£40K in VL60 Fund

Reluctantpensioner

The recommended holding period for VLS60 is 7 years. (Google vanguard 60% recommended holding period)

What might you lose if you hold for one year? It is easy to obtain:
The mean gain for this fund is 9.3% for one year. The standard deviation, 6.3%.
IF the fund follows a normal distribution (it won't)
This indicates a 68% chance of a return between 3% to 15.6%.
And a 95% chance of a return between -6.7% to 24.9%.

Another way of looking at possible losses is called "Value at Risk" (I'm not as familiar with this one, I'll just report what it says in the Vanguard Prospectus for the VLS range):

31 March 2017 31 March 2016
LifeStrategy 60% Equity Fund 9.13% 14.16%
"under normal market conditions and assuming no changes to Fund holdings, there is a 95% probability that the value of Fund assets will not decrease by more than the calculated value over a one-year period."

In some sort of global crisis (Like in 2008) the return could be as low as -20 to -50%.
However, markets bounce back: in seven years you should be back to a normal profit. (In 2008 it took 1-2 years depending on fund).

JohnRo

DairyQueen wrote: »

No year is 'good' for a 12-month investment in the markets.

2017 was

bostonerimus

FrankR wrote: »

Hello,
New to investing.
VLS60/40 seems all the rage at the moment.
Should I put my £40,000 in the VLS60/40 for 1 year?
How much can I expect to make?

No, 1 year isn't long enough, only put money into such funds for times greater than 5 years. In such a fund I've average 8.5% annual return, but that's no guarantee of what it might make in the future.

DairyQueen

JohnRo wrote: »

2017 was

Ah yes... hindsight. 'Tis a most wonderful thing