Any Suggestions on my ISA portfolio

BananaRepublic

Thrugelmir said:

China is the last place to look at if you are concerned about safety. 

I’d agree, but what’s the reason for your view? The Chinese market is growing like a prize pumpkin. 

mazibee

BananaRepublic said:

Am I the only one who thinks you chose funds by looking for max growth over the last 3-5 years? Not the way I’d choose funds, but maybe that’s just me. 

Yes you are right,  before picking the BG funds,  I looked at the past 5 years performance on the HL platform and then invested

If you don't mind please can you explain how to pick and choose a fund.

Thrugelmir

BananaRepublic said:

Thrugelmir said:

China is the last place to look at if you are concerned about safety. 

I’d agree, but what’s the reason for your view? The Chinese market is growing like a prize pumpkin. 

China only has one interest at heart. China. Every action only has one long term objective. To benefit China.  Nor a political culture to be trusted.  Elon Musk didn't disappear when he spoke out of turn........

firestone

mazibee said:

BananaRepublic said:

Am I the only one who thinks you chose funds by looking for max growth over the last 3-5 years? Not the way I’d choose funds, but maybe that’s just me. 

Yes you are right,  before picking the BG funds,  I looked at the past 5 years performance on the HL platform and then invested

If you don't mind please can you explain how to pick and choose a fund.

Probably by sticking to and trusting your methods & choices and not listening to us random people

benbay001

mazibee said:

jimjames said:

mazibee said:

ISA with iWeb
Stocks
IAG	34.19%
INRG	22.79%
LLOY	28.49%
SMT	14.53%

We are aiming for growth but also need safety, I know the iWeb portfolio seems too much risky, as 20K invested in only 4 shares,plan is, once I get some gains in this ISA will shift to some safe funds (any suggestions 9on this will be much appreciated)

The £20k in iWeb isn't really in just 4 shares. SMT is an investment trust so invested in 40+ shares. Obviously the other 3 are just shares though, any specific reason you chose them?

Thanks for your reply.

Not an expert in the field of investing,

IAG in a national carrier and will take some time to recover  to the pre covid levels even it take 3 years , to bet back to 450, it will be 200% increase  ( might be my calculation and thinking is wrong)

LLOY One of the largest bank in UK  I invested with the hope that it will reach pre-covid value in the next 2-3 years

INRG My view was to invest some in clean energy trust/ fund and selected it, I plan to hold it for the long term at least  5+ years

All the shares are in profit at the moment, shall I keep them or convert to some safe fund  Lindsell Train Global Equity.

IAG have more than doubled the number of shares issued over the course of the year, so even if profitability returns to pre pandemic levels, the amount of profit attributable to each shareholder is now less than half and therefore so would the price be. 

As for the rest, it seems like you have 3 positions that focus on the same thing.
Positive Change, Sustainable World and Global Clean Energy Fund.
Very impressive that you have such moral commitment to clean energy, but then you also hold an airline, so maybe that is carbon offsetting?
(Not trying to imply moral values on you because frankly my investing ethics are lacking, just pointing out that you could be missing out on returns and diversity in an attempt to appear green, yet happy to hold an airline)

moneyfoolish

mazibee said:

BananaRepublic said:

Am I the only one who thinks you chose funds by looking for max growth over the last 3-5 years? Not the way I’d choose funds, but maybe that’s just me. 

Yes you are right,  before picking the BG funds,  I looked at the past 5 years performance on the HL platform and then invested

If you don't mind please can you explain how to pick and choose a fund.

I'd ask the same question. Certainly, in the case of the Baillie Gifford Managed Class B Acc and the Royal London Sustainable World Trust C Acc Funds, both are in the 40% to 85% equities to bonds sector, are spread geogrphically, are over different sectors and have performed very well over 1, 3 and 5 years, therefore, would seem to a layman like myself a reasonable choice for funds for an adventurous investor who doesn't have the time or expertise to re-balance a selection of funds from different sectors.

JohnWinder

moneyfoolish said:

Yes you are right,  before picking the BG funds,  I looked at the past 5 years performance on the HL platform and then invested

If you don't mind please can you explain how to pick and choose a fund.

