What's happened to my portfolio in the last 2 weeks?!

jimjames

Rather than worrying you could buy more and get better value?

But 3% cheaper isn't really much of a bargain. If it was 50% then I'd be filling my boots!

atush

investing above your risk acceptance level? Dont know enough about investing (or even what your own risk level is)?

Learn or as D says, get out.

atush

jimjames wrote: »

Rather than worrying you could buy more and get better value?

But 3% cheaper isn't really much of a bargain. If it was 50% then I'd be filling my boots!

Well that is what I do? but this guy, dont know/

Thrugelmir

El_Selb wrote: »

.but regardless pretty annoyed at losing £200+ off my previously £6k portfolio.

One of my SIPP shares is currently down 32%. Rather than panic I looked at the Company's fundamentals and bought a further tranche of shares. Investors move in herds akin to Buffaloes. Rather than understanding what they've invested in. Better to be a lion and bide ones time.

Totton

You may wish to look at how risky those investments are, since Feb you should be up a little imho though over the last two weeks a loss is not unexpected. As others have pointed out, you have to be prepared for losses.

I wouldn't be surprised to see further falls so I have moved more defensive than I was last year. I bought more of RIT Capital Partners (RCP) and Personal Assets (PNL) whilst also moving to about 15% in cash within the ISA.

TrustyOven

dunstonh wrote: »

Ok, so you have picked a very high risk selection in terms of volatility. Way above the typical UK investor.

Hi dunstonh

I'm intrigued to know what the typical UK investor's risk profile is. Purely out of interest and fascination.

The individual company stock (IP Group) would be too much risk for me, but the other funds in OP's portfolio wouldn't worry me too much. As jimjames says, good time to buy more.

Again, out of pure intrigue, I did some quick searches on Google for the fund information and seems to me (in my very amateurish, untrained, inexperienced eye) that the above portfolio is about 92% equity:

FTSE 250: I assume 100% equity
IP group : I assume 100% equity
Lizard Emerging: Indicates 5.10% cash, the rest I assume is equity
Vanguard LS 80: They report can be up to 85% equity, checked the factsheet from H-L and it said about 72% equity (58.52% international, 14.21% uk).

Not sure if I got the following maths right:
(1+1+0.95+0.72)/4 = 92% equity (percentages of each fund)

Weighted values of equity of each fund, summed and then divided by total:
((1000*1) + (500*1) + (700*0.95) + (3600*0.72))/5800 = 82% equity.

Not sure why they don't match up. I'm an amateur

bowlhead99

TrustyOven wrote: »

Not sure if I got the following maths right:
(1+1+0.95+0.72)/4 = 92% equity (percentages of each fund)

Weighted values of equity of each fund, summed and then divided by total:
((1000*1) + (500*1) + (700*0.95) + (3600*0.72))/5800 = 82% equity.

Not sure why they don't match up. I'm an amateur

They're not supposed to match up. The first calculation is irrelevant for working out your exposure because if you put more money into the funds that are low equities your overall portfolio will be lower equities. Doing a simple average doesn't work at all unless you have exactly the same amount of money in each investment.

Imagine you had £100,000 in a 100% equity fund and a tenner in a 50% equity fund. Your overall exposure to equities is £100,005 (99.995% of your £100,010 portfolio) while the simple average of the two types of investment you hold is 75%. As you can see, the simple average is useless.

As an aside:

Vanguard LS 80: They report can be up to 85% equity, checked the factsheet from H-L and it said about 72% equity (58.52% international, 14.21% uk).

.It's more than 72% equity. Pretty much 80% really.

On that asset allocation table at HL,they have a 5% chunk which is basically unclassified,; HL just call it 'managed fund' and don't look into it properly. However if you look at the list of top 10 holdings you can see there's a 5% chunk called "VANGUARD FTSE UK ALL SHARE IND VANGUARD FTSE UK ALL I A GBP" which is just a UK allshare unit trust. So altogether there's 20% in the UK: 15% in one uk equity index fund and 5% in another. And overall there's about 80% in equities despite the fact that HL have some of it unclassified.

Of course, whether there's 72 or 75 or 80% in equities doesn't really change the fact that the fund could feasibly make or lose 30,40% or more once or twice a decade. And that is the least volatile of the OP's four holdings. I would imagine the 'typical UK investor' of which Dunstonh speaks would normally not want anything like that level of volatility.

Most would say they would not want to risk much of their money because they need it to fall back on in x years time or in retirement. Basic psychology of the uninitiated - people are naturally cautious and risk averse. But this is because the typical investor does not know much about investing when they first consider it. Probably after a bit of education they would begrudgingly accept that being hypercautious doesn't allow you to retire anything like so easily, and would then embrace some investment risk / greed ahead of caution. But not totally risk:On.

Another factor is that the 'average' person who has significant sums to invest is older than the youngest. Which sounds like common sense... but basically the youngest can have a 50+ year timescale and be earning a steady income rather than relying on the day to day investment returns. They can be heavily or totally weighted to equities- but the 'average' does not have that luxury as they may be looking to retire on it in a couple of decades or already be retired and wondering how to give themselves 30 years or more of stable income. While 90% equities is fine for some of those people, I can't see it being common.

The average person doesn't use MSE forums or IFAs so they probably have a relatively low exposure to equities within their net worth. Maybe a pension with a standard 'balanced' default fund choice, which is nowhere near 90% equity once they get into their 40s, even though they still have half their life left to live.

PenguinJim

El_Selb wrote: »

Not sure whether I've been very unlucky or there's been a bit of a slump in the last couple of weeks...but regardless pretty annoyed at losing £200+ off my previously £6k portfolio. I've endured a pretty tight month so I could hit the £6k mark this month....only to see half of what I put in get wiped off! It's basically wiped off the earnings above cost since I started investing in Feb.

I'm in a similar position, although I didn't start until May this year. As I've only had time to put money into income shares and index funds so far, I haven't "lost" anything on the shares (except the cut divi from Tesco) because I'm DRIPping anyway (so 5% reinvested in 100 shares worth 400p each buys exactly as many shares as 5% reinvested in 100 shares worth 200p each, for example).

But all of those red numbers! Jiminy Cricket! I've stopped looking every day as I'm just going through so many tissues. People say you need a strong stomach to take losses, and they're right. Just don't sell..!

Intellectually, I know I haven't lost anything because they're all 20+ year investments, and all I've missed is the chance to buy some of the shares slightly cheaper. But just as with buying any other purchase, you need to choose the price you're willing to pay at the time you're going to buy. If it's too much, don't buy. If it goes on sale cheaper a week later, it's annoying (ANNOYING ANNOYING ANNOYING sometimes!) but perfectly fair, and you've still got your original purchase at the price you were prepared to pay.

Curiously, it has not deterred me from buying more. Hurry up and fall, FTSE! I'll have more cash next week and I'd like... ummm... BP please! 400p, if you would be so kind. :beer:

TL;DR don't sell, and buy more when they're cheap!

2010

Think of poor, old Warren Buffet, who`s lost £500 MILLION on Tesco alone.

Freecall

2010 wrote: »

Think of poor, old Warren Buffet, who`s lost £500 MILLION on Tesco alone.

....... and he said that he accepted that he may have misjudged the investment but retained long term confidence.

Now there's risk tolerance for you!