S&S ISAs performance over recent years - anyone in the know?

Charlton_King

Ok, so in retirement I'm biting the bullet and finally considering stocks and shares rather than a deposit account... but I would prefer this to be managed for me rather than self-invested.

Would anyone have an overview of how the average scheme of this kind has fared over, say, the last five years?

I have talked briefly with a friend who says that their own investments via this route have virtually doubled in value over that time and of course this sounds very attractive - but I'm sure there must be catches and I need these flagging up!

Also, would there be any suggestions, from personal experience, as to any reliable performers in this market?

I would be extremely grateful for any thoughts.

BLB53

Also, would there be any suggestions, from personal experience, as to any reliable performers in this market?

I hold Vanguard Lifestrategy 60 which has provided ~9% p.a. on average over the past 5 years. In addition I hold several investment trusts - City of London, Finsbury Gr & Income, Edinburgh and Scottish Mortgage which have provided a combined return a little higher but they are also more risk.

I have been selling a part of the investments over recent months and will hold in cash due to the fall in sterling and the surge in the markets.

The investments have provided 4x more than my cash deposits in recent years but I am thinking this cannot continue for much longer.

Sally57

BLB53 wrote: »

I hold Vanguard Lifestrategy 60 which has provided ~9% p.a. on average over the past 5 years. In addition I hold several investment trusts - City of London, Finsbury Gr & Income, Edinburgh and Scottish Mortgage which have provided a combined return a little higher but they are also more risk.

I have been selling a part of the investments over recent months and will hold in cash due to the fall in sterling and the surge in the markets.

The investments have provided 4x more than my cash deposits in recent years but I am thinking this cannot continue for much longer.

Regarding your IT's, I can understand Scottish Mortgage as a global IT but would you mind me asking why you would hold three different IT's all in the UK Equity Income sector?

p00hsticks

Charlton_King wrote: »

I have talked briefly with a friend who says that their own investments via this route have virtually doubled in value over that time and of course this sounds very attractive - but I'm sure there must be catches and I need these flagging up!

The catch is that past performance does not necessarily indicate future returns, and that you may lose money in the short / medium term.

Assuming that the money you are talking about is being used to supply / supplement your retirement income, then the best time to consider such investments would really have been BEFORE retirement. Do you need a regular income from the meny / how long can you leave it invested ?

Charlton_King

p00hsticks wrote: »

The catch is that past performance does not necessarily indicate future returns, and that you may lose money in the short / medium term.

Assuming that the money you are talking about is being used to supply / supplement your retirement income, then the best time to consider such investments would really have been BEFORE retirement. Do you need a regular income from the meny / how long can you leave it invested ?

What I am looking to do, essentially, is find a home for regular monthly savings which could be anywhere in the range £500 - £1500, depending on the month.

I have access to other funds for unexpected contingencies so, no, I don't need any income from it and it can be left invested for a number of years... the object would be for it to grow to the maximum.

AnotherJoe

Go and speak to an IFA because if you want your funds managed, then thats would you'd need.

You also have the unfortunate misconception that knowing what the average performance of managed funds is, would give you some guidance as to what you could expect, but it doesn't, for multiple reasons.

Firstly, the last 5 years has mostly been a rising market. So gains over the past 5 years are no guide to gains or losses over the next 10+

Second, no one compiles such averages because these are private investments. No one knows the performance of my funds, and if they were managed by an IFA they wouldn't know that either. So how would you come by such figures?

Third, lets say the average was 10% because half were up 2% and the other half up 18%. So 10% isnt doable.

Fourth, performance is correlated to risk. Maybe the average is up 10% a year but thats includes people on high risk, and there will be a crash in the next year or two and those people will take a bath and lose 20% whereas those who got 5% past 5 years will only lose 5%? Which risk band will you be in (I'm guessing far left of the "hardly any") so in that case, why would you expect to get performance that includes people who took a high risk?

Fifth, what do you need to get? If you only need 5% no use taking a risk that might get you up 20% (or down 30%). An IFA can guide you at the appropriate risk level for what you can tolerate and what you need.

Finally, you conclude with "the object would be for it to grow to the maximum." Thats not meaningful there isn't a "maximum" except with hindsight. Maybe you could have a tiny chance of increasing it it 20x but at a very real and high risk of losing it all. Is that what you are prepared for?

So, if you dont have enough money for an IFA to be interested and I think £50k would be at the low end for IFA management, look for "robo advice" sites where you select your risk level and the website manages it for you. Nutmeg is one such there are others. Expensive compared to DIY but you said you didnt want that.

