CGT and CGAR (wealth draining not preservation)

CheekyMikey

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss…I’m putting the money into a one year 6% fixed bond to at least recoup that capital loss. Conditions aren’t right for those WP funds to pick up anytime soon so better to take a guaranteed return than watch my money at best flatline but probably dwindle in the next 12 months

aroominyork

CheekyMikey said:

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss…I’m putting the money into a one year 6% fixed bond to at least recoup that capital loss. Conditions aren’t right for those WP funds to pick up anytime soon so better to take a guaranteed return than watch my money at best flatline but probably dwindle in the next 12 months

Would you like to explain this?

CheekyMikey

The economic environment which has led to the decline in these funds will not dramatically change over the next year, certainly not enough to see them recoup that loss…just my opinion.

aroominyork

I wouldn't totally lump them together. Although they are the purest, IMO, of the WP funds, they invest very differently and while CGT/CGAR has had a torrid year (esp the former moving from premium to discount), Trojan has suffered much less. Anyway, hearing more of why this economic environment is bad for WP funds would be interesting. 

Albermarle

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss

As said by @aroominyork, Trojan X has held up pretty well, so not sure how you made a 6% loss, unless you mean that was your overall loss of the two funds?

As of today Trojan X is only 2% down over the last 12 months, flat over two years and 9% up over 3 years.

CheekyMikey

Albermarle said:

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss

As said by @aroominyork, Trojan X has held up pretty well, so not sure how you made a 6% loss, unless you mean that was your overall loss of the two funds?

As of today Trojan X is only 2% down over the last 12 months, flat over two years and 9% up over 3 years.

Yes, down nearly 6% across both since I bought them early last year…Trojan down 2, CGAR down 7.5. My belief remains that getting a guaranteed return of 6% over the next 12 months is a better strategy than sitting tight with either of them. If interest rates had been 6% 17 months ago I wouldn’t have considered them at all…

Albermarle

CheekyMikey said:

Albermarle said:

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss

As said by @aroominyork, Trojan X has held up pretty well, so not sure how you made a 6% loss, unless you mean that was your overall loss of the two funds?

As of today Trojan X is only 2% down over the last 12 months, flat over two years and 9% up over 3 years.

Yes, down nearly 6% across both since I bought them early last year…Trojan down 2, CGAR down 7.5. My belief remains that getting a guaranteed return of 6% over the next 12 months is a better strategy than sitting tight with either of them. If interest rates had been 6% 17 months ago I wouldn’t have considered them at all…

It is a judgement call that may be right or wrong. In the next 12 months the funds may go up more than 6%, or not.

CheekyMikey

Albermarle said:

CheekyMikey said:

Albermarle said:

I’ve bitten the bullet and sold down my CGAR and and Trojan X holdings today at a 6% loss

As said by @aroominyork, Trojan X has held up pretty well, so not sure how you made a 6% loss, unless you mean that was your overall loss of the two funds?

As of today Trojan X is only 2% down over the last 12 months, flat over two years and 9% up over 3 years.

Yes, down nearly 6% across both since I bought them early last year…Trojan down 2, CGAR down 7.5. My belief remains that getting a guaranteed return of 6% over the next 12 months is a better strategy than sitting tight with either of them. If interest rates had been 6% 17 months ago I wouldn’t have considered them at all…

It is a judgement call that may be right or wrong. In the next 12 months the funds may go up more than 6%, or not.

Of course, it’s always a judgement call…given CGAR 5 year annualised return is 3.6% there’s a good chance it won’t return 6% imo as economic conditions are unlikely to significantly alter much to those in which it has struggled, unless something very dramatic happens. The only thing I can know and control for sure is the fact I can have another £6k in my account this time next year if I move to fixed rate deposit so we’ll see…

Linton

If you are going to sell your investments on the basis of 1 bad year I suggest you don’t invest at all but stick to cash savings. A necessary requirement for successful investing is to think long term. You will get some moderately bad years but should get. more good years over say 5 years with a WP fund. Switching on the basis of the previous 12 months history is a good way to lose money as you experience the falls and crystallise your losses but miss out on the subsequent rises.

phillw

Linton said:

A necessary requirement for successful investing is to think long term.

Another requirement is knowing when to cut your losses and to move to something with a better long term future.