Is a SIPP protected?

StellaN

dunstonh wrote: »

As they have no FSCS protection whatsoever. They also have increased risks over the closest equivalent UT/OEC (NAV pricing and gearing).

So, for a new investor showing the concerns the OP is, they are best avoided.

What would be an equivalent UT/OEIC to Scottish Mortgage IT?

Linton

StellaN wrote: »

What would be an equivalent UT/OEIC to Scottish Mortgage IT?

There isnt anything exactly equivalent. Many of these older ITs are conviction funds which invest in selected companies and sectors the manager likes often from anywhere in the world. The nearest perhaps are Global UTs/OEICS that invest in a similar basis such as those from Lindsell Train and Fundsmith. But their managers may well not share the same enthusiasms. Scottish Mortgage appears to have a high risk/ high return strategy exemplified by large holdings in high tech companies such as Tesla.

An investment in such a fund is very much a belief in the abilities of a particular manager, trustnet gives no other funds managed by James Anderson who runs Scottish Mortgage.

StellaN

Linton wrote: »

There isnt anything exactly equivalent. Many of these older ITs are conviction funds which invest in selected companies and sectors the manager likes often from anywhere in the world. The nearest perhaps are Global UTs/OEICS that invest in a similar basis such as those from Lindsell Train and Fundsmith. But their managers may well not share the same enthusiasms. Scottish Mortgage appears to have a high risk/ high return strategy exemplified by large holdings in high tech companies such as Tesla.

An investment in such a fund is very much a belief in the abilities of a particular manager, trustnet gives no other funds managed by James Anderson who runs Scottish Mortgage.

I already hold Fundsmith as well as Scottish Mortgage and in recent years they have done well, however I am now considering selling SMT mainly due to the high risk profile but still not sure if this would be a wise move.

goRt

OP, You need to be aware of Life Time Allowance (LTA) rules - there are numerous tests (at Benefit Crystallisation Events - BCEs) which *will* have significant tax implications.
Current LTA is £1m which could be tested when you start taking your SIPP, and is again tested at age 75 - the design of these tests FORCES you to take all fund growth out of the SIPP to stay within the LTA limit. (there is LTA indexation from 2018, but this could be 'adjusted' at any time).

I'm not and IFA or anything connected with such, but I did retire at 50 and manage my SIPP, etc. focusing on the LTA.

MPN

StellaN wrote: »

I already hold Fundsmith as well as Scottish Mortgage and in recent years they have done well, however I am now considering selling SMT mainly due to the high risk profile but still not sure if this would be a wise move.

If you did decide to cash in on SMT which fund would you reinvest the money to run alongside Fundsmith?

jamesd

With £675k in the £900k pot after taking the tax free lump sum it's quite easy to avoid the lifetime allowance. Average UK stock market growth has been about 5% plus inflation, about £33,750 a year plus inflation. Well within the basic rate tax band so just plan to withdraw the whole basic rate band every year and deliberately gradually reduce the value. Just reinvest anything above spending outside the pension.