Vanguard FTSE Global/Dev World ex-uk, LS80/100, all down - is it Ukraine?

Chris_English

ProDave said:

eskbanker said:

ProDave said:

This last 3 months has been a learning curve.  What I have learned is IGNORE THE ADVICE HERE.

Just when Omicron was rearing it's head, I got a feeling things were not looking good, as per previous lockdowns, the economy slows and economic activity falls and sentiment weakens.  I suggested the markets might fall and then might have been a good time to sell some things.

The forum talked me out of it saying that much regurgitated "time in the market not time the market"

Oh how I WISH I had ignored them and sold.

If i had followed my instinct I would be looking to buy back some but possibly not until the Ukraine issue is resolved.

Next time I will follow my instinct but keep it to myself because you just can't educate some people.

Do you have a link for the thread(s) in which you were talked out of selling investments?  The fact that prices have dropped a bit doesn't in itself mean that it would have been right to sell two or three months ago, unless there was a compelling reason to liquidate assets, as trying to time the market isn't generally advisable - the fact that in this particular case it may have been possible to benefit by a few percentage points doesn't actually invalidate the usual rule of thumb (or mean that those advocating it are uneducated), especially if wanting to try to time re-entry too.  What does your instinct say is the right time to buy back, in more specific terms than "possibly not until the Ukraine issue is resolved"?

I can't find my old thread.

What a surprise...

masonic

ProDave said:

Thrugelmir said:

ProDave said:

eskbanker said:

ProDave said:

This last 3 months has been a learning curve.  What I have learned is IGNORE THE ADVICE HERE.

Just when Omicron was rearing it's head, I got a feeling things were not looking good, as per previous lockdowns, the economy slows and economic activity falls and sentiment weakens.  I suggested the markets might fall and then might have been a good time to sell some things.

The forum talked me out of it saying that much regurgitated "time in the market not time the market"

Oh how I WISH I had ignored them and sold.

If i had followed my instinct I would be looking to buy back some but possibly not until the Ukraine issue is resolved.

Next time I will follow my instinct but keep it to myself because you just can't educate some people.

Do you have a link for the thread(s) in which you were talked out of selling investments?  The fact that prices have dropped a bit doesn't in itself mean that it would have been right to sell two or three months ago, unless there was a compelling reason to liquidate assets, as trying to time the market isn't generally advisable - the fact that in this particular case it may have been possible to benefit by a few percentage points doesn't actually invalidate the usual rule of thumb (or mean that those advocating it are uneducated), especially if wanting to try to time re-entry too.  What does your instinct say is the right time to buy back, in more specific terms than "possibly not until the Ukraine issue is resolved"?

What is mystifying is the types of funds discussed in this thread probably down 10% in the last month or so is against a backdrop of the FTSE100 looking generally positive apart from a few blips.  I know we are not talking about FTSE trackers, but it does seem very odd that a number of high profile and previously well respected funds are falling sharply while the FTSE100 is generally up over the same period.

In summary. Investors have been net sellers of UK equities since before the Brexit referendum in 2016. Cash subsequently flowed into US stocks resulting in a disparity in valuation. As with any trade they comes a point when other markets offer better future returns. Institutional money has been flowing back into the UK more recently. With the index weighting to energy, miners and financials. Any uptick in interest rates and inflation will benefit said stocks in particular. As far as bank stocks are concerned the GFC and PPI saga's are consigned to history. 

Not a recommendation to invest in the UK per se I should add. 

This is the sort of thing I wish people would post regularly.  the turn of the year might have been a good time to switch from global funds to more UK centred funds perhaps.  Why don't we regularly see this sort of discussion on this board about what might be good, what might be bad etc.  It would be a so much more useful forum if we did.

We had many a discussion in ~2011 where several of us were concerned about how overvalued the US seemed to be and how it made sense to underweight it and go overweight into markets trading at a lower CAPE (interestingly Russia was specifically mentioned then and went on to lose 40% over the next 5 years while the US soared). Anyone who did so in a big way missed out on a lot of returns over the last decade. Eventually a reversion to the mean can be expected and now is as good a time as any. I don't think there has been any time S&P 500 CAPE has been this high and the next 10 year returns have been positive (in real terms), but the most I'm willing to do is dial down the US a bit and focus away from the big tech names mainly responsible for driving the last decade's growth. Elsewhere I've been transitioning to funds with more of a wealth preservation mandate over the last few years (apart from a quick top-up of the big fallers during March-April 2020) and defensives now make up ~40% of my portfolio. Other than a few minor holdings in growth investments, my portfolio is weathering the current conditions well. Seems a far preferable approach to me than watching daily movements with my finger on the sell button in an attempt to trade my way out of volatility.

coyrls

Thrugelmir said:

coyrls said:

Thrugelmir said:

coyrls said:

The known risk with SWR strategies is that they will fail in historically unprecedented circumstances but what we are seeing now is far, far from historically unprecedented.

