Vangaurd life strategy 40

Adyinvestment

I have had my eye on a UK Gilt maturing 2046 paying 4.25%, which is now pretty much trading at parity.

Allowing for a bit of spread that would be approx. 4.2% guaranteed risk free for 23 years worst case scenario, however pre interest rates rise it usually traded 40-90% above where it is now. My thinking is that if interest rates go back down in the next few years this could turn out to be a decent investment...and if not 4.2% guaranteed isn't the worse outcome (unless we go into crazy inflation!)

JohnWinder

I don’t know, but here goes. The top of the yield curve is now at about 16 years (BoE site), higher yield and less long term risk than a 23 year bond that suggests.

The last 30-40 years of history shows long term bonds have not had a period longer than about 12 years when they’ve had a negative real return, so 23 years would be safe from loss to inflation if that continues.

metrobus

dunstonh said:

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It shouldn't be.   It should have bottomed out in October and rose a little since then but pretty wavy line but not going anywhere this year.

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

An economic cycle is around 15 years. That is the ideal minimum hold period.   In that time you will see approx 12 positive years and 3 negative years.    You have had the fund less than 2 years and one has been negative.

So, why you thinking you won't see growth?

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

Every investor on the planet has this issue.  And again, and again, and again.....
You know there would be negative years when you started investing? (one assumes you did a little bit of research)
So, when you get your first negative year, why are you surprised?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

What a load of crock.     Ignore them.  Clearly written by someone that either doesn't know what they are talking about or is being a troublemaker on purpose.

Totally meaningless if the losses in the 3 years is greater than profit in the 12.

Its the actual loss or profit in each year that counts not just that an individual year is one or the other..

Just look at the last 3 years 

InvesterJones

metrobus said:

dunstonh said:

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It shouldn't be.   It should have bottomed out in October and rose a little since then but pretty wavy line but not going anywhere this year.

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

An economic cycle is around 15 years. That is the ideal minimum hold period.   In that time you will see approx 12 positive years and 3 negative years.    You have had the fund less than 2 years and one has been negative.

So, why you thinking you won't see growth?

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

Every investor on the planet has this issue.  And again, and again, and again.....
You know there would be negative years when you started investing? (one assumes you did a little bit of research)
So, when you get your first negative year, why are you surprised?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

What a load of crock.     Ignore them.  Clearly written by someone that either doesn't know what they are talking about or is being a troublemaker on purpose.

Totally meaningless if the losses in the 3 years is greater than profit in the 12.

Its the actual loss or profit in each year that counts not just that an individual year is one or the other..

Just look at the last 3 years 

Have the losses of the last 3 years been greater than the profit of the previous 12?

GeoffTF

metrobus said:

dunstonh said:

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It shouldn't be.   It should have bottomed out in October and rose a little since then but pretty wavy line but not going anywhere this year.

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

An economic cycle is around 15 years. That is the ideal minimum hold period.   In that time you will see approx 12 positive years and 3 negative years.    You have had the fund less than 2 years and one has been negative.

So, why you thinking you won't see growth?

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

Every investor on the planet has this issue.  And again, and again, and again.....
You know there would be negative years when you started investing? (one assumes you did a little bit of research)
So, when you get your first negative year, why are you surprised?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

What a load of crock.     Ignore them.  Clearly written by someone that either doesn't know what they are talking about or is being a troublemaker on purpose.

Totally meaningless if the losses in the 3 years is greater than profit in the 12.

Its the actual loss or profit in each year that counts not just that an individual year is one or the other..

Just look at the last 3 years 

He bought a risk investment. He has to accept that he might lose money. He is down now, but he has excellent prospects of recovering his losses and making a profit, but that will take time.

metrobus

InvesterJones said:

metrobus said:

dunstonh said:

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It shouldn't be.   It should have bottomed out in October and rose a little since then but pretty wavy line but not going anywhere this year.

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

An economic cycle is around 15 years. That is the ideal minimum hold period.   In that time you will see approx 12 positive years and 3 negative years.    You have had the fund less than 2 years and one has been negative.

So, why you thinking you won't see growth?

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

Every investor on the planet has this issue.  And again, and again, and again.....
You know there would be negative years when you started investing? (one assumes you did a little bit of research)
So, when you get your first negative year, why are you surprised?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

What a load of crock.     Ignore them.  Clearly written by someone that either doesn't know what they are talking about or is being a troublemaker on purpose.

