Savings or investing?

VXman

Savings rates are getting reasonable now and my investments aren't doing much. 

Wondering whether sticking money in a savings account is the best option at the moment. It's ok, I'm not considering taking the money from the investments yet! Talking about additional non invested cash.

So what would you do with £20000 ISA allowance this year - cash or S&S?

(Assuming no short term need for the cash but not looking at long term investment anyway - too old for that!)

Beddie

If you are sitting on the fence about what to do - £10,000 in each perhaps?

Swipe

VXman said:

Savings rates are getting reasonable now and my investments aren't doing much. 

Wondering whether sticking money in a savings account is the best option at the moment. It's ok, I'm not considering taking the money from the investments yet! Talking about additional non invested cash.

So what would you do with £20000 ISA allowance this year - cash or S&S?

(Assuming no short term need for the cash but not looking at long term investment anyway - too old for that!)

I currently have this year's £20K ISA in a money market fund but I do have more than enough invested for retirement so I figure why take the extra risk while I can get decent rates right now?

GazzaBloom

Cash savings rates are still well below the rate of inflation - 5 or 6% is nothing to get all gooey over.

What are you invested in? Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

Swipe

GazzaBloom said:

Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

35% YTD is impressive until you look at the 2YTD

GazzaBloom

Swipe said:

GazzaBloom said:

Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

35% YTD is impressive until you look at the 2YTD

I make it 12.8% gain over last 24 months July 2021 to June 2023. That's way better than any interest rates on cash.

 Personally, I only really get interested the 10 year performance, which is still a bit short term for me, I wish there was 20 & 30 year performance history easily available for funds, well the ones that have endured that long that is...

Doshwaster

Swipe said:

GazzaBloom said:

Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

35% YTD is impressive until you look at the 2YTD

Another problem with that fund is that it isn't very diverse - almost 50% is Apple, Microsoft, Google (Alphabet) and Facebook (Meta)

https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F0GBR06I57&tab=3

All companies which are capable of making a lot of money but which are at risk of being overvalued and liable to lose a lot especially if the tech sector becomes more strictly regulated.

Millyonare

Depends on one's timeline and one's tax band. A 45% taxpayer with a 5.2% cash ISA for 3 years is effectively "guaranteed" 9-10% gross. Makes things much more attractive.

For me, I'd do a hybrid. Put half in a cash ISA at 5.2%, and half in a US or Global tracker S&S ISA.

Not advice, etc.

GazzaBloom

Doshwaster said:

Swipe said:

GazzaBloom said:

Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

35% YTD is impressive until you look at the 2YTD

Another problem with that fund is that it isn't very diverse - almost 50% is Apple, Microsoft, Google (Alphabet) and Facebook (Meta)

https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F0GBR06I57&tab=3

All companies which are capable of making a lot of money but which are at risk of being overvalued and liable to lose a lot especially if the tech sector becomes more strictly regulated.

Another problem? Is volatility a problem?

Some people may not see that concentration (which is market cap weighted) as a problem and actually desire holding that group of stocks.

After all, It's a technology fund, the name is on the tin, it's not trying to be a fully diversified multi-asset fund is it?

 

VXman

GazzaBloom said:

Cash savings rates are still well below the rate of inflation - 5 or 6% is nothing to get all gooey over.

What are you invested in? Some stocks and shares funds are up 35% YTD:

Fund Performance|Total Returns|Legal & General Global Technology Index Trust I Class Accumulation|ISIN:GB00B0CNH163 (morningstar.co.uk)

Not invested in pure shares. Not enough knowledge and too risky for me. Current investments are Vanguard LS and HL UK fund. These haven't even recovered from dips in the last year or so yet. I realise it's not touching inflation but it's a better return than any of my investments.

I'm 61, already been retired for 3 years so long term is pointless. I'm just looking for places to put my money (£150K) for immediate use or short term savimgs, some to put aside for 3/5 years. 10 years max.

InvesterJones

Yeah 3-10 years is probably too short a time frame for a volatile fund, which the L&G Tech one would probably class as with a 3yr std deviation of over 20% (for comparison, a GBP denominated S&P 500 tracker has under 13% 3yr std deviation).

3-5yr time frames are decidedly medium to short term investments and I'd want to add bonds into the mix (especially at the moment) to dampen down the volatility. You might not beat inflation in the short term, but you're minimising the inflation loss, rather than having to take it AND wait for volatility to average out over a long time period.