Why do posters here have disproportionately higher than average pension funds...

Albermarle

m_c_s said:

The HSBC Global Strategy Cautious fund in my SIPP is up 1% since Feb 20 and up 4% since Aug 2019
The HSBC Global Strategy Conservative fund in my ISA is up 0.2% since Feb 20 and up 4.1% since Aug 2019

Although low risk (I am retiring in the next 18 months at 56) I am quite happy with their performance.  The corresponding Vanguard 20 fund has performed slightly better although the comparable Vanguard 40 fund is slightly worse:

Vanguard 20 is up 2% since Feb 20 and up 4.5% since Aug 2019
Vanguard 40 is up 0.1% since Feb 20 and up 3.9% since Aug 2019
 
It seems maybe for Vanguard 20 the mix of bonds could be the reason for Vanguards slight over performance. HSBC has property and slightly higher EM equity allocations which may improve performance in the future. 

From reading other posts and info about bonds performance in future , I do not think you can guarantee that the non equity side/bonds of these multi asset funds will necessarily always do their stabilising job as well as they have done . It is not guaranteed ( although some seem to think so ) that in a market downturn that VLS 20 will always do better than VLS40.
I have seen recommendations that a safer mix would actually be an 100% equity fund and cash in varying proportions and forget about bonds altogether . Not everyone shares that view for sure but interesting all the same. 

AlanP_2

pensionpawn said:

AlanP_2 said:

pensionpawn said:

Pile_o_stone said:

cfw1994 said:

Pile_o_stone said:

couriervanman said:

OP I've always loved these posts as well your not the only one
Its always somebody who is mortgage free in a £500k house with £150k in isa,generous pension pot £350k increasing by £1k a month top up with a partner who has retired a few years earlier on £20k a year.+ £100k savings. And they always ask will i have enough to last for 20 years,plus they forget the £180 a week they will collect at 65. 

They also seem to have 8% growth year on year on year, and do not get hit with the Global financial crisis crash, the Corona virus crash or other corrections in the market. I also would take issue with the idea that if you are interested in pensions and save early then you will automatically get a £1m pot. As someone who has been a high rate taxpayer for over 20 years and who has been VERY interested in pensions over that time, who has consistently saved double digit percentages (I saved 15% when that used to be the maximum and I have been saving 20% over the last 7 years). I have always had DC pensions and when I move companies I have consolidated my pensions into a HL SIPP which gives me access to a large range of funds. I have no where near £1m saved in a pension plan. I'm currently 15% down on my pre-corona share values.

15% down?

Really?   Are you investing in super safe funds?
I took an overkeen interest this year in my main DC pot.  +4% since the Feb, +23% since the trough in March, and  +10% on start of year.    

I agree, 8% year after year gains would be unrealistic....but markets have broadly (& curiously, perhaps!) bounced back apace.

If I was invested in super safe funds, then I'd imagine they would not still be 15% down after the Corona crash. I assume you were in supersafe funds prior to the crash and then moved them all to riskier high-gain equities after the crash? 

Looking at your figures, you have made a 6% gain since the crash, so your shares must have fallen 17% in the crash (i.e. +4% - 17% + 23% = 10%). What funds/shares were you in prior to the crash for such a small drop from peak to trough?

Before contributions during the year, a tad up, however I view my portfolio as still down compared to where I expected it to be by now. Just a word of caution on comparing percentage fall and growth, it takes more than 10% growth to recover a 10% fall!

Comparing where you are against where you expected to be sounds like masochism to me. The actual numbers are all that matters, and the only really important one is - Do I have enough? 

....and the answer is no, because I am not where I planned to be by now, and if something doesn't change, neither will I be by my planned retirement date. Don't you believe it's sensible to monitor progress (of anything) according to a plan, so you can adjust accordingly if necessary? So either my fund managers evolve their strategy to improve fund growth, I modify my fund allocations, I increase my contributions, a combination or do nothing and hope for the best (markets make a spectacular recovery, which could happen).

Absolutely agree on the plan and to monitor progress but feeling that I was "down" against my expectations of returns just seems bound to disappoint in my view.

The only thing under our control is the contributions and an assumed return, adjusted as reality unfolds.

