How to choose funds

stphnstevey

I've been using H&L for S&S ISA and SIPP and been picking my own funds for the last five years or so. I have had some success, but overall performance has been 'ok'.

I invest a lump sum intermittantly a few times a year (although I understand the benfits of regular investment, I receive my income in lump sums and regular investment is not really an option for me)

I was wondering how others go about picking their funds, what strategies they might use, tools, websites etc

I'm not looking for advice 'you should invest in this fund/sector', more 'this is the method I used to come to the conclusion of picking my funds'

I'm currently (and I am expecting alot of criticism! (as these forums only seem to be now)) looking at last 5yr performance. I thought about looking at fund manager, but find this difficult to keep track of.

grizzly1911

stphnstevey wrote: »

I've been using H&L for S&S ISA and SIPP and been picking my own funds for the last five years or so. I have had some success, but overall performance has been 'ok'.

I invest a lump sum intermittantly a few times a year (although I understand the benfits of regular investment, I receive my income in lump sums and regular investment is not really an option for me)

I was wondering how others go about picking their funds, what strategies they might use, tools, websites etc

I'm not looking for advice 'you should invest in this fund/sector', more 'this is the method I used to come to the conclusion of picking my funds'

I'm currently (and I am expecting alot of criticism! (as these forums only seem to be now)) looking at last 5yr performance. I thought about looking at fund manager, but find this difficult to keep track of.

I tend to have lump sums.

Smarter Investing - Tim Hale: a succinct summary of which is in Slow & Steady Steps from Debt to Wealth J E Hutton, Monkey with a Pin - Pete Comley, Monevator.com.

Trustnet (research, multi chart &portfolio modelling monitoring), Morningstar and City Wire (for information, research).

Ensure a good spread and mix, look to keep costs down and don't be greedy or expect stellar performance - more steady progressive performance.

Patience.

dunstonh

I was wondering how others go about picking their funds, what strategies they might use, tools, websites etc

First work out your risk profile. Then decide what investment strategy you wish to use then research funds that match that investment strategy.

I'm currently (and I am expecting alot of criticism! (as these forums only seem to be now)) looking at last 5yr performance.

Which is not how you should pick funds. If that 5 year period was mostly good, then typically you would expect the higher risk funds in the sector to at the top end. If that period was bad, then you would expect the lower risk funds in the sector to be at the top end. Also, when you use cumulative performance, you have the funds that got lucky once rather than showing any consistency. If you are going to factor performance into the selection then use discrete performance over multiple periods.