Any Difference?

jimjames

threlkeld53 said:

What, if any, would the difference be between adding £30k to similar 60:40 funds OR putting £18k into an index fund (100% equity) and £12k into a savers' bank account for a fixed 12 month term @ 1.3%?

Which index fund are you thinking of? There are index funds for markets across the world so cover a wide range. The risk of £18k in a tech index fund will be higher than the same money in a bond index fund.

If you were looking at a worldwide index fund in the same proportions as your 60% allocation in your current one then it would have a similar impact on volatility and returns I would suspect. 

LHW99

How old is mum? does she have accessible savings for emergencies?

Thrugelmir

threlkeld53 said:

dunstonh said:

What, if any, would the difference be between adding £30k to similar 60:40 funds OR putting £18k into an index fund (100% equity) and £12k into a savers' bank account for a fixed 12 month term @ 1.3%?

Differences could be anything up to 50% over a 12 month difference.  i.e. loss of 50% (theoretically, more than 50% is possible).

Your question is a bit like asking the difference between walking, driving and flying when doing the school run.

Let's just assume that the market crashes 50%....

£18k in an index fund would have a reduced value of £9k
£30k in a 60:40 multi-asset fund would also be reduced by £9k.

So the difference in equity value in the 2 scenarios would be zero. 

The market value of bonds can change as well. 

Likewise the allocations across the equity segments will determine how much they respectively fall. There's no one single global market.