I'd ask the same question.

It needs to be a fund which will outperform a comparable passive index fund if one exists, otherwise why not just take the index.

Sadly, I've looked and asked but can't find how to pick and choose such a fund. Most funds with a comparable index are beaten by the index after about 5 years of outperformance compared to the index, so I wouldn't leave the choice to chance. Anyone who knows how to do it might not want to share the secret.

As to the funds without a comparable index.......well, draw your own conclusions, but I don't know why they should be any different.

bd10

You have a lot of concentration on the Baillie Gifford stable. They're a very good fund manager by all means, but personally I would not want to rely on any single management house too much.

Total portfolio concentration: What you could do is to run this through Morningstar, there you see overlaps, styles of stocks etc. In fact, have a look at the latest quarterly portfolio reports HL and Iweb provide, it should be an extract from Morningstar. From there you also see how well diversified your overall portfolio is (region, sector, individual names/overlaps), sharpe, performance against benchmark of your choice, etc.

Have a look what your exposure is to US tech (Nasdaq, the Faangs etc). Compared to other markets US valuations look quite ambitious at the moment. A lot of discounting of the covid recovery happening already. Other markets might offer some good value for money. Maybe not an exciting growth story but even on my UK equity income funds they picked up quite nicely since US election and EU/UK trade relationship, just a thought.

When I look at the usual global growth portfolios I cannot help but feel bored by the lack of inspiration. They all have the usual suspects in their top 10 to various percentages. That's a lot of concentration on a handful of shares to keep beating earnings expectations to keep up that rally. Must be the fear of missing out making the round.

As for Lloyds, I also looked at banks last summer. Pure value play. EU and UK banks are generally not in the best of shapes even before covid came along. US counterparts have fared much better (if we ignore Wells Fargo for a moment) since the GFC. Fed stress-tested them during covid (with names instead of BoE referring to them collectively) and they're looking in quite decent shape.
Just my 2c.

JohnWinder

bd10 said:

You have a lot of concentration on the Baillie Gifford stable. They're a very good fund manager by all means, but personally I would not want to rely on any single management house too much.

There is a lot of insightful 'market commentary' and suggestions in those 4 paragraphs. But I didn't pick up anything about how to pick the funds/stocks you should have. So I'll have a crack....

For equities have them as diversified as you can tolerate; if Vietnam makes you shudder, leave it out. But not the US. Probably the same for bonds unless you're sticking with government bonds only.

Get some idea of the long-ish term volatility of stock and bond values, and choose their proportions according to how risk tolerant you are. Equities can fall 60% for a while, when bonds might only drop 10% at that time. 50/50 stocks/bond mix would fall 35%; too worrying for you?

Keep the costs as low as you can within the above constraints. Over longer periods the costs' detriment to returns compounds like any other investment gain or loss that is recurring. Do some estimates to inform you of the size of the problem.

Try not to fiddle with your funds/stocks too much especially when they seem to be doing poorly lest you rob them of their chance of redemption. That's especially hard advice to follow, and thus one of the appeal of diversified index funds. Investments, like your soap, can get smaller with repeated handling even if there are no buy/sell spreads, trading fees, exit fees, taxes incurred.

BananaRepublic

mazibee said:

BananaRepublic said:

Am I the only one who thinks you chose funds by looking for max growth over the last 3-5 years? Not the way I’d choose funds, but maybe that’s just me. 

Yes you are right,  before picking the BG funds,  I looked at the past 5 years performance on the HL platform and then invested

If you don't mind please can you explain how to pick and choose a fund.

Well, I do have some BG funds (Japan and Europe). 🤣 I would like to know why so many BG funds have performance that is at or near top in their category, with a huge spurt over the last year. Did they foresee covid, and move to cash in time, and then back to equities in the dip? If that is the case, then they may well be a good buy as the recent spurt was good judgement. 

I have no proof that my fund picking mechanism works and will continue to work. Buyer beware! All I do is spread over geographical areas, with a mix of small, medium and large caps, weighted towards small and medium, and then look for funds with consistent long term performance.