Post #3 Which fund to choose? Screens attached

MX5huggy

@FatFred66 all very interesting but “cheapish” was a reference to the AMC charge at 0.35% compared to the other options here. 

I’m in the global tracker camp as long as it’s cheap to hold. Markets are efficient, I can’t guess the market I don’t know if HSBC will be better than Apple the market says Apple will I’ll go with the market, but have a bit of HSBC as well. 

FatFred66

@FatFred66 all very interesting but “cheapish” was a reference to the AMC charge at 0.35% compared to the other options here. 

I realised that. It's pretty irrelevant when the fund's dominated by stocks which are trading at many multiples of their actual value, and which value is just magnified by them being included in every market cap weighted tracker fund.

I've nothing against global funds, and not really much against tracker funds in general, but the influence of those 7 overpriced stocks on the investment portfolios of all of us is a bit concerning.

81% of that 'global' fund is invested in the US and 40% of it with just 7 (overpriced) companies. That's not the level of diversification you're looking for from a global fund.

Qyburn

What's wrong with the Legal and General "Global Equity Index" funds, for example ...
https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000UGZO

LHW99

Of the ones offered I'd go with 2 - As a UK investor and likely to remain here, I can tolerate 30% in the country.

1. has too much UK for me

3. Has a highish charge, and IMO rather a lot of US

4. Is OK, but I wouldn't personally want a large proportiion of my pension in Emerging Markets

The Islamic one has a very high US proportion, so you are definately betting that the US is the place to be over the next decades. It may be, but again it may not.

All my personal opinion only.

Babystep7

@MX5huggy

Also just for clarity, here is my current fund. But I don't think I can select this 1 as this is specific to my employer. I think they may have selected this when swapping to L&G. And the other pension which was transferred over to L&G, doesn't have this fund option available for me to select. Is this also a bad fund?

Thanks again

Rich

Albermarle

Is this also a bad fund?

It is basically the second fund you highlighted diluted by a couple of smaller ones.
It is up 30% in 5 years which could be worse.

I think in the end you have a choice .
Stick with this one or the second fund you highlighted. You should get some reasonable growth without too many wild swings.
Or go with the sharia fund that has increased by 80% in 5 years. It might do the same again in the next 5 years but probably at some point there will be some scary correction.
Your choice now.

noclaf

I have the same Sharia fund in my work pension which is also L&G...some of the fund choices are bizarre to be honest and it seems many of the active funds which are pricey and haven't performed too well are being removed later this year however the passive options have some strange allocations similar to those you posted e.g: 30% allocated to the UK.

If you have 25 years to retirement you can afford to take relatively higher risk and reap the rewards. I have anywhere from 16-20 years and the Sharia fund currently represents less than 8% of my overall pensions value though will increase each month. I am happy to ride out the bumps with this fund as can buy more units when the price dips due to monthly employer+ my sal sac contributions. Just be aware it will be a choppy ride with this fund!

Albermarle

 however the passive options have some strange allocations similar to those you posted e.g: 30% allocated to the UK.

If you look at the pension/default funds of the traditional providers ( eg L&G, Standard Life, Aviva, Scottish Widows etc) you will normally see a lot of home bias/ high UK %.

I think historically this was seen as normal, partly because the man in the street was a bit suspicious of foreign investments. There are also some more rational arguments in favour of a high UK component ( a matter of debate ) and not all the UK % will be equity of course in a multi asset fund.

gm0

With a restricted range you won't be offered all the ones you want in situ and it may be appropriate to talk to your trustees if something obvious and simple is indeed missing - such as a global developed markets passive tracker. 

L&G do developed global markets passives.  Which are not materially better or worse than others which track the same indices to 0.5%.  This requires careful reading of fact sheets and trustnet etc. for matching ISINs.

They do exist in the Worksave Master Trust employer pension scheme universe but the fund lists per scheme are unique to the scheme and the customer trustees who set it up.  So questions about adding "missing" items should be addressed to the trustees - along the lines of we don't have a cheap global developed markets passive - why not ?

As examples:  We get:

L&G World Ex UK Equity Index (a global developed stocks index tracker less the UK). 

L&G UK Equity Index - is a UK FTSE All Share tracker

So can make a "home market bias" to taste from at weight to any value you like - for global developed markets indices with those two funds.

And you can add the EM one if so desired.  I have some and am not a fan so far. 
But when different countries move around again my Korean holdings elsewhere (currently up a lot from 2022) may tank.  And my small experiment in the L&G EM fund and its coverage may (or may not) recover some ground. 

L&G Multi-Asset 3 is another choice which is a "one and done" - bonds/alts/FI credit stuff and equities all in one fund.  I would not use it in accumulation at a young age - not enough equities for my risk appetite.  

I bought some of that in February 2022 which was not the best decision I have ever made as the falling bond knife was still falling.  But my true investment horizon is a lot longer.  So I will keep it as I planned for some years and assess then.

I don't especially like the various more complicated L&G funds which are spins on Future World and ESG and such like as they often involve opaque indices, and FX hedging and blended benchmarks.  Failing the keep it simple test.  And a number of them quite new and unproven.