We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Views on Royal London Governed Portfolio

Options
1356711

Comments

  • mcc100
    mcc100 Posts: 624 Forumite
    Part of the Furniture 500 Posts Name Dropper
    Apologies if the answer is fairly obvious, but I just wondered what the procedure is for taking part of my TFLS from this fund when I'm 55 in a couple of months time.

    Are units within the fund to the value of the TFLS sold?
  • SonOf
    SonOf Posts: 2,631 Forumite
    1,000 Posts Fourth Anniversary
    mcc100 wrote: »
    Apologies if the answer is fairly obvious, but I just wondered what the procedure is for taking part of my TFLS from this fund when I'm 55 in a couple of months time.

    Are units within the fund to the value of the TFLS sold?

    It can vary with providers but typically you sell the investments down to allow the part of the fund you are crystallising (4 times the lump sum you are taking) and that is moved into a separate segment within the pension to allow your uncrystallised funds and crystallised funds to be kept apart.

    You are on a Royal London thread, So, all you need to do with them is a form and they do the rest.
  • [Deleted User]
    [Deleted User] Posts: 0 Newbie
    1,000 Posts Third Anniversary Name Dropper
    edited 7 October 2019 at 12:31PM
    A couple of questions to ask your IFA:

    1. The bulk of this portfolio is in RLP Global Managed. Why has it underperformed it’s benchmark year in, year out? It’s otherwise tracking the benchmark, just a few percent below each period. Why would I not invest in the benchmark instead?

    2. The fund is classified as “balanced”/“moderately cautious”/“moderately adventurous”

    Balanced funds typically have at least 40% bonds. This fund has 20% bonds; the rest is in highly volatile assets, such as industrial property, commodities and stocks. What’s the potential for a drawdown and how it corresponds to my risk tolerance?

    3. How do you justify recommending an investment with over 50% in a single market (UK).
  • SonOf
    SonOf Posts: 2,631 Forumite
    1,000 Posts Fourth Anniversary
    1. The bulk of this portfolio is in RLP Global Managed. Why has it underperformed it’s benchmark year in, year out? It’s otherwise tracking the benchmark, just a few percent below each period. Why would I not invest in the benchmark instead?

    Global Managed the default but the IFA can change that fund to any of the other global managed funds.

    The fund is lower risk than the benchmark and as the portfolio is volatility targetted, that will be intentional.
    2. The fund is classified as “balanced”/“moderately cautious”/“moderately adventurous”

    Balanced funds typically have at least 40% bonds. This fund has 20% bonds; the rest is in highly volatile assets, such as industrial property, commodities and stocks. What’s the potential for a drawdown and how it corresponds to my risk tolerance?

    Irrelevant as the portfolio has a target volatility range linked to both risk profile and timescale. Individual funds should not be viewed in isolation.
    3. How do you justify recommending an investment with over 50% in a single market (UK).

    GP5 has 24.6% UK equities. Not over 50%.
  • mcc100
    mcc100 Posts: 624 Forumite
    Part of the Furniture 500 Posts Name Dropper
    SonOf wrote: »
    It can vary with providers but typically you sell the investments down to allow the part of the fund you are crystallising (4 times the lump sum you are taking) and that is moved into a separate segment within the pension to allow your uncrystallised funds and crystallised funds to be kept apart.

    You are on a Royal London thread, So, all you need to do with them is a form and they do the rest.

    Thanks SonOf. My investment is in RL Governed Portfolio 5 so it should be fairly straightforward then. I assume that I don't have to wait until my 55th birthday to crystallise the part of the fund necessary to take my lump sum.
  • cfw1994
    cfw1994 Posts: 2,127 Forumite
    Part of the Furniture 1,000 Posts Hung up my suit! Name Dropper
    mcc100 wrote: »
    Thanks SonOf. My investment is in RL Governed Portfolio 5 so it should be fairly straightforward then. I assume that I don't have to wait until my 55th birthday to crystallise the part of the fund necessary to take my lump sum.

    er....surely no: "Pension freedoms" only allows you to access them after 55

    Unless you mean "can you post the paperwork in advance?", in which case perhaps you can, but they shouldn't act on it until you are 55.

    I think there are exceptions for people who are seriously ill.
    Plan for tomorrow, enjoy today!
  • mcc100
    mcc100 Posts: 624 Forumite
    Part of the Furniture 500 Posts Name Dropper
    cfw1994 wrote: »
    er....surely no: "Pension freedoms" only allows you to access them after 55

    Unless you mean "can you post the paperwork in advance?", in which case perhaps you can, but they shouldn't act on it until you are 55.

    I think there are exceptions for people who are seriously ill.

    No, I was just thinking of sending off the paperwork now as I wasn't sure how long the process took.
  • The fund is lower risk than the benchmark and as the portfolio is volatility targetted, that will be intentional.

    Interesting. Then the question to ask: why the heck is the fund manager using an inappropriate benchmark?
  • GP5 has 24.6% UK equities. Not over 50%.

    Commercial property/REITS = a type of equity. Of all equity exposure over 50% is in the UK.
  • In general the approach of taking 3 correlated highly volatile assets and then claiming the resulting fund is “low volatility” is similar to what the insurance companies did when when they lumped different subprime mortgages and said “all is good!”
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351K Banking & Borrowing
  • 253.1K Reduce Debt & Boost Income
  • 453.6K Spending & Discounts
  • 244K Work, Benefits & Business
  • 599K Mortgages, Homes & Bills
  • 176.9K Life & Family
  • 257.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.