[Deleted User]

pensionpawn said:

AlanP_2 said:

pensionpawn said:

Pile_o_stone said:

cfw1994 said:

Pile_o_stone said:

couriervanman said:

OP I've always loved these posts as well your not the only one
Its always somebody who is mortgage free in a £500k house with £150k in isa,generous pension pot £350k increasing by £1k a month top up with a partner who has retired a few years earlier on £20k a year.+ £100k savings. And they always ask will i have enough to last for 20 years,plus they forget the £180 a week they will collect at 65. 

They also seem to have 8% growth year on year on year, and do not get hit with the Global financial crisis crash, the Corona virus crash or other corrections in the market. I also would take issue with the idea that if you are interested in pensions and save early then you will automatically get a £1m pot. As someone who has been a high rate taxpayer for over 20 years and who has been VERY interested in pensions over that time, who has consistently saved double digit percentages (I saved 15% when that used to be the maximum and I have been saving 20% over the last 7 years). I have always had DC pensions and when I move companies I have consolidated my pensions into a HL SIPP which gives me access to a large range of funds. I have no where near £1m saved in a pension plan. I'm currently 15% down on my pre-corona share values.

15% down?

Really?   Are you investing in super safe funds?
I took an overkeen interest this year in my main DC pot.  +4% since the Feb, +23% since the trough in March, and  +10% on start of year.    

I agree, 8% year after year gains would be unrealistic....but markets have broadly (& curiously, perhaps!) bounced back apace.

If I was invested in super safe funds, then I'd imagine they would not still be 15% down after the Corona crash. I assume you were in supersafe funds prior to the crash and then moved them all to riskier high-gain equities after the crash? 

Looking at your figures, you have made a 6% gain since the crash, so your shares must have fallen 17% in the crash (i.e. +4% - 17% + 23% = 10%). What funds/shares were you in prior to the crash for such a small drop from peak to trough?

Before contributions during the year, a tad up, however I view my portfolio as still down compared to where I expected it to be by now. Just a word of caution on comparing percentage fall and growth, it takes more than 10% growth to recover a 10% fall!

Comparing where you are against where you expected to be sounds like masochism to me. The actual numbers are all that matters, and the only really important one is - Do I have enough? 

....and the answer is no, because I am not where I planned to be by now, and if something doesn't change, neither will I be by my planned retirement date. Don't you believe it's sensible to monitor progress (of anything) according to a plan, so you can adjust accordingly if necessary? So either my fund managers evolve their strategy to improve fund growth, I modify my fund allocations, I increase my contributions, a combination or do nothing and hope for the best (markets make a spectacular recovery, which could happen).

This approach is problematic. Responding to performance by jumping around hurts long term returns. 

The best long term returns are achieved by setting up a solid investment policy and following through. In a perfect world you don’t change anything and don’t even look at returns unless your circumstances change. 

Acting based on not achieving an arbitrary guess about future returns = acting on emotions and is counterproductive. 

“Doing nothing” and sticking to the plan is the best strategy, assuming you have a good allocation to start with. 

pensionpawn

Deleted_User said:

pensionpawn said:

AlanP_2 said:

pensionpawn said:

Pile_o_stone said:

cfw1994 said:

Pile_o_stone said:

couriervanman said:

OP I've always loved these posts as well your not the only one
Its always somebody who is mortgage free in a £500k house with £150k in isa,generous pension pot £350k increasing by £1k a month top up with a partner who has retired a few years earlier on £20k a year.+ £100k savings. And they always ask will i have enough to last for 20 years,plus they forget the £180 a week they will collect at 65. 

They also seem to have 8% growth year on year on year, and do not get hit with the Global financial crisis crash, the Corona virus crash or other corrections in the market. I also would take issue with the idea that if you are interested in pensions and save early then you will automatically get a £1m pot. As someone who has been a high rate taxpayer for over 20 years and who has been VERY interested in pensions over that time, who has consistently saved double digit percentages (I saved 15% when that used to be the maximum and I have been saving 20% over the last 7 years). I have always had DC pensions and when I move companies I have consolidated my pensions into a HL SIPP which gives me access to a large range of funds. I have no where near £1m saved in a pension plan. I'm currently 15% down on my pre-corona share values.

15% down?

Really?   Are you investing in super safe funds?
I took an overkeen interest this year in my main DC pot.  +4% since the Feb, +23% since the trough in March, and  +10% on start of year.    

I agree, 8% year after year gains would be unrealistic....but markets have broadly (& curiously, perhaps!) bounced back apace.

If I was invested in super safe funds, then I'd imagine they would not still be 15% down after the Corona crash. I assume you were in supersafe funds prior to the crash and then moved them all to riskier high-gain equities after the crash? 

