Bonds, should i have them?

Dazza_a89

Hi everyone,

i am still new to investments and i have an S&S ISA. I keep seeing things about bonds and my portfolio and to be honest i don't know a great deal about bonds.
Should i have bonds in my small portfolio? It's only small (£3k) and grows all the time as i add available funds into it. I keep one's appear on HL 150+ like Royal London Corporate Bond Trust and Artemis Strategic Bond.
My portfolio is currently 50% Vanguard life Strategy 80%
30% Legal & General UK Index
20% Vanguard FTSE Developed World ex-UK Equity Index

I know that the FTSE dev in located in the LS 80%, but i brought this right at the start.
So do i need bonds?
Thanks
D

Linton

You are already holding bonds - Vanguard life Strategy 80% means 80% equity (shares) amd 20% bonds.

For such a small portfolio I dont see any need for bonds assuming you are investing for the long term eg 10-15years or more. Bonds reduce risk. However as you are drip feeding, were share prices to fall a large amount you should be happy as your contributions will buy extra shares that will increase your profits when prices rise again. Both the relatively small amount in your portfolio and your drip feeding mean that you are not taking a major risk. When your portfolio rises to £25K+ or you can see a time when you will want to cash-in the portfolio you can reconsider.

Dazza_a89

Linton wrote: »

You are already holding bonds - Vanguard life Strategy 80% means 80% equity (shares) amd 20% bonds.

For such a small portfolio I dont see any need for bonds assuming you are investing for the long term eg 10-15years or more. Bonds reduce risk. However as you are drip feeding, were share prices to fall a large amount you should be happy as your contributions will buy extra shares that will increase your profits when prices rise again. Both the relatively small amount in your portfolio and your drip feeding mean that you are not taking a major risk. When your portfolio rises to £25K+ or you can see a time when you will want to cash-in the portfolio you can reconsider.

Thank you Linton i am investing 15 years+, i started looking and i confused me no end!! So if i keep adding to the LS80 then that would do the trick?

Linton

Dazza_a89 wrote: »

Thank you Linton i am investing 15 years+, i started looking and i confused me no end!! So if i keep adding to the LS80 then that would do the trick?

Personally I wouldnt bother holding bonds at all at the moment. A 100% equity portfolio is very likely to perform better over the long term, and it would seem you are talking long term. See my 2nd paragraph.