Is a Vanguard Lifestrategy investment all you need

StellaN

MPN wrote: »

I've just gone the comparefundplatforms route because I am also with Fidelity. At the moment I have about £45K in my ISA account and iweb is the cheapest. I am about to add £15,240 before the end of the tax year and iweb would be even cheaper and if I add £20K in the new tax year then iweb will be by far the cheapest platform!

If you want to stay on the Fidelity platform then Cavendish are one of the next cheapest funds to save the hassle of changing platforms and being out of the market (but iweb are quite a lot cheaper)!

Is iweb any good, what are peoples views/experiences with this platform?

You are quite right that on the amounts you mentioned Iweb and indeed Halifax vare both cheaper options, however Cavendish are not that far behind and you do have the added advantage of the Fidelity website. They also do not charge to trade funds.

Bachelorplace

Strangley I have lost money ever since I threw some cash into their 20% LOW RISK lifestrategy fund 2 months ago. In fact my rate is -67%

Take off their fee and I have made a dumb decision.

I am considering taking the money out and spreading the 5k odd across 11 funds I have in HL instead - which is averaging at least a 0.87 positive in the same period.

bowlhead99

Bachelorplace wrote: »

Strangley I have lost money ever since I threw some cash into their 20% LOW RISK lifestrategy fund 2 months ago. In fact my rate is -67%

"Minus 67%" is not your actual unrealised loss on that fund. That would imply you paid £100 and now it's worth £33. It has not lost two thirds of its value in the last two months, or at any time ever.

Are you perhaps meaning you have lost a small percentage but if those losses continued at the same pace, then 'annualised' the maths tells you you're on course to lose 67% after a year or two? If so, you need to realise that all funds will have up months and down months but in a conservative fund which is 80% bonds, it's not going to just keep losing month after month in a straight line and then get to a 67% loss.

Of course, a 20% equities 80% bonds fund can move several percent in a week, whether up or down. Investment is not about what the value is from day to day it is what it is worth in the end, after the long term.

Take off their fee and I have made a dumb decision.

The management fees and operating / transaction costs are already included in the net returns. The only extra for you to take off is the fees you pay to the platform or intermediary. How much is their platform fee, about 0.15% if buying direct from Vanguard? Over two months the 0.15% platform fee is only one fortieth of a percent, it takes an entire year to cost you 0.15%. I don't think the platform fee of one fortieth of a percent that you've paid so far is going to ruin your life in the context of your overall potential gains and losses from investing.

I am considering taking the money out and spreading the 5k odd across 11 funds I have in HL instead - which is averaging at least a 0.87 positive in the same period.

Without even asking what those HL funds are, I'm sure they could move by 0.87% up or down in a single day. Major equity indexes or foreign currency markets can easily move by a couple of percent a day. It's not unexpected. So looking at returns over two months and seeing that the return on one product is better than another, when the entire return from one of them is less than the daily movement it might experience tomorrow, is naive.

When we invest we expect ups and downs. Whether you go 80% equities or 80% bonds you will have ups and downs. If there is a big equities crash wiping 50% off the values of equities, you will be glad you did not have all your money in equities. Whether you want to have as little as 20% of your money in equities (as in the VLS20 product) is a matter for the individual.

But if you think you made a dumb rash decision buying VLS20, try to at least understand what you are doing before you make another dumb decision and slap the money into 11 funds just because they went slightly up in a short space of time.

economic

Buying a VLS20 Seems a bit slap dash to me.

Gadfium

Bachelorplace wrote: »

Strangley I have lost money ever since I threw some cash into their 20% LOW RISK lifestrategy fund 2 months ago. In fact my rate is -67%

Take off their fee and I have made a dumb decision.

I am considering taking the money out and spreading the 5k odd across 11 funds I have in HL instead - which is averaging at least a 0.87 positive in the same period.

Are you sure that investing is for you?
You bought a fund and after 2 months you are thinking of selling it, thus crystallising any loss into hard money. :wall: Then your'e going to spread £5k over 11 funds.....what do you really think that you're going to gain by putting £450 into a fund? how much are those funds going to cost you?

The fund hasn't lost 67%...in fact over the last 2 months it is up 0.5%. That's just flotsam and jetsam though....you really shouldn't be measuring a fund like this over a nanosecond like 2 months.

TBC15

economic wrote: »

Buying a VLS20 Seems a bit slap dash to me.

Not much volatility, I’ll give it that.

economic

TBC15 wrote: »

Not much volatility, I’ll give it that.

Quite the opposite. Having 80% in bonds when rates are low and starting to rise substantially is a recipe for potential volatility. Why buy bonds when you can buy annuities for 3% (not saying i would buy annuities - they are also guaranteed to lose money long term).

TBC15

economic wrote: »

Quite the opposite. Having 80% in bonds when rates are low and starting to rise substantially is a recipe for potential volatility. Why buy bonds when you can buy annuities for 3% (not saying i would buy annuities - they are also guaranteed to lose money long term).

Funny looks like a badly drawn flat line to my eyes. Must be my age.

Alexland

economic wrote: »

Quite the opposite. Having 80% in bonds when rates are low and starting to rise substantially is a recipe for potential volatility.

I doubt the bonds will cause too much volatility but the risk is more that there will be an overall drift in the wrong direction. I agree in the way that mixed asset funds are marketed more attention should be drawn to the risks of getting too heavy in a single 'safe' asset class as per VLS20 and perhaps VLS40.