I have switched out of China and moved into International funds !!!!

wombat42_2

For about two months i have invested entirely in China funds. I have made some nice gains but opinion of late is sharply divided between "there will be a bad crash" and "it will go up forever". In the last two days there has been a wobble in Hong Kong which some say may be the start of a correction.

Anyway it is making me feel nervous and I have hit upon the idea of investing in international funds as an alternative. I am getting rather fed up of frequently chopping and changing funds so I hope with international funds I will stick with them for the long term. The fund manager will work out what sectors or countries to invest in. However different international funds do have diverse investment strategies.

I have chosen:
- Jupiter Global Managed
http://funds.ft.com/funds/jupiter/unittrustmanagers/RWGO

- Gartmore Global Focus
http://funds.ft.com/funds/gartmore/fundmanagers/DBGFS

- Neptune Global Equity
http://funds.ft.com/funds/neptune/investmentmanagement/CGORBA

These funds complement each other quite nicely so I have some exposure to just about every sector/country in the world to some degree.

I am not particularly keen on investing much in the UK and these funds satisfy that requirement. Also IFAs say dont invest more than 5% in any one country yet I dont see why the UK is often excepted as being OK to invest 100%.

I dont need large gains - just something that will tick over nicely for the long term. I would hope to make bigger gains than UK income equity funds at least.

ramborai1987

good move. i heard about the hong kong thing and i think your right to pull out. you must have made a big gain anyway.

i usually have atleast 40 - 50% invested in UK, dont know why but i've always been told it has the best stability which is usually correct. Your probably always going to see some sort of growth in UK and it has alot less risk which does match my downturn risk though.i wouldnt suggest everything in UK though so i think your right on that choice.

wombat42_2

ramborai1987 wrote: »

good move. i heard about the hong kong thing and i think your right to pull out. you must have made a big gain anyway.

i usually have atleast 40 - 50% invested in UK, dont know why but i've always been told it has the best stability which is usually correct. Your probably always going to see some sort of growth in UK and it has alot less risk which does match my downturn risk though.i wouldnt suggest everything in UK though so i think your right on that choice.

Well some useful gains anyway. What was really annoying was about 30% of my investment was out of the market for 4 days doing a fund switch in August and just during that 4 days the market rocketed by 12% :mad: so I missed out on that.

Regarding the UK, folks have different levels of paranoia regarding overinflated property prices - there is apparently at least a 10% chance of a 90s style property crash which would seriously hit the general economy. Ther are also personal debt issues. I dont see why the UK is any more secure than any other developed country. Apparently the UK is considered a "low risk" investment because there are no currency risks while any foreign investment is either considered medium or high risk. Seems a nonsense really that minor currency fluctuations can make much difference.

Also the FTSE100 has still not recovered its year 2000 levels.

m_c_s

wombat are you with H&L?
I have a fidelity account and they turn around switches in 2 days(although once it took 3 days), sometimes within a day if it’s their own funds.

Regarding UK sector bias I am still learning and don't fully understand the recommendation of 50% holding. Clearly volatility is an issue but I don’t understand why it is any riskier than a well managed fund in Germany (or developed Europe), US or Japan (we know what has happened here though).

wombat42_2

Hi m_c_s. I switched my ISA/PEP holding from Legal and General to H& L. It was out of the market for only 4 days but it exactly coincided with a huge spurt on Aug 20th and successive days when it was announced that the Chinese could invest in Hong Kong - also global markets did well in that period. :mad::mad::mad:

Yes H&L internal switches arent a problem. I did one a few weeks ago and was out of the market for just one day.

I agree with your comments about the Uk.

cloud_dog

Regarding a UK bias, there are probably a number of reasons why it appears sensible, although it will always depend on the individual.

Currency fluctuations have been mentioned and I think it is potentially a bigger consideration than "that minor currency fluctuations can make much difference", as an example........... I hold some investments in CEF (Central Fund of Canada) - a gold & silver bullion fund, in the last two months the $price has risen by 25% whilst my actual sterling increase has been nearer 9% - fairly significant.

You may also want to consider the fact that continental europe (certainly the politicians) are getting very nervous over the Euro's strenth against the dollar; this will affect exports and therefore growth.

Other than this it makes sense (down to the individual) to make or keep substantial investments in an area that they have good knowledge and ease of information on - remember all investments are risky. For example - in the UK you probably know that:

a) property prices are high and that news items are starting to appear saying prices are starting to decline or the rate of increase is slowing significantly
b) You will know / hear about redundancies
c) You will know / hear about events which might affect an industry or company

Because of the above and more you have your finger more on the pulse in the UK than anywhere else. Not saying the internet won't assist in finding out information but I don't think its quite the same.

