Pension options

BLB53

In summary, if you can't outperform (present tense) Vanguard LifeStrategy 60/40 you may as well give up.

Well, that would apply to 70% of fund managers in the same sector (90% for VLS 80) over past 5 yrs.
https://www.trustnet.com/Investments/MultiManagerMixedAsset.aspx?univ=O&tabType=MI85&moreresult=true

Malthusian

zagfles wrote: »

Not much of a boast to outperform it then really.

If DunstonH had been asked "how good is your model portfolio" and he said "it outperforms Vanguard 60/40" then that would be a good point. However, the question being asked was "why not just stick your money in Vanguard 60/40".

However, if smaller companies, commercial property, fixed interest or emerging markets nose dived over the next few years then it would likely outperform other portfolios.

I took it as implicit that we were talking about long-term outperformance (since neither you nor dunstonH nor I are day traders), and over the long term a portfolio that includes a sensible proportion in, for example, higher-risk-higher-return areas like smaller companies and emerging markets should outperform one without, otherwise the laws of economic physics are broken. Over a short-term period, of course, anything can happen.

BLB53 wrote:

Well, that would apply to 70% of fund managers in the same sector (90% for VLS 80) over past 5 yrs.

That sector is "40-85% Mixed Investment". That will include managers who have a mandate to keep their equity allocation somewhere between 40% and 60%, and in simple terms you wouldn't expect them to outperform VLS 60. Similarly, it will include risk-targeted funds who have a mandate to keep expected volatility at a certain level, which may dictate a more cautious mix than VLS' fixed 60/40 proportions. The category is so broad as to be of extremely limited use.

zagfles

Malthusian wrote: »

If DunstonH had been asked "how good is your model portfolio" and he said "it outperforms Vanguard 60/40" then that would be a good point. However, the question being asked was "why not just stick your money in Vanguard 60/40".

I took it as implicit that we were talking about long-term outperformance (since neither you nor dunstonH nor I are day traders),

I wrote "the next few years"!

and over the long term a portfolio that includes a sensible proportion in, for example, higher-risk-higher-return areas like smaller companies and emerging markets should outperform one without, otherwise the laws of economic physics are broken. Over a short-term period, of course, anything can happen.

Yes, should not will.

Over a longer term period anything can happen too. When do you think Japanese equities will get back to their 1989 level? IIRC the UK stockmarket was lower in 1954 than it was in 1900. Maybe the "laws of economic physics" were broken then?

Not that I believe this will happen, otherwise I'd change my investment strategy now. I'm just saying the future is unknown and would never take it for granted that just because I'd outperformed a tracker in the past that I would do in the future.

That sector is "40-85% Mixed Investment". That will include managers who have a mandate to keep their equity allocation somewhere between 40% and 60%, and in simple terms you wouldn't expect them to outperform VLS 60. Similarly, it will include risk-targeted funds who have a mandate to keep expected volatility at a certain level, which may dictate a more cautious mix than VLS' fixed 60/40 proportions. The category is so broad as to be of extremely limited use.

Although scanning down the risk score column, the vast majority of those performing worse than VLS60 have a higher risk rating, not lower.

patricia1066

Most of the threads is offtopic, as standard life sipp terms are what DH has to consider.

Option3 is for discretionary investment, and off platform I asked SL today and was told that these are funds other than mutual or insured. If not a SL fund if probably is off platform. Odd use of the phrase.

The ifa is offering a portfolio service, which should be charged at the fixed rate. Then the ofc and ifa charges can be assessed depending on the transaction in that year.