End of year review

fjh

I like most i guess will be looking at progress of my holdings year on year - but which is the best index to ‘benchmark’ a basket of 7holdings in my SIPP per below?
F&C MM Navigator Moderate C Inc
Jupiter Merlin Income Portfolio I
Prufund Growth Fund series E
Quilter Investors CIR bad Pt R (GBP)
Quliter Investors CIR Cons PT R (GBP)
Treadneedle Mangd EQ&BD Z GBP Acc
Vanguard Lifestratergy 40% Equity fund

In isolation I feel I have had a good year but need ‘context’

Many thanks

msallen

As you have a "vanilla" fund in the VLS40 plus some more specialised ones, then the intention is presumably to improve on the VLS40 alone. Hence why not just benchmark against that?

[Deleted User]

The context is that 2019 has been a year of very strong returns for world equities as well as bonds with a balanced tracker portfolio (60/40 stocks to bonds) returning over 15% (time weighted). An all equity portfolio will have returned over 20%.

kuratowski

My advice would be to compare portfolio to the sector averages on FE Trustnet. I'm not familiar with all the funds in your portfolio, but it looks to me as if "Mixed Investment 20-60% Shares" would be a good benchmark?

fjh

Thanks , YTD I am net of fees etc up 6.38% with a wide variance in performance hence seeking advice as to what ‘good’ looks like

Sea_Shell

Don't forget, last December was at the bottom of a dip, so year on year will look good in comparison.

[Deleted User]

fjh wrote: »

Thanks , YTD I am net of fees etc up 6.38% with a wide variance in performance hence seeking advice as to what ‘good’ looks like

That’s low for any imaginable benchmark mixing stocks and bonds. Is it accurate? How did you derive 6.38%?

What was your last years’ return? Anything on multi-year returns?

Also, how were these funds picked? The logic does not exactly jump out.

In theory one year returns for an active portfolio tell us very little. Performance chasing by buying active funds which have done well and dumping the offenders is among the key reasons for investors doing badly. You really need 10 years or more. Still, if you underperform in both good years (19) and bad (18), it should raise questions.

fjh

Deleted_User wrote: »

That’s low for any imaginable benchmark mixing stocks and bonds. Is it accurate? How did you derive 6.38%?

What was your last years’ return? Anything on multi-year returns?

Also, how were these funds picked? The logic does not exactly jump out.

In theory one year returns for an active portfolio tell us very little. Performance chasing by buying active funds which have done well and dumping the offenders is among the key reasons for investors doing badly. You really need 10 years or more. Still, if you underperform in both good years (19) and bad (18), it should raise questions.

% Growth is calculated from value on the Pru website as at 31 Dec 18 and the value today - nothing has changed re holdings.

All stocks ‘selected’ by IFA when I changed from final salary but I was going to change a few but performance has improved . 65% of holdings are in the Pru funds .
Portfolio as set up July 18 so this is first full year.

Linton

You havent given us the % allocation so its impossible to say what your portfolio looks like. However were it to be split equally between the 7 funds it would be about 33% equity so in the lower half of the Mixed Investment 20%-60% shares.


The remaining 67% is split between bonds (32%), the Prufund which is With Profits and so not comparable with anything else in the short term, cash and what Morningstar calls "others". So its not really possible to give a clear unarguable comparator.



One can compare the portfolio with VLS20 and VLS40


portfolio: 1 yr: 7%, 3yr: 15.4%, 5yr:31%
VLS20:1yr: 10.1% 3yr: 14.6%, 5yr: 27.2%
VLS40:1yr:12.9%, 3yr: 18.3%, 5yr:37.3%



If you can provide the %s I will update the posting.

fjh

Split of holdings is
BMO MM Navigator Cautious D Acc 6.31%
Jupiter Merlin Income Portfolio I Acc 5.88%
Quilter Investors Cirilium Balanced Portfolio R Acc GBP 5.67%
Quilter Investors Cirilium Conservative Portfolio R Acc GBP 5.63%
Threadneedle Managed Equity & Bond ZNA GBP 5.88%
Vanguard LifeStrategy 40% Equity A Acc 5.97%
Total 35.34%
Pension Funds
Name Weight
GBP
Pru PruFund Cautious Fund Pn Ser A 15.95%
Pru PruFund Growth Fund Pn Ser A 48.71%
Total 64.66%

[Deleted User]

1. Any contributions to the portfolio in 2019?

2. IFAs are called “advisors” rather than decision-makers for a reason. Your investments should be decided by you. You and your family will be impacted. Big time. The impact on your IFA is negligible. You need to understand the exact reason for “stock selection” by the IFA. And then you need to decide.

3. In order to make an informed decision you need to educate yourself. Lots of good books, read a couple.

4. Changing funds based on perceived low returns over a short period of time isn’t right. Poorly designed portfolio with a hotch potch of arbitrary picks is a good reason to change. But first you need to learn enough to define a clear objective, understand risks, evaluate the desired level of risk and then develop a strategy. Only then pick instruments to execute your strategy, and you should know the exact reasons you paid lots of hard earned money for each fund you own.