Hargreaves Lansdowns own recommendations. Your view?

jamesd

gadgetmind wrote: »

Regards the gilts, you need to be aware that gilt yields are such that you *will* lose money in real terms unless something *very* bad happens in the world of equities, something worse than we've seen in the last decade.

Right! Gilt yields are at lows not seen for hundreds of years, meaning prices are at comparable highs. If there's even a glimmer of reversion to mean following the end of quantitative easing and trouble in the European Bond markets there are going to be some big capital losses for gilt holders over the next five to ten years.

Gilts can be a good thing to hold but sometimes the pricing/timing is just too bad to be buying them.

Commercial property is one possibly good alternative.

jamesd

margaretclare wrote: »

I have M&G Strategic Corporate Bond Class X Income

Did you happen to check whether HL discounts any of the exit fee for the M&G class X funds?

For those who don't know, class X has no initial charge but instead charges it when you sell.

gadgetmind

jamesd wrote: »

Gilts can be a good thing to hold but sometimes the pricing/timing is just too bad to be buying them.

I really, really want to be holding some gilts, but not as current prices and yields. I'm out for now other than via conviction ITs.

Commercial property is one possibly good alternative.

I've gone for a combination of an active (yes!) global infrastructure fund, some PFI/other infrastructure companies (HICL, JLIF, BBGI) and a couple of low-gearing commercial property companies (UKCM and LSP).

I also hold corporate bonds and a strategic bond fund that is heavily into the same.

This is all well and good, but it's all too heavily correlated.

Dare I rebalance with VIX? Yikes!

Mikeyorks

Judwin wrote: »

For these reasons, I don't think it makes any sense buying the 'income' version of funds unless you actually need the income.

Quite right. I've got a couple of 'income' funds simply because there is no 'accumulation' equivalent. And find it quite irritating (£49 seems a frequent payment!) that money can hang around in the income pot for months.
I would have it paid to me - and put it back in with a top up - were it not that both are now in ISAs.

gadgetmind

jamesd wrote: »

Did you happen to check whether HL discounts any of the exit fee for the M&G class X funds?

I don't hold that fund, but I do hold M&G Global Basics Class X.

I checked with HL before acquisition and there is no exit fee.

I have carefully saved their response!

gadgetmind

Mikeyorks wrote: »

And find it quite irritating (£49 seems a frequent payment!) that money can hang around in the income pot for months.

It's not a huge problem if you use funds, but it's a drag if you buy equities as you need around £2k otherwise dealing fees are too large a percentage.

For an unwrapped account we just chip a few more bob in, but it's a problem in an ISA. If the wind is in the right direction, I'll sell down a bond fund to make an equity purchase, but it doesn't always work that way.

margaretclare

Thanks for all the comments. I think I got the idea of income rather than accumulation from someone else a few years ago now - not that many years - and I've stuck with it ever since. No longer. I've now switched all the funds I had as income into the accumulation equivalent. There isn't one for Jupiter Ecology so that has to go. All my funds from now on will be the 'acc' version.

I've been getting income sitting in a cash account and then I add a bit to it - minimum to reinvest is £250 - and I've done it that way. We'll see how it does from now on.

jamesd

gadgetmind wrote: »

I've gone for a combination of an active (yes!)

Since I have substantial amounts in both types I can hardly knock you doing this.

gadgetmind wrote: »

global infrastructure fund, some PFI/other infrastructure companies (HICL, JLIF, BBGI) and a couple of low-gearing commercial property companies (UKCM and LSP). ... I also hold corporate bonds and a strategic bond fund that is heavily into the same.

Seems reasonable to me.

gadgetmind wrote: »

This is all well and good, but it's all too heavily correlated. ... Dare I rebalance with VIX? Yikes!

Not sure how well a pure volatility measure would do for rebalancing. Haven't looked. Options or covered warrants come to mind as things that offer protection at known initial cost.

gadgetmind

jamesd wrote: »

Not sure how well a pure volatility measure would do for rebalancing. Haven't looked.

Dunno if it's just a recent thing, but the S&P 500 and VIX are heavily negatively correlated. GOK what the frequency of rebalancing should be!

jamesd

Well, that does make it an option to consider, at least.