180K Investment

MonroeM

AnotherJoe wrote: »

I see a fundamental reason why they should differ, the extra management fees ! If you are paying an extra % or two for a fund that held, for sake of argument the exact same makeup as VLS80, why would you do that? So they are bound to be different, both in constituents and in percentages, or there would be no active management going on.

And i did specifically mean diversified between an active and a passive approach. Its all diversification.



fair comment but also depends on your definition of "broadly" invested. Fundsmith for example holds only about 50 companies shares i think (OK looked it up, its actually 29) so there's no broad spread there, and that of course is an active management decision thus if you sold that and moved to another fund that was "temporarily low" that might have 200 shares with a very different spread. If you buy the theory that some managers can make a difference and its not all luck, then you are moving your money from a company with good management to poor management.

Of course you might not buy the story that active management is worth it.

Or you might "diversify" and split between both. Of my collective investments I have about 10% in active, down from what used to be 100%, just two active funds left, and I'll be sticking with those two for the foreseeable.

Would you mind me asking which two active funds you have kept purely out of interest?

ColdIron

MonroeM wrote: »

but instead because I have recently retired and have a lot of spare time I feel the need for a good hobby

Investing can be a very rewarding hobby in more ways than one and you can never stop learning

Royal London Sustainable World is strictly a Mixed Investment 40-85% Shares fund or what used to be called a Balanced fund but yes it is multi asset

MonroeM

ColdIron wrote: »

Investing can be a very rewarding hobby in more ways than one and you can never stop learning.

That's very true and although I have only been doing my research for a couple of days I've already learnt quite a lot. For sure, I know a lot more about my ISA investments than I did a few days ago thanks to this forum and research.

AnotherJoe

MonroeM wrote: »

Would you mind me asking which two active funds you have kept purely out of interest?

Quite happy to say , Biotech Growth Trust (BIOG) and Fundsmith.

The former because over the long term I fail to see how biotech cannot bring back high rewards*, (I've just doubled my investment in it this past week) and the latter because I like Terry Smiths style, philosophy and track record. Both are about 5% of my investment portfolio e.g. ignoring cash)

I've had a radical "rebalance" of my funds over the last couple of months to a portfolio that's substantially more hands off than it was before, which to me means trackers / passive / automated low cost.

I do hold a fair few individual shares for growth, and some high dividend paying shares as well, e.g. my own version of an income fund and I don't plan to buy anything new for a year at least, I'll top up existing holdings with any income if I don't just use the money (since I plan to retire next year)

* of course, I realise I could be wrong but I'm betting on that conviction and I think its a fairly safe bet, most realistic worst case is, it doesn't do as well as my general global investments.

MonroeM

AnotherJoe wrote: »

Quite happy to say , Biotech Growth Trust (BIOG) and Fundsmith.

The former because over the long term I fail to see how biotech cannot bring back high rewards*, (I've just doubled my investment in it this past week) and the latter because I like Terry Smiths style, philosophy and track record. Both are about 5% of my investment portfolio e.g. ignoring cash)

I've had a radical "rebalance" of my funds over the last couple of months to a portfolio that's substantially more hands off than it was before, which to me means trackers / passive / automated low cost.

I do hold a fair few individual shares for growth, and some high dividend paying shares as well, e.g. my own version of an income fund and I don't plan to buy anything new for a year at least, I'll top up existing holdings with any income if I don't just use the money (since I plan to retire next year)

* of course, I realise I could be wrong but I'm betting on that conviction and I think its a fairly safe bet, most realistic worst case is, it doesn't do as well as my general global investments.

Thanks for that and yes, it sounds as if there is a constant and interesting ongoing debate into the active vs passive funds. I've been looking into some of the ETF passive funds such as Vanguard FTSE All World (VWRL) and the HSBC MSCI World (HMWO). However, some people have concerns about ETF's rather than UT/OEIC's mainly because apparently they are generally based offshore, have no FSCS protection and are not regulated investments. So are you in safer hands going for UT/OEICS such as Fidelity Index World (no EM market) or the L&G Global Equity Index or the L&G Global 100 Index Trust. I realise these trackers will be more expensive due to platform charges but is it safer?

You mentioned that you are now 90% in passive funds. Please can you tell me if you have selected quite a lot of single sector passive funds to diversify your portfolio or have you just selected a 2/3 funds to cover the world markets?

