Which Vanguard life strategy fund will be most suitable for my situation?

Thrugelmir

If you are working in the NHS have you investigated the idea of buying more pension? Just a thought as an alternative option.

pauljoecoe

trickydicky14 wrote: »

Can you help
Just spent my first £1000 on vanguard 60% this is with Charles Stanley I did this on the 15th Oct when I log in I just get a message saying "Pending order" could you tell me how long it takes to go through.
Thanks.

Charles Stanley only buy into the vanguard on the 10th of the month so nothing will happen to the money you pay in until then. It will just sit in your CS account. I pay mine in around the 5th so that it is there ready for the 10th. I think they advise direct debits to be set for 3rd at the latest.

ColdIron

pauljoecoe wrote: »

Charles Stanley only buy into the vanguard on the 10th of the month so nothing will happen to the money you pay in until then. It will just sit in your CS account. I pay mine in around the 5th so that it is there ready for the 10th. I think they advise direct debits to be set for 3rd at the latest.

Quite incorrect I'm afraid. If you have entered into a monthly savings arrangement with them they do indeed place the order on the 10th but you can buy funds etc at any other time that you like

pauljoecoe

Ryan_Futuristics wrote: »

Personally: I wouldn't touch a Vanguard Lifestrategy fund with a barge pole at the moment (and if I owned one I'd be selling in the next few months)

Really? Worse than it sitting in a 1.5% ISA?

Any other views on Ryans comment anyone?

masonic

pauljoecoe wrote: »

Really? Worse than it sitting in a 1.5% ISA?

Any other views on Ryans comment anyone?

Vanguard LS contains a large allocation towards markets such as the US, which on historic terms are starting to look expensive, or if you go for one with significant bond exposure, you have impending interest rate rises, both of which increase the likelihood of a capital loss, or poor growth, in the short term. However, one thing I don't think Ryan would advocate is staying in cash.

If you believe that you can forecast the returns of different markets, then avoiding a fixed allocation fund like LS is natural, but many people who try to predict market returns get it wrong and may end up doing worse than if they'd just invested in something like LS. So there are no guarantees, and in that situation it is perfectly reasonable to ignore the short term financial climate and stick to a fixed long term strategy.

The one thing you might want to do if you have a lump sum to invest is to drip feed it over the next 6 months in case of further market drops, but even doing that you run the risk of missing out on gains if markets start to rise again.

Ryan_Futuristics

Yeah I looked at Vanguard LS 100 again the other day and it's average valuations aren't as bad as I'd thought - it's just the US component I feel could drag performance a bit

I'd certainly drip-feed rather than put a lump sum on it (the markets could be on the verge of tanking, or the US could be back to growth next year with further QE) ... But as far as low charges go, I'd probably be choosing a FTSE All Share or UK income tracker above it (because of better valuations and a higher dividend)

A great site Meb Faber linked to yesterday, with a nice interactive graph showing predicted returns of various equities and bonds

http://www.researchaffiliates.com/AssetAllocation/Pages/Equities.aspx

While it's impossible to predict the future, valuation at least tells you whether you're paying above or below the odds ... And when you're paying above - despite all the chaos of the markets - probably is slightly working against you

Similarly, the key to buying cheap is to diversify (because when probability's on your side, the more you spread out your risk, the more shots you take, the more it tends to average out in your favour over 5-15 years)

mgdavid

OP, getting back to basics, did you say you are saving into an S&S ISA? Is this standalone or is it held within a SIPP so you get the 20% tax added to it? Free money must never be overlooked - especially when it is gifted by the taxman! :beer:

masonic

Ryan_Futuristics wrote: »

A great site Meb Faber linked to yesterday, with a nice interactive graph showing predicted returns of various equities and bonds

http://www.researchaffiliates.com/AssetAllocation/Pages/Equities.aspx

Yes, I've been playing with that today. I noticed it seemed to be missing some of the cheaper European markets, but it covered all those to which one can get reasonable exposure without looking to non-UK listed investments.

Monevator also pulled together some interesting commentary on CAPE in relation to the UK market today: http://monevator.com/weekend-reading-shares-fell-its-what-shares-do/