my portfolio - comments

Ash1982

Long term growth, risky but potentially rewarding.

Japan and Europe undervalued, natural resources will pick up when global economy does as will demand for technology (China middle classes) and emerging markets are growth areas.

Voyager2002

Personally I would put more into technology, but I would find a fund with a really good manager first. I think that technology offers more volatility than other sectors, and probably more scope to pick winners if you (ie the manager) really understands what is going on.

And since most technology funds concentrate on the USA, an alternative approach would be to find a tracker or ETF for Nasdaq.

gadgetmind

With no fixed interest, and holdings that are both volatile and highly correlated, you're going to be in for a wild ride. I hope your investment window is significantly larger than the five years you mention!

I mainly use trackers and ITs, but I do also hold some actively managed funds including that First State one. I also hold their global listed infra-structure funds, M&G Global basics and Rathbone Global Opportunities.

For smaller companies exposure, I again mainly use ITs, but also picked up Liontrust Special Situations a couple of years ago, and this has done rather well.

It's interesting that you switched into Europe as over the last six months I've bought chunks of two European ITs (JEO and HEFT) and also TR Property that has a fair bit of continental exposure.

I've also been cranking up my exposure to Brazil and India.

srcandas

Would it be better if posters stated if their objective is to track the world and if not what they are avoiding?

To be fair to OP posts pointing out that he is missing coverage, with the amounts he has (< 5000), is doubtful to be helpful.

He needs to start somewhere and further diluting a £50 per fund drip seems crazy to me.

Ash you've chosen with reason. Now give it a chance. Just my two pennies worth :beer:

Ash1982

gadgetmind wrote: »

With no fixed interest, and holdings that are both volatile and highly correlated, you're going to be in for a wild ride. I hope your investment window is significantly larger than the five years you mention!

I mainly use trackers and ITs, but I do also hold some actively managed funds including that First State one. I also hold their global listed infra-structure funds, M&G Global basics and Rathbone Global Opportunities.

For smaller companies exposure, I again mainly use ITs, but also picked up Liontrust Special Situations a couple of years ago, and this has done rather well.

It's interesting that you switched into Europe as over the last six months I've bought chunks of two European ITs (JEO and HEFT) and also TR Property that has a fair bit of continental exposure.

I've also been cranking up my exposure to Brazil and India.

Thanks for the comments, how do you mean highly correlated? Brazil and India exposure interests me, how have you targeted them markets (shares, ITPS

PS, I don't invest in bid spread funds (opecs?) Or IT's that charge to capital or have performance fees or with ters over 2%

Ash1982

srcandas wrote: »

Would it be better if posters stated if their objective is to track the world and if not what they are avoiding?

To be fair to OP posts pointing out that he is missing coverage, with the amounts he has (< 5000), is doubtful to be helpful.

He needs to start somewhere and further diluting a £50 per fund drip seems crazy to me.

Ash you've chosen with reason. Now give it a chance. Just my two pennies worth :beer:

Thanks scrandas, for info. I have a cash isa 'fund' for emergencies of 4k so im .not all in!

gadgetmind

Ash1982 wrote: »

Thanks for the comments, how do you mean highly correlated?

Global equities are increasingly correlated, which means they bounce up and down together. Corporate bonds are slightly negatively correlated, and sovereign bonds (gilts, bunds, treasuries, etc.) are highly negatively correlated. If you hold a mix of such assets, it can both reduce volatility and due to rebalancing also give better gains. Property and gold are other key assets that show reduced correlation to equities, but the main job can be done with just bonds.

Brazil and India exposure interests me, how have you targeted them markets

Partly via a BRIC fund but also via some ITs and equities that have exposure. I'm a big believer in infrastructure investing, and Brazil is going to be doing a lot of building over coming years.

PS, I don't invest in bid spread funds (opecs?) Or IT's that charge to capital or have performance fees or with ters over 2%

Unit Trusts tend to have spreads whereas OEICs don't.

As I say, I'm increasingly using passive investments, but do like to keep a corner of the portfolio for dabbling.

Ash1982

Thanks gadgetmind, good explanation of correlation, I had a corporate bond holding that has appreciated 2.5% since the spring but I just switch it to my European fund as I think bonds are overvalued and European funds are undervalued at the moment. I understand the risks (I think!). I guess im using my cash holdings as a counterweight on the basis that I can handle any losses (or im only investing surplus money I don't need)

gadgetmind

Ash1982 wrote: »

I had a corporate bond holding that has appreciated 2.5% since the spring but I just switch it to my European fund as I think bonds are overvalued and European funds are undervalued

Sovereign bonds of AAA states are definitely over-valued, but most corporate bonds (other than high yield aka "junk") are fair value IMO. Europe was massively under-valued a few months ago, but since then I've seen 10-15% gains on most of my holdings, so it's heading towards just vanilla under-valued.

There are still screaming bargains in European (and UK!) financials for those with a strong stomach.

I understand the risks (I think!). I guess im using my cash holdings as a counterweight on the basis that I can handle any losses (or im only investing surplus money I don't need)

The best way to achieve long-term success is to have a strategy and to stick with it.

If you want to know more about balancing a portfolio, and why bonds are important, you might want to read "Smarter Investing" by Tim Hale. It's an easy read and covers all the essentials.

Ash1982

Thanks for the book recommendation.

As you say, I will stick to my strategy as I think the jist of the responses to this post have been generally positive although I take on board the correlation point. I just think I may be less risk averse than some (it's a matter of opinion I guess)

PS losses aren't losses until you sell, im willing and able to hold!