My index fund or my actively managed fund

d712

Hello

I've recently read about Warren Buffett's bet on the 10 year performance of an S&P 500 index fund against that of 5 actively managed funds and have put my faith in Buffett's judgement and transferred quite a lot of my investments into an S&P 500 index fund.

About a year ago I invested in the Jupiter India fund and this had since gone down by over 10%.

I can't make up my mind whether to hold onto the Jupiter India fund and hope for it to go up again or to take a hit, sell up, accept the loss and transfer the funds into the S&P 500 index fund.

What do you think I should do?

Stick with the Jupiter India fund or transfer to the S&P 500 fund?

Thanks

Audaxer

I think most people would either go passive with several index funds or a multi asset fund, or go active with a portfolio of single sector active funds. In both cases they would be aiming for a diversified portfolio.

The one actively managed fund you have seems to be in a fairly high risk sector so it will be volatile. I would aim to get a more diverse portfolio. Have a look at low cost globally diversified multi asset funds like for example Vanguard LifeStrategy, HSBC Global Strategy or L&G Multi Index funds. You can get them in various risk categories, so you can pick one to suit your risk tolerance. Any of these types funds would give you more diversification than you currently have.

d712

Thanks

I have the Vanguard LifeStrategy fund amongst other index funds.

My choice is whether to stick with Jupiter India or transfer into S&P 500.

I'm going to do one or the other. Which would you go with?

dunstonh

I've recently read about Warren Buffett's bet on the 10 year performance of an S&P 500 index fund against that of 5 actively managed funds and have put my faith in Buffett's judgement and transferred quite a lot of my investments into an S&P 500 index fund.

Do remember that the last decase has seen the S&P500 outperform most markets. The decade previous to that, it underperformed most markets.

So, following his advice is risky.

About a year ago I invested in the Jupiter India fund and this had since gone down by over 10%.

Emerging Markets have gone a little off the boil recently.

I can't make up my mind whether to hold onto the Jupiter India fund and hope for it to go up again or to take a hit, sell up, accept the loss and transfer the funds into the S&P 500 index fund.

Sounds like you are chasing returns after the event. What are you going to do when the S&P500 next underperforms?

What do you think I should do?

Hopefully, the S&P500 and india funds are not your only funds. That is no way to build a portfolio. What other funds do you have in your portfolio and what are their weightings?

darkidoe

d712 wrote: »

Thanks

I have the Vanguard LifeStrategy fund amongst other index funds.

My choice is whether to stick with Jupiter India or transfer into S&P 500.

I'm going to do one or the other. Which would you go with?

One is a fund invested in India and the other in S&P 500. (US) (2 different geographical locations)

One is a active fund whilst the other is an index tracker. Both have different volatility profiles and charges.

Question is what are you trying to achieve here with this fund? And how does this fit into your overall portfolio?

d712

As I've already mentioned, I have other index funds including Vanguard LifeStrategy, Vanguard Emerging Markets, Vanguard Global Small Cap, Vanguard Developed World Ex UK, Legal and General Global 100.

But the decision I'm making now is whether to stick with Jupiter India as I have a large amount of funds in there or transfer it to the S&P 500 fund.

Buffett's argument would be to do the latter as the index fund would outperform an actively managed fund over time.

AnotherJoe

d712 wrote: »

As I've already mentioned, I have other index funds including Vanguard LifeStrategy, Vanguard Emerging Markets, Vanguard Global Small Cap, Vanguard Developed World Ex UK, Legal and General Global 100.

But the decision I'm making now is whether to stick with Jupiter India as I have a large amount of funds in there or transfer it to the S&P 500 fund.

Buffett's argument would be to do the latter as the index fund would outperform an actively managed fund over time.

No, it isn't.

Buffets argument was that an S&P500 Index fund would outperform an actively managed fund picking stocks from the S&P500.

He hasnt bet that an investment in S&P500 index will beat any other stock market, or stock market sector, in the world, that would be nonsensical.

So you've misunderstood what he said and then acted on your misunderstanding :eek: but lucked out so far

d712

Actually the actively managed funds were never publicly named so neither of us know what they consisted of.

I've repeated my original question a couple of times as it hasn't been answered yet.

The question was of the two, what would you do?

Stick with Jupiter India or go with S&P 500?

Thanks

d712

Also I'm not sure how you can say I have lucked out when you don't know where I stand with my investments overall.

Prism

d712 wrote: »

Actually the actively managed funds were never publicly named so neither of us know what they consisted of.

I've repeated my original question a couple of times as it hasn't been answered yet.

The question was of the two, what would you do?

Stick with Jupiter India or go with S&P 500?

Thanks

What has changed in your mind since last year when you invested in Jupiter India? Do you no longer think returns from India are likely to be as good as from the US? If what you are asking is are the future returns of the S&P better or worse than Jupiter India then how would anyone know that?

lpgm

The answer would depend on whether we've gone off India or not. Have YOU gone off India or not?

You've already got a ragbag of index funds. Adding another one, a large cap US one, might or might not work out. Who knows?

You've given yourself a somewhat bizarre binary choice to make.