Nutmeg - Investment Management - Thoughts?

moneyfoolish

I put in £5760 into an ISA on January 8th so have been invested for nearly 5 months. I used them because
1) The website is very easy to use.
2) Money transactions are very easy.
3) I don't want to spend time changing investments and although I now know the fees are pretty expensive they make changes to the porfolios and adjust asset allocations which a discount broker won't do.

Currently, after almost 5 months I am up 1.7% or approx £97.
My high was a couple of days ago when I was up around £120 and my low has been around £180 down. When I get to 6 months, I'll try to compare the performance with other 6 monthly performances to see how it looks before I put in any or all of this year's ISA money.
I should add that I split my £5760 between 4 risk levels to compare the results. I put £2000 in Level 10, £1760 in Level 6, £1000 in Level 8 and £1000 in Level 4.
Currently my Level 4 is £15 up on the £1000.
Level 6 is £34 up on the £1760
Level 8 is £15 up on the £1000
Level 10 is £31 up on the £2000

bowlhead99

RichardS wrote: »

luke222010, I only invested 2 months ago. Currently, after fees I am £245 up (1.4%). £16k of the £17k I have in there is wrapped as an ISA. I know others on here say there are cheaper alternatives but Nutmeg do seem to make it all very easy to manage and view (especially the automatic ISA wrapper) and that all seems to add value to me. As to the safety of the money, I have no idea about that.

All credible funds platforms offer an ISA wrapper and allow you to put funds and/or shares in it; the difference is with Nutmeg you tell them how risky you like it and they pick the mix of funds, whereas elsewhere you would pick them yourself from a long list, or employ an IFA to properly tailor them for your needs and goals.

You would basically be able to make a Nutmeg portfolio yourself out of cheap equivalent tracker funds elsewhere, and not pay the high management fee, justpaying some nominal percentage for the individual funds' charges and a bit to the platform. Or even have some managed multi-asset funds on your DIY platform of choice, that you just look in on once a year or so, which would cost somewhere between the DIY tracker solution and the managed service from Nutmeg.

Basically, Nutmeg are going to cost more than doing it yourself, but it is a perfectly valid approach to choose to pay rather do something yourself. They don't have a long track record so it requires a bit a leap of faith of course; they appear cheaper than some other discretionary managers who usually cater clients with large portfolios and structure their fees accordingly.

In their pitch, they walk a fine line between making it sound simple and cheap and transparent compared to other discretionary managers, but also making it sound like they are adding a lot of value by making decisions you wouldn't be able to make yourself, so the 1%fee will sound well spent.

But assuming this is a long term investment for you, remember that 1% a year for 50 years is 50%! You might feel that this fee is all coming out of "profits" but it gets charged whether your funds are up, down or sideways. And each 1%, if not paid to Nutmeg, would compound up to give you profits on profits over time. So personally I would pick my asset allocation myself and pocket the difference. That does require some reading and research of course.

You mention you like the automatic ISA wrapper. With other providers, when you get a new ISA allowance (usually in April but also as a one-off this July) they will let you sell your unwrapped assets and buy them back inside the wrapper. You mention it being "automatic" but presumably you have to explicitly tell them that the allowance is available (I.e. you're not using it for a cash ISA with someone else)?

kidmugsy

moneyfoolish wrote: »

My high was a couple of days ago I was up around £120 and my low has been around £180 down.

Oh dear, don't check every day, you'll only fret and fidget. Twice a year is quite often enough.

RichardS

bowlhead99 thanks for that advice. Yes, you do set that limit with Nutmeg. With my ISA I have set a £10K limit for this year as I intend to put £5k in my Cash ISA (held separately).

moneyfoolish

kidmugsy wrote: »

Oh dear, don't check every day, you'll only fret and fidget. Twice a year is quite often enough.

I haven't got enough invested to fret. I'm looking regularly because I haven't yet decided if I'm going to put this year's ISA money with them or use a Vanguard Lifestrategy Fund or even a model portfolio so I'm checking when they change the asset allocation and how my portfolio is changing. I've actually got the time to do it all myself but there are too may fund choices and I won't know which to choose for the best!!!!!

moneyfoolish

I've now had my ISA invested with Nutmeg for 6 months exactly. The 6 month position is that I am 0.1% down. During the 6 month period the high has been up 2.8% and the low has been down 3.1%. Obviously it's too early to learn much but I've noticed over the same period that the FT100 is 1.2% up and the FT AllShare is 0.5% up so not too much variation although as my Nutmeg portfolio has a reasonable proportion in the USA I would have expected a little better.

jimjames

moneyfoolish wrote: »

I haven't got enough invested to fret. I'm looking regularly because I haven't yet decided if I'm going to put this year's ISA money with them or use a Vanguard Lifestrategy Fund or even a model portfolio so I'm checking when they change the asset allocation and how my portfolio is changing. I've actually got the time to do it all myself but there are too may fund choices and I won't know which to choose for the best!!!!!

One Vanguard fund can do 100% of your portfolio at the risk level of your choice so it isn't really too much of a choice - just between the % equities and bonds.

guymo

moneyfoolish wrote: »

as my Nutmeg portfolio has a reasonable proportion in the USA I would have expected a little better.

But as the pound strengthens against the dollar your US holdings lose value in Sterling.

RichardS

Just thought I would give an update. After 5 months with Nutmeg I am up 1.5% overall. My Level 4 fund is up 0.9%, my Level 6 fund is up 3% and my Level 8 fund is up 0.1%.

RichardS

Another update on this. I am currently up 3.6%. My NET Contribuitions are £18,635 and my overall value is £19,331 (a net return of £696). £10,000 of that is in an ISA. My Level 4 fund is up 3.4%, my Level 6 fund is up 4.6% and my Level 8 fund is up 2.1%.

I have been investing with Nutmeg since May I think so that's after around 8 months. I'd love to know if anyone thinks thats a good return or whether I could have done a lot better somewhere else with the money (as I am a bit of a novice)