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Further investment in Vanguard LifeStrategy?

I've held a small amount in the Vanguard LifeStrategy 80 product (~£500) with Charles Stanley Direct since around the start of the year inside a S&S ISA. I'm in my mid-twenties and have a reasonable amount saved in cash for emergencies (~£20k).

I now have a further £4,500 ready to invest and I'm wondering whether or not VLS is still a reasonable choice for a novice investor to go down.

I am considering splitting this between VLS80 and VLS100 around 50/50 to try to get an equities split closer to 90 - is this a reasonable approach?

I've also read several reports of the US being pricey at the moment, and note that the VLS seems to have quite a US focus. At what stage does it become a good idea to look at other ways to reduce the US focus?

Comments

  • Drp8713
    Drp8713 Posts: 902 Forumite
    Ninth Anniversary 500 Posts
    If youre in your twenties and don't need the money for 10+ years then 100 equities shouldnt be a problem, as long as you are sure you can hold your nerve in a crash and stay invested (or ideally top up).

    Regarding the US thing, if you have opinions on what is good value and what isnt then VLS probably isnt for you. Its there to be a low cost bundle of trackers that you buy and forget, that auto rebalances.

    If you want geographical exposure in different proportiona to the people at Vanguard, then you could build you own portfolio of funds to the weightings of your choice.

    Or you could use a managed fund, which is also multi asset but has a manager to make active decisions like whats good value and what isnt. A low cost example is Baillie Gifford Managed.
  • enthusiasticsaver
    enthusiasticsaver Posts: 16,105 Ambassador
    Part of the Furniture 10,000 Posts Photogenic Name Dropper
    I am a novice investor and have opted for Vanguard LS 60 but I am older than you (mid fifties) so gone for lower equity balance. I too have heard that the US focus is quite high on the Vanguard but in fact in proportion to the global economy it looks about right to me so I am happy to stick with it. I have been putting all my investments into Vanguard LS60 rather than going for a number of different funds to keep my investment portfolio balanced.


    In answer to your question I would say that the Vanguard LS is still a good route to go down therefore.
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  • BLB53
    BLB53 Posts: 1,583 Forumite
    At your age I would say the VLS 100 is a reasonable choice but I do not think you would be losing much by selecting the LS80 and holding a few bonds may help to smooth the journey if you are concerned about market corrections.

    You are correct, the US markets have gained quite a bit in recent years and above their long term average. When they may revert back is anyones guess.

    Like timing the market, very few can do it so just get your allocation right - I use the LS60 but I don't want to shoot the lights out and I am happy with a 'steady as she goes' approach.

    If you probably have not been investing too long, you will not know how you may react when the markets head south - some sail through and pick up more on the cheap - others panic and sell up! LS100 or even 90 is fairly aggressive. Bonds help to reduce volatility when the equity markets dive but you pay the price of slightly lower returns in the long run. All down to you!
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