Nutmeg - I feel like they've punished me

cloud_dog

DAE wrote: »

Feels futile to start giving them my money again as it will take an age to get back that £122 loss.

If you are at the start of your investing and investing monthly then you should look on these times of market pull-backs as heaven sent, allowing you to purchase more investments at a lower price.

Google pound cost averaging.

cloud_dog

eskbanker wrote: »

Yes, OP really put their foot in it!

That's so funny, I'm not even going to correct it

Joe_Bloggs

I suggest that DAE stick to mainly using many regular saving opportunities,associated with current accounts to build up a buffer of money before considering investing in higher risk opportunities.


You can flexibly fund regular savers from your income and fund S&S from your matured savings buffers.



J_B.

Bravepants

Since I found I was saying (typing!?) the same thing all the time I keep this handy list, which I update on occasion, in Microsoft OneNote.



Start with bullet point number 1 and then choose other bullets as appropriate, or consider them in order:

• Pay off any debt first (apart from mortgage, depending on interest rate), then

• Start with 3, 6 or 12 months outgoings (maybe even swap the word "outgoings" for "salary") as an emergency fund in some sort of (or several) instant access account. Find out about current accounts, regular savers etc. and the interest rates they provide.

• Keep an eye on your work pension and how much extra your company contributes for any additional contribution you make, pensions (work, private or SIPPS) are particularly good if you are a higher rate tax payer

• Buy or borrow a copy of Tim Hale's "Smarter Investing", and once you have point 2 in place:

• Check out www.monevator.com, particularly the passive investing section, and,

• Read up about the tax advantages of Stocks and Shares ISAs and SIPPS, and

• If considering retiring early check out www.mrmoneymustache.com for inspiration

• Make sure you have any cash needed for expenditure in the short term, such as house purchase deposit, replacement car, wedding (don't overspend on this) etc., then stash as much as you can, monthly (taking advantage of "pound cost averaging"), in a global index fund (read up online about these). As you get older switch to funds that a contain a mix of equities and bonds (read up online about these, but Tim Hale talks about it too)

• Whatever fund(s) you plan to invest in make sure you don't pay too much in annual fees; a good passive index fund should be around 0.5% or so, including platform charge, active funds (those managed by humans) are around 1% to 1.5% but try to keep close to 1%. In no way pay 2% in annual fees for any of your investments!

• Learn about the concept of a "phased" retirement, using certain pots of money to carry you through periods before work pensions become payable at Normal Retirement Age.

• Learn to use Microsoft Excel (other spreadsheet software is available) and write yourself a retirement planning spreadsheet!

chockydavid1983

Investments can go up and down in the short term, sometimes wildly if the investments are heavily equity based.
If you can't handle this or can't leave your money invested for a longer term where the ups and downs will even themselves out, you shouldn't be investing.

Thrugelmir

DAE wrote: »

Yeah, I think I've just got unlucky.

Speculative investment is a judgement call. You shouldn't be relying on luck.

I decided to put risk level at 8/10, because I'm of the mind that I'm starting small and may as well gamble

There's an old saying "Oak trees grow from acorns". Treat you money the same way. Plant it carefully, look after it, and let it grow over time. There's no rush. The best returns come after years not days. Unless you happen to be extremely lucky.Which statistically is unlikely.

badger09

cloud_dog wrote: »

You do understand that you have made an investment in to a socks and shares type investment?

eskbanker wrote: »

Yes, OP really put their foot in it!

Just dipping his toe in:p

Mnd

You wouldn't be so humorous if the boot was on the other foot.

AnotherJoe

webjaved wrote: »

Ouch! How did that make you feel? I'd have sleepless nights over that!

Believe it or not only slightly miffed because I've lost more before (and made more).

I'm sort of trapped with a huge capital gain (nice place to be trapped. ) , had i sold it at the max, then I'd have paid a lot of CGT, so the $70k loss might only be say $20k (WAG guess CGT would have been $50k)) plus if I was that way inclined I would have sold it before it got to the max (because how did i know what the max was?) .

Indeed arguably if i was minded to do that, I'd have sold it at a much lower price and thus not had it rise so much and probably made less than the total I'd make of "losing" (I suppose it should be in quotes) plus paying CGT.
So I'm currently just selling off the most i can each year keeping within CGT limits.

bowlhead99

AnotherJoe wrote: »

Believe it or not only slightly miffed because I've lost more before (and made more).

I'm sort of trapped with a huge capital gain (nice place to be trapped. ) ,

These 'traps' or 'nice problems to have' can sometimes change your investment strategy. For example this year I found myself cashing in a large gain, that I couldn't do anything about being well over the exemption. As a result, I will have a hefty CGT bill for 18/19.

But ordinarily my gains are well within the limits, as mostly my investments are in tax wrappers, so no need to pay tax.

So from here, as someone with a CGT bill in waiting, I find it's skewing me to higher risk investments. If a £10k investment made today goes down £2k by 5th April, I can cash in that loss, reducing my net capital gains for the year by £2k and my tax bill by £400. But if instead the same investment goes up by £2k by 5th April, I can simply dispose of it the following morning with no CGT to pay because of having a whole new exemption for next tax year.

If the investment is a coin toss whether it will make £2k or lose £2k but the practical outcome is make £2k tax free or lose £1.6k after the 'tax shield' effect, that's an attractive prospect

The trick is just identifying what investment opportunity is pure 50:50 potential gross gain vs potential gross loss over next couple of months to the end of the tax year, to make the maths nice and clean In reality, many investments are either a slim chance of a great return and a high chance of losing some money; or a high chance of making only a small amount of money with a small chance of a big failure.

It would be much easier if everything was a straight coin toss with equal odds and sizes of ups and downs, in which the expected value from the tax rules was nice and clear... Nutmeg should get their whizz kids on the case with some clever derivative products. Unfortunately spread bet firms which offer easy-to-understand binary outcomes, are outside scope of CGT!