Vanguard Life Strategy

Linton

takesyourchances wrote: »

Thank you Linton on correcting me that the Aberdeen Asian Small Cap is a fund rather than a tracker and that it looks to be a good one, what would your opinion be on adding that as a smaller pot percentage as above with the Lifestrat 60% being the main?

Thank you also JohnRo for the above table.

Asia was in my mind but on a small holding long term and breaking up from large caps which I learnt here, interesting.

Best regards.

It is a fund with a very good track record that should add some useful spice to your core choice. I will probably buy some myself. Probably up to 5% of my total growth portfolio.

My only slight hesitation in your case is that this is very much a niche fund. So its a big gap between the globally based large company Vanguard funds and this one. I would prefer to see a strategy rather than just cherry picking random good looking funds. However that could well be for the future. Why not go for it, but dont let it go beyond say 5-10% of your total investment.

takesyourchances

Linton wrote: »

It is a fund with a very good track record that should add some useful spice to your core choice. I will probably buy some myself. Probably up to 5% of my total growth portfolio.

My only slight hesitation in your case is that this is very much a niche fund. So its a big gap between the globally based large company Vanguard funds and this one. I would prefer to see a strategy rather than just cherry picking random good looking funds. However that could well be for the future. Why not go for it, but dont let it go beyond say 5-10% of your total investment.

Thank you Linton again, the track record looks good so far and it does seem like it should add some useful spice to my core choice of the lifestrat 60%.

It is a very niche choice and would be a second holding only in the S&S ISA with a big gap between the global large company Vanguard Lifestrat fund. I understand what you are saying about cherry picking random good looking funds, the other areas to diverse could be covered in the future as the investment pots grow and I learn more.

I am cautious of the percentage holding overall in the portfolio with an Asian fund like this and agree running at 5% to 10% would be a wise approach.

This is why I was thinking of opening with the minimum of £500 and drip feed of £50 per month as my Vanguard Lifestrat is approaching 3K and leaving this set up alone for a while and let the percentage gap widen with the lifestrat 60% in time as I will allocate a higher drip feed percentage into it and will have a bigger lump sum which I plan to increase in October as well from a maturing bond then.

I am thinking to go for this Asian fund on the side and It could be a starting point and then for certain leave it as it is and let the percentage gap widen in time and then look at covering some other areas between them down the line.

Maybe this sounds a reasonable game plan at the moment to be getting on with and most important I think would be leave things as they are for a while and widen the percentage gap between the two funds in time and learn.

Thanks again.

Best regards.

hugo15

I'm looking at starting a stocks and shares isa and think the Vanguard LifeStrategy is for me but I'd appreciate a second opinion.

I've just turned 40 and have got myself to the position where my mortgage is fully offset. I'm now starting to think about retirement planning and paying my monthly mortgage payment into a S&S Isa. I'm a member of my employers defined contribution scheme (11% going in each month). The S&S Isa would be a long term plan for the next 20 or so years until retirement. From reading this thread I like the idea of the passive investing (as I've no idea about investing!) and would probably go for either the 80% or 60% fund. I'm I making a decent decision here or a big mistake?

Can I also check I understand the charges. Looking at HL, my understanding is

0.24% of everything I put in as an initial charge
0.31% annual charge - when is this calculated?
£2 per month platform charge

I would also want to re-invest the dividends. Presumably I would select the accumulation rather than the income option?

Sorry for so many questions.

westy22

0.24% of everything I put in as an initial charge
this will be built into the buying calculation i.e. you will pay a marginally higher price for each unit bought
0.31% annual charge - when is this calculated?
You won't see this as this cost is built into the growth figures and therefore the growth you see in the fund will be net of this cost
£2 per month platform charge
Taken by HL on a monthly basis - you can either pay it by debit card every couple of months or so or deposit some funds and leave it as cash for HL to use to pay the platform fee

I would also want to re-invest the dividends. Presumably I would select the accumulation rather than the income option?
Correct

edinburgher

Interesting thread (I've come late to the party), although it strikes me that there's far too much discussion around diversification in relation to products that are basically intended as a fire and forget solution to long term *passive* investing and diversification.

I currently invest in the 100% equities flavour with HL (see, there are a few of us lurking) and I'm generally satisfied with the range of markets covered and the split between these markets.

Yes, you can always tinker around the edges to fit in small caps/exotic parts of the world/whatever else you fancy, but it strikes me that folk who fall into this camp are often wannabe active investors. There's absolutely nothing wrong with that, but I think it's important as a new investor to get straight your approach in your own head before starting.

I find the arguments in favour of a low fee, passive investing approach to be convincing and the LifeStrategy funds are the best solution I've seen for my needs

Pick a fund that suits your tolerance for risk and how long you're planning to invest, uprate your payments each year to keep pace with inflation and be patient!

grey_gym_sock

edinburgher wrote: »

Pick a fund that suits your tolerance for risk and how long you're planning to invest, uprate your payments each year to keep pace with inflation and be patient!

that's all very well, but you might end up having to have fun in the real world, instead of through investing!

edinburgher

grey_gym_sock wrote: »

that's all very well, but you might end up having to have fun in the real world, instead of through investing!

