Invesco perpetual high income

jamesd

A_Flock_Of_Sheep wrote: »

So I could put in the 11k for this ISA year and it is then held until I decide where to invest then I can top up the following week with the next years allowance and that is held with the previous years and I can the ISA 22k when I have decided? That is clever?!:D

Right. Like redbuzzard I've done this myself in the past.

Brasso is right about buying when prices are low. It's a sale. I have some great profits from funds I bought in 2009. It's hard to do that, particularly for relatively new investors, because the news is all bad at the time. It's one area where regular investments can help, by causing the buying to continue even when the human might have reservations about it.

Selling at highs is even harder.

Brasso isn't fully right about markets being at record highs. Some like the US and UK are near to highs but others are quite low.

Have a look at say JPM Natural Resources fund to see a fund that's invested in low parts of markets, so it's not just markets. Note that this fund also had a change of manager just before the drops and there's a chance that the manager change also played a role - sell on manager change is a commonly used guide for active managed funds, because you can't be sure how the new manager will do. Prices may drop further but next time there's talk of nice global recovery funds like this should do well. At the moment it's getting back to 2009 prices. Those who bought then and sold on manager change would have big smiles on their faces right now... selling near the top.

Or look at emerging markets funds, which haven't matched the UK and US in growth this year.

There are opportunities, just takes looking around and deciding what they are and whether you think they are worth trying.

grey_gym_sock

1 might well think that a value approach is a plausible way to attempt to outperform the index on a total return basis. it's just a theory, but it's not obviously wrong ...

IronWolf

Linton wrote: »

Err, I would say if you want outperformance of the index you are better off in a fund that is restricted to subsets of the index more likely to provide that outperformance. As you say, an income fund is restricted by other criteria,. Companies providing income tend to be the larger and more established ones which would find major relative increases in company value more difficult to achieve.

But also more likely to provide underperformance

An unrestricted fund has the ability to focus on any sector it chooses, so in theory should always beat a restricted fund over time. Of course it all depends on the fund manager and whether they're any good.

Linton

IronWolf wrote: »

But also more likely to provide underperformance

An unrestricted fund has the ability to focus on any sector it chooses, so in theory should always beat a restricted fund over time. Of course it all depends on the fund manager and whether they're any good.

I prefer fund managers to work within tight limits. There is then some chance that they will have particular focused knowledge and abilities. If this were not the case, you would expect that the best performing funds would be those without any sector constraints. Look at the lists on Trustnet - the best performing funds are all highly focused.

srcandas

Linton wrote: »

Look at the lists on Trustnet - the best performing funds are all highly focused.

Yes it is interesting that aspect. It is of course also true that some fund managers are trapped in a loosing environment and thus loose. So perhaps a study may prove more focus gives greater bigtime loss/gain potential

However if you have a look at Schroder Small Cap Discovery I think you can see how a fund manager with broad scope can benefit from a large team of other fund managers with focused expertise. So the quality of the fund manager's organisation comes into play.

But I'd say in general looking at the fund manager's expertise and the expertise he can delve into are important.

Fascinating stuff folks. Got my brain cells vibrating. :beer:

dunstonh

Linton wrote: »

I prefer fund managers to work within tight limits. There is then some chance that they will have particular focused knowledge and abilities. If this were not the case, you would expect that the best performing funds would be those without any sector constraints. Look at the lists on Trustnet - the best performing funds are all highly focused.

We had a fund recently that passed due diligence requirements when it was in the 40-85% equity sector but it decided to move to the flexible sector to give it more flexibility and not be constrained. That is a fine objective but it failed due diligence using the same criteria/basis as before because the constraints that existed also made it clear how it could invest. With it being more flexible, those constraints where not there and although it has now passed due diligence checks, it is higher up the risk profile than it was previously because whilst it has flexibility to have less equities, it also has flexibility to have more.

redbuzzard

Partly stimulated by the discussion here I have just put some Troy Trojan fund into herself's ISA, having whittled the equity index funds down a bit.

Linton

Rollinghome wrote: »

Perhaps a good reason for using the figures for "the best performing funds" very carefully.

The shorter the period you look at the better highly specialised funds will appear to perform and the maximum period given by the free version of Trustnet is just five years. Obviously any fund that happens to be investing in a specialised segment that had done well will do better than funds with more diverse assets.

It's for similar reason that investment managers will often have half a dozen different funds all covering the same market to improve the chances of one of them beating the index. Every dog has it's day and differentiating between luck and skill is harder than we'd prefer to believe.

Trustnet provides 10 year cumulative data. See "Create a custom tab" just above the results of the fund search. If you look at the best performers over 10 years they are all niche funds Latin America, EM, Small Companies etc etc. 10 years covers a fair range of economic conditions.

brasso

redbuzzard wrote: »

Partly stimulated by the discussion here I have just put some Troy Trojan fund into herself's ISA, having whittled the equity index funds down a bit.

Good decision. TT is a little bit boring and safe, but that's no bad thing these days. I bought my last lot (for my wife's fund too) exactly 12 months ago yesterday and am very happy with the 6.1% increase. It was bought as a reliable but more profitable alternative to the 3% cash ISA she would normally opt for. So far, so good.

mike88

IP High Income is an excellent core holding in a balanced portfolio. I have held the fund since around 1995 and my initial £7000 investment currently stands at close to £54000. I have held racier funds which rise and fall with dramatic regularity but this fund seems to be fairly constant and has given a very reasonable return over a long period. My worry is that if Woodford leaves performance is likely to suffer as investors leave in their droves.