VLS 100 - Stick or twist

DireEmblem

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

barnstar2077

DireEmblem said:

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

As above! :  )

noclaf

DireEmblem said:

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

Thanks, completely makes sense and to take it one step further I probably need to think about what 'amount' would I be comfortable investing and potentially taking a hit if there was a significant market event that sees 20/30/40% drop in the value of my investments.

Slightly off topic, what's your views on the VLS range and do you use them and if not whats your go-to for global equities exposure? Reason for the q is I like to get the perspectives of the more experienced posters. The VLS probably suits my knowledge and experience in investing but I am always curious! 

TheAble

If you'd feel uncomfortable with 20/30/40% drops in your investments then maybe question a little bit if you should be investing. I don't mean that unkindly. But it's a point on which many folks stumble, selling out of their holdings just because the price has gone down.

Thrugelmir

noclaf said:

DireEmblem said:

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

Thanks, completely makes sense and to take it one step further I probably need to think about what 'amount' would I be comfortable investing and potentially taking a hit if there was a significant market event that sees 20/30/40% drop in the value of my investments.

Even a 10-15% correction can be a sizable amount of money as the value of your portfolio grows. The unknown is how long it's going to take to recover. Until you are in that position. You aren't going to know yourself. As much as people can tell you. Experiencing events first hand as an investor is ultimately what will shape your personal attitude. 

noclaf

Thrugelmir said:

noclaf said:

DireEmblem said:

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

Thanks, completely makes sense and to take it one step further I probably need to think about what 'amount' would I be comfortable investing and potentially taking a hit if there was a significant market event that sees 20/30/40% drop in the value of my investments.

Even a 10-15% correction can be a sizable amount of money as the value of your portfolio grows. The unknown is how long it's going to take to recover. Until you are in that position. You aren't going to know yourself. As much as people can tell you. Experiencing events first hand as an investor is ultimately what will shape your personal attitude. 

I think the tolerance to market falls can be built up, last year in March/April was a good albeit limited test..I did not sell out and actually topped up the s&s ISA during the fall..though did go onto take some profit. 
The funny thing is pension funds have been been going through the same pattern yet I havent touched those as it's probably more difficult to do e.g: the faff of trying to tell my pensions administrator to sell/buy and time the market..I just wouldn't do it with a pension so guess I need to apply the same logic to my S&S ISA and other investments.
I think my issue is that I feel the markets are just getting higher and higher and making me a bit more nervous. I'd rather get in at a lower price point (wouldn't we all!) so maybe I will continue to drip feed for now (as I have been doing for the last 3 years) and if there any market falls add lump sums during those periods. I will of course ensure that I am only committing funds that I am comfortable leaving in for the next 10 years+.

BananaRepublic

noclaf said:

DireEmblem said:

You need to consider how long you would be able to leave your money in the fund.  If you need quick easy access to your funds, then the closer to cash the better, as lower risk, but then also lower return.  If you would be quite happy to leave it sitting for say >10 years, then quite easily the Lifestrategy 100 out of the lot.  As you get closer to the point you would like access to use your funds, then consider dialling down to the 80/60/40 and so on to reduce risk.

Thanks, completely makes sense and to take it one step further I probably need to think about what 'amount' would I be comfortable investing and potentially taking a hit if there was a significant market event that sees 20/30/40% drop in the value of my investments.

Slightly off topic, what's your views on the VLS range and do you use them and if not whats your go-to for global equities exposure? Reason for the q is I like to get the perspectives of the more experienced posters. The VLS probably suits my knowledge and experience in investing but I am always curious! 

It’s a case of no pain, no gain. To get reward, you have to take risk. Your investments could drop 50%, the Great Financial Crash was definitely a cure for constipation, and the markets plummetted, but they recovered in a year or two and went on to grow hugely. Some people invested spare cash at or near the low and made a nice return. If you can’t keep calm, and leave your money invested, then you shouldn’t be investing in shares. I know from first hand experience that it is uncomfortable seeing funds plummet, but time is the great healer. 

Years ago I did a comparison of numerous funds. Some rated as low volatility made minimal losses in crashes, but also made small gains in bull runs. Others plummeted in crashes, but rocketed up afterwards and during bull runs. Of course there is always the risk of a truly huge event, but bear in mind the severity of the crash in the early 20’th century was largely due to the government response, or lack of. 

Regarding funds, a global fund is better diversified but it’s still ~60% US. Many commentators point to the UK, and to a lesser extent Europe, being good value. That said, no-one can see the future.