HL stocks and shares ISA advice needed

MONEYTREE_2

JimJames

"But in 7 months time it might be higher than it is now. No-one knows. My portfolio dropped about 25% earlier this year. It's now higher. "

THANK YOU for sharing that! I feel a little less panicky now.

(Excuse me for not knowing the correct jargon for this. My ignorance of money matters, maths, etc, is legendary.)

On HL you can look at a graph that shows how each fund has been doing, and it is true that if you choose the "5 year view" they all zigzag up and down but overall, over 5 years, they are much higher than they were back in 2011.

Two weeks ago I put £13,000 into a Managed Portfolio with HL called "Portfolio+ Balanced Growth" and that hasn't lost any money (yet). And now there is this new thing they have invited me to join, which I asked about in the other thread. Because one of my options is to accept the £1789 loss and move all my S&S ISA into the new fund or add it to the "Portfolio+ Balanced Growth" thing.

I am not sure I can leave this money in for 5 years because, owing to splitting up with said boyfriend, I am now thinking of moving to another town. I want to get as far away from that b* as I can and start a new life.

I might (only might) need to take all my investments out of the S&S ISA in question in order to move.

jimjames

MONEYTREE wrote: »

I am not sure I can leave this money in for 5 years because, owing to splitting up with said boyfriend, I am now thinking of moving to another town. I want to get as far away from that b* as I can and start a new life.

I might (only might) need to take all my investments out of the S&S ISA in question in order to move.

Difficulty is that your situation has changed completely within the space of 4 days. Back in post #9 you didn't need to touch the money for 5 years, now you may need to.

Purely based on your comments here, how volatile the investments are and how there appears to be a very high chance of your situation changing then it may be safer for you to move it back to cash. But only you can decide if that's the right move to do. I certainly wouldn't move it into a brand new HL fund that is expensive and has no track record.

(BTW HL haven't invited you to join anything. They are sending you marketing to persuade you to invest money into their fund which will earn them commission. It is in no way any form of specific invitation or advice to you personally)

MONEYTREE_2

Thanks Jim

I might leave it another week and see if they are going back up.

I won't invest in the new fund.

bowlhead99

MONEYTREE wrote: »

JimJames

"But in 7 months time it might be higher than it is now. No-one knows. My portfolio dropped about 25% earlier this year. It's now higher. "

THANK YOU for sharing that! I feel a little less panicky now.

With respect, this thread is getting ridiculous.

From the start, people have been observing that investments in shares and other assets can go down as well as up from time to time and that a few percent here and there is small change in the grand scheme of things.

We have all pointed out that the portfolio you have is higher risk than many people would use, and certainly higher risk than you can handle, and not really suitable for you.

This is clearly the case because you are are literally flip-flopping from

OMG I AM TREMBLING WITH FEAR; to

THANK YOU DUNSTONH FOR EXPLAINING THAT MARKETS GO UP AND DOWN I FEEL MORE COMFORTABLE NOW; to

OMG DUNSTONH HAS SAID THAT IT COULD GO DOWN 30-50% AND NOT RECOVER FOR SEVERAL YEARS, t
I AM LITERALLY CRYING NOW, MY EX CLEARLY BOUGHT THESE SHARES TO PSYCHOLOGICALLY DESTROY ME EVEN THOUGH HE BOUGHT THEM FOR HIMSELF TOO; to

THANK YOU JIM I AM LESS PANICKY NOW THAT I KNOW YOUR INVESTMENTS RECOVERED FROM A CRASH QUITE QUICKLY, ONCE.

You have been told by quite knowledgeable people that the investments you hold are a volatile mix that could easily be 20% higher or 40-50% lower after a couple of years, or even after 6 months. A drop over 6 months, or starting in 6 months, or starting in a year, or two, or five, could indeed take years to recover. That is the nature of the riskier end of the financial markets.

Freddie says ignore the risks that professionals are always careful to point out - because he doesn't like professionals. He says check later in 6 months and you might be pleasantly surprised. Well, of course you might be nicely surprised and you might be nastily distraught. Clearly if the risk of being distraught is a bigger deal for you than some potential profits, you should not just tuck them away and ignore them. Either sell them and move back to cash or change them for something offering lower risk of loss.

