Stocks and shares NISA advice

Profish

ok thanks guys

I was lookign at nutmeg and also axa all in one packages which offer a selection of funds.
How do these rate in general?

Or just finding a platform and sticking the money into say a couple of these multi asset funds going to show a similar return?

bowlhead99

Nutmeg doesn't have a long enough track record to see how it rates. It's charging a whole percent for its management services though, on top of the costs within the funds. So if the underlying funds make 4 or 5 or 6 or 7% after their own running costs and fees, the 1% you pay to Nutmeg is a quarter or a fifth or sixth or seventh of whatever you expect to make. You can decide whether you want generally higher risk with an expectation of a higher return over time, or generally lower risk with lower returns, but of course none of it is guaranteed. You pay them the high management fee come rain or shine.

You really need 15 years of history to see what happens to a fund manager's return in different parts of the economic cycle. A figure for the return of the last 5 years is just the stock market recovery from mid 2009, and the 10 year return is also from a pretty low point after the previous market bottom in 2003. As we have no idea what funds Nutmeg would have chosen to hold at what time, it's a little difficult to judge them, other than to think to ourselves that 1% plus 0.3% of underlying fund costs is quite a bit.

If you shop around you'll see quite a few fund platforms have 'starter portfolios' where they just suggest 4 or 5 funds that could be held together for a high risk / more adventurous or lower risk portfolio . BestInvest and Hargreaves Lansdown are examples of these. You could buy the funds from them or from any number of fund supermarkets/ platforms who all have slightly different platform fees. So you might end up paying something like 0.5-1% in fees (including platform fees and the fees within the individual funds) depending what you choose, which is quite a bit lower than 1.3% at nutmeg.

To answer your question, just sticking your cash into a platform and buying a couple of multi-asset funds, or a whole bunch of individual specialist funds, may or may not be the same sort of return as nutmeg. Arguably if the fees are lower the returns should be higher but unfortunately you can't know in advance!

If you look at Trustnet or Morningstar (or the fund choices on your platform of choice), you should be able to filter down the huge list of funds to one that is 'mixed investment' i.e. multi asset. So, mixed investment, 40-85% shares, would get you a list like this:
http://www.trustnet.com/Investments/Perf.aspx?ctr=QS&univ=O&Pf_Sector=O:BALMAN

Some of them will have done better than others in recent years depending on what proportion of shares they hold (shares are generally more volatile than other types of assets like bonds, so they go up more in the good times and down more in the bad).

Profish

Thanks for that bowl

I spent a few hours looking at this last night and came to the same conclusion that the fees of a Nutmeg type site would be hard to overcome in terms of profitability.

I have actually just realised (as was kind of obvious I guess) that basically I am better off working out what type of fund/mix I am looking for and trying to pick one with a pretty diverse portfolio with the level of risk I am willing to take and invest in this.

I realised that I can actually transfer my cash ISA to a S&S NISA and then also top up for this year since I have not made any payments to actually have about £27k to put in.

At the moment I am thinking of buying into 4/5 different multi asset funds, I am no sure if this is better than one into one fund but that way I don't feel tied to just one particualr product or rely on just it's success.