Totally meaningless if the losses in the 3 years is greater than profit in the 12.

Its the actual loss or profit in each year that counts not just that an individual year is one or the other..

Just look at the last 3 years 

Have the losses of the last 3 years been greater than the profit of the previous 12?

No but I could tell you thousands of investments that have, and the comment that was made was for investment performance in economical cycles and not this individual one.
So yes to say something goes up 12 times and down 3 is meaningless if no figures are given for those years.

masonic

metrobus said:

InvesterJones said:

metrobus said:

dunstonh said:

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It shouldn't be.   It should have bottomed out in October and rose a little since then but pretty wavy line but not going anywhere this year.

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

An economic cycle is around 15 years. That is the ideal minimum hold period.   In that time you will see approx 12 positive years and 3 negative years.    You have had the fund less than 2 years and one has been negative.

So, why you thinking you won't see growth?

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

Every investor on the planet has this issue.  And again, and again, and again.....
You know there would be negative years when you started investing? (one assumes you did a little bit of research)
So, when you get your first negative year, why are you surprised?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

What a load of crock.     Ignore them.  Clearly written by someone that either doesn't know what they are talking about or is being a troublemaker on purpose.

Totally meaningless if the losses in the 3 years is greater than profit in the 12.

Its the actual loss or profit in each year that counts not just that an individual year is one or the other..

Just look at the last 3 years 

Have the losses of the last 3 years been greater than the profit of the previous 12?

No but I could tell you thousands of investments that have, and the comment that was made was for investment performance in economical cycles and not this individual one.

I'd be interested to learn of any example of a mixed asset fund with 60+% bonds that has fallen further over a 3 year period than it returned in the previous 12 year period. Just one example would satisfy my curiosity.

metrobus

Your  reply was for economical cycles and nothing to do with the Vanguard LS 40 which is obvious since it had not been going even 12 years having its inception in June 2011.
Anyway this is irrelevant to the OP thread so I will leave it there.But remember past performance does not guarantee anything in the future and is totally meaningless also and that’s a school boy lesson.👍

masonic

metrobus said:

Your  reply was for economical cycles and nothing to do with the Vanguard LS 40 which is obvious since it had not been going even 12 years having its inception in June 2011.
Anyway this is irrelevant to the OP thread so I will leave it there.But remember past performance does not guarantee anything in the future and is totally meaningless also and that’s a school boy lesson.👍

I've not mentioned economic cycles in any of my replies, but clearly Vanguard LS 40 is subject to the influences of economic cycles and it is therefore reasonable to assume any replies directly quoting the OP and referring to economic cycles were made in relation to the thread topic. All of my responses in this thread have been on topic to the fund under discussion, including my request for an example of a related product which could demonstrate Vanguard LS 40 had the capacity to deliver a greater loss in 3 years than returns in the preceding 12 years. If you could identify such an example, then I'm sure it would be a learning point for anyone investing at the lower risk end of the spectrum, as typically the reason for doing to is to avoid such extreme loss cases.

Does this mean that none of the "thousands of investments" you know of that have fallen further in 3 years than they have grown in 12 were mixed asset funds of this type?

Beddie

Elum29 said:

Hi everyone,

I have had a LifeStrategy 40 fund since Nov 21 and you probably won’t be surprised to hear that it has steadily been dropping in value since day 1 

It is at this moment down by almost 12% and I’m now starting to wonder if and when I’ll ever start to see some growth on it. 

Does anyone else have experience with this sort of issue? Should I stick it out or look at getting out now?

I have done some Google rattling and have found quite a few different articles saying that if a fund is still not performing after 2 years then it’s best to cut and run. 

Still a few months yet before I hit the 2 year period but with things the way are I’m not very hopeful of a big recovery anytime soon. 

Any insight on this would be greatly appreciated. 

Liam. 

If it was the right choice for you then, it probably still is now. It's relatively quite low risk, so stick with it and see where you are after 5 years. If you cannot be that patient, then investing is probably not for you and you should stick to savings accounts.

I feel your pain, we all hate losing money, but you have to accept the ups and downs if you want the long term gains.