Diversifying lifestrategy

Fatbritabroad

Hi

I've now got a reasonable sum in lifestrategy 100and am considering diversifying. I recognise I will now need to rebalance if I do this.

I was looking at the vanguard small cap index and was thinking of putting 10% of my holding in this. I just wondered if there were any other options people would recommend considering that I could research. I was also looking at investment trusts but not sure what they'd give me that lifestrategy doesn't as I'm not after I come at present. Thoughts welcome

ArchBair

F&C Global Smaller Companies Investment Trust?

Fatbritabroad

Thanks for the response. What would be the advantage of an it over a fund out of interest? I don't know much about investment trusts yeas not had to use them

ArchBair

Fatbritabroad wrote: »

Thanks for the response. What would be the advantage of an it over a fund out of interest? I don't know much about investment trusts yeas not had to use them

It's actively managed and the management reports to the board of directors. Depending on which platform you use the costs in holding IT's in general are very low. Over the past 10 years it has returned 285.70 although obviously there are no guarantees for the future. It is currently trading at a discount of -3.4% and pays a small dividend of 1%.

GT85

I'm glad you have asked this, as I have been thinking the same. I am very new to all this, but am desperately trying to take in as much as possible with reading and getting up to speed.

I'd like to add some tilts. Vanguard has emerging markets, but I was thinking of diversifying with smallcap or value, especially as I'm in it for 20-30 years. Vanguard have an active Value ETF, 0.22 OCF, but I'm confused as to why it is rated only a 4 out of 7 in terms of risk. I've always been under the impression value stock were fairly risky.

From reading Tim Hale's book, I believe another aspect to diversifying would be to add in REITs such as the iShares developed market fund. I was reading that REIT's have had a hard start to 2018, which to me screams opportunity, but I'm going to have to do further reading over the weekend before putting my money where my mouth is, so to speak.

Audaxer

GT85 wrote: »

I'm glad you have asked this, as I have been thinking the same. I am very new to all this, but am desperately trying to take in as much as possible with reading and getting up to speed.

I'd like to add some tilts. Vanguard has emerging markets, but I was thinking of diversifying with smallcap or value, especially as I'm in it for 20-30 years. Vanguard have an active Value ETF, 0.22 OCF, but I'm confused as to why it is rated only a 4 out of 7 in terms of risk. I've always been under the impression value stock were fairly risky.

From reading Tim Hale's book, I believe another aspect to diversifying would be to add in REITs such as the iShares developed market fund. I was reading that REIT's have had a hard start to 2018, which to me screams opportunity, but I'm going to have to do further reading over the weekend before putting my money where my mouth is, so to speak.

This thread may interest you as it is mostly about the pros and cons about further diversifying a multi asset fund by adding single sector funds:
http://forums.moneysavingexpert.com/showthread.php?t=5802405
Unless you are an experienced investor and have significant sums to invest, I don't think its worthwhile diversifying from the professionally structured asset allocation that a multi asset fund will give you.

TCA

Fatbritabroad wrote: »

I was also looking at investment trusts but not sure what they'd give me that lifestrategy doesn't as I'm not after I come at present. Thoughts welcome

Presuming that says "I'm not after income", you seem to be under the impression that investment trusts are income vehicles. Not so. Yes, there are trusts with an income focus, but equally they can be focused on growth. Depends on their remit.

Fatbritabroad

Yes sorry misprint income. Thanks for that yes I freely admit to not knowing slot about investment trusts. Only that they are their own companies so can be bought and sold like other individual shares. I only said income as the ones I'm aware of from blogs like monevator.com seem to be tilted that way and they seemed to think they were useful for retirement planning

MallyGirl

ITs will be liable for stamp duty when buying.

ColdIron

MallyGirl wrote: »

ITs will be liable for stamp duty when buying.

Not if they are not domiciled in the UK, such as Jersey or Guernsey etc. It's a small but satisfying saving

fun4everyone

You could look at micro/small cap funds by region

You could look at different sorts of active emerging market funds in different areas

You could look at a small % of frontier markets

You could look at adding some individual sectors like biotech or property or water etc etc