Review my stocks and shares ISA

Filo25

Looking at your current portfolio I suppose my one concern would be the political element, what is the future for the energy companies in the UK, if we get a Corbyn led Labour government in the near future.

That said I can't see an election before 2022 unless the Tories think they have it in the bag, so it is probably safe enough to hold for now and enjoy the high yields driven by the currently depressed prices!

sixpence.

Economic - thanks so much for taking the time to write me such a detailed reply.

Single stocks I am currently looking into for diversification are: Vodafone, Unilever and Next.
My ideas for diversification through funds are posted above.

I did some research into trackers and there seem to be two schools of thought:

1. People like them: because they are lower risk with lower management fees.
2. People don't like them because they have a lower yield and some say that it is like having a machine pick shares for you.

Right now I am thinking about this as a future balance:
1/3 index funds
1/3 general funds (by this I mean funds that would either focus on growth or income)
1/3 individual stocks

These would all be across various sectors and places (USA, Asia, UK... technology, energy, corporate bonds) with a bias towards UK companies that have a global reach.

There is no way I want to stick to this current set up - I'm basically looking to diversify as much as possible now

No help from friends or family with this one so trying and trying to make as few mistakes as possible!

Also re the other posters question about Centrica: I invested for the high dividend yield and because the company has a history of offering regular dividend payments. I also invested in this while the stock was down and recon it'll go up long term. This is the sort of stock I would hope to never sell, Warren Buffet style... but who knows what will happen long term.

Superscrooge

Ray_Singh-Blue wrote: »

Great post by Economic sharing what he/she has learned through experience.

I entirely agree, but would make one balancing point:

The benefits of diversification are often stated here. Yet concentration, the opposite of diversification, is often the strategy that was chosen by abnormally successful investors. Over recent years, the people who made 1000%+ from Apple shares, gold, and bitcoin did so not by diversifying, but by holding and holding these investments as they broke through the stratosphere.

Concentration can work if you choose the right shares. But it adds a lot of extra risk with no guarantee of success.

Stocks markets are up considerably over the last three years. But three of the OP's shares (Centrica, National Grid and Bank of Ireland) have actually fallen in value over the past three years and the Aviva share price is virtually unchanged.

A global tracker fund would have provided a better return

Linton

Ray_Singh-Blue wrote: »

Great post by Economic sharing what he/she has learned through experience.

I entirely agree, but would make one balancing point:

The benefits of diversification are often stated here. Yet concentration, the opposite of diversification, is often the strategy that was chosen by abnormally successful investors. Over recent years, the people who made 1000%+ from Apple shares, gold, and bitcoin did so not by diversifying, but by holding and holding these investments as they broke through the stratosphere.

You never hear about the abnormally unsuccessful investors who adopted the same focussed strategy.

economic

Linton wrote: »

You never hear about the abnormally unsuccessful investors who adopted the same focussed strategy.

For every abnormally successful investor there are probably a thousand abnormally unsuccessful investors. Survivorship bias at work.

bostonerimus

I have a nasty feeling that the OP is heading for a complex "dart board" portfolio with lots of stocks and funds chosen because they seem to plug a perceived gap. The fact that the OP is 28 and is emphasizing dividends is also a worry. This is where a simple muti-asset fund portfolio that can be easily managed through downs as well as ups might save the OP from big loses and a lot of worry.

sixpence.

Can you embellish a bit on what a simple muti-asset fund portfolio is?

Yeah, I'm a bit of a lost fish doing research and just trying to make this work out. Funds seem to be the way forward.

I was told by my dad to invest in individual stock utilities early on. Always question your parents, folks. Should have done funds sooner I recon.

Ray_Singh-Blue

Linton wrote: »

You never hear about the abnormally unsuccessful investors who adopted the same focussed strategy.

You are pointing out that, while every Englishman who walks to John O'Groats has been on a long journey, not every Englishman who embarks on a long journey ends up at John O'Groats? Sure.

Although, actually I think you hear about "abnormally unsuccessful investors" quite often here. I have been one & could name many others. Getting older, we often lean towards a passive investment strategy, based on our experiences of being less successful than average when we tried a more active approach. I'm something like 80% passive now.

I am assuming that the OP does not want average returns. Presumably they are hoping that they will do better than average. Who hasn't been there? Along the way, some of us realise that this is not an easy game to win. Every trade has a winner and a loser, and we are amateurs mainly playing against professional investors. I think many of us also come to realise that average is pretty good, and may be good enough for our goals.

economic

Ray_Singh-Blue wrote: »

You are pointing out that, while every Englishman who walks to John O'Groats has been on a long journey, not every Englishman who embarks on a long journey ends up at John O'Groats? Sure.

Although, actually I think you hear about "abnormally unsuccessful investors" quite often here. I have been one & could name many others. Getting older, we often lean towards a passive investment strategy, based on our experiences of being less successful than average when we tried a more active approach. I'm something like 80% passive now.

I am assuming that the OP does not want average returns. Presumably they are hoping that they will do better than average. Who hasn't been there? Along the way, some of us realise that this is not an easy game to win. Every trade has a winner and a loser, and we are amateurs mainly playing against professional investors. I think many of us also come to realise that average is pretty good, and may be good enough for our goals.

Average is only good if the returns beat inflation. You could be average when the average market tanks and thus you probably won’t meet your goals if it’s consistently like this.

firestone

not mentioned much but IT's may give you some dividends which you seem to like with a UK,Asia or Global etc outlook and even property or you could go for growth.As mentioned with your age things like Tech or Bio Tech could be a play or something like the old favorite Scottish Mortgage which tends to take a more long term risky approach