stockmarkets -are we nearing the bottom or is there further to go ??

bowlhead99

BananaRepublic wrote: »

Don't worry, normal service will be resumed as soon as possible ...

C'mon guys, get back 2 arguing pls so I hv moar tym 2 mak sum essays while ur distracted , kthxbai.
:beer:

masonic

Alcorn60 wrote: »

This year I have looked a 1000% more into the amount of growth /loss of my investment pension with Aviva . This is only because I had decided to retire early aged 59. In April last year when I retired ,I decided to leave pension as is, i.e paid up!! the idea being to give me time get my head round my finances . The amount was back in to April around 160k pension + an ISA investment of around 60K. But !! this last 6 months the values have droped dramatically, especially since the begining of January, its droped another 4% . The ISA is now below my my actual investment amount . Simply I've panicked and arranged for my pension to be transfered into a SIP account with Aviva. (cash account) this will now allow me to drawdown when I do require funds .Can I ask ? Would you who are more experianced at this , reinvest it or leave it safe in the cash account until the current volitile market looks like its starting to recover?

Well why not compare scenarios. So, taking that snapshot of your starting £160k in the pension and £60k in an ISA, plus a couple of years of spending in cash (which I'll ignore for this purpose), you could perhaps target a conservative withdrawal rate of just under £9k per year (rising with inflation).

Considering the worst case scenario of someone retiring right before the Great Depression, just ignoring what was going on around them and continuing to draw down money at the same rate: the money would have lasted about 30 years. In every other situation, the outcome would have been better and on average one would expect for the value of their investments to actually grow in real terms.

Contrast that with moving into cash. Here you might not even keep up with inflation, but let's assume you are able to match inflation. The same withdrawal rate would lead to you running out of money within 25 years - a worse outcome than staying invested right through the Great Depression.

Now I don't know how much you will need to draw down each year, but whether the amount is larger or smaller than my illustration above, it would be unprecedented over the long term for you to be better off having moved into cash.

Edit: and also, since you mention trying to move in and out of cash to avoid some of the market turbulence, you'll find from reading some of the other posts in this thread that if you try to do that, you'll most likely end up worse off than if you simply stayed invested, because you can't time the market.

BananaRepublic

Alcorn60: By the way, you have checked your state pension estimate haven't you? Easy to do online via the government web site. Given your age, you may well have a good whack lined up, since I am 52, mine is less good due to new state pension rules.

coastline

Latest Global Fund Managers survey taken last week 6-11th Feb shows cash levels at their highest in last 15 years.
Funds allocated to Global equities have fallen sharply in last few months although not as bad as 2008.
Will those cash piles end up back in the market who knows ??

http://fat-pitch.blogspot.co.uk/2016/02/fund-managers-current-asset-allocation.html

Alcorn60

BananaRepublic wrote: »

Now is exactly the wrong time to convert shares into cash. Yes they could fall further, but in my view the best approach is to put on your tin helmet, and wait for the storm to pass. They may fall further, but they will rise again. I happen to believe that by the end of the year they will be quite a bit higher, but you should not base investment decisions on the beliefs of a stranger. If you NEED money, cash in the minimum from your investments. As I've said before the tendency for the novice is to buy when shares are peaking and sell when they have fallen. It is often said that you should not buy when taxi drivers tell you to invest in shares, and you should buy when everyone says don't.

Yes my wife and I think your right ,we have both decided to put on our tin hats as you have put it.and hope it will just recover over time and to try and stop panicking . We had applied to Aviva to transfer our existing pension to a SIP,we have today canceled the transfer and left it invested as is. As for my Isa investment ,I have also left as is for at least another year.:eek:

Alcorn60

masonic wrote: »

Well why not compare scenarios. So, taking that snapshot of your starting £160k in the pension and £60k in an ISA, plus a couple of years of spending in cash (which I'll ignore for this purpose), you could perhaps target a conservative withdrawal rate of just under £9k per year (rising with inflation).

Considering the worst case scenario of someone retiring right before the Great Depression, just ignoring what was going on around them and continuing to draw down money at the same rate: the money would have lasted about 30 years. In every other situation, the outcome would have been better and on average one would expect for the value of their investments to actually grow in real terms.

Contrast that with moving into cash. Here you might not even keep up with inflation, but let's assume you are able to match inflation. The same withdrawal rate would lead to you running out of money within 25 years - a worse outcome than staying invested right through the Great Depression.

Now I don't know how much you will need to draw down each year, but whether the amount is larger or smaller than my illustration above, it would be unprecedented over the long term for you to be better off having moved into cash.

Edit: and also, since you mention trying to move in and out of cash to avoid some of the market turbulence, you'll find from reading some of the other posts in this thread that if you try to do that, you'll most likely end up worse off than if you simply stayed invested, because you can't time the market.

Yes my wife and I think your right ,we have both decided to leave it invested & hope it will just recover over time and to try and stop panicking . We had applied to Aviva to transfer our existing pension to a SIP,we have today canceled the transfer and left it invested for at least another year or so. As for my Isa investment ,I have also left as is for at least another year.:eek:
Thank you reply much appreciated:money:

stringer_bell

Alcorn60 wrote: »

Yes my wife and I think your right ,we have both decided to leave it invested & hope it will just recover over time and to try and stop panicking . We had applied to Aviva to transfer our existing pension to a SIP,we have today canceled the transfer and left it invested for at least another year or so. As for my Isa investment ,I have also left as is for at least another year.:eek:
Thank you reply much appreciated:money:

yes, don't sell. I'm no expert, but this time last week, my S&S isa was sitting on a 3 percent loss, Now its showing a 2 percent gain.. might not seem much, but the difference is about £3000

Sam_J12

I've just sold all of my remaining stocks and shares. I was up around 1% over the last 6 months, so the market turmoil did not really affect me much - probably down about 4% from the portfolio's "peak". I felt forced into it as I have had expensive changes of circumstances recently - moving country soon and uncertainty over my job situation for the next year. Feel kind of gutted as I suspect the overall movement will be a very volatile upwards this year but the prospect of a major collapse is significant in my opinion. I couldn't afford to take the risk of having to sell my shares after such a collapse if personal circumstances go down a worst case scenario.

Oh well :beer:

Belfastbelle

I'm so tempted to sell and invest in property.

Is there any good news on the horizon??

bowlhead99

Yes.

There is always good, bad, and indifferent news on the horizon. That is generally why investors earn money from investments over time. Dividends and value growth are the rewards, the compensation, for accepting the risk that the next news about your investment might be good, bad, or indifferent.

But there is usually always good news on the horizon just like there is bad ; what changes from time to time are the relative strength of the different types of news and the distance to the next horizon on which the news is coming.

What is the good news on the horizon for property? Are you expecting lower mortgage rates, perhaps a reversal of the stamp duty changes, a reversal of the recent rules on interest cost deductibility?

Or perhaps you forsee an increase in international demand for UK property due to massive strong growth in Chinese wealth, or greater immigration into UK following an exit from the EU?