Investing in Global Trackers and other similar investments

DoneWorking

bostonerimus said:

FYI you could save 80% of that fee if you just did some reading and went with a simple multi-asset fund from one of the major providers. Opening a GIA and then transferring to an ISA over a number of years is simple and you don't need anything complicated for your portfolio. Have you read and understood this yet? It will provide you with a foundation for whatever path you take.
https://www.bogleheads.org/wiki/Investing_from_the_UK

I haven't made any decision as yet

Just looking into DIY and IFA options

Concerned at my lack of experience and knowledge

The IFA says there could be volatility ahead

I'm concerned that I would not know how to deal with that under DIY

Thrugelmir

DoneWorking said:

bostonerimus said:

FYI you could save 80% of that fee if you just did some reading and went with a simple multi-asset fund from one of the major providers. Opening a GIA and then transferring to an ISA over a number of years is simple and you don't need anything complicated for your portfolio. Have you read and understood this yet? It will provide you with a foundation for whatever path you take.
https://www.bogleheads.org/wiki/Investing_from_the_UK

I haven't made any decision as yet

Just looking into DIY and IFA options

Concerned at my lack of experience and knowledge

The IFA says there could be volatility ahead

I'm concerned that I would not know how to deal with that under DIY

Like life itself. Until a situation arises you know how you will react personally. As the saying goes. When the going gets tough the tough get going. Follow the threads on this forum and you'll notice how optimism ebbs and flows. Startly slowly and gently. Take a long time to find your feet. No one can control volatility. As it's a function of the market. We are all participants in the market. Our individual actions all combine to influence the markets direction. Whether it's through investing or whether we decide to spend our money or not, and where and what we spend our money on. 

Michael121

GeoffTF said:

Thrugelmir said:
Mega caps have only existed more recently. Their valuations owe much to the volume of money pouring into passively managed investment vehicles.

Mega cap valuations owe nothing to market weighted trackers. They do not trade at all as valuations change. New investors buy all the stocks in their free float market proportions, and exert the same upward pressure on all of them.

Thrugelmir said:
Tesla how investors can overpay for a stock. As the entry into the SP500 was so well flagged that many investors (such as BG) bagged a comfortable profit for doing nothing. Passive funds were forced to pay over the odds to reweight their holdings.

The S&P 500 is not a simple market weighted index. It has a rule that companies have to be profitable to be included in the index. That had unfortunate results for S&P 500 investors when Tesla became profitable. You avoid that problem by investing a simple market weighted tracker. They did not have any problem with Tesla. They bought it when it was an unprofitable tiddler, and passively held it as it grew.

By simple weighted do you mean equal weighted?

ColdIron

Michael121 said:

GeoffTF said:

Thrugelmir said:
Mega caps have only existed more recently. Their valuations owe much to the volume of money pouring into passively managed investment vehicles.

Mega cap valuations owe nothing to market weighted trackers. They do not trade at all as valuations change. New investors buy all the stocks in their free float market proportions, and exert the same upward pressure on all of them.

Thrugelmir said:
Tesla how investors can overpay for a stock. As the entry into the SP500 was so well flagged that many investors (such as BG) bagged a comfortable profit for doing nothing. Passive funds were forced to pay over the odds to reweight their holdings.

The S&P 500 is not a simple market weighted index. It has a rule that companies have to be profitable to be included in the index. That had unfortunate results for S&P 500 investors when Tesla became profitable. You avoid that problem by investing a simple market weighted tracker. They did not have any problem with Tesla. They bought it when it was an unprofitable tiddler, and passively held it as it grew.

By simple weighted do you mean equal weighted?

I would guess a simple (ordinary, run of the mill etc), market capitalisation weighted index

bostonerimus

DoneWorking said:

bostonerimus said:

FYI you could save 80% of that fee if you just did some reading and went with a simple multi-asset fund from one of the major providers. Opening a GIA and then transferring to an ISA over a number of years is simple and you don't need anything complicated for your portfolio. Have you read and understood this yet? It will provide you with a foundation for whatever path you take.
https://www.bogleheads.org/wiki/Investing_from_the_UK

I haven't made any decision as yet

Just looking into DIY and IFA options

Concerned at my lack of experience and knowledge

The IFA says there could be volatility ahead

I'm concerned that I would not know how to deal with that under DIY

Have you read through the link I sent you? If so you should see that you don't need to to much of anything.

