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

bownyboy

Interesting thread and one that is close to my current experience. I started investing monthly into S&S ISA with VLS LS60 1 year ago. I now have £8.5k in there and my 'profit' is £200 or 2.1% for 12 months.

It was higher last month, but as my monthly contribution is about to go through I'll get shares on the cheap this month, so swings and roundabouts.

I'm a passive investor (hence the tracker) but can't help checking in most days using the HL app...

My time horizon is 8+ years, so you just have to leave it to do its thing and not worry unduly.

MadMat

bownyboy wrote: »

Interesting thread and one that is close to my current experience. I started investing monthly into S&S ISA with VLS LS60 1 year ago. I now have £8.5k in there and my 'profit' is £200 or 2.1% for 12 months.

If you've been dripping the money in over 12 months the growth rate is significantly better than 2.1% - only the first monthly installment has been invested for the full 12 months!

The profit may be £200, but assuming equal monthly installments your average balance over the year would have been £4250 and so the profit rate more like 4.5%

Mat

Eco_Miser

PenguinJim wrote: »

In your example, Eco Miser, you could be rebalancing during those 10 years, funnelling money out of the stocks that show high gains and moving them into a less risky "deposit pot" as time goes by, so it's not a case of buying today and ignoring them completely until 8/10/2024.

I was rather hoping that puk999 would explain his reasoning; but anyway, my rhetorical example posits a market drop whenever I consider cashing in an investment.

Alternatively, rebalancing and funneling could be used with a five year investment to make it safer.

Linton

Eco_Miser wrote: »

Could you explain why 5 years? I could hold funds for 10 years, then have them crash 50% a week before I want to cash them in to buy a house; or I could hold for just 3 years and be up 30%.

Because you work on a rolling 5 years perhaps re-evaluated annually. So in your example after 5 years higher risk investing if you were then planning to sell in year 10 you would begin to transfer to lower risk investments.

Why 5 years? 5 years is a reasonable time for shares to recover from a major crash. You could make a 30% gain in 3 years, you could also make a 30% loss and not had time to recover. If you had the boundary a lot more than 5 years you would be likely to miss out on the gains.

Linton

Also in your example, even if you hadnt reset the 5 year period and you had a 50% crash in year 10 you would still be likely to be up overall.

Freecall

dunstonh wrote: »

....want lots of return without taking any risk.....

That's me!


Unfortunately I've been investing for 20+ years and am still looking. Let me know when you find such a beast.

puk999

Eco_Miser wrote: »

I was rather hoping that puk999 would explain his reasoning;

My apologies, the internet was down in work most of yesterday and PenguinJim gave what I thought was a fairly good reason. I should've explained my thinking in the original message.

If you are investing with a particular date in mind for when you need the funds (e.g. house deposit, retirement, university fees), as the date draws nearer it is prudent to lower the proportion in equities so that you don't feel the full effects of a crash. For example, managed pension funds know the date you plan to retire and do this automatically for you. The longer the investment timeframe, the more opportunities you have to rebalance the equity:cash ratio when you feel that markets are up. 5 years was suggested as a minimum as I think that will give the OP chance (not certainty) to recover if he/she invested today and there was a crash tomorrow. If OP needed the money in 5 years, I feel it would be very risky to keep 100% equities right up until the end of the 5 years.

The OP mentioned wanting the money in 2-3 years time. I would hold cash if I was him/her and take advantage of the current accounts. If OP really wants to invest then I would do it with a portion of the money (a quarter?, a third?) but be prepared for the real possibility to be 30% or more down on that portion when he/she needs the money.

A_Flock_Of_Sheep

I only have VLS 60 equity now and £2000 in unicorn UK income. Not sure how either are faring at present but I suspect they are both down.

OP I feel what you are saying as I was like that.

Think I will go and check my two investments later. Might even find a dividend lurking in there somewhere.

A_Flock_Of_Sheep

One thing I will say is in my experience you think your risk aversion is greater than it actually is.

A_Flock_Of_Sheep

My unicorn is down 8% and VLS up 6.2%

I guss 8% down on unicorn isn't bad as its a fairly risky one.