A balanced long term investing view actually makes me feel more relaxed about having fun in the real world

takesyourchances

To update on the previous posts on a side fund to start with along with my Vanguard 60% fund as the core investment, I decided to go with the Aberdeen Global Asian Smaller Companies GBP D2 Accumulation a few of us have been discussing to add some spice into the mix on a lower investment amount

I thought about it another day and decided it was a niche fund I would like to invest in for some Asian exposure and to see how it goes, so I have went ahead and put the order in with £500 opening early this morning for the Aberdeen Asian Small Cap fund so it should become live and active alongside my Vangard 60% over the course of the coming days

I am happy to be adding this Asian fund, although very novice still I feel that there is some potential to be had in Asia and growth potential in smaller companies in the region. I hope that this will be a complimentary investment on a smaller scale along with the Vanguard 60% core over time.

March's drip feed, I am now going to do £300 in March as the new tax year will be in April, I will allocate £250 to my Vanguard 60% fund that will bring me to 3K invested in it and £50 to the newly opened Aberdeen Asian Small Cap fund.

I will look to widen the pot percentage cap between the two funds over time and later this year will put more lump sum in.

I think this is plenty for me to be getting on with now and will keep drip feeding the main amount to my Vangaurd Lifestrat with a lower allocation to the Asian Small Cap fund.

While doing this I will keep learning and reading, I want to keep it passive and long term, but still with an understanding and I am happy with the structure of the Vanguard Life Strat for the mixture it gives as the core and over time down the line would like to cover some caps as I learn.

I am looking forward to seeing how these two go now they are set up and building the overall investment up.

Any thoughts is appreciated.

Best regards.

edinburgher

Any thoughts is appreciated.

Do you actually have a specific asset allocation planned, or is the split between your Vanguard fund and the Aberdeen fund going to be a bit arbitrary for the next few months?

takesyourchances

edinburgher wrote: »

Do you actually have a specific asset allocation planned, or is the split between your Vanguard fund and the Aberdeen fund going to be a bit arbitrary for the next few months?

The core fund will be the Vanguard Lifestrat for the mix of allocation within one fund. While it is a good mix, I also realise there are some other investment areas that it does not cover and some of these I would like to cover with smaller holdings. I would like to keep a global spread long term and also understand what and why I am investing in.

I would like to have a few holdings covering some of these areas, as the Vanguard 60% is mainly western focused large caps, covering a third of the UK in my fund and then America etc being the next biggest, I would like some focus out of the UK in some small holdings.

I know I have much learning to do about diversifying, I think personally if there is a region in the world that has potential to grow in the long term it is Asia, so was prepared to take a risk for some reward on a smaller fund holding here and small companies with growth potential on the way up. The main regions in this fund, Singapore, Malaysia, Hong Kong and Thailand etc are regions I had in my mind.

Also the smaller companies I also looked at the main holdings in the fund of these companies and was happy with these being allocated. Singapore for example I feel is a very dynamic place so I am comfortable with that being the main holding in this fund and also if the western economic situation improves I feel that Asia will grow further from western investment and trade, with Asia producing a lot of products for the western markets and also western business being conducted in Asia and located there. So while this is a niche fund with the Vanguard Life strat this was also why I decided to also go with this for these reasons as well for Asia and the Vanguard Lifestrat on its own would not give that exposure like this.

While being novice, this is my early strategy so far and hopefully it will work out. As for the next few months, I think I will be running with only these two funds certainly I would think to later this year at least.

When the investment increases, I could add another fund / tracker to cover some other caps. Discussed previous this could be covering Global Small Caps if there is a suitable fund for such on HL's platform, this would maybe diversify from Global Large Caps in the Vangaurd.

I see there is also ex UK European funds and also small caps here, I am not sure on European focus at the moment, the Euro problems and strains within mainland Europe at the moment kind of make me feel elsewhere or wider, so not sure. Also there are other investment types but I would need to understand things more.

So for the moment this is my general idea and early approach and my reasons why I decided to add the Asian Small Cap fund, it was not decided on easily although it may have seemed quick, but I had Asia in my mind and was happy to go with it for my reasons above and feel it is worth a small risk on a lower holding along side at the moment.

Looking ahead I would like to have a small structure set up covering a few areas, it does not need to be many or overly complicated and I want to know what and why I am investing in these for and I am looking long term, as long as possible while paying in regular to build it up.

Basically I am happy with the Vanguard Lifestrat as the main core, with a few branches of lower holdings on the side to cover some other areas outside of that and leave.

I hope my thoughts have made sense I like to keep this simple and I am very aware of how early everything is and that this is a long term view and have accepted that.

Any pointers and advice is always welcome to learn

Best regards.