DoneWorking

bostonerimus said:

DoneWorking said:

bostonerimus said:

FYI you could save 80% of that fee if you just did some reading and went with a simple multi-asset fund from one of the major providers. Opening a GIA and then transferring to an ISA over a number of years is simple and you don't need anything complicated for your portfolio. Have you read and understood this yet? It will provide you with a foundation for whatever path you take.
https://www.bogleheads.org/wiki/Investing_from_the_UK

I haven't made any decision as yet

Just looking into DIY and IFA options

Concerned at my lack of experience and knowledge

The IFA says there could be volatility ahead

I'm concerned that I would not know how to deal with that under DIY

Have you read through the link I sent you? If so you should see that you don't need to to much of anything.

This link ?
https://www.bogleheads.org/wiki/Investing_from_the_UK

I've started reading it but not finished it yet

I'm slowly going through all of the various comments so I can form an over all opinion

As regards the article it's initially a lot to take in

So many options to chose from

Keeping in mind I want to go ESG can anyone give me any ideas on selecting suitable funds

Would I go for just one fund

Or several

Sorry for being such a new by

I hope I will get a better understanding after I have followed up all the links and comments

GeoffTF

Michael121 said:

GeoffTF said:

Thrugelmir said:
Mega caps have only existed more recently. Their valuations owe much to the volume of money pouring into passively managed investment vehicles.

Mega cap valuations owe nothing to market weighted trackers. They do not trade at all as valuations change. New investors buy all the stocks in their free float market proportions, and exert the same upward pressure on all of them.

Thrugelmir said:
Tesla how investors can overpay for a stock. As the entry into the SP500 was so well flagged that many investors (such as BG) bagged a comfortable profit for doing nothing. Passive funds were forced to pay over the odds to reweight their holdings.

The S&P 500 is not a simple market weighted index. It has a rule that companies have to be profitable to be included in the index. That had unfortunate results for S&P 500 investors when Tesla became profitable. You avoid that problem by investing a simple market weighted tracker. They did not have any problem with Tesla. They bought it when it was an unprofitable tiddler, and passively held it as it grew.

By simple weighted do you mean equal weighted?

No, by simple market weighted, I mean buying the same percentage of every company's stock, not investing an equal amount in each stock. If a company is ten times as big, you buy ten times as much. The S&P 500 is picky about which stocks it includes, and is restricted to enormous companies.

GeoffTF

DoneWorking said:
Keeping in mind I want to go ESG can anyone give me any ideas on selecting suitable funds

Would I go for just one fund

You would need to tell us what you mean by ESG, i.e. give us a list of the types of companies that you do not want to invest in. The shorter the list, the better, as far as risk and likely return are concerned.

Yes, you should go with just one fund.

Thrugelmir

GeoffTF said:

Michael121 said:

GeoffTF said:

Thrugelmir said:
Mega caps have only existed more recently. Their valuations owe much to the volume of money pouring into passively managed investment vehicles.

Mega cap valuations owe nothing to market weighted trackers. They do not trade at all as valuations change. New investors buy all the stocks in their free float market proportions, and exert the same upward pressure on all of them.

Thrugelmir said:
Tesla how investors can overpay for a stock. As the entry into the SP500 was so well flagged that many investors (such as BG) bagged a comfortable profit for doing nothing. Passive funds were forced to pay over the odds to reweight their holdings.

The S&P 500 is not a simple market weighted index. It has a rule that companies have to be profitable to be included in the index. That had unfortunate results for S&P 500 investors when Tesla became profitable. You avoid that problem by investing a simple market weighted tracker. They did not have any problem with Tesla. They bought it when it was an unprofitable tiddler, and passively held it as it grew.

By simple weighted do you mean equal weighted?

No, by simple market weighted, I mean buying the same percentage of every company's stock, not investing an equal amount in each stock. If a company is ten times as big, you buy ten times as much. The S&P 500 is picky about which stocks it includes, and is restricted to enormous companies.

The bubble in the INRG ETF is an example of how passive investing can cause distortion to the pricing of stocks. 

DoneWorking

GeoffTF said:

DoneWorking said:
Keeping in mind I want to go ESG can anyone give me any ideas on selecting suitable funds

Would I go for just one fund

You would need to tell us what you mean by ESG, i.e. give us a list of the types of companies that you do not want to invest in. The shorter the list, the better, as far as risk and likely return are concerned.

Yes, you should go with just one fund.

Don't want to go with fossil fuels or weapons