Bad Advice. Can I do anything?

masonic

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

Rich1976

masonic said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

I’m saying that even if they were aware investments go down, the impact of this may not have been obvious until they saw the value plummet.

I can’t imagine many people with no prior knowledge of investments and who are potentially risk averse/ low risk being comfortable with the loss they have had when they have clearly stated they would not have expected a fall that big.

it is my interpretation they were not aware or did not appreciate that a medium risk fund can have double digit returns, and I can understand where they are coming from. 

Most people I would imagine unless they are experienced investors with lots of knowledge and who take a keen interest in such things would not have thought they’d have made a bigger loss with what they perceive to be a safer fund than a fund with 100% invested.

im just trying to see it from their point of view and tbh can understand their thoughts. I don’t think it was bad advice but simply is down to a lack of understanding and being invested above their risk tolerance.

masonic

Rich1976 said:

masonic said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

I’m saying that even if they were aware investments go down, the impact of this may not have been obvious until they saw the value plummet.

I can’t imagine many people with no prior knowledge of investments and who are potentially risk averse/ low risk being comfortable with the loss they have had when they have clearly stated they would not have expected a fall that big.

it is my interpretation they were not aware or did not appreciate that a medium risk fund can have double digit returns, and I can understand where they are coming from. 

Most people I would imagine unless they are experienced investors with lots of knowledge and who take a keen interest in such things would not have thought they’d have made a bigger loss with what they perceive to be a safer fund than a fund with 100% invested.

im just trying to see it from their point of view and tbh can understand their thoughts. I don’t think it was bad advice but simply is down to a lack of understanding and being invested above their risk tolerance.

If they wouldn't have expected a fall that big, then that points to them not being aware of how their investments could reasonably perform, which leaves the door open to it being bad advice.

If they had a conversation about the possibility they could see 20% wiped off their investment '...just like what happened a couple of years ago', and that didn't lead them to anticipate a 15% drop coming along at some point, then I don't think any amount of discussion and visualisation would have helped. But I don't think many people would come away from a conversation where a recent drop of 20% was mentioned expecting that never to happen again. An adviser needn't specifically reference the Covid crash when discussing potential losses, but they should certainly be giving their client an appreciation for what could happen under various levels of economic stress.

If they genuinely had no reason to expect that a 15% drop was possible, because their adviser didn't mention loss potential or what had happened to the funds in the recent past, and they didn't volunteer that they'd be prepared to tolerate a drop of that magnitude, then clearly something was lacking on the advice front and their could even be grounds for complaint. It therefore seems sensible to explore this possibility, which is the only one that leads to any practical action (the "Can I do anything?" part of the thread title).

wmb194

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

Yes, I know. My point is that they're not a youngster and, like most adults, must have noticed that the stockmarket has these sorts of bouts from time to time. Quite regularly, actually.

Rich1976

wmb194 said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

Yes, I know. My point is that they're not a youngster and, like most adults, must have noticed that the stockmarket has these sorts of bouts from time to time. Quite regularly, actually.

Many people take no interest in the stock market. Out of everyone I know I’m the only one who knows how their pensions are invested. Everyone else doesn’t even look at their statement .

so few people are interested in financial matters , so it’s not true to say they would be aware of how the markets have been going up and down over the years.

wmb194

Rich1976 said:

wmb194 said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

Yes, I know. My point is that they're not a youngster and, like most adults, must have noticed that the stockmarket has these sorts of bouts from time to time. Quite regularly, actually.

Many people take no interest in the stock market. Out of everyone I know I’m the only one who knows how their pensions are invested. Everyone else doesn’t even look at their statement .

so few people are interested in financial matters , so it’s not true to say they would be aware of how the markets have been going up and down over the years.

Come off it, the dot-com crash, the 2008 financial crisis and the Covid crash - just to name a few without delving into the 1929 crash and other historical ones - are common knowledge.

In just the last year we've had the sell-off into the June lows, a bounce back and now another sell-off. At what point does someone twig that it can be volatile?

bobdisk

Rich1976 said:

masonic said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

I’m saying that even if they were aware investments go down, the impact of this may not have been obvious until they saw the value plummet.

I can’t imagine many people with no prior knowledge of investments and who are potentially risk averse/ low risk being comfortable with the loss they have had when they have clearly stated they would not have expected a fall that big.

it is my interpretation they were not aware or did not appreciate that a medium risk fund can have double digit returns, and I can understand where they are coming from. 

Most people I would imagine unless they are experienced investors with lots of knowledge and who take a keen interest in such things would not have thought they’d have made a bigger loss with what they perceive to be a safer fund than a fund with 100% invested.

im just trying to see it from their point of view and tbh can understand their thoughts. I don’t think it was bad advice but simply is down to a lack of understanding and being invested above their risk tolerance.