Looking at your figures, you have made a 6% gain since the crash, so your shares must have fallen 17% in the crash (i.e. +4% - 17% + 23% = 10%). What funds/shares were you in prior to the crash for such a small drop from peak to trough?

Before contributions during the year, a tad up, however I view my portfolio as still down compared to where I expected it to be by now. Just a word of caution on comparing percentage fall and growth, it takes more than 10% growth to recover a 10% fall!

Comparing where you are against where you expected to be sounds like masochism to me. The actual numbers are all that matters, and the only really important one is - Do I have enough? 

....and the answer is no, because I am not where I planned to be by now, and if something doesn't change, neither will I be by my planned retirement date. Don't you believe it's sensible to monitor progress (of anything) according to a plan, so you can adjust accordingly if necessary? So either my fund managers evolve their strategy to improve fund growth, I modify my fund allocations, I increase my contributions, a combination or do nothing and hope for the best (markets make a spectacular recovery, which could happen).

This approach is problematic. Responding to performance by jumping around hurts long term returns. 

The best long term returns are achieved by setting up a solid investment policy and following through. In a perfect world you don’t change anything and don’t even look at returns unless your circumstances change. 

Acting based on not achieving an arbitrary guess about future returns = acting on emotions and is counterproductive. 

“Doing nothing” and sticking to the plan is the best strategy, assuming you have a good allocation to start with. 

Indeed I am happy with my allocation and will stick with what I have in the main, it has rebounded well compared to general markets. However I have around 13% in cash, doing nothing, and am tempted to move some of that into more 'adventurous' emerging markets / US tech sectors to see what happens. 

[Deleted User]

pensionpawn said:

Deleted_User said:

pensionpawn said:

AlanP_2 said:

pensionpawn said:

Pile_o_stone said:

cfw1994 said:

Pile_o_stone said:

couriervanman said:

OP I've always loved these posts as well your not the only one
Its always somebody who is mortgage free in a £500k house with £150k in isa,generous pension pot £350k increasing by £1k a month top up with a partner who has retired a few years earlier on £20k a year.+ £100k savings. And they always ask will i have enough to last for 20 years,plus they forget the £180 a week they will collect at 65. 

They also seem to have 8% growth year on year on year, and do not get hit with the Global financial crisis crash, the Corona virus crash or other corrections in the market. I also would take issue with the idea that if you are interested in pensions and save early then you will automatically get a £1m pot. As someone who has been a high rate taxpayer for over 20 years and who has been VERY interested in pensions over that time, who has consistently saved double digit percentages (I saved 15% when that used to be the maximum and I have been saving 20% over the last 7 years). I have always had DC pensions and when I move companies I have consolidated my pensions into a HL SIPP which gives me access to a large range of funds. I have no where near £1m saved in a pension plan. I'm currently 15% down on my pre-corona share values.

15% down?

Really?   Are you investing in super safe funds?
I took an overkeen interest this year in my main DC pot.  +4% since the Feb, +23% since the trough in March, and  +10% on start of year.    

I agree, 8% year after year gains would be unrealistic....but markets have broadly (& curiously, perhaps!) bounced back apace.

If I was invested in super safe funds, then I'd imagine they would not still be 15% down after the Corona crash. I assume you were in supersafe funds prior to the crash and then moved them all to riskier high-gain equities after the crash? 

Looking at your figures, you have made a 6% gain since the crash, so your shares must have fallen 17% in the crash (i.e. +4% - 17% + 23% = 10%). What funds/shares were you in prior to the crash for such a small drop from peak to trough?

Before contributions during the year, a tad up, however I view my portfolio as still down compared to where I expected it to be by now. Just a word of caution on comparing percentage fall and growth, it takes more than 10% growth to recover a 10% fall!

Comparing where you are against where you expected to be sounds like masochism to me. The actual numbers are all that matters, and the only really important one is - Do I have enough? 

....and the answer is no, because I am not where I planned to be by now, and if something doesn't change, neither will I be by my planned retirement date. Don't you believe it's sensible to monitor progress (of anything) according to a plan, so you can adjust accordingly if necessary? So either my fund managers evolve their strategy to improve fund growth, I modify my fund allocations, I increase my contributions, a combination or do nothing and hope for the best (markets make a spectacular recovery, which could happen).