Just my thoughts on why the 'recommendations' to keep monies invested in the UK.

cloud_dog

Geoffo_M

wombat42 wrote: »

For about two months i have invested entirely in China funds. I have made some nice gains but opinion of late is sharply divided between "there will be a bad crash" and "it will go up forever". In the last two days there has been a wobble in Hong Kong which some say may be the start of a correction.

Anyway it is making me feel nervous and I have hit upon the idea of investing in international funds as an alternative. I am getting rather fed up of frequently chopping and changing funds so I hope with international funds I will stick with them for the long term. The fund manager will work out what sectors or countries to invest in. However different international funds do have diverse investment strategies.

I have chosen:
- Jupiter Global Managed
http://funds.ft.com/funds/jupiter/unittrustmanagers/RWGO

- Gartmore Global Focus
http://funds.ft.com/funds/gartmore/fundmanagers/DBGFS

- Neptune Global Equity
http://funds.ft.com/funds/neptune/investmentmanagement/CGORBA

These funds complement each other quite nicely so I have some exposure to just about every sector/country in the world to some degree.

I am not particularly keen on investing much in the UK and these funds satisfy that requirement. Also IFAs say dont invest more than 5% in any one country yet I dont see why the UK is often excepted as being OK to invest 100%.

I dont need large gains - just something that will tick over nicely for the long term. I would hope to make bigger gains than UK income equity funds at least.

There are some big fears about China. I have taken profits also, but not totally sold out. Like you, I feel it's a good idea to be in global funds so I reinvested 50% Neptune Global Equity and 50% Artemis Global Growth.

wombat42_2

Geoffo_M wrote: »

There are some big fears about China. I have taken profits also, but not totally sold out. Like you, I feel it's a good idea to be in global funds so I reinvested 50% Neptune Global Equity and 50% Artemis Global Growth.

I see Hong Kong was well up last night ! :mad: But anyway I think global funds are the way to go. I want to just leave my investments alone for a long time, forget about them and not lose any sleep over them. I am fed up with chopping and changing.

I will check out Artemis Global Growth. Neptune Global Equity has quite a lot of emerging markets/China/Hong Kong in it.

purch

I have switched out of China and moved into International funds !!!!

...........PHEW ......... we can all exhale at last !!!!!

I see Hong Kong was well up last night !

The HangSeng is exhibiting all the signs of a market due a correction soon....

Don't understand all this flapping about currency risk

It amazes me that people invest their hard earned money in overseas markets without understanding properly relative currency risks and the basic principal of HEDGING

It is cheap and easy to hedge currency risks........some Fund Managers will hedge nearly all their risk, and some don't

Currencies change value for a reason, and this needs to be factored into any investment decision.

For example, as far as I know, Artemis tend to hedge a lot of the risk, Neptune less so, and M&G hardly ever.

So it might be a good idea to investigate and research the funds you are looking at, rather than just investing willy-nilly without considering all the possible implications.

Personally speaking I think Sterling is overvalued, and due a correction so Investing in overseas markets might be a good idea right now.

wombat42_2

purch wrote: »

It amazes me that people invest their hard earned money in overseas markets without understanding currency risks and the basic principal of HEDGING

It is cheap and easy to hedge currency risks........some Fund Managers will hedge nearly all their risk, and some don't

Currencies change value for a reason, and this needs to be factored into any investment decision.

For example, as far as I know, Artemis tend to hedge a lot of the risk, Neptune less so, and M&G hardly ever.

So you need to investigate and research the funds you are looking at, this information should be available.

Personally speaking I think Sterling is overvalued, and due a correction so Investing 'unhedged' in overseas markets might be a good idea right now.

Agreed that it will make some differnce but not that much surely. Also just as likely to work in my favour as against. Also a global fund will involve a large mix of currencies.

Perhaps you might like to address the issue of why the uK is considered exempt from the IFAs "no more that 5% in any one country" rule.

purch

Perhaps you might like to address the issue of why the uK is considered exempt from the IFAs "no more that 5% in any one country" rule.

Not being an IFA I couldn't possible comment, other than maybe it's one of the 'rules', like the factfind and advising people that investments can go up as well as down etc etc.

To my mind, and it appears yours too, it is illogical, and no doubt just a holdover from the 'good olde days'. Just about every company in the FTSE 100 is a Global Company who make their profits and losses all over the world and are affected by factors outside of the U.K.

The World is a much smaller place than it used to be and we need to embrace it, not run shy of it.