Time to sell all non-cash Investments ?

BananaRepublic

sjw11 wrote: »

He berates me for holding some investments, saying I should not feel any loyalty to them just because you have held for several years

Some of my investments were flavour of the month, round about the time I bought them, although that was not my motivation for buying. Then they fell out of favour. But over 10-20 years they have done well. If an investment does consistenly badly compared to its target sector, then it might be wise to sell. And if you have good evidence that the sector is doomed, then sell. But otherwise, hold.

Incidentally you can check the performance of your investments via the A J Bell web site. They allow you to look at performance of all funds in a sector, a feature which as far as I know no other freely avalaible site provides. I suspect IFAs have access to such tools, which are very useful. Many sites such as Fidelity simply allow you to view performance of a single fund, or a few, which is less informative.

jamesd

Given the substantial risk of market turmoil the adviser seems to be giving you good capital preservation advice. That would turn out to be particularly good advice if the vote is in favour of brexit and could give you the opportunity to invest again after major stock market drops.

Of course if brexit doesn't happen you could miss out on a relief rally in markets and this risk is one of the costs of choosing capital preservation over remaining in the market.

Personally I've been reducing my stocks an shares investments for some time, favouring P2P because it has little correlation with stock and bond markets so is likely to suffer much less in any turmoil. The rates available also exceed the long term average growth of the UK stock market so I'm not likely to be giving up any returns by doing it at the moment. This is not primarily due to brexit risk, reducing that is just one of the benefits.

Whether the move looks good or bad longer term depends on your opinion about whether brexit will happen or not. A person who thinks brexit is unlikely and has a long investment horizon will probably think it's foolish. A person who wants to protect against a significant medium term adverse possibility or who has a shorter investment horizon may think it's a great idea. And those who just hate volatility will be willing to pay the price of being in cash or other investments for a while.

If you think you can deal with a 40% stock market drop, severe market turmoil for at least three following years if the vote is in favour of brexit then then ten years of low growth there's much less reason to do this. If you want to protect against it you'll probably pay a percent or three in lost growth for the peace of mind if you use cash, less or nothing if you use other investments.

The protection first view is particularly appropriate for those approaching or in the early years of retirement, for whom a big drop in value could be very harmful.

bigadaj

BananaRepublic wrote: »

Some of my investments were flavour of the month, round about the time I bought them, although that was not my motivation for buying. Then they fell out of favour. But over 10-20 years they have done well. If an investment does consistenly badly compared to its target sector, then it might be wise to sell. And if you have good evidence that the sector is doomed, then sell. But otherwise, hold.

Incidentally you can check the performance of your investments via the A J Bell web site. They allow you to look at performance of all funds in a sector, a feature which as far as I know no other freely avalaible site provides. I suspect IFAs have access to such tools, which are very useful. Many sites such as Fidelity simply allow you to view performance of a single fund, or a few, which is less informative.

Trustnet? Morningstar?

BananaRepublic

bigadaj wrote: »

Trustnet? Morningstar?

The MorningStar fund comparison tool looks like the one as used by YouInvest, with a few cosmetic changes.

chucknorris

It is approximately 1/2 (67%) stay in, 2/1 (33%) exit, currently on betfair. A bit closer than I envisaged, but I am hoping that common sense prevails.

Glen_Clark

chucknorris wrote: »

It is approximately 1/2 (67%) stay in, 2/1 (33%) exit, currently on betfair. A bit closer than I envisaged, but I am hoping that common sense prevails.

Interestingly the Establishment seems split between royalty who want to re-establish their Authority over us by coming out, and the rest of the landed gentry who want to stay in to keep EU Farm subsidies - their agricultural land prices have already fallen on the possibility of Brexit.

Linton

jamesd wrote: »

......

If you think you can deal with a 40% stock market drop, severe market turmoil for at least three following years if the vote is in favour of brexit then then ten years of low growth there's much less reason to do this. If you want to protect against it you'll probably pay a percent or three in lost growth for the peace of mind if you use cash, less or nothing if you use other investments.

This seems a remarkably unlikely scenario in global terms. Perhaps if you are 100% UK invested, but even then much of the value of the FTSE All Share is founded on world markets. With a well balanced portfolio a 40% overall drop is always possible, but not because of Brexit.

When will you know that the time is right to re-invest?

The protection first view is particularly appropriate for those approaching or in the early years of retirement, for whom a big drop in value could be very harmful.

If this and the first quote are serious worries for you it is a sign that you were invested way beyond your risk tolerance and you should never have been in this position in the first place.

bigadaj

BananaRepublic wrote: »

The MorningStar fund comparison tool looks like the one as used by YouInvest, with a few cosmetic changes.

Which way round do you think that is?

The two websites identified provide most of the fund monitoring data which is then bought or utilised by the platforms selling the funds, though trustnet now have introduced their own offering in the last couple of years.

bigadaj

chucknorris wrote: »

It is approximately 1/2 (67%) stay in, 2/1 (33%) exit, currently on betfair. A bit closer than I envisaged, but I am hoping that common sense prevails.

Yes I think the polls are close than that.

I think an out vote might prevail, I'm fairly ambivalent and unless you work for or are heavily invested in rolls Royce, Airbus and any other companies that have an interest in staying in then it's not clear cut.

I wouldn't be at all surprised by an out vote and may put a few quid on it. The weight of media is on out, people are suffering from immigration related issues such as house prices, social housing, commuting, traffic, etc

Immigration has held wage inflation down and more general ex house inflation too, but more people probably feel more strongly about being out than staying in.

I'm veering towards out currently, I certainly don't blame immigrants for any issues and if there is a benefit problem then the root cause of this is uk legislation and legal systems rather than foreigners themselves. What might be a problem is trying to get many British people off benefits to do the low paid work that is currently done by immigrants, there doesn't seem a lot of incentive for many to do hard manual work for what would be a very marginal increase over income that comes from doing little or nothing and being reliant on benefits, housing benefit being the primary problem.

economic

i would be holding cash, defensive stocks (blue chip in US) and property in locations with liited supply. now is not a time to get aggresive with risk.