Dunstonh who is a professional and doesn't want you to get distressed, has pointed out that there is a very real risk of losing a large portion of the £40k by just turning a blind eye to the fact that the portfolio is composed of risky assets and might be very light in some areas and overly heavy in others. So, several of us have said scrap it, take the small loss, take some time out to work out what you want, and go a different way.

On HL you can look at a graph that shows how each fund has been doing, and it is true that if you choose the "5 year view" they all zigzag up and down but overall, over 5 years, they are much higher than they were back in 2011.

A rising tide lifts all boats, good and bad.

You are looking at a short period of time on which world markets have generally been going up for both stocks and bonds and particularly overseas stocks which make up the bulk of your holdings (at least, by number of funds; we don't knew the proportions in which they are held). If you picked another time period like 1998 to 2003 they would not all be higher, some would be much lower and then not recover until 2006 or later.

Two weeks ago I put £13,000 into a Managed Portfolio with HL called "Portfolio+ Balanced Growth" and that hasn't lost any money (yet).

Interesting new information, I thought at the beginning of the thread you had £40k of cash and £40k of investments chosen by your ex. Now you have another £13k of fund investment coming out of the woodwork. This one is lower risk and volatility but can still produce losses and has very high fees. It can still produce losses although is likely to be more stable. It's still only suitable for the long term, like 5-10 years plus.

And now there is this new thing they have invited me to join, which I asked about in the other thread

You will have seen by now on the other thread, that this is just marketing material, which HL will send from time to time and advertise on their home page. Buying a new fund that only invests in shares from one market (the UK) is not appropriate if you are already investing in a sensible balanced fund that invests across lots of markets and asset classes.

Because one of my options is to accept the £1789 loss and move all my S&S ISA into the new fund or add it to the "Portfolio+ Balanced Growth" thing.

Definitely sell the existing boyfriend-selected holdings. Definitely don't buy the new fund which is single sector with potential for high losses. Perhaps invest the proceeds in the expensive portfolio+ thing if you can't be bothered researching any other choices and you are definitely sure you can tie up the money for many many years.

I am not sure I can leave this money in for 5 years because, owing to splitting up with said boyfriend, I am now thinking of moving to another town. I want to get as far away from that b* as I can and start a new life.

I might (only might) need to take all my investments out of the S&S ISA in question in order to move.

Before, you said you might not have the £40k available to invest because you might use your cash to upgrade your house and therefore your isa money would be your only money, and I suggested you shouldn't have your only money tied up in funds that go up and down on value and might be heavily down when you need the money.

Now, you say you might relocate, and use the money for that. So, for the same reason, you should sell these volatile and unsuitable shares, so that they are not down 20-50% for a few years when you most want to call on them.

As an aside, the fact that you are quite emotionally fragile (that you would literally change the part of the country you live in if a relationship failed... ) - or that you would be crying at the mere mention that funds you are invested in might fall in value 25%+ (even though they have not yet fallen that far and you can easily remove the risk of that happening by selling them now)... tells us that you should *not* be invested in a portfolio that you don't understand and which could drop tens of percent and take several years to recover.

We can all see this.

Sell the portfolio, take the small loss, then take your time to figure out next steps. You do not need to put the proceeds into any HL funds or any investments at all for that matter.

MONEYTREE_2

Bowlhead, I am still going to say "thank you" for your post because it clearly took a lot of your time and effort to try to clarify things for me, even though I feel that to some extent you are mocking me.

I only have one thing that I want to clear up:

Interesting new information, I thought at the beginning of the thread you had £40k of cash and £40k of investments chosen by your ex. Now you have another £13k of fund investment coming out of the woodwork.

The ONLY investments that I started this thread about, the only investments that I am worried sick about, is the 40k boyfriend-chosen funds. There didn't seem any need to list all the other money I have for example the £13k, my Premium Bonds, money in other bank accounts, my SIPP, etc. It was only because someone specifically asked me if I had any account where I could quickly access cash, I believe, that I said yes, I have 40k in two 123 accounts and 2.5 in nationwide.