This approach is problematic. Responding to performance by jumping around hurts long term returns. 

The best long term returns are achieved by setting up a solid investment policy and following through. In a perfect world you don’t change anything and don’t even look at returns unless your circumstances change. 

Acting based on not achieving an arbitrary guess about future returns = acting on emotions and is counterproductive. 

“Doing nothing” and sticking to the plan is the best strategy, assuming you have a good allocation to start with. 

Indeed I am happy with my allocation and will stick with what I have in the main, it has rebounded well compared to general markets. However I have around 13% in cash, doing nothing, and am tempted to move some of that into more 'adventurous' emerging markets / US tech sectors to see what happens. 

Yes, because the market has been going up. 

Good luck. 

Thrugelmir

Albermarle said:

m_c_s said:

The HSBC Global Strategy Cautious fund in my SIPP is up 1% since Feb 20 and up 4% since Aug 2019
The HSBC Global Strategy Conservative fund in my ISA is up 0.2% since Feb 20 and up 4.1% since Aug 2019

Although low risk (I am retiring in the next 18 months at 56) I am quite happy with their performance.  The corresponding Vanguard 20 fund has performed slightly better although the comparable Vanguard 40 fund is slightly worse:

Vanguard 20 is up 2% since Feb 20 and up 4.5% since Aug 2019
Vanguard 40 is up 0.1% since Feb 20 and up 3.9% since Aug 2019
 
It seems maybe for Vanguard 20 the mix of bonds could be the reason for Vanguards slight over performance. HSBC has property and slightly higher EM equity allocations which may improve performance in the future. 

I have seen recommendations that a safer mix would actually be an 100% equity fund and cash in varying proportions and forget about bonds altogether . Not everyone shares that view for sure but interesting all the same. 

Gilts are effectively cash. Unlike cash there's a predictable return into the future. 

[Deleted User]

Thrugelmir said:

Albermarle said:

m_c_s said:

The HSBC Global Strategy Cautious fund in my SIPP is up 1% since Feb 20 and up 4% since Aug 2019
The HSBC Global Strategy Conservative fund in my ISA is up 0.2% since Feb 20 and up 4.1% since Aug 2019

Although low risk (I am retiring in the next 18 months at 56) I am quite happy with their performance.  The corresponding Vanguard 20 fund has performed slightly better although the comparable Vanguard 40 fund is slightly worse:

Vanguard 20 is up 2% since Feb 20 and up 4.5% since Aug 2019
Vanguard 40 is up 0.1% since Feb 20 and up 3.9% since Aug 2019
 
It seems maybe for Vanguard 20 the mix of bonds could be the reason for Vanguards slight over performance. HSBC has property and slightly higher EM equity allocations which may improve performance in the future. 

I have seen recommendations that a safer mix would actually be an 100% equity fund and cash in varying proportions and forget about bonds altogether . Not everyone shares that view for sure but interesting all the same. 

Gilts are effectively cash. Unlike cash there's a predictable return into the future. 

Everything is “predictable” just not accurately.  Bonds and cash are fixed income but they are not the same.  Agree that  short duration gilts are somewhat similar to cash.

cfw1994

Deleted_User said:

pensionpawn said:

AlanP_2 said:

pensionpawn said:

Pile_o_stone said:

cfw1994 said:

Pile_o_stone said:

couriervanman said:

OP I've always loved these posts as well your not the only one
Its always somebody who is mortgage free in a £500k house with £150k in isa,generous pension pot £350k increasing by £1k a month top up with a partner who has retired a few years earlier on £20k a year.+ £100k savings. And they always ask will i have enough to last for 20 years,plus they forget the £180 a week they will collect at 65. 

They also seem to have 8% growth year on year on year, and do not get hit with the Global financial crisis crash, the Corona virus crash or other corrections in the market. I also would take issue with the idea that if you are interested in pensions and save early then you will automatically get a £1m pot. As someone who has been a high rate taxpayer for over 20 years and who has been VERY interested in pensions over that time, who has consistently saved double digit percentages (I saved 15% when that used to be the maximum and I have been saving 20% over the last 7 years). I have always had DC pensions and when I move companies I have consolidated my pensions into a HL SIPP which gives me access to a large range of funds. I have no where near £1m saved in a pension plan. I'm currently 15% down on my pre-corona share values.

15% down?

Really?   Are you investing in super safe funds?
I took an overkeen interest this year in my main DC pot.  +4% since the Feb, +23% since the trough in March, and  +10% on start of year.    

