Comments on investments welcomed

Moe_The_Bartender

Investing isn’t complicated. I’ve had most of my money in the same 3 index trackers for 20 years and I’ll hopefully stick with them for at least another 30. Keeping things simple makes managing your investments easier which is useful in down turns.

Index funds are fine if you are willing to accept the fact that they include some awful companies as well as some great ones.

AnotherJoe

For values of awful = ???

bostonerimus

Moe_The_Bartender wrote: »

Index funds are fine if you are willing to accept the fact that they include some awful companies as well as some great ones.

You can say exactly the same about active funds.

masonic

Moe_The_Bartender wrote: »

I have a real problem with Emerging Markets - corporate governance and the political risk to begin with.

My ex-IFA recommended that I put 28% of my pension pot into EM based upon my Attitude to Risk. The funds he recommended were 'interesting' and included Russian and South African banks. Why would I put my money into such an investment when I wouldn't even invest in a UK bank?

If I want emerging markets in my portfolio, I can get that through the likes of Unilever, Diageo and Heineken.

A 28% allocation to EM is high, even for an adventurous portfolio. My own allocation is about 10%, and avoids exposure to the likes of Brazil and Russia. EM investments tend to be smaller company investments, and my portfolio has a strong leaning towards the latter. My EM exposure helps with diversification, given I'm not so keen on US smaller companies.

nxdmsandkaskdjaqd

bostonerimus wrote: »

Investing isn’t complicated. I’ve had most of my money in the same 3 index trackers for 20 years and I’ll hopefully stick with them for at least another 30. Keeping things simple makes managing your investments easier which is useful in down turns.

Out of interest what would these be? (just interested in trackers at the moment).

cogito

bostonerimus wrote: »

You can say exactly the same about active funds.

You can but then it comes down to the fund manager. Given that Index Trackers give you the average of the whole of the market and that at least half fund managers are average or less, you need to find above average managers.

Your above average manager is almost by definition investing in above average companies.

bostonerimus

cogito wrote: »

You can but then it comes down to the fund manager. Given that Index Trackers give you the average of the whole of the market and that at least half fund managers are average or less, you need to find above average managers.

Your above average manager is almost by definition investing in above average companies.

Indeed, we all want to be above average, but unfortunately that's a mathematical impossibility.

badger09

nxdmsandkaskdjaqd wrote: »

Out of interest what would these be? (just interested in trackers at the moment).

I'm sure bostonerimus will be back to answer, but just as a caveat - he is based in USA where he has lived & worked for many years.

That isn't meant to detract from his fondness for just 3 index trackers, but should give some context

EDIT
cross posted, but bostonerimus hasn't responded to your question

bostonerimus

nxdmsandkaskdjaqd wrote: »

Out of interest what would these be? (just interested in trackers at the moment).

I'm in the US and use Vanguard. The index trackers are US Total Equity Index, an International Equity index and a Total US bond index....ratios are 50/25/25. Costs are 0.06%, I have no platform fees and don't use a financial advisor. Average annual returns for the last 20 years have been 8.5%.

So the OP's portfolio seems complicated to me as I have taken a very simple approach to get a satisfactory result. That's not to say that more complicated portfolios won't produce excellent returns or even better returns, but I haven't found them to be necessary for financial success. I am carrying on with a simple index tracker portfolio in retirement.

bowlhead99

GBY wrote: »

I’d be very grateful for any feedback on my current allocation of my employee pension investments provided by Aviva. I was in Blackrock Consensus for a number of years but recently set up the following. I’m now questioning whether it’s overly complicated and I’d be better off with just the Baillie Gifford Fund or switching to Liontrust SF Managed as the latter’s fees are lower. I’d even consider a world equity, asian and bond tracker instead though the options available are limited.

You are looking at simplifying to an all-in-one fund and would consider global equity and bond trackers. Is Blackrock Consensus no longer available to you (which is a fund which invests in equity and bond trackers to a consensus mix)? It would be surprising if its fees weren't lower than either Baillie Gifford or Liontrust's managed offerings even if your employer has negotiated quirky pricing.

Not to get into too much detail about your current choices of specialist or country-specific funds or your thoughts on them, but:

GLG Japan Core Alpha 5% 5% currently low value, scope to grow?

It's up 50% in three years (which is about 14.5% annualised) or 150% in ten years, 250% in fifteen years (about 9% annualised). If those returns for a fund invested into a developed economy strike you as 'low value scope to grow', perhaps moderate your expectations.