Property Fund - Suspended

Thrugelmir

bottleandahalf wrote: »

sold some of the investments long before the vote?

Then it wouldn't a property fund.

Why didn't investors weigh up the risk and liquidate property holdings earlier. Greed perhaps. A fear of missing out if prices were to rise.

gadgetmind

dunstonh wrote: »

It could go on for years. Seeing as you dont really understand the investment class, its probably isnt a good opportunity for you.

I tend to agree.

Commercial property has been on a bit of a bubble as people saw that 1) it had gone up, 2) had a decent yield, 3) "property prices never fall", so off we go.

But in a downturn/recession the usual posture adopted by a property company is leaning desperately on their tottering bankers praying the voids don't keep on multiplying.

It's an interesting asset class and not one to have heavy exposure to IMO. I have no idea why anyone would want a single commercial property in their SIPP under pretty much any circumstances, but I know a few people who've done it. It's either done very well or ended in tears of the "totally wiped out" variety.

bottleandahalf

All a learning curve for me folks. I just thought that if there was an odds on chance of voting to leave that property fund managers would maybe sell off some of the bubble property in the London and the SE, to counter the threat or something.

I am invested for the long term, but just concerned the funds will never reach the prices I bought at again.

gadgetmind

The problem is that "sell off" with property takes time, and if you're selling at the same time as others, then prices will fall unless you can find loads of "bigger fools".

This is why it's called "illiquid" and this is why holding anything with low liquidity in an open ended vehicle is (in the opinion of myself and many others) a very bad idea.

I leave others to comment on why professional advisers almost exclusively steer naive consumers towards these products.

Linton

bottleandahalf wrote: »

All a learning curve for me folks. I just thought that if there was an odds on chance of voting to leave that property fund managers would maybe sell off some of the bubble property in the London and the SE, to counter the threat or something.

I am invested for the long term, but just concerned the funds will never reach the prices I bought at again.

The property is things like large office blocks or shopping centres which perform very differently to residential property. You cant just sell a few if the market looks a bit peaky or when your stop loss is triggered and buy back a couple of months later. The underlying investments, if they are of reasonable quality, continue to provide a steady rent. These type of property funds are for the long term to provide some level of diversification, just buy and forget.

Thrugelmir

bottleandahalf wrote: »

I am invested for the long term, but just concerned the funds will never reach the prices I bought at again.

Worth taking a look at what the fund actually owns. Who the tenants are. Length of remaining leases. Quality of the premises. Etc etc.

At a given price level. It may be worth buying more units. Not that one should chaser losers to recover losses. Sometimes you just have to take it on the chin. Diversification within a portfolio is key. As long as the winners exceed the losers. Then you'll be making money.

simonfitba

I'm thinking of opening up a couple of small equal positions in LAND and BLND within my ISA. But I think they have further to fall.

AnotherJoe

bottleandahalf wrote: »

All a learning curve for me folks. I just thought that if there was an odds on chance of voting to leave that property fund managers would maybe sell off some of the bubble property in the London and the SE, to counter the threat or something.

I am invested for the long term, but just concerned the funds will never reach the prices I bought at again.

You can't sell off a massive office block in five minutes !
And to answer your response on another post, people are behaving like lemmings because they are selling off almost without thought just because, others are, and not on any analysis on rentals, yields etc.
Wait long enough and prices will recover. Whether that outpaces other shares, inflation, who knows. I didn't have the foresight to liquidate a month ago so im sticking with mine. End of the day, people need houses, businesses need office space, shops need retail premises so I'm betting it will recover.
You shouldn't focus on whether it will get back to what you bought it for that's history and utterly irrelevant. The question is, at today's prices, is it a buy or sell.. If a buy, hang on. If a sell, sell.

gadgetmind

Those are two of the larger ones, and we do hold one of them, but some of the tiddlers seem to be more hungry. Of course, you can just use the IUKP ETF if you can't decide.

jimjames

bottleandahalf wrote: »

Because they are getting paid to 'manage' these funds. If they think there will be a risk of withdrawals, should these fund managers not have earned their corn and sold some of the investments long before the vote?

L and G was holding 20% cash before the vote, in case of a Brexit vote. Along with a 5% spread. Ridiculous in my opinion.

I'm afraid it's not ridiculous at all if you think about it logically. If I invest I expect the company to invest in what they say, not hold cash on the off chance that a few people may want to get their money out.

If you were so concerned about accessing your money why didn't you use an investment trust or sell up before the Brexit vote?