I used to be indecisive but now I'm not so sure!

Intending to start a couple of managed fund investment ISA's for the first time with £20K into each (myself and my wife). Was settling for Halifax Managed Fund 4, but then came across Vanguard Life Strategy (60% Equity). Halifax including the fund management works out at 0.69% a year, Vanguard 0.37% for the same. With my investment / withdrawal profile over about 20 years I reckon that at an average return of 5% Vanguard will win by around £12K but I appreciate its not as straightforward as that. The Halifax funds only have a two year performance history because they are new(?), Vanguard appear to give an average figure for performance. I do appreciate this can only be a guide though.

I know there will be other providers too but I really don't have the knowledge to properly understand all the possible pitfalls or the various tables that are on the internet so am probably going to settle on one of these two. I would like to move on, but as the title implies I'm worried that I could be missing something. I'm not trying to get the best of the best, which is probably a moving feast anyway, I'm just trying to ensure that I'm starting off on the right foot and getting something reasonable. Despite the fact that in my example Vanguard win, with other intangibles it really is quite close and I'm inclined towards Halifax.

Anyone any thoughts / comments / advice please?

Thanks.

Comments

  • le_loup
    le_loup Posts: 4,047 Forumite
    Performance figures are for PAST performance - they cannot be projected to the future. What you have to compare are the Platforms charge and then the "ongoing costs" for the fund you have chosen. Historic fund performance is a poor guide to the future. Choosing a manager with a good past performance may help but can't be guaranteed.
  • Linton
    Linton Posts: 17,030
    Name Dropper First Post First Anniversary Hung up my suit!
    Forumite
    I think you should investigate what the Halifax Managed Growth Fund 4 invests in. Like VLS60 it is split 60% equity and 40% bonds. However the equity part is nearly 90% UK with only just over 10% "International" whatever that may mean. VLS60 is 15% UK equity and the rest well defined %s in Europe, US Japan EM etc etc. So the Halifax fund seems far too poorly diversified to me to be a serious option.
  • Ok, thanks for the comments.
  • Truth is thought I haven't got a clue what is good or bad, that's why I want to use a managed fund, managed by experts.You seem to be saying that I should look at what the experts are doing.
  • Alexland
    Alexland Posts: 9,639
    First Anniversary Photogenic Name Dropper First Post
    Forumite
    Halifax fund has higher fees and the investments are mostly in a cheaper to invest country. Even if you want a UK centric fund (and I don't know anyone on this forum that would advocate 90% home bias) there are much cheaper ways of building it on Vanguard Investor. UK funds cost less than VLS.

    Personally given the choice for only those 2 then I would definitely do VLS on Vanguard Investor.

    Alex.
  • Thank you. You say "Even if you want a UK centric fund.....", honestly, I don't have the knowledge to have such an opinion, and there's certainly no moral reason. Your personal opinion is much respected and helpful though.
  • badger09
    badger09 Posts: 11,061
    First Post First Anniversary Name Dropper
    Forumite
    Thank you. You say "Even if you want a UK centric fund.....", honestly, I don't have the knowledge to have such an opinion, and there's certainly no moral reason. Your personal opinion is much respected and helpful though.


    You might want to have a read around this website. The writer has a bias towards passive investing, but that's no bad thing for a novice investor.

    http://monevator.com/category/investing/passive-investing-investing/
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 341.8K Banking & Borrowing
  • 249.7K Reduce Debt & Boost Income
  • 449.2K Spending & Discounts
  • 234K Work, Benefits & Business
  • 606.2K Mortgages, Homes & Bills
  • 172.5K Life & Family
  • 246.8K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards