Investment Timing.....

scoot65

I'm fairly new to investing, about 18 months.

I have a S&S ISA (HSBC Global Strategy bal. and VLS 60).

I'm aware of the "time in the market" rather than "timing the market" argument, however I've still managed to do the newbie mistake of trying to 'time the market'

Since May I've had £20k ready to go into my ISA. I've been looking at my current investments and the price has been going up since April. I had been hoping to wait until there was a drop before I invest my 2019/20 ISA amount.

Obviously there's been no downturn (as yet) and I'm still sitting with £20k in cash......yes, I know, I should've invested it back in May.

I'm debating with myself whether I should just get the £20k invested asap, or given that we're inching closer to October 31st (B day), wait until after October 31st incase share prices drop significantly......

Your thoughts please on what I should do..........

Audaxer

If you are investing for the long term, the usual advice is best to invest it all now. Alternatively if you are worried about a drop just after you invest, you could invest in something like £5k lump sums over the next 4 or 8 months. You could get lucky, but markets may well keep increasing over the next year or more.

ColdIron

If we leave with no deal sterling will probably drop in the short term, so your existing non-sterling assets will rise and they will cost more to buy (or in reality your £20k will buy fewer units)

If we have a managed exit sterling may rise in the short term so your existing non-sterling assets will drop and they will cost less to buy (more units)

If you can predict with certainty which way it will go you're a better man than me. Or you could buy either side and get a blend. Or you could think that in 10+ years time it won't make a huge amount of difference in the great scheme of things

Voyager2002

You could choose a different investment: rather than relying on global trackers, you might identify a region of the world and/or sector of the economy that you believe is undervalued at current prices.


On Brexit: virtually everyone whose opinion deserves to be taken seriously expects that a 'no deal' departure would be damaging for the economy in the short term. We can therefore be confident that when a 'no deal' seems to be inevitable, the value of the pound will fall. At that point, the prices (in pounds) of FTSE 100 companies will rise, since most of their income comes from outside the UK Shares in other companies, those that rely on the UK market for much of their income, will fall in the short term (because of the belief that the UK economy will be damaged). Of course, in the medium term it is likely that the UK economy will perform better than the pessimists fear, so after a year shares in such companies might come to look like bargains. (I am not saying that I expect things to turn out well, merely that when markets expect things to end badly they expect things to be even worse than what actually happens.)

Thrugelmir

Wouldn't focus purely on Brexit. US/China relationship will have far more profound consequences for all of us investment wise. The way matters are heading.

Remember funds grow on the back of reinvested income not just capital growth. The bulk of investment return actually comes from reinvested income over the longer term, i.e. compounding. As Einstein was quoted as saying "the eighth wonder of the world".

Investing isn't a one way street. You will have periods of negative returns. Whether you deposit a lump sum or drip feed monthly. All part and parcel of being an investor.

SonOf

or given that we're inching closer to October 31st (B day),

Which is such an important issue that it impacts on less than 1% of global GDP. (UK accounts for 4% of global GDP. Only 12% of UK GDP is linked to EU). There are far bigger things that concern the markets.

scoot65

Many thanks for the replies, lots of good information and insights. Very useful and much appreciated!

I'm leaning towards the "in 10+ years time it won't make a huge amount of difference in the great scheme of things" way of thinking so I'll get that £20K thrown in asap!


Thanks again!

PingPongSet

scoot65 wrote: »

I'm fairly new to investing, about 18 months.

I have a S&S ISA (HSBC Global Strategy bal. and VLS 60).

Your thoughts please on what I should do..........

Hi, what are the reasons that you chose HSBC Global Strategy bal. and VLS 60)?

scoot65

PingPongSet wrote: »

Hi, what are the reasons that you chose HSBC Global Strategy bal. and VLS 60)?

Being new to investing, after doing research on this forum I knew global multi asset funds would suit my needs. I looked at VLS and HSBC SD sites to ascertain the funds' risk level and matched it to a risk level I felt I would be comfortable with.

I basically chose the middle / medium risk funds of VLS and HSBC GS.

OldMusicGuy

I moved a large sum from cash into the HSBC Balanced fund in Feb 2018, 2 days before a 10% downward correction. That felt a bit bad. I just checked - it's up 8.33% since the initial investment.

It's time in the market.

Alice_Holt

You could always opt for a regular monthly savings plan over the ISA year.

One advantage is that had you done this at the start of the tax year, you would already have 5/12's of that £20k invested.
Another is that it removes a potential procrastination obstacle / decision point to your investing - set it up and forget it.

But generally, if you have a sensible 10 years plus time-frame I'd be inclined to get it invested asap and not be too concerned about short term price movements.

It all depends on what you feel most comfortable doing, try to pick the option (and funds) that suit your investing psychology and will involve as little "tinkering / adjusting" as possible.