I agree, 8% year after year gains would be unrealistic....but markets have broadly (& curiously, perhaps!) bounced back apace.

If I was invested in super safe funds, then I'd imagine they would not still be 15% down after the Corona crash. I assume you were in supersafe funds prior to the crash and then moved them all to riskier high-gain equities after the crash? 

Looking at your figures, you have made a 6% gain since the crash, so your shares must have fallen 17% in the crash (i.e. +4% - 17% + 23% = 10%). What funds/shares were you in prior to the crash for such a small drop from peak to trough?

Before contributions during the year, a tad up, however I view my portfolio as still down compared to where I expected it to be by now. Just a word of caution on comparing percentage fall and growth, it takes more than 10% growth to recover a 10% fall!

Comparing where you are against where you expected to be sounds like masochism to me. The actual numbers are all that matters, and the only really important one is - Do I have enough? 

....and the answer is no, because I am not where I planned to be by now, and if something doesn't change, neither will I be by my planned retirement date. Don't you believe it's sensible to monitor progress (of anything) according to a plan, so you can adjust accordingly if necessary? So either my fund managers evolve their strategy to improve fund growth, I modify my fund allocations, I increase my contributions, a combination or do nothing and hope for the best (markets make a spectacular recovery, which could happen).

This approach is problematic. Responding to performance by jumping around hurts long term returns. 

The best long term returns are achieved by setting up a solid investment policy and following through. In a perfect world you don’t change anything and don’t even look at returns unless your circumstances change. 

Acting based on not achieving an arbitrary guess about future returns = acting on emotions and is counterproductive. 

“Doing nothing” and sticking to the plan is the best strategy, assuming you have a good allocation to start with. 

I agree that "jumping around" is very likely to be a mistake......but how do you define your "good allocation" you start with?   
Mind sharing your allocation of things, so some can maybe follow that lead?

If things were as black and white as you describe, then everyone would chose the same starting "allocation" and the industry would be bereft of options, surely!
I think examining how things are performing on a quarterly-to-annual basis, and making nudges or occasional changes is perfectly reasonable.
I wouldn't suggest people particularly focus on this 'during a crisis' as we are in now, but as an on-going task.  

[Deleted User]

My allocation is 70% equity and 30% fixed income and I am a passive investor but that’s irrelevant.  There are many paths to success. 

We tend to spend  way too much time on picking funds. In fact, diversified low cost portfolios do well and its the investor behaviour that hurts returns. We always have great arguments justifying us messing with our portfolios but invariably its a human emotion responding to various biases we have, such as “recency”. Studies have shown that investors who literally forget about investments do the best. (And I am sorry I don’t remember the references but if you read books analyzing actual returns secured by investors you will have come across it).  For this reason professionals, including active funds,  use a fixed set of rules or computers to remove human emotion from the decision making process.

“ Reviewing performance“ is ok (I am guilty of curiousity) as long as you have the will power to not make any changes to your IPS (including asset allocation and choice of investment vehicles). That should be reserved for rare, exceptional events, such as major changes in expected lifetime earnings from your job or if much cheaper investment vehicles become available. 

Linton

Thrugelmir said:

Albermarle said:

m_c_s said:

The HSBC Global Strategy Cautious fund in my SIPP is up 1% since Feb 20 and up 4% since Aug 2019
The HSBC Global Strategy Conservative fund in my ISA is up 0.2% since Feb 20 and up 4.1% since Aug 2019

Although low risk (I am retiring in the next 18 months at 56) I am quite happy with their performance.  The corresponding Vanguard 20 fund has performed slightly better although the comparable Vanguard 40 fund is slightly worse:

Vanguard 20 is up 2% since Feb 20 and up 4.5% since Aug 2019
Vanguard 40 is up 0.1% since Feb 20 and up 3.9% since Aug 2019
 
It seems maybe for Vanguard 20 the mix of bonds could be the reason for Vanguards slight over performance. HSBC has property and slightly higher EM equity allocations which may improve performance in the future. 

I have seen recommendations that a safer mix would actually be an 100% equity fund and cash in varying proportions and forget about bonds altogether . Not everyone shares that view for sure but interesting all the same. 

Gilts are effectively cash. Unlike cash there's a predictable return into the future. 

The future of gilts is only predictable if you buy gilts.  Gilt funds are very different.  Most investors dont buy raw gilts.