Scottish Friendly My UK Tracker Options (ISA)

masonic

mal48 wrote: »

The annualised returns month by month are always consistent with no significant variation.This slight difference can be accounted for as the Scottish Growth Fund bought separately from My Choice has a higher cost-.09% and the fact that My Choice is in an ISA wrap could be relevant. The results are certainly enough to demonstrate that no extra charges are being applied on top of those stated. Cross referencing the L and G underlying funds in the Higher Fund gives similar consistency.

Scottish Friendly UK Growth has an AMC of 1.5%
SVM UK Growth B has an AMC of 0.75%

1.5% is higher than 0.75%.

So you are wrong to state the cost is higher outside of Scottish Friendly.

Also, performance figures are not affected by whether the fund is held inside or outside of an ISA, since they are calculated on the same basis regardless and there is no reclaimable tax deducted at source for any of the funds being discussed here.

Trying to extrapolate 1 month figures into an annualised return is extremely misleading. It is far better to use long term figures, such as the 10 year performance. In this case, the annualised performance figures based on 10 years are:

Scottish Friendly UK Growth: 7.0%
SVM UK Growth B: 10.2%

That's a loss of 3% annualised through holding the investment with SF, which would dwarf any platform charges incurred through investing using a platform.

dunstonh

masonic wrote: »

Scottish Friendly UK Growth has an AMC of 1.5%
SVM UK Growth B has an AMC of 0.75%

1.5% is higher than 0.75%.

Also, SVM publish the OCF at 1.08% compared to their AMC at 0.75%. Whereas SF do not publish the OCF and only the AMC at 1.5%.

bigadaj

dunstonh wrote: »

Also, SVM publish the OCF at 1.08% compared to their AMC at 0.75%. Whereas SF do not publish the OCF and only the AMC at 1.5%.

Whilst it's by no means certain that should be an indication of the sf ocf. It could vary, and may well be larger, but an additional 0.33% would suggest an ocf of 1.83%, which looks very pricey by current standards.

dunstonh

bigadaj wrote: »

Whilst it's by no means certain that should be an indication of the sf ocf. It could vary, and may well be larger, but an additional 0.33% would suggest an ocf of 1.83%, which looks very pricey by current standards.

You are correct. I was really only pointing out to highlight to Mal, who seems to be struggling to understand, that OCF is the important figure and not the AMC.

masonic

dunstonh wrote: »

You are correct. I was really only pointing out to highlight to Mal, who seems to be struggling to understand, that OCF is the important figure and not the AMC.

I've given up on that one. While we are comparing, AMC vs. AMC seems to adequately illustrate how much more expensive the Friendly Society product is.

mal48

Currently Scottish Friendly Growth is outperforming SVM Growth by some margin. Key Facts show Scottish Friendly charges to be 1.5% only. I'm making an annualised return of 20% across my portfolio at present. Good enough. Higher Fund is far and away one of the best performing flexible funds, Mal

bowlhead99

mal48 wrote: »

Currently Scottish Friendly Growth is outperforming SVM Growth by some margin.

Its performance over five years is 70.52% while SVM UK Growth B's performance is 87.35%.

Its performance over ten years is 74% while SVM UK Growth B's performance is 139.7%.

As a long term investment, do you think it is appropriate to focus instead on growth over period of less than five years?

Key Facts show Scottish Friendly charges to be 1.5% only.

Key Facts show that the charges by Scottish Friendly for management services only (the "annual management charge") are 1.5% and are silent on the level of other operating costs.

Key Facts say the option you have selected uses the Scottish Friendly Asset Managers UK Growth OEIC to make its investments, which is the fund whose published performance figures you were talking about in your first sentence.

Scottish Friendly Asset Managers UK Growth OEIC publishes its ongoing charges figure or "OCF" n line with FCA guidance, in a Key Investor Information Document following an industry standard template. In line with the standards, the OCF includes the "annual management charge" and various other operating costs.

The published KIID is available at http://www.scottishfriendly.co.uk/uploads/pdf/products/kiid/key-investor-information-ukgf.pdf . It shows that the OCF is 1.56%

This was pointed out to you in post #81 and you are still in denial. Actually in post #81 I said the OCF was 1.55% but that was outdated information because SF had not bothered to update their published reports since 2014. The latest Short Form report as of May 2016 (which is now available at http://www.scottishfriendly.co.uk/uploads/pdf/customer-centre/isa-oeic-investors/managed-and-uk-growth-fund-short-form-report-may-2016.pdf) shows that the OCF has increased to 1.56% from 1.55 the previous year.

I'm making an annualised return of 20% across my portfolio at present. Good enough.

And unsustainable, driven by one-off market events.

Higher Fund is far and away one of the best performing flexible funds

Not at all. It's performance will be no better than any other fund which went into the current year with the same asset mix of 30% UK, 56% US, 14% Europe. In fact, worse - due to the charges which are higher than market standard.

As its asset mix did not include equities from Asia or emerging markets which have performed better from a UK investor's perspective than equities from UK or Europe for the last year, it would be worse than a large number of funds with a high equities allocation.

Of course, SF do not tell you what it is currently invested in because they do not want their investors to get detailed and transparent information for performance evaluation purposes, because they do not want the sort of investors who critically evaluate funds. They want people who will just throw money at them, accept high fees, sit back and relax.

On the Key Facts document for the Higher Fund it gives that 30/56/14% asset mix and states:

This mix may change tactically from time to time as decided by Scottish Friendly. In addition the target mix will be reviewed at least once a year and will be published at: www.scottishfriendly.co.uk/risk-graded-fund

However, if you go to that link, the target mix has not been republished since August 2015, approximately 17 months. So much for reviewing annually and republishing it. They don't care about investor transparency because they are not looking for investors who are interested in how funds work, how money is allocated, cost control etc. They know that experienced investors like us will have already dismissed them and selected an asset manager who embraces industry best practices.

As a result, you don't know what you are invested in, other than its been going up for a while so you're happy. Ignorance is bliss.

, Mal

Latin for bad, yes?

Good characterisation of the overpriced Scottish Friendly products.

jimjames

mal48 wrote: »

Key Facts show Scottish Friendly charges to be 1.5% only.

1.5% only. Only 1.5%. Wow. That's not something to be crowing about as if it's a good deal.
My funds are mainly under 0.1%, some as low as 0.06%. That's 20x less than you are paying!

bigfreddiel

jimjames wrote: »

1.5% only. Only 1.5%. Wow. That's not something to be crowing about as if it's a good deal.
My funds are mainly under 0.1%, some as low as 0.06%. That's 20x less than you are paying!

When you tell most people that charges are 0.1% they don't actually understand what you mean.

Firstly they don't know what a percentage is!

Secondly they tink you mean 1% not 0.001 of the fund value.

In fact I would guess that the majority of people would think a category of 1.5% was a good deal.

Cheers fj

bigfreddiel

dunstonh wrote: »

Except they are and everyone knows that because the AMC does not include all charges.

Well of course it doesn't!

This is a financial product, so it's not going to be simple and clear is it?

It's a well known fact that the finance world keeps things hidden to the benefit of themseilves.

How can I say such a thing?

Well let's take RDR for starters thst was forced upon the finance industry a few years ago, to try and convince us punters that we weren't going to be ripped off anymore with hidden charges.

Ah well that's okay then it's all good now isn't it folks?

Cheers fj