It wasn't my intention in this thread to lay bare every detail of my entire estate and income, but purely to ask what to do with this particular 40k portfolio. Hope that clears things up on that score.

bowlhead99

MONEYTREE wrote: »

Thanks Jim

I might leave it another week and see if they are going back up.

And if they are down another 3%, what then. Wait another week and see if they recover the 3%, And then what?

If the answer is that you would sell them if they fell another three percent or five percent or ten percent, and you would not wait for them to fall all the way 30-40% and recover all the way back up again, then you have quite a high chance of taking a loss.

If they are down £1.75k from £40k it is a complete coin toss whether they hit £40k or £36.5k next. So, as you don't want to lose £3.5k - but you would probably end up selling and take the loss if it happened, and it is pretty much a 50:50 chance of losing £3.5k as losing £0k... You might as well just sell now - and lock in the £1.7-1.8k loss today.

I won't invest in the new fund.

Good.

MONEYTREE_2

Bowlhead, they showed a slight recovery today since Friday, that is why I thought, let's see which way they are going ... they dropped from 1500 loss to 1800 loss in a week, now only 1789 loss, so maybe in a few more days, they might be at 1700 loss, then 1600 loss ... etc. If they go up to 2,000 loss, then I will definitely pull out at that point.

Does that sound like a plan?

[Deleted User]

Hi,

MONEYTREE wrote: »

Bowlhead, they showed a slight recovery today since Friday, that is why I thought, let's see which way they are going ....

most funds are priced at 12 noon, so the prices you see today are Friday at noon.

The FTSE 100 was down about 40 points at noon today, so not looking good for your funds.

bowlhead99

MONEYTREE wrote: »

It wasn't my intention in this thread to lay bare every detail of my entire estate and income, but purely to ask what to do with this particular 40k portfolio. Hope that clears things up on that score.

Understood.
Nobody is trying to mock you. One of the things to help put a £40k set of investments into context is to get an idea of your other assets (capacity for loss) and the type of assets you have (your familiarity with, and understanding and experience of, other types of holdings). Otherwise any guidance might be well off the mark.

So it is good to know that you already have other investments inside an S&S ISA, and it is also good to be able to put *that* into context by understanding that you have only had that ISA less than a month and have been lucky to never every experienced any material loss on it, which is quite different to holding a big pile of investments up and down through an entire economic cycle or two.

Also I see you mention you have a SIPP, a self invested pension where you select from potentially tens of thousands of options while planning for your retirement. Don't take this the wrong way again, but I would have thought from your involvement with the SIPP that would be obvious that a mixed portfolio of mostly equities-based specialist investment funds could easily bobble up and down every few months.

If your SIPP is really stable and low risk that would perhaps reduce the risk to your overall wealth of your £40k portfolio crashing hard, especially as you are at an age where you can draw on some of your SIPP.

However, another inference would be that if the SIPP is low risk it's because you are unaccustomed to investment risk and do not like it, and therefore based on your preference for low risk, the £40k ISA really really shouldn't be invested in stuff that can drop heavily because it would put you at your wits' end, which it seems to be doing.

bowlhead99

MONEYTREE wrote: »

Bowlhead, they showed a slight recovery today since Friday, that is why I thought, let's see which way they are going ... they dropped from 1500 loss to 1800 loss in a week, now only 1789 loss, so maybe in a few more days, they might be at 1700 loss, then 1600 loss ... etc. If they go up to 2,000 loss, then I will definitely pull out at that point.

Does that sound like a plan?

No.
You are banking on a 1789 gain (to get you out at breakeven) happening before a 111 loss (to get you out at -2000).

Any statistician will tell you that as the market does its random daily walk (with only a mild upwards bias over periods of a year or more), it is *much* more likely to hit -111 before it hits +1789.

So, you might as well put the order in to sell now rather than wait until you lose the whole £2k.

When you put your order in to sell, you do not get the last price you saw anyway, because you are not allowed to deal with hindsight. You get the *next* price they announce, assuming your order made the cut-off time for that day.

So on a bad day you could put the order in after seeing the portfolio is down £1995, and end up taking a loss of £2795 if the particular markets in which you are invested fell a further 2% on average before the redemption was processed.