Which period of history are you comparing it too? 

The periods used for SWR studies.  Do you think that this month's drop in equity prices (which is what is being discussed in this thread) is unprecedented over the periods used by SWR studies?

Do you think that all the issues that the global markets are trying to price in are now resolved?  Personally I don't recall a similar set of scenaros previously which would have set any form of precedent. 

As I said, my comment referred to the drop in the current month (the subject of this thread), not to any possible drops in the future.

Alexland

Well I have just done the end of month numbers and our net worth is only down 3.4% over the month which is our 4th worst month in the past 5 years of our wealth more than doubling. I haven't seen anyone forecasting a Depression this time..

Audaxer

Alexland said:

Well I have just done the end of month numbers and our net worth is only down 3.4% over the month which is our 4th worst month in the past 5 years of our wealth more than doubling. I haven't seen anyone forecasting a Depression this time..

Were you able to get the fund values as at the end of today yet, as I thought I wouldn't be able to get them until tomorrow morning?

masonic

Audaxer said:

Alexland said:

Well I have just done the end of month numbers and our net worth is only down 3.4% over the month which is our 4th worst month in the past 5 years of our wealth more than doubling. I haven't seen anyone forecasting a Depression this time..

Were you able to get the fund values as at the end of today yet, as I thought I wouldn't be able to get them until tomorrow morning?

Depends what type of funds they are. For ETFs and investment trusts you do not have to wait. For open ended investments it depends on the valuation point. Some are available in some places in the evening (e.g HL tends to update them before many other places, some funds already have today's pricing data, while others do not).

Thrugelmir

Deleted_User said:

Thrugelmir said:

Investors have been net sellers of UK equities since before the Brexit referendum in 2016.

Who did they sell them to?

How many companies have been acquired and delisted off the London exchanges in the past 20 years ?

Thrugelmir

Alexland said:

Well I have just done the end of month numbers and our net worth is only down 3.4% over the month which is our 4th worst month in the past 5 years of our wealth more than doubling. I haven't seen anyone forecasting a Depression this time..

Are the stock markets in tune with the real economy at the current time or immediate future ?  Are investors making rational choices when selecting which stocks to invest in. 

Audaxer

masonic said:

Audaxer said:

Alexland said:

Well I have just done the end of month numbers and our net worth is only down 3.4% over the month which is our 4th worst month in the past 5 years of our wealth more than doubling. I haven't seen anyone forecasting a Depression this time..

Were you able to get the fund values as at the end of today yet, as I thought I wouldn't be able to get them until tomorrow morning?

Depends what type of funds they are. For ETFs and investment trusts you do not have to wait. For open ended investments it depends on the valuation point. Some are available in some places in the evening (e.g HL tends to update them before many other places, some funds already have today's pricing data, while others do not).

Just looked at the VLS funds and they are not updated yet - they tend to be updated the following day even on HL, but some other multi asset funds I see are already updated.

Alexland

Audaxer said:
Just looked at the VLS funds and they are not updated yet - they tend to be updated the following day even on HL, but some other multi asset funds I see are already updated.

Many of our investments are in ETFs and am happy to just take the latest fund values such as Fidelity who update around 3pm from a valuation point at midday. Sure this might not include the improving US market this evening but it's good enough. The overall net worth calculation is going to have a margin for error anyway as who knows what a house is really worth until it's sold? For that reason I would guess my spreadsheet is only accurate to the nearest £50k or so but at least if I am consistent with the method it gives comparable monthly values.

Thrugelmir said:

Are the stock markets in tune with the real economy at the current time or immediate future ?  Are investors making rational choices when selecting which stocks to invest in. 

Was it ever, were they ever? The world isn't that logical and probably never will be so we just have to find a way through the mess for a good outcome.