Nutmeg - choosing portfolio

dunstonh

Has anyone else who has/had a Nutmeg S&S ISA found the returns are poor (actually -minus!).

Not sure why you are emphasing "minus".     

Investments go down as well as up at times.   We are currently in a negative period.  Some of the reasons you would be aware about.  e.g. The Russian invasion of Ukraine (and its impact on the global economy).  The cost of living crisis (as its being referred to in places).   China taking strict zero covid actions which are hitting supply lines.  Tech companies suffering losses and major falls in the market.   Rising interest rates and rising inflation..... plus many more.

im no expert at all, but do expect a little return for having a medium/slightly higher risk profile, but my Nutmeg ISA has returned -1.19% over the last year, so im actually worse off!!. not impressed, i won`t be investing there anymore and note Martin has said "ditch the ISA"

an economic cycle is around 10-15 years.   In that period you will have positive years, negative years and nothing years. Most years are postive.  You have only invested for around one year and you have picked a negative period.

If you read the risk warnings and looked at any of the information provided that explains how investing works, you would know that you can have negative periods.  So, why are you angry at having a loss during a negative period?

And you said you chose a slightly higher risk profile.  In other words, you made the active decision to invest knowing that your value would zig zag more.   Yet the first sign it has gone down, you have expressed dissatisfaction and are incorrectly blaming nutmeg.

And Martin has said nothing of the sort in respect of investments held in ISAs.

The problem is not Nutmeg.  Or the ISA.   It is your understanding.   Put the effort in to understand how investments work and your problems go away.

bonzai06

Thank you for your reply.
I do appreciate that any investment has negative and positive periods, as i said, im no expert and understand that the markets have been very volatile recently and my investment was perhaps bad timed during a negative period.

I`m not angry but you`ve summed up correctly that im disappointed and i guess i wanted to share that experience with others. Perhaps i should`ve done a lot more research into this before investing, and by flagging things up, and as you`ve also clearly explained, any investment has the potential to go up as well as fall,  i hoped my experience may be viewed by others, so they can be perhaps better informed than i had let myself believe i was.

I hadn`t appreciated that investments such as these were generally viewed as being long-term, i had done a little research on this and wasn`t that clear about that.

Lastly and i do appreciate your responses, which has helped me better understand matters. However, just to clarify as i realise now, my statement "Martin has said ditch the ISA" was based on his statement of Cash ISA`s, rather than S&S ISA.

I hope this helps others a little better, as it has now done for me. 
  

Thrugelmir

bonzai06 said:

Has anyone else who has/had a Nutmeg S&S ISA found the returns are poor (actually -minus!). im no expert at all, but do expect a little return for having a medium/slightly higher risk profile, but my Nutmeg ISA has returned -1.19% over the last year, so im actually worse off!!. not impressed, i won`t be investing there anymore and note Martin has said "ditch the ISA"

Correspondingly you'll suffer greater declines in times of economic turmoil.

Are you still adding new money to the pot? 

dunstonh

I hadn`t appreciated that investments such as these were generally viewed as being long-term, i had done a little research on this and wasn`t that clear about that.

All investments are long term.    Statistically, the vast majority of 5 year periods have not resulted in a loss.  That is why you often see a minimum term of 5 years recommended.   However, ideally 10-15 years is better.

At the start of the millennium, you had the rare event of three negative years in a row.   However, the five years that followed that low point saw people double their money.

investing is largely about timescale.   5-10+ years and you should close your eyes to the negative periods. Stop looking at the values.   Indeed, if you are paying in regularly, negative periods in the early years are great news.    Even though you have a short term loss, each payment you make is buying the investments cheaper during negative periods.  When things go back up, it will be those cheaper investments that make the most money.

Albermarle

bonzai06 said:

Thank you for your reply.
I do appreciate that any investment has negative and positive periods, as i said, im no expert and understand that the markets have been very volatile recently and my investment was perhaps bad timed during a negative period.

I`m not angry but you`ve summed up correctly that im disappointed and i guess i wanted to share that experience with others. Perhaps i should`ve done a lot more research into this before investing, and by flagging things up, and as you`ve also clearly explained, any investment has the potential to go up as well as fall,  i hoped my experience may be viewed by others, so they can be perhaps better informed than i had let myself believe i was.

I hadn`t appreciated that investments such as these were generally viewed as being long-term, i had done a little research on this and wasn`t that clear about that.

Lastly and i do appreciate your responses, which has helped me better understand matters. However, just to clarify as i realise now, my statement "Martin has said ditch the ISA" was based on his statement of Cash ISA`s, rather than S&S ISA.

I hope this helps others a little better, as it has now done for me. 
  

Nutmeg themselves have a nice graph showing that the risk of losses diminishes over time .

Long-term investing: Increasing your chances of positive returns (nutmeg.com)

older_and_no_wiser

bonzai06 said:

Has anyone else who has/had a Nutmeg S&S ISA found the returns are poor (actually -minus!). im no expert at all, but do expect a little return for having a medium/slightly higher risk profile, but my Nutmeg ISA has returned -1.19% over the last year, so im actually worse off!!. not impressed, i won`t be investing there anymore and note Martin has said "ditch the ISA"

Please do some research in investing and investments - especially if you ever contemplate a DIY investment approach should you withdraw your Nutmeg account. 

Personally,  my Nutmeg managed pot is 16% up as of today.  However that is purely because I opened the pot near the bottom of the Covid dip. That was sheer luck though. We can't time the market. It's all  about leaving it, adding to it and ignoring the short term noise.

Also your ML ISA quote is wrong. He's referring to cash ISAs 

missymouse

My nutmeg has also dropped and was higher in December but then so has my other investments which are in - figures

it is putting me off investing the full 20K this year

are savings better with interest rates rising?

Albermarle

missymouse said:

My nutmeg has also dropped and was higher in December but then so has my other investments which are in - figures

it is putting me off investing the full 20K this year

are savings better with interest rates rising?

Savings rates may get to 3% at some point , for say a two year fix, maybe even a little more . However with inflation going to 10% , then that is a guaranteed loss of value of 7%. Hopefully next year inflation will slowly come down , so the gap between savings rates and inflation will go down , but unlikely to disappear.

Most investments are down 5% to 15% this year , so with inflation as well , a value loss of nearly 20%. To be fair though most investments have not lost or gained very much at all over the last 12 months. Nobody knows what will happen to investments in the next 12 months, although large gains seem pretty unlikely.

So you have to choose between two less than perfect options . Or spread the £20K across both 

Thrugelmir

missymouse said:

My nutmeg has also dropped and was higher in December but then so has my other investments which are in - figures

it is putting me off investing the full 20K this year

are savings better with interest rates rising?

Consider drip feeding your money in. Markets are likely to remain extremely volatile. Investing is for the long term. 

missymouse

Thanks Thrugel

I’ve kept some in cash within the investment from last year  but unsure when to use it, can you get more for your money in a falling market as it is now or is that not the way to look at it