not the investment board BUT...

TheBlueHorse

I like the opinion of the people on this board.

So, I have an ISA and in that ISA I have some units from the JP Morgan Natural Resources. They have TANKED the last few years and don't seem to be improving much at all.

The question is, should I leave them alone to one day rejuvinate themselves, or should I cash them in and re-invest in another fund that is doing better?

And if yes to reinvestment, any suggetsions on good funds/ISA providers?

Current ISA is with HSBC and it is rubbish as you can't see funds or change anything online. All you can do (if you're lucky) is see the overall value.

Cheers
TBH

purch

Natural Resources was a "fashion" investment, and JPM was the poster child of those who peddle such stuff.

The problem with the spivs who like to push you into investing in these high commision paying vehicles, is that they are all too keen to tell you to pile in, but then they have a tendency to go awfully quiet..............

Did you really think "Natural Resources" was a great sector to get into, or was it just the spivs you told you it was ?

It's your decision what you do with the investment, especially as those who peddled the idea to you are not around to help.

My advice is stick it somewhere you understand, and for good reasons that you understand, so in the future decisions such as when to take the profit, or the loss are simple to make.

TheBlueHorse

my theory was, people will always need natural resources. So essentially the price will go up. It seems to invest in oil, diamonds, gold, coal etc etc.

I know that building has slumped since 2008 peaks - but nevertheless, you'd think that natural resources (being limited in nature) would always do "ok" over time. But over 6 years or so, they have done terribly.

This fund was started in 1965 i think - so hardly a newbie.

The question is - do I stick with them until they claw back the losses (if they ever do) or bin them and move on.

I don't think I really understand anything (sector wise). Does anyone - unless they work in those sectors, and even then, do they really know?

Generali

Sell resources. They're only going to go down further.

purch

TheBlueHorse wrote: »

people will always need natural resources

Yes, that was the line used by Mark Dampwit from HL when they were pushing this fund hard.

Yes it has been in existance since the 1960's but it became an "essential" part of fashionable investing 7 or 8 years ago and was pushed hard by those who care little for your profit and a lot about their own.

It did well out of the commodities boom around the end of the last decade, but that has long gone.

People will always want NR, but they won't pay the kind of prices that these reached back then.

If you bought into this fund based on your own research and knowledge, then deep down you will know it's not going to reach the heady heights it managed 5 or more years ago.

Generali

Our commodities analyst at work is a very, very bright lad and he is very bearish on commodities.

Oil, gas, iron ore, gold, silver, copper and coal all expected to fall substantially from current prices. BHP, Rio Tinto, the US and Saudi have all said that they're going to dig up as much as they can as fast as they can. That is only going to have one impact on prices.

purch

There is an idiot on this board who paid £30 plus for Anglo American once, and something equally as stupid for Xstrata :eek:

TheBlueHorse

Cheers Generali. I think the received wisdom here is dump them.

The next question is what do I put the pittance that is left into?

purch

Buy the BGRE (although you may have missed the βάρκα)

Generali

purch wrote: »

Buy the BGRE (although you may have missed the βάρκα)

Greek Sovereign Bonds. What could possibly go wrong?

If it's a diversification investment then a REIT or Listed Infrastructure fund looks good right now. People are looking for yield and they should both provide yield. REITs have to.

Commercial property (offices not shopping malls) looks like a good bet to me.

I'd actively avoid IT, resources, fixed income (bonds) of any sort. An ethical fund might be a good bet with the Paris Round of Climate Change talks coming up. If even Tony Abbot has been converted to a Greenie then there might be some serious implications for miners, electricity generators and others likely to be underweight or even excluded from an ethical fund (bear in mind I help run several ethical funds, albeit ones that you can't invest in, so I must declare an interest).

Alternatively there's Warren Buffet's investment of choice for his family, the Vanguard S&P500 index tracker.

IronWolf

TheBlueHorse wrote: »

my theory was, people will always need natural resources. So essentially the price will go up. It seems to invest in oil, diamonds, gold, coal etc etc.

I know that building has slumped since 2008 peaks - but nevertheless, you'd think that natural resources (being limited in nature) would always do "ok" over time. But over 6 years or so, they have done terribly.

This fund was started in 1965 i think - so hardly a newbie.

The question is - do I stick with them until they claw back the losses (if they ever do) or bin them and move on.

I don't think I really understand anything (sector wise). Does anyone - unless they work in those sectors, and even then, do they really know?

But natural resources arent just affected by demand, they are also affected by supply. A few years ago was the end of a decade long bull run in resources, now we are in the bear phase. The build time and costs of digging mines and getting supply means that resources have supercycles, where the price rockets for 10-20 years followed by 10-20 of oversupply and cheap resources.