Investing advice for a noob

Mikey17

Hello, after reading this thread from another noob https://forums.moneysavingexpert.com/discussion/5003896 , I would appreciate your thoughts on a proposed investment.
I have some money invested in
HSBC FTSE All Share Index Class C - Accumulation and a bit more in
Vanguard LifeStrategy 60% Equity Accumulation
I was thinking of either BlackRock Corporate Bond Tracker or BlackRock Dynamic Diversified Growth
My main reasoning behind this, is to get a mixture of investments.
I would appreciate any thoughts on whether this is a bad way of reasoning.( with the investments chosen )
Many thanks

bigadaj

Most people would look at a spread of investments based on their risk profile and targets and then determine an asset allocation to achieve that profile.

Two ways of doing that are either selecting a range of funds, either trackers or actively managed, that cover various markets such as uk, us, Europe, Japan, Asia, emerging markets etc to meet a profile you are happy with.

Alternatively using multi asset funds, again either managed or passive, the latter having the advantage they normally automatically rebalance. This second took won't cover smaller investment areas, so if you want to invest in areas not included in the multi asset funds then you have to add side funds.

The problem currently is that your vanguard fund follows teh second approach whereas the hsbc fund follows the first approach. Also the vanguard fund has a Bond allocation so you wouldn't need a separate bond fund.

Best to do a bit of reading and come up with an approach and check back for sensibility.

BLB53

My main reasoning behind this, is to get a mixture of investments.
I would appreciate any thoughts on whether this is a bad way of reasoning.( with the investments chosen )

The main thing to address is asset allocation and also to get to know the difference between risk and volatility - the two are often confused.

Equities are more volatile than bonds and many think they are therefore more risky but over the longer periods, equities will provide the better returns - maybe on average 4% or 5% pa. Over many years, this will make a big difference to the value of your portfolio due to the magic of compounding.

Therefore if you are likely to be investing for 10+ years, personally I would look mainly at a diversified equity portfolio rather than bonds and particularly smaller companies.

Mikey17

Thanks for all your replies. I will take on board what you have said,
Cheers

fiza200 wrote: »

How much money you have to invest?

Not a great amount, but I wouldn't want to divulge such info on the internet

bigadaj

Mikey17 wrote: »

Thanks for all your replies. I will take on board what you have said,
Cheers



Not a great amount, but I wouldn't want to divulge such info on the internet

Don't know why, it's all anonymous. Also the stance you adopt will change depending on whether it's hundreds, thousands or tens of thousands.

Mikey17

bigadaj wrote: »

Don't know why, it's all anonymous. Also teh starlets you adopt will change depending on whether it's hundreds, thousands or tens of thousands.

Ok, about £ 7,000

atush

is this all the money you have, or do you have a cash emergency fund?

Do you have a pension?

Mikey17

atush wrote: »

is this all the money you have.

Do you have a pension?

No, with the £7000 and my other money invested, it totals about 11% of my savings. I have no debts
My pension is extremely insignificant. I appreciate any advice on my poor choice of investments ,but feel a bit uncomfortable about posting personal details

atush

These are anonymous details. that can't hurt you but could help you.

Put the 7K in the pension, watch it grow instantly to 8750. Then invest it however you would have invested it in a S&S isa. at 11% of your savings, I am hoping the other 89% isn't just in cash.

Hows that?

Mikey17

atush wrote: »

These are anonymous details. that can't hurt you but could help you.

Put the 7K in the pension, watch it grow instantly to 8750. Then invest it however you would have invested it in a S&S isa. at 11% of your savings, I am hoping the other 89% isn't just in cash.

Hows that?

Thanks very much , just been reading about SIPP, see what you mean now