This is my position exactly. I have no experience of investing, and did not realise that the impacts the dropping values would have, until it happened. I knew the cash ISAs and other savings did not make much interest, but the basic amount did not reduce (like it does with investments) so I did not take much notice of it. I was told (not only by the financial adviser, but also by what I saw when surfing the internet) that that amount just sitting in those accounts doing next to nothing was bad practice. 

bobdisk

masonic said:

Rich1976 said:

masonic said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

I’m saying that even if they were aware investments go down, the impact of this may not have been obvious until they saw the value plummet.

I can’t imagine many people with no prior knowledge of investments and who are potentially risk averse/ low risk being comfortable with the loss they have had when they have clearly stated they would not have expected a fall that big.

it is my interpretation they were not aware or did not appreciate that a medium risk fund can have double digit returns, and I can understand where they are coming from. 

Most people I would imagine unless they are experienced investors with lots of knowledge and who take a keen interest in such things would not have thought they’d have made a bigger loss with what they perceive to be a safer fund than a fund with 100% invested.

im just trying to see it from their point of view and tbh can understand their thoughts. I don’t think it was bad advice but simply is down to a lack of understanding and being invested above their risk tolerance.

If they wouldn't have expected a fall that big, then that points to them not being aware of how their investments could reasonably perform, which leaves the door open to it being bad advice.

If they had a conversation about the possibility they could see 20% wiped off their investment '...just like what happened a couple of years ago', and that didn't lead them to anticipate a 15% drop coming along at some point, then I don't think any amount of discussion and visualisation would have helped. But I don't think many people would come away from a conversation where a recent drop of 20% was mentioned expecting that never to happen again. An adviser needn't specifically reference the Covid crash when discussing potential losses, but they should certainly be giving their client an appreciation for what could happen under various levels of economic stress.

If they genuinely had no reason to expect that a 15% drop was possible, because their adviser didn't mention loss potential or what had happened to the funds in the recent past, and they didn't volunteer that they'd be prepared to tolerate a drop of that magnitude, then clearly something was lacking on the advice front and their could even be grounds for complaint. It therefore seems sensible to explore this possibility, which is the only one that leads to any practical action (the "Can I do anything?" part of the thread title).

If these potential percentages of losses had been mentioned, I would not have gone ahead, and left the money where it was. I am not a gambler, I only do things like the Lottery when there is a rollover, but am prepared to lose the cost of the ticket! 

Linton

One wonders what the OP would consider good advice, presumably “go away, investing is not for you”.

masonic

bobdisk said:

masonic said:

Rich1976 said:

masonic said:

Rich1976 said:

wmb194 said:

The OP didn't notice how quickly the markets tanked when they panicked over Covid in Feb/Mar 2020? It was all anyone was talking about at the time. If they've been savings in cash Isas since they began - 1999 - then they've lived through multiple periods of stock market turmoil.

They were only invested from October 2021.

It seems like you are suggesting that nothing short of someone having their own money invested and seeing it fall can lead someone to a true understanding of how much they'd be willing to see their investments fall.

I’m saying that even if they were aware investments go down, the impact of this may not have been obvious until they saw the value plummet.

I can’t imagine many people with no prior knowledge of investments and who are potentially risk averse/ low risk being comfortable with the loss they have had when they have clearly stated they would not have expected a fall that big.

it is my interpretation they were not aware or did not appreciate that a medium risk fund can have double digit returns, and I can understand where they are coming from. 

Most people I would imagine unless they are experienced investors with lots of knowledge and who take a keen interest in such things would not have thought they’d have made a bigger loss with what they perceive to be a safer fund than a fund with 100% invested.

im just trying to see it from their point of view and tbh can understand their thoughts. I don’t think it was bad advice but simply is down to a lack of understanding and being invested above their risk tolerance.

If they wouldn't have expected a fall that big, then that points to them not being aware of how their investments could reasonably perform, which leaves the door open to it being bad advice.

If they had a conversation about the possibility they could see 20% wiped off their investment '...just like what happened a couple of years ago', and that didn't lead them to anticipate a 15% drop coming along at some point, then I don't think any amount of discussion and visualisation would have helped. But I don't think many people would come away from a conversation where a recent drop of 20% was mentioned expecting that never to happen again. An adviser needn't specifically reference the Covid crash when discussing potential losses, but they should certainly be giving their client an appreciation for what could happen under various levels of economic stress.

If they genuinely had no reason to expect that a 15% drop was possible, because their adviser didn't mention loss potential or what had happened to the funds in the recent past, and they didn't volunteer that they'd be prepared to tolerate a drop of that magnitude, then clearly something was lacking on the advice front and their could even be grounds for complaint. It therefore seems sensible to explore this possibility, which is the only one that leads to any practical action (the "Can I do anything?" part of the thread title).

If these potential percentages of losses had been mentioned, I would not have gone ahead, and left the money where it was. I am not a gambler, I only do things like the Lottery when there is a rollover, but am prepared to lose the cost of the ticket! 

Investing isn't gambling, but if you are sure that your adviser did not discuss with you what your investments could potentially lose in the short term, then it seems worth making a complaint.