HL stocks and shares ISA advice needed

MONEYTREE_2

Then I am back where I started!

I don't know what to do!

Bigfreddie so when you say "don't panic, reinvest" do you mean remove all the money and take the £1,800 loss, and then reinvest in this Lifestrategy thingummy?

MONEYTREE_2

I just googled Lifestrategy funds downloaded the PDF and read this:

"Detailed view of sub-asset allocations The sub-asset allocation to individual funds within each asset class is based upon an array of quantitative and qualitative methods designed to provide the best possible return in exchange for a given risk appetite. The equity and bond allocations of the funds are divided into sub-asset classes, designed to meet different riskreturn requirements. The sub-asset allocations, with the exception of UK equities and bonds, are intended to be market capitalisation weighted to help avoid taking a significant bet on any one segment of the market. Such a bet may introduce unsought risk or volatility. The sub-asset allocation each portfolio is adjusted from
a pure global market cap weighting to a heavier weighting in broadly diversified UK equities and bonds to reflect investors’ desire to hold more domestic assets, as well as to balance diversification requirements and investor costs."

Now, whilst I recognise nearly all of those words as being in the English dictionary, I genuinely have no idea what on earth that paragraph means. It's just a load of gobbledegook and might as well be written in Chinese.

I'd like to invest in something so simple that a child could understand it. I am trending now towards Premium Bonds! Is that REALLY as mad as it sounds?

[Deleted User]

MONEYTREE wrote: »

I'd like to invest in something so simple that a child could understand it. I am trending now towards Premium Bonds! Is that REALLY as mad as it sounds?

Not mad, just as long as you realise that you might win nothing. On the other hand you could be lucky .... your capital however is guaranteed by the government.

MONEYTREE_2

I'm sitting here crying now. I honestly don't know what to do.

[Deleted User]

Hi,

MONEYTREE wrote: »

I'm sitting here crying now. I honestly don't know what to do.

woa, don't get upset, chill, you can't do anything until Monday morning anyhow.

Chill, wee bottle of wine, chill.

MONEYTREE_2

Shouldn't that be WHISKEY?

[Deleted User]

MONEYTREE wrote: »

Shouldn't that be WHISKEY?

Whisky or Whiskey, depending on which side of the Irish Sea you live ...

MONEYTREE_2

Whoops. I knew I'd get it wrong!

dunstonh

I am being more cautious because it is not a case of if but when. If you have investments with a risk profile that you are comfortable with then its ok. However, these investments are way above the level that you seem to be comfortable with.

Risk is not on or off. Everything has risk. However, it is a sliding scale. Risk is diluted over time. So, investing £40k in high risk funds with a timescale of 1 year is very high risk. Whereas investing in high risk funds with a timescale of 10 or more years reduces the risk a bit.

You should also invest within your knowledge and understanding. The funds you have are geared to a more experienced investor. You are certainly not that I doubt your ex boyfriend was either (eager amateur playing with someone else's money)

I mentioned that possible range your money could be worth in 12 months time. Anything between £20,000 and £50,000. If you left it and it was £50k or more in 12 months you would be very happy. However, what would happen if it was £30k. Would you accept that, shrug your shoulders and say to yourself you knew it could happen and can just wait for it to go back up. Or would you be worrying even more than you are with just £1250 lost?

bigfreddiel

Dunsty is right, you must realise markets go up and down.

The real money is made from reinvesting dividends, over a long period of time, five years min.

So decide what you want to invest for. Growth or income. In the early years growth is good.many years later after your portfolio has grown, you can start taking the dividends as income.

I started many years ago with £3k in a cash ISA. It made £90 a year tax free. All my mates laughed at me. Said it was a waste of time to save a bit of tax on £90, about £18 I think.

Now my portfolio has £400,000 I'm still reinvesting, and if I took an income it would be say £10k tax free. Anyway in the last few weeks I've made and lost and made again about £20,000. But I don't worry about it. It just noise in the market.

Hope that helps fj