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

Glen_Clark

2010 wrote: »

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

... and has only got 14 winners in his top 15 shares ...:cool:
Just my luck that I bought his losing one because living in England it was the cheapest and easiest one to buy
I'm still in profit overall though

dunstonh

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

It is generally considered to be cautious. Often conflicting (want lots of return without taking any risk). Remember that the average UK consumer has little or no knowledge of investing. Whilst most will say they know there will be losses and know that investments will go down as well as up, when they actually see a loss they suddenly change their mind on that point (especially when going to the FOS where you see "I didnt know I could lose money" style complaints).

Speaking of FOS, most investment complaints that they uphold are about people investing above their risk profile and knowledge. There was an interesting one earlier in the year that made the media about someone who got advice to invest in a spread of single sector funds (across the sectors). The funds were mainstream single sector funds built to a risk averaged spread. Nothing weird or unusual. However, the FOS decided that the use of single sector funds was above the knowledge and ability to understand by the individual. No-one seems to understand that position as few consider the likes of Invesco Perpetual High Income to be specialist investments. The investor was also a company director as well.

Perhaps the FOS were right. The OP here has invested and suggests they accept losses but when a really tiny loss has occurred they have got concerned. Also, if that was an advised selection of funds, it would probably be a mis-sale. Although as a DIY investor, he is free to make his own mistakes.

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:

Risk is really hard to define and there are more things considered nowadays. Loss potential is not the only thing. Capacity for loss is a big consideration. Knowledge and ability come in to play as mentioned. Timescale as well However, if you wanted a really basic indicator, you would probably find 40-60% equity is more common for the average.

Doshwaster

My portfolio as a whole in down 4% this month but up 5% year to date and up 10% in the last 12 month so it's not all bad news. My best fund is up 35% so far this year (but worst is down 30%)

The secret to long term investing is not to get too excited with short term rises and don't get too depressed with sudden falls. This is money that I'm not planning on touching for at least 20 years so what happens in one month is fairly irrelevant. Long term if I can get 10% annual growth then I will be very happy indeed.

Ryan_Futuristics

My investment portfolio's about 98% equities (the rest in property, but that's being sold off as the market tops)

I would normally hold about 10-20% bonds, but they're too expensive at the moment

I'm about breaking even this month in this dip (I would be 3-4% down like everyone else, but Neil Woodford's fund - which I invested heavily in about a month after launch - seems to be immune from bad news, and Murray International's been very strong too)

Dips are great - just as important for investing as peaks (you couldn't really have one without the other) ... I'm holding quite in cash *hoping* that we get a decent 30-40% dip next year (US equities are certainly due one, and the FTSE tends to follow)


@the thread starter:

My advice - don't focus on the cash value of your investments so much ... What you're really trying to do is own shares - and you've still got just as many as you had

Dips are great because they mean you can buy more shares for less money

You might prefer some better dividend payers - markets are likely to get worse before they get better, so income is a nice predictable return (and you can use it to buy even more shares, when markets are terrible)

Personally I'd sell the FTSE 250 and Vanguard LS when the market's swung back, and you won't lose money, (because they're both at the upper end of their valuations) and buy a top rated UK equity income fund, like Woodford, maybe in monthly deposits over 9 months from your capital

gkerr4

Thrugelmir wrote: »

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.

wow! - you're a brave man! - i wouldn't hold anything "down" that much

to the OP - yes - portfolios have taken a kicking in the past couple of weeks - but i agree that you need to look at your risk tolerance in shares if you are unhappy at showing a £200 loss in a £6k portfolio.

green_man

@OP

As long as you are looking at these as a longer term savings then ignore these drops and just keep putting in regular (monthly) amounts. If you get jumpy at a 3% drop then you shouldn't be investing in equities. Don't sell your existing shares they are fine, but when you buy something new maybe think about how to diversify.

Glen_Clark

gkerr4 wrote: »

wow! - you're a brave man! - i wouldn't hold anything "down" that much

Since you must have felt it was worth £3 a share to buy it at that price, why would you sell it when the price drops to £2?

gkerr4

Glen_Clark wrote: »

Since you must have felt it was worth £3 a share to buy it at that price, why would you sell it when the price drops to £2?

because either your research was flawed, or something has changed.

It could be shares in the worlds top VHS cassette manufacturer?

it would have been sold around the £2.60 - £2.70 mark.

jimjames

gkerr4 wrote: »

wow! - you're a brave man! - i wouldn't hold anything "down" that much.

Do you mean something you own that is down that much or a share that has fallen that much?

You could see a bargain that you think the market has mispriced and at the new price it's good value. Not sure if it makes any difference whether you hold the share already or not but I guess there is more attachment to it when you're already an investor which may clould judgement.

So of my best returns have come from buying out of favour stocks - private equity in 2009 was one example.

gkerr4

jimjames wrote: »

Do you mean something you own that is down that much or a share that has fallen that much?

You could see a bargain that you think the market has mispriced and at the new price it's good value. Not sure if it makes any difference whether you hold the share already or not but I guess there is more attachment to it when you're already an investor which may clould judgement.

So of my best returns have come from buying out of favour stocks - private equity in 2009 was one example.

i don't hold or own anything 'down' 32%

I might buy a share which is 32% down on its 52-wk high - thats different.

but in the example used by GlenClark, if i did my research and thought a share was a buy at £3 - bought it - but it then fell to £2 - then either my research was flawed - or something has changed.

Either way, i've messed up and it would be dropped at around the -12%ish mark.

Bit of flexibility there as we have seen, for example a general market dip in the last few weeks - if a share was hovering around the -12% mark in these conditions, id ride the "general market dip" out.

there shouldn't be any "attachment" to a share - they are just bits of paper for trading. getting attached to a share is the road to the poor house.

out of favour stocks are a good buying opportunity - i agree - but to buy and then the price drop a further 32% means you mis-timed the purchase. Or something changed.