paying a Marks and Spencer price and getting asda quality.
Out of the thousands and thousands of managed funds some are bound to beat the tracker. But there is some pretty solid evidence this outperformance is down to luck.....
to be fair i think UTs do an important job in taking money from the stupid and giving it to the rich. it's a type of darwinian evolution in action. quite beautiful to see.0 -
no, what i'm saying is a tracker is a better investment than a UT in the same market.
http://www.morningstar.co.uk/uk/snapshot/snapshot.aspx?id=F0GBR04HVM&tab=1
Which isn't true in all cases. Only 2 years in 10 has it failed to beat the index.
If this was all down to luck....0 -
http://www.morningstar.co.uk/uk/snapshot/snapshot.aspx?id=F0GBR04HVM&tab=1
Which isn't true in all cases. Only 2 years in 10 has it failed to beat the index.
If this was all down to luck....
congratulations on finding a UT that wasn't "perp high income" for your example.
if i flipped a coin 10 times do you not think it possible that it would land heads eight times? have you studied statistics?0 -
congratulations on finding a UT that wasn't "perp high income" for your example.
if i flipped a coin 10 times do you not think it possible that it would land heads eight times? have you studied statistics?
Yes and the chances of that are 0.1%, whats your point?
You have said thats it not worthwhile at any point, well, this fund proves that you are either a) lying b) an idiot c) both
I am not going around to find more and more examples. But you are lying if you thinking copying and pasting results from Googling "trackers are better than active manager" will count as evidence. A good example of this was copying and pasting an article from the US, whereby it is entirely irrelevant because of tax difference.
At least gadget brings something to this debate, you just make trackers side look bad.0 -
no, what i'm saying is a tracker is a better investment than a UT in the same market.
Look at post #51 - a tracker (if it existed) would have been pretty much the worst investment in both the UK and US Small Cap sectors. In the Euro Small Cap sector it would have been 8th out of 12.
In the Far East (exclude Japan) sector the L&G and HSBC trackers only manage to be somewhere in the middle of the 5 year listing by being apparently extraordinarily bad at tracking the index they claim to follow. This is most odd, anyone any idea whats going on there? See trustnet for the evidence.0 -
er darkpool has been in this whole thread, because the 3% fees "aren't worth it" at anytime.
http://en.wikipedia.org/wiki/Straw_manI am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
It also calls into question the attitude that a FTSE100 tracker is a sort of safe average vanilla investment.
Did anyone claim it was? Investing in only large caps in a single territory is *always* going to have lower returns and greater volatility that a more balanced investment across different asset classes and territories.
The mathematics show this just as rigorously as they show that funds underperform trackers.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0
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