Multi asset funds

Bluenose123

I have been looking multi asset funds and like the way that you can choose the risk level and relatively low charges.

Which companies would forum members recommend using and what sort of return on 100k would I be likely to receive over an average 12 months if invested for 5 years in low risk funds.

I ask because trying to decide if the risk in putting money in funds is worth it over the safety of guaranteed bonds which currently pay around 2.5 per cent interest.

masonic

If your investment horizon is only 5 years, then it would not be appropriate to invest in a fund with much more than 20% in equities vs bonds.

A 20:80 fund would typically generate returns of about 3% on average, with a loss potential of 20%, but a less than one in ten risk of losing money over 5 years.

Personally I would opt for a fixed rate savings account over such a fund. Or perhaps put 50-80% of my money in such a savings account and the rest in a higher risk fund.

xylophone

https://www.thisismoney.co.uk/money/diyinvesting/article-6675167/Sanlams-list-14-best-income-UK-funds-yields-5-6.html

may be worth a read.

Bluenose123

Thanks xylophone. Interesting article which suggests average of 5% is achievable which could make it worthwhile.

Bluenose123

Thanks Masonic for Taking

the time to reply.

Gives me some food for thought as if only 3% return probably just as well putting money in guaranteed bonds

Aminatidi

I think the question you have to know the answer to before considering any kind of investment over savings is, if you put £100K in, in 5 years do you want to be sure you can take at least £100K out.

If the answer is yes, go with a savings product IMO.

dunstonh

Bluenose123 wrote: »

Thanks xylophone. Interesting article which suggests average of 5% is achievable which could make it worthwhile.

In the long term yes. However, you are only looking at around half an economic cycle and bonds still havent corrected within the last decade.

When you are investing short term, you dont know if you are going to get the good period or the not so good or even bad period.

A_T

Bluenose123 wrote: »

Thanks xylophone. Interesting article which suggests average of 5% is achievable which could make it worthwhile.

5% has been very achievable in the last 10 years' bull market - in fact it's on the very low side considering how shares have risen. But these income funds aren't like savings accounts that pay 5% interest - there will be some years when your total capital will actually fall.

David_Evans

Bluenose123 wrote: »

I have been looking multi asset funds and like the way that you can choose the risk level and relatively low charges.

Which companies would forum members recommend using and what sort of return on 100k would I be likely to receive over an average 12 months if invested for 5 years in low risk funds.

I ask because trying to decide if the risk in putting money in funds is worth it over the safety of guaranteed bonds which currently pay around 2.5 per cent interest.

What are your plans for the money?
Retirement?
House purchase?

Bluenose123

Will be using the money to help fund house purchase.

masonic

Bluenose123 wrote: »

Will be using the money to help fund house purchase.

Then unless you are quite relaxed on the timeframe in which you wish to buy, and would be ok with waiting 10 years instead of 5, investments are pretty much off the table.