SIPP Question?

Kaiser71

Hello Folks,

What you think of this pension fund that is now sitting in my old company pension with Fidelity? I was thinking of transferring this to a SIPP, probably something like the Fundsmiths, Legg Mason IF or LF Lindsell Train funds.

Fidelity BlackRock Long Term Fund Class 5 - Passive

60% FTSE All Share Index,
13.2% FTSE W United States Index,
13.2% FTSE Dev Europe ex UK,
6.8% FTSE AW Dev Asia Pac.Ex JP Index,
6.8% FTSE W Japan Index.

Fund performance = 6.9% since launch 2012
5 year = 11.8%
3 year = 10.8%
1 year = 13.4%

Prism

The BlackRock fund is far too UK focused for my liking. Before you transfer to a SIPP though you could always look at changing the fund first assuming you have some other choices.

Chris_P_2

Impossible to say. Asking users of a forum on the merits of a fund one scraps of info is like asking for an opinion of a painting by describing it

IanSt

Kaiser71 wrote: »

I was thinking of transferring this to a SIPP, probably something like the Fundsmiths, Legg Mason IF or LF Lindsell Train funds.

I'm wondering as to what your particular reasons were for thinking of those particular funds and whether you were thinking of putting it all into one fund or sharing the money between them?

The fund you have is heavy on the UK but from your description it appears to be passively managed with the rest of the holdings diversified across the globe, so in my eyes it is certainly not the worst of funds to have your money in.

TBH I'm not sure that I'd like to be putting a bunch of new money into some of the equities that Fundsmiths etc own, but each to their own and if you've bought into their managers strategy then you might prefer their active approach.

Linton

The UK has underperformed the rest of the world for many years, because of the increasingly dire nature of the FTSE100. It's nothing to do with the UK's economy, but rather that comparatively few top rank global companies choose to quote on the London Stock Exchange. I think you should replace your 60% UK fund with a much more broadly based fund. eg a World tracker - Fidelity Index World (6% UK) would fit the bill if you needed a Fidelity fund . There is no need to go to the extremes of Lindsell Train/Fundsmith except as secondary holdings. You could supplement the Index World fund with a UK small companies one if you wanted to increase the UK allocation a bit.

Kaiser71

Thanks for the replies. I think I may just do that and the reduce the UK fund down a bit, and add some % to Emerging Markets or India/Japan funds.

Prism

Kaiser71 wrote: »

Thanks for the replies. I think I may just do that and the reduce the UK fund down a bit, and add some % to Emerging Markets or India/Japan funds.

If you do go for the Legg Mason IF Japan fund be prepared for some serious volatility. +/- 3% daily changes are fairly regular but so far it has performed really well. Its my strongest holding

Tcquins

If you’re going to run it yourself, your first question shouldn’t be whether you should move to a SIPP it should be whether it’s worth switching funds.

Fidelity pension plans often have low all in one charges including the trackers. Some i’ve seen come in at 0.3% all in.

If you move to a SIPP such as HL as the typical example, you’ll be paying 0.45% as a platform fee, plus whatever the funds are.

If you are using trackers then you’re not looking to actively beat the market, just follow it. As such, building in a 0.2-4% extra cost per year may not be worth doing to invest in another tracker.

Prism

IanSt wrote: »

ITBH I'm not sure that I'd like to be putting a bunch of new money into some of the equities that Fundsmiths etc own, but each to their own and if you've bought into their managers strategy then you might prefer their active approach.

For me I would rather put my money into those high quality equities than most other active funds selection of equities. If you want a global active fund its one of the best. The other option is an index of course which includes the good and the bad and will at least guarantee that you will underperform the benchmark only slightly.

Kaiser71

Thats the dilemma with active funds, you have to pick the right active managers. Passive funds/trackers are still performing well, but can be beat by the best fund managers. Looking at some of the big players , they pretty much all have similar share holdings.

AnotherJoe

What Linton said. I wouldn't put anything in the FTSE 100 not so much because its so UK focussed, but because of the way it works, so much is concentrated on the top companies and it doesn't really matter what the rest do, anything under position 50 or so might as well not be in it. Its pretty much all about the top 20 or so companies, and they are only in a handful of industries.