One more IT for this years ISA...

ColdIron

If you like Terry Smith's approach and you are light on EM, his Fundsmith Emerging Equities Trust (FEET) might be worth a look?

rathernot

ColdIron wrote: »

If you like Terry Smith's approach and you are light on EM, his Fundsmith Emerging Equities Trust (FEET) might be worth a look?

Thank you, I'd completely forgotten about that!

economic

economic wrote: »

Sure you just outlined one possible scenario in a world of near infinite number of scenarios for his portfolio returns. What if in your scenario of a 30% drop in a few years occurred after say a 40% rally in stocks? You would still be better off fully invested now.

you are not really adding anything new or insightful, nor am i. I was just trying to find out the OPs reasoning for waiting for each tax year as it seems he may not know about "bedding". Historically it seems like a bad idea to time the market or drip feed over such a long period. But of course it could turn out to be a good idea, who knows?

I think the key to all this is the OPs age and other personal circumstances such as if the cash may be needed potentially for a purchase in which case it may make sense to not have everything invested.

Mathematically i was wrong, a 30% drop after a 40% rally from now would still incur a loss. its more like 43% just to be flat. Of course to make money one needs to beat inflation so assuming a 3% inflation and the 30% drop happens in 3 years, you would need stocks to rally about 56% from here at least to keep up with inflation.

Audaxer

economic wrote: »

Mathematically i was wrong, a 30% drop after a 40% rally from now would still incur a loss. its more like 43% just to be flat. Of course to make money one needs to beat inflation so assuming a 3% inflation and the 30% drop happens in 3 years, you would need stocks to rally about 56% from here at least to keep up with inflation.

In view of the long bull run, it would be interesting know what the odds would be of further 40% to 56% gains before the next 30% correction. I'd be surprised if the markets continued to rise so much before the next big correction, but who knows.

As the OP says its a psychological thing, he would therefore be happier to wait and invest his £20k ISA allowance every April, rather than invest it all now with the potential for a big drop in the near future.

rathernot

Currently thinking F&C Global Smaller Companies looks a sensible option.

bostonerimus

rathernot wrote: »

Currently thinking F&C Global Smaller Companies looks a sensible option.

Vanguard Global Small Cap index has better 1, 3 and 5 year returns and I'm sure there are other examples of better performance.......so why F&C?

MonroeM

bostonerimus wrote: »

Vanguard Global Small Cap index has better 1, 3 and 5 year returns and I'm sure there are other examples of better performance.......so why F&C?

It's done great over the past 10 years so not really a bad decision.

Or alternatively, you can select individual smaller companies IT's in the main regions such as UK, Europe, US, Japan and Asia Pacific?

Thrugelmir

Audaxer wrote: »

In view of the long bull run, it would be interesting know what the odds would be of further 40% to 56% gains before the next 30% correction. I'd be surprised if the markets continued to rise so much before the next big correction, but who knows.

Which market(s) are your refering to historically?

economic

Audaxer wrote: »

In view of the long bull run, it would be interesting know what the odds would be of further 40% to 56% gains before the next 30% correction. I'd be surprised if the markets continued to rise so much before the next big correction, but who knows.

As the OP says its a psychological thing, he would therefore be happier to wait and invest his £20k ISA allowance every April, rather than invest it all now with the potential for a big drop in the near future.

I would rather stay open minded to all possibilities and invest according to your risk tolerance and goals.

Audaxer

Thrugelmir wrote: »

Which market(s) are your refering to historically?

I was just quoting the figures economic had used in his post.