How to construct my investment portfolio?

AnotherJoe

Dont go for the VLS. Too much oil and finance in it.

 

dakofsta

AnotherJoe said:

Dont go for the VLS. Too much oil and finance in it.

 

I'm guessing your issue with oil is the volatility, but what's your issue with finance?

[Deleted User]

You could also look at the active fund Vanguard Global Equity. This is a portfolio of approximately 200 stocks from around the world picked and managed by Baillie Gifford and Wellington. OCF of 0.48%

Voyager2002

dakofsta said:

Thank you all so much for your advice, this has been so helpful!
I think for now, the best option is to use either Vanguard LifeStrategy 100% equity fund or the FTSE Global All Cap for my 75% passive split as they give me coverage of many sectors (and if I can't decide on a weighting split myself, it makes sense to use a pre-determined one instead), and putting the other 25% into either the active global equity fund or global momentum factor fund. I think the simplicity of these funds would be good for the meantime, and I can do some reading over the next few months to see if I have a better idea of how I want to split my investments

That is a workable plan. I do think that it would be better for your passive split to be less weighted towards the UK. Despite comments above currency is unlikely to be a major consideration, and since your job and life generally depend on the UK economy it makes sense IMHO to have your investments mainly depending on other parts of the world. (And of course there is Brexit...)

dakofsta

Deleted_User said:

You could also look at the active fund Vanguard Global Equity. This is a portfolio of approximately 200 stocks from around the world picked and managed by Baillie Gifford and Wellington. OCF of 0.48%

Had no idea Baillie Gifford managed on behalf of Vanguard - their active funds were the ones I wanted to invest in most, so I think all active money will go into here

dakofsta

Voyager2002 said:

dakofsta said:

Thank you all so much for your advice, this has been so helpful!
I think for now, the best option is to use either Vanguard LifeStrategy 100% equity fund or the FTSE Global All Cap for my 75% passive split as they give me coverage of many sectors (and if I can't decide on a weighting split myself, it makes sense to use a pre-determined one instead), and putting the other 25% into either the active global equity fund or global momentum factor fund. I think the simplicity of these funds would be good for the meantime, and I can do some reading over the next few months to see if I have a better idea of how I want to split my investments

That is a workable plan. I do think that it would be better for your passive split to be less weighted towards the UK. Despite comments above currency is unlikely to be a major consideration, and since your job and life generally depend on the UK economy it makes sense IMHO to have your investments mainly depending on other parts of the world. (And of course there is Brexit...)

The global all cap index fund only has 4% of the fund in UK stocks, which is far less than the 25% or so from the LifeStrategy fund, so maybe this is more suitable?

AnotherJoe

dakofsta said:

AnotherJoe said:

Dont go for the VLS. Too much oil and finance in it.

 

I'm guessing your issue with oil is the volatility, but what's your issue with finance?

No, not the volatility as that implies it might go up
The fact it's going to be on a long term downward trend because billions of dollars of assets under the ground will have to be written off . It's a dead industry. Share prices propped up by unsustainable dividends.  Some realise it's doomed . Get out before everyone else does. That's your "edge" as an ordinary investor to move faster than dinosaur industries and analysts too locked in to see the problem.  

Finance is going to have a a lot of bad debts - Many fossil fuel related, oil, coal,  the auto industry has debt up to the eyeballs  and needs more money to switch to EVs. 

Covid will be the icing on the cake. IMHO of course. 

Sebo027

AnotherJoe said:

dakofsta said:

AnotherJoe said:

Dont go for the VLS. Too much oil and finance in it.

 

I'm guessing your issue with oil is the volatility, but what's your issue with finance?

No, not the volatility as that implies it might go up
The fact it's going to be on a long term downward trend because billions of dollars of assets under the ground will have to be written off . It's a dead industry. Share prices propped up by unsustainable dividends.  Some realise it's doomed . Get out before everyone else does. That's your "edge" as an ordinary investor to move faster than dinosaur industries and analysts too locked in to see the problem.  

Finance is going to have a a lot of bad debts - Many fossil fuel related, oil, coal,  the auto industry has debt up to the eyeballs  and needs more money to switch to EVs. 

Covid will be the icing on the cake. IMHO of course. 

BP has already accounted for the reduced oil forecast in writing down it's asset value. The industry itself is developing and implementing smarter technologies to assist in exploration, development and operation. One example is unmanned, remotely operated platforms power by subsea power cables. No people = no catering, no accommodation = less power = smaller platform = less steel = cheaper to design, fabricate, build and operate. There are also clever initiatives to replace the "expensive" vessel based work associated with maintaining subsea assets i.e. unmanned surface vessels, remotely piloted ROVs etc. 
Furthermore, the ever increasing digital work force will require more plastics and derivative products from oil. Global gas demand is forecasted to increase until at-least 2025. 80% of the world's cargo is transported by ship, the vessels burn heavy diesel. I wouldn't call oil and gas a dead industry. It's market share is going to decrease, many of the companies will transform and diversify, but I will bet oil and gas itself will be a part of the world for a good while yet.

dakofsta

Sebo027 said:

AnotherJoe said:

dakofsta said:

AnotherJoe said:

Dont go for the VLS. Too much oil and finance in it.

 

I'm guessing your issue with oil is the volatility, but what's your issue with finance?

No, not the volatility as that implies it might go up
The fact it's going to be on a long term downward trend because billions of dollars of assets under the ground will have to be written off . It's a dead industry. Share prices propped up by unsustainable dividends.  Some realise it's doomed . Get out before everyone else does. That's your "edge" as an ordinary investor to move faster than dinosaur industries and analysts too locked in to see the problem.  

Finance is going to have a a lot of bad debts - Many fossil fuel related, oil, coal,  the auto industry has debt up to the eyeballs  and needs more money to switch to EVs. 

Covid will be the icing on the cake. IMHO of course. 

BP has already accounted for the reduced oil forecast in writing down it's asset value. The industry itself is developing and implementing smarter technologies to assist in exploration, development and operation. One example is unmanned, remotely operated platforms power by subsea power cables. No people = no catering, no accommodation = less power = smaller platform = less steel = cheaper to design, fabricate, build and operate. There are also clever initiatives to replace the "expensive" vessel based work associated with maintaining subsea assets i.e. unmanned surface vessels, remotely piloted ROVs etc. 
Furthermore, the ever increasing digital work force will require more plastics and derivative products from oil. Global gas demand is forecasted to increase until at-least 2025. 80% of the world's cargo is transported by ship, the vessels burn heavy diesel. I wouldn't call oil and gas a dead industry. It's market share is going to decrease, many of the companies will transform and diversify, but I will bet oil and gas itself will be a part of the world for a good while yet.

Starting to think this is edging towards a sector argument - I'm not trying to constantly rebalance my portfolio with the aim of buying into the best industries for the year, I just want a consistent active global fund to complement my passive global fund, and that's why I think the active global equity fund is for me. 

Also, the fact that its ran by Baillie Gifford is very pleasing, as they tend to get super high returns across the board

ifonlyian

if i understand it, Vanguard Global Equity is a Distributing Fund - Quarterly,, on their platform as opposed to the LS100 which is an accumulation, are there any advantages for the Distributing Fund if you are looking long Term 10 years + to build your pot up?