Charlton_King

As I said in the OP, I've decided I'm willing not to have the security of a fixed rate or the certainty that the value of funds wouldn't 'go down'.

This is why I've turned to stocks and shares and the possibility at least of having them in a tax free wrapper.

Within that context, I'm hoping people can give me some rough pointers, that's all.

Yes, I realise all the stuff about past performance not being any guarantee etc. etc. I'm not stupid, thank you.

I don't 'need' to get any fixed target return but am hoping for a better one than from deposit accounts.

It seems to me that my English must be on the blink or something...

mollycat

Charlton_King wrote: »

As I said in the OP, I've decided I'm willing not to have the security of a fixed rate or the certainty that the value of funds wouldn't 'go down'.

This is why I've turned to stocks and shares and the possibility at least of having them in a tax free wrapper.

Within that context, I'm hoping people can give me some rough pointers, that's all.

Yes, I realise all the stuff about past performance not being any guarantee etc. etc. I'm not stupid, thank you.

I don't 'need' to get any fixed target return but am hoping for a better one than from deposit accounts.

It seems to me that my English must be on the blink or something...

Without wishing to annoy you further....

Given the context and your circumstances; I think the question "what is your goal" or (put differently), "what are you looking to achieve" is valid.

Enough money for your needs is enough money; what people may be thinking is why would you take a higher risk approach to get "the maximum", if this is not necessary?

Charlton_King

mollycat wrote: »

Without wishing to annoy you further....

Given the context and your circumstances; I think the question "what is your goal" or (put differently), "what are you looking to achieve" is valid.

Enough money for your needs is enough money; what people may be thinking is why would you take a higher risk approach to get "the maximum", if this is not necessary?

What wasn't valid was to assume stupidity on my part.

My position, to state it again, is that I have put the bulk of my savings in a safe environment am now willing to try to achieve something better, with monthly savings, in a riskier one. I don't know how much plainer I can be.

AnotherJoe

Your English isn't on the blink but your knowledge of what's involved is less than zero, as shown by your (no disrespect meant) naive questions that can't really even be answered, hence my points.

EDIT; I didn't imply you were stupid. But you obviously have a complete lack of knowledge. So some of your questions are, again no disrespect meant, nonsensical, in the same way as if I was to ask questions about the theory of relativity. That doesn't mean you are stupid just have no understanding of the right questions to ask.

How much would you be happy to risk losing in one year, indeed in a few months ?
.. 10%?
20%?
30%?

All very possible depending what you selected

How would you trade off a potential gain of 10% against a loss of 20% or a gain of 20% vs a loss of 40% ? Without knowing that people can't make suggestions, so it's really not as simple as you suggest "just pick me a fund" or "I want an something riskier than cash" (that could easily have lost you money even in a time of rising stock markets!)

That risk reward area is the the sort guidance an IFA would seek when selecting funds for you. There is no random fund someone looking to get "the maximum possible" would choose (and if there was that would have massive loss potential as well. Perhaps 90%. )

This is BTW from personal experience, I've lost 100% on shares for example,gambling for "maximum possible". £10k down the Swanee. Are you up for that ?

The most cautious funds have actually lost money over the last five years, (something I'd have said required spectacular expertise to achieve) so it's not even a question of suggesting a cautious fund . If you pick a non-hedged cautious fund, like VLS20 you could equally be below deposit accounts with a risk of losing money. Is that a good idea? I don't know. It would be for some, for others it would be a waste of time. I don't know which category you fall into.

I suggest you read Moneyvator and make your own mind up what to buy from their suggestions or just copy your mates funds. I'm out.

Charlton_King

Ok, as someone with 'a complete lack of knowledge', I shall ask this again... you know, on the grounds that, just maybe, the first two and a half years of the recent five years of 'rising market' WERE a pointer to the subsequent two and a half years.

You never know, eh?

I am 'happy to risk losing' any or all of the money I put into this investment. I would have thought that 'no guarantees' means... just that. Or, are you saying that some investment firms actually DO guarantee a maximum level of loss..?? Are you deliberately quoting strange percentages to try to elicit more of my alleged 'naivety'..??

So, once again, is there anyone out there who can give me:

A. a rough guide as to how this market has performed over the last few years?

and

B. a suggestion as to a reasonable 'contender'? BLB53 proposed Vanguard Lifestrategy 60, for which I am duly grateful. Any other possibilities would be gratefully received.