Shocked at how much my pension lost last year - should I change?

V1m_Fuego

Got a Scottish Widows Pension via work, I think we have a good deal on low fees, but shocked at how badly it performed.  It's not clear if this is COVID-19 related or not.   If all plans have gone to hell in a handbasket, then I guess that's just how things are. I'm trying to work out how badly it's performed compared to similar pension investment portfolios.  Is there some way of comparing common pension portfolios?
the fund is called "Pens Portfolio Two", with Scottish Widows.
I paid in £8,000 and it's worth £3,000 less than this time last year.   Is this to be expected?

mcooke999

Stop worrying

Prism

Its all perfectly normal. A few things to note
That fund has a relatively large allocation to the UK (about 25%), which has fallen badly over the last few months
The exact dates of valuation are important at the moment as things are pretty volatile. Equities went up a lot in April after a large drop in Feb and March.
Being £11000 less than last year doesn't really tell us much as we don't know what the total figure is.
You can check the performance here
https://www.trustnet.com/factsheets/p/qg30/scottish-widows-pension-portfolio-two-pension-series-2

bowlhead99

V1m_Fuego said:

Got a Scottish Widows Pension via work, I think we have a good deal on low fees, but shocked at how badly it performed.  It's not clear if this is COVID-19 related or not.   If all plans have gone to hell in a handbasket, then I guess that's just how things are. I'm trying to work out how badly it's performed compared to similar pension investment portfolios.  Is there some way of comparing common pension portfolios?
the fund is called "Pens Portfolio Two", with Scottish Widows.
I paid in £8,000 and it's worth £3,000 less than this time last year.   Is this to be expected?

It's not like the £8000 you added has gone down in value by £3000. The total fund value of that portfolio has fallen 3.6% over the year. So, if you had £300k in it, it would have lost £11k for the year, and even if you added £8k to it, it would still be £3k lower than where it started. 

Going from a year ago (14 May 2019), it was 11% up by 20 February, and then Covid happened to the markets and it was down 15% instead ; more than a 25% downswing in the space of five weeks. Ouch. But since then it has recovered somewhat, so that by yesterday it was only 3.6% down from where it was a year earlier.

If you weren't really looking for literally a year 'this time last year' to now, you might see different figures. For example 31 March to 31 March was a drop of about 10%, so you could have seen the size of loss you described on a smaller portfolio.

I took the information from https://www.trustnet.com/factsheets/p/qg30/scottish-widows-pension-portfolio-two-pension-series-2 
Under the graph you can see 'explore further with interactive charting' and from there you can add other types of investments or indexes or sector averages, to include them in the chart. You can also change the time periods to go back over longer timescales from the defaults, as short term results can be a bit meaningless. 

Thrugelmir

Wait until the size of your pension fund grows larger than your eyes will be popping out of your head during downturns!
When markets fall there's nowhere to hide. All one can do is sit in out. A timely reminder that markets do fall as well as rise. Keep saving. Keep steadily increasing the level of your contributions. Over time now will become a distance memory.

Brynsam

V1m_Fuego said:

I paid in £8,000 and it's worth £3,000 less than this time last year.   Is this to be expected?

Means little in isolation. What's your total fund value now?

dunstonh

but shocked at how badly it performed.

What makes you think that is has performed badly?  A loss in a negative period does not equal bad performance.

It's not clear if this is COVID-19 related or not.

The CV drop happened between around 24th Feb to 23rd March.    So, it should be very clear.

If all plans have gone to hell in a handbasket,

No plans have done that. Investments would have gone down but all within normal levels and expectation.   It has pretty much been a routine crash for now.

The fund is performing exactly as expected for that type of fund.   Not badly.  This is all pretty much routine.

carpy

V1m_Fuego said:

Got a Scottish Widows Pension via work, I think we have a good deal on low fees, but shocked at how badly it performed.  It's not clear if this is COVID-19 related or not.   If all plans have gone to hell in a handbasket, then I guess that's just how things are. I'm trying to work out how badly it's performed compared to similar pension investment portfolios.  Is there some way of comparing common pension portfolios?
the fund is called "Pens Portfolio Two", with Scottish Widows.
I paid in £8,000 and it's worth £3,000 less than this time last year.   Is this to be expected?

yep my Scottish Widows pension has also performed quite badly over the last year or 2....
significantly worse than some of my other pension funds!
i suspect it has a similar underlying fund to yours, mine is the SW SSgA 50:50 Global Equity Index Pension (Series 2)
it's not just due to C19 it's been well below the fund sector average for a while now.
i'm looking to move mine into something better

[Deleted User]

Love the forum name Vim, must go and rewatch those two episodes 

dunstonh

i suspect it has a similar underlying fund to yours, mine is the SW SSgA 50:50 Global Equity Index Pension (Series 2)

It hasn't underperformed relative to what it invests in.  That fund is effectively a tracker covering two areas (if you class global as an area).  If you look at one of the two areas, you will see why it has performed how it has. 

it's not just due to C19 it's been well below the fund sector average for a while now.

It is in the global equities sector despite not being a fully global fund.  So, it is no surprise it has not performed in line with the sector average.  It is not a fund to be in by choice. (that isn't hindsight talking.  It is the ratio that is the issue)

carpy

dunstonh said:

i suspect it has a similar underlying fund to yours, mine is the SW SSgA 50:50 Global Equity Index Pension (Series 2)

It hasn't underperformed relative to what it invests in.  That fund is effectively a tracker covering two areas (if you class global as an area).  If you look at one of the two areas, you will see why it has performed how it has. 

it's not just due to C19 it's been well below the fund sector average for a while now.

It is in the global equities sector despite not being a fully global fund.  So, it is no surprise it has not performed in line with the sector average.  It is not a fund to be in by choice. (that isn't hindsight talking.  It is the ratio that is the issue)

thanks for the advice.
if global = 1 area, what other 'area' is it in??

when you say it's not a fund to be in by choice....what do you mean exactly?  what is the problem with the ratio?
thank you