Pension values dropped?

jubilee14

I know that the pensions pots go up and down throughout their lives. but checking on line my pots seem to have dropped quite a bit in the last few months. Is this because of Brexit or another reasons?

Still have about 20 years to go to retire but not looking like an early escape is very likely!

Filo25

jubilee14 wrote: »

I know that the pensions pots go up and down throughout their lives. but checking on line my pots seem to have dropped quite a bit in the last few months. Is this because of Brexit or another reasons?

Still have about 20 years to go to retire but not looking like an early escape is very likely!

There has been a noticeable downwards correction in global equity markets for the last month or so, to be honest it has been a pretty down year for most markets outside North America

dunstonh

I know that the pensions pots go up and down throughout their lives. but checking on line my pots seem to have dropped quite a bit in the last few months. Is this because of Brexit or another reasons?

nothing to do with Brexit. Just normal market movements.

Investments zig zag in value on a daily basis. You cant have only zigs. You have to have zags as well.

The recent drop is minor. Not even classed as a crash. We had a slightly larger loss earlier this year, A number of smaller losses last year. 2015/16 saw a period that lost twice as much over a longer period. And for scale, the dot.com period and the credit crunch saw losses about 4 times the current level.

All routine and normal. And great news if you are paying in monthly. You need these negative periods and you should be pleased when they happen.

Zola.

When drops in value happen, does that automatically mean the units are cheaper? Surely its a supply and demand thing?

E.g. I noticed our Vanguard funds value drop significantly recently, but the unit price is only down by a couple of pounds.

Thrugelmir

jubilee14 wrote: »

I know that the pensions pots go up and down throughout their lives. but checking on line my pots seem to have dropped quite a bit in the last few months. Is this because of Brexit or another reasons?

Trump trade wars, Italian debt crisis, Merkel standing down as Chancellor, Chinese shadow banking, poor company performance etc etc. Take your pick.

Thrugelmir

Zola. wrote: »

When drops in value happen, does that automatically mean the units are cheaper? Surely its a supply and demand thing?

Units are created and cancelled as purchase\sales transaction are made. Units simply reflect the underlying value of the investments held.

Zola.

Thrugelmir wrote: »

Units are created and cancelled as purchase\sales transaction are made. Units simply reflect the underlying value of the investments held.

Can you go into more detail?

lisyloo

Still have about 20 years to go to retire

Let's say the price of burgers varies between £6 and £10.
If you are buying a burger would you prefer to pay £6 or £10?


You want the price to be low if you are a buyer.

AnotherJoe

jubilee14 wrote: »

I know that the pensions pots go up and down throughout their lives. but checking on line my pots seem to have dropped quite a bit in the last few months. Is this because of Brexit or another reasons?

Still have about 20 years to go to retire but not looking like an early escape is very likely!

Brexit will, all other things being equal have contributed to them going up not down for UK investors. You may have noticed an orange buffoon creating worldwide havoc. Thats the main cause, though a stock market correction has been on the cards for some time. Maybe this is it maybe it isnt.

As Dunston says this is good news as you have the opportunity whilst putting money into your pension to buy more units at a lower price.

Its a better than good idea to educate yourself about investing, perhaps try the Monevator website as a starting place and also The Escape Artist on investing and pensions.

Ps. its funny how many people post here to the same effect you did;
" i know the stock market goes up and down but why have my pension investments gone down?".
Its as if theres an intellectual disconnect between the idea that markets go up and down, and the concept that your (pension) investments might also go up and down !

Thrugelmir

Zola. wrote: »

Can you go into more detail?

New money creates more units.

Sales\redemptions results in less units.

The number of units in existance isn't static.

ColdIron

Zola. wrote: »

E.g. I noticed our Vanguard funds value drop significantly recently, but the unit price is only down by a couple of pounds.

How do you measure your 'value' if not by unit price? Your number of units does not change. If your units were worth £3 then a drop of £2 isn't something I'd qualify by the word 'only'