I know some people have all their money in VLS80 but I feel that has too much UK exposure especially now compared to an all World Equity Index. Thanks again.

AnotherJoe

MonroeM wrote: »

You mentioned that you are now 90% in passive funds. Please can you tell me if you have selected quite a lot of single sector passive funds to diversify your portfolio or have you just selected a 2/3 funds to cover the world markets?

I am mostly a few different global funds, some of which are ex UK, since Brexit I've been "dialling back" UK exposure though I've always had a large foreign component anyway. Apart from the component of global funds, the only UK exposure i have directly now is via high dividend paying shares.

Other than the 'mostly global' I have equal amounts (circa 5%) in a far east fund, a global property fund (Black Rock) because there isnt generally much if any property in global funds, and the previously discussed BIOG. So I'm mostly global but slightly emphasising those areas that i expect to do better than the average global market over the next 5-10 years. But get too many single sector funds and are you are effectively building your own global fund so I dont see myself buying any more, indeed my plan is to buy nothing more for at least a year, at most I'll top up existing with dividends.

(all of this excludes what I might call my "gambling fund" which are various high tech shares I occasionally buy and sell, was a small amount of money, is now quite a lot and will be gradually sold down over the next 5-10 years or so to avoid CGT but I might buy some more within that as I do this. But its not core to my retirement other than it lets me feel better about buying 'boring' funds for that )

MonroeM

AnotherJoe wrote: »

I am mostly a few different global funds, some of which are ex UK, since Brexit I've been "dialling back" UK exposure though I've always had a large foreign component anyway. Apart from the component of global funds, the only UK exposure i have directly now is via high dividend paying shares.

Other than the 'mostly global' I have equal amounts (circa 5%) in a far east fund, a global property fund (Black Rock) because there isnt generally much if any property in global funds, and the previously discussed BIOG. So I'm mostly global but slightly emphasising those areas that i expect to do better than the average global market over the next 5-10 years. But get too many single sector funds and are you are effectively building your own global fund so I dont see myself buying any more, indeed my plan is to buy nothing more for at least a year, at most I'll top up existing with dividends.

(all of this excludes what I might call my "gambling fund" which are various high tech shares I occasionally buy and sell, was a small amount of money, is now quite a lot and will be gradually sold down over the next 5-10 years or so to avoid CGT but I might buy some more within that as I do this. But its not core to my retirement other than it lets me feel better about buying 'boring' funds for that )

So by a few global tracker funds do yo mean for instance 1 ex UK, 1 All World and 1 Devoloped Markets only inc UK? I'm just trying to figure out how to diversify the global funds instead of just choosing one all world tracker?

AnotherJoe

MonroeM wrote: »

So by a few global tracker funds do yo mean for instance 1 ex UK, 1 All World and 1 Devoloped Markets only inc UK? I'm just trying to figure out how to diversify the global funds instead of just choosing one all world tracker?

Well, I'm not sure what I'm doing is 'textbook' or should be followed :eek: essentially I have 5 global trackers 2 of which are ex UK. Then I have the Property, Far East & Biotech.

One reason for having so many global is that I have a Company Pension which restricts what I can invest in plus a SIPP. For a long time the CP had dull and boring funds and the SIPP somewhat 'racy' funds but over the last 3 or 4 years I've moved them towards each other , so CP now has 3 global funds where it should probably only have two (one with UK one ex UK) but i couldn't decide which of the two ex UK to go for so I've just split between them.

And in the SIPP i did have one global fund VLS but I've decided to move some of that to a lower cost version (HMWO). Again if i was a bit more decisive I'd just have swapped it all to HMWO but it was a fair chunk and its done well so I didnt fancy moving it all. I cant claim this is logical or anything, though i suppose what with ETFs not havinga s much protectin as funds maybe a bit of diversification is safer also? Thats rationalising after the event though.

So thats how I ended up with five global when it should really be two, one in CP, one in SIPP. But I dont see any real harm done either.

ravsd

If your going to see an Financial Advisor then I would recommend that you negotiate the upfront fee's they are likely to receive for setting up any potential new investments. With the amount you are talking they are likely to receive a considerable amount as commission, which you can negotiate to split as they are GOING to want your business.


https://www.aneasierway.co.uk

dunstonh

With the amount you are talking they are likely to receive a considerable amount as commission

No they wont.

which you can negotiate to split as they are GOING to want your business.

A split of zero is zero. Commission has been banned since the end of 2012.