Is this a sensible pension investment

retiringtoosoon

Hi

Wanting to get some opinions on my DC pension investment fund. I intend to retire in 12 years time at 55. Is this an outlandish fund to be 100% invested in?
One area i'm unsure of is about being currency hedged to sterling as per the description. What with Sterling tanking, is that a good/bad/indifferent thing?

It is as follows from factsheet blurb:

"L&G PMC Global Equity Market Weights 30:70 Index 3 (Fund ID: NRJ3)

Fund aim: To capture the total returns of the UK and overseas equity markets as represented by the FTSE All-Share Index in the UK and the FTSE AW - All World (ex UK) Index overseas while maintaining a fixed 30/70 weighting between the UK and theoverseas assets. A total of 75% of the overseas assets (excluding emerging markets) will be currency hedged to sterling, exposure to emerging market currencies, will be left unhedged."

https://www.trustnet.com/factsheets/p/ndn4/lg-global-equity-market-weights-3070-index-75-currency-hedged-pmc-pn

Marcon

retiringtoosoon said:

Hi

Wanting to get some opinions on my DC pension investment fund. I intend to retire in 12 years time at 55. Is this an outlandish fund to be 100% invested in?
One area i'm unsure of is about being currency hedged to sterling as per the description. What with Sterling tanking, is that a good/bad/indifferent thing?

It is as follows from factsheet blurb:

"L&G PMC Global Equity Market Weights 30:70 Index 3 (Fund ID: NRJ3)

Fund aim: To capture the total returns of the UK and overseas equity markets as represented by the FTSE All-Share Index in the UK and the FTSE AW - All World (ex UK) Index overseas while maintaining a fixed 30/70 weighting between the UK and theoverseas assets. A total of 75% of the overseas assets (excluding emerging markets) will be currency hedged to sterling, exposure to emerging market currencies, will be left unhedged."

https://www.trustnet.com/factsheets/p/ndn4/lg-global-equity-market-weights-3070-index-75-currency-hedged-pmc-pn

What's your attitude to risk?

MallyGirl

100% equity would be too high risk for many. I have that as one of my company pension funds in combination with one with much less equity 

retiringtoosoon

Marcon said:

retiringtoosoon said:

Hi

Wanting to get some opinions on my DC pension investment fund. I intend to retire in 12 years time at 55. Is this an outlandish fund to be 100% invested in?
One area i'm unsure of is about being currency hedged to sterling as per the description. What with Sterling tanking, is that a good/bad/indifferent thing?

It is as follows from factsheet blurb:

"L&G PMC Global Equity Market Weights 30:70 Index 3 (Fund ID: NRJ3)

Fund aim: To capture the total returns of the UK and overseas equity markets as represented by the FTSE All-Share Index in the UK and the FTSE AW - All World (ex UK) Index overseas while maintaining a fixed 30/70 weighting between the UK and theoverseas assets. A total of 75% of the overseas assets (excluding emerging markets) will be currency hedged to sterling, exposure to emerging market currencies, will be left unhedged."

https://www.trustnet.com/factsheets/p/ndn4/lg-global-equity-market-weights-3070-index-75-currency-hedged-pmc-pn

What's your attitude to risk?

Given the time frame of 30-40 years drawdown i'm comfortable with more risk.
(I won £18 when i went to the gee-gees a few weeks back).

gm0

Not one of my L&G selections but I don't think we were offered that exact one.

L&G have some "half" hedged funds for those who can't decide (we had those in our scheme but I did not use them either)

And some unhedged ones that I do use - World Developed ex UK and UK All Share TR

Equity %

McClung (Living off your money) analysis would suggest that above 70-80 the extra volatility across all the possible paths becomes problematic.  (100% has the "best" die rich paths - but also starts to have the retirement failures) and the sustainable increase in income over the cycle is not (due to the limit of not being sustainable being reached that impressive). 

Clearly a pension portfolio can be 100% equities and your overall position is less.  And it's the overall posture of investible assets that counts provided there is sufficient flex around within and between tax wrappers to rebalance and do what you need to do.

Hedging

Monevator this week has a subjective thought piece on hedging equities and bonds and whether we have the correct kind of currency in recent decades for this to be a good idea after costs. 

Prior discussion here has generally been sceptical of it for equities and a bit less so for bonds.

noitsnotme

Does your pension fund specifically state you can start drawing at 55?  If not, you won’t be able to until you’re 57 due the recent changes.