Fund Performance - Mobius Life Equity Accumulation

FireatWill

I’m hoping for some advice about my workplace pension fund. The pension is with Crestive Pensions and the underlying fund is Mobius Life Equity Accumulation. This was recommend as I had a higher risk appetite.

When looking at the performance over the two years since I joined, it appears to be returning quite a bit less than my Vanguard Lifestrategy 100% fund.

Can anybody with more knowledge on the subject give me any feedback on the fund? I am 39 with 20+ years left at work, so keen make sure I am doing the right thing.

many thanks

FireatWill

Apologies, the underlying funds might be useful:

TL&G Life N UK Equity Index Fund 16.2%

BLK Life AQC Emerging Markets Equity Fund 16.2%

L&G Life UPAK Future World UK Equity Fund 15.3%

L&G Life GPDC Future World (ex-UK) Developed Equity Index Fund 13.1%

L&G Life S North America Equity Index Fund 8.9%

L&G Life T Europe (ex UK) Equity Index Fund 8.5%

L&G Life EPAG Future World Europe (ex UK) Equity Fund 6.5%

L&G Life R Japan Equity Index Fund 5.9%

L&G Life JPAC Future World Japan Equity Fund 4.8%

L&G Life W Asia Pacific (ex Japan) Dev Equity Index Fund 2.8%

robatwork

Suspect the fees on your funds are a lot more than the Vanguard.

Personally speaking I think you also have too many funds. 5 or 6 can cover the entire world and a spead of types

Linton

FireatWill said:

Apologies, the underlying funds might be useful:

TL&G Life N UK Equity Index Fund 16.2%

BLK Life AQC Emerging Markets Equity Fund 16.2%

L&G Life UPAK Future World UK Equity Fund 15.3%

L&G Life GPDC Future World (ex-UK) Developed Equity Index Fund 13.1%

L&G Life S North America Equity Index Fund 8.9%

L&G Life T Europe (ex UK) Equity Index Fund 8.5%

L&G Life EPAG Future World Europe (ex UK) Equity Fund 6.5%

L&G Life R Japan Equity Index Fund 5.9%

L&G Life JPAC Future World Japan Equity Fund 4.8%

L&G Life W Asia Pacific (ex Japan) Dev Equity Index Fund 2.8%

Always when you feel your portfolio is underperforming look at what it is invested in.  This factor is far more significant than charges.  In your case you have something like:

UK - 32%
Europe (Ex UK) - 18%
North America -17%
EM+ Asia Pac - 20%
Japan - 12%

Which can be compared with VLS100:

UK - 22%
Europe (ex UK) - 12%
North America - 50%
EM+Asia Pac - 9%
Japan - 5%

So you can see your portfolio has an unusually small allocation to the US which has provided a large part of global growth in the past few years.

That is not to say your portfolio is necessarily  wrong - at some point in the future it could outperform VLS100.  But that point is not now.  However your allocations are certainly unusual.  If you want your returns to look more like those from VLS100 the I suggest you look for a single global fund if you can get one from Mobius Life.  The Mobius Life website gives virtually no information on its in-house funds.

A further point - 2 years results means very little.  Look again in 10 years time

Bostonerimus1

So I assume Mobius Life Equity Accumulation is a multi-asset fund and you've given us the constituent funds. It's performance relative to VLS100 will be determined by the funds they hold and the fees they charge. If you are not satisfied with you fund then change it. 

Do you know why your workplace chose the pension provider you mentioned? I get the feeling that fees might be a big part of the underperformance.

Bostonerimus1

mortgageFTB said:

Ooof 32% in the Uk?! And only 17% in North America... No wonder the performance is sub par.

UK should be closer to ~4.5%.
US should be closer to ~60% (~70% if you’re  just developed markets).

You’ve been missing out on fantastic US gains, with that low N.America allocation.

I’d strongly consider moving funds into a market cap weighted fund/ETF with low fees, likely either doing a substantial partial transfer out of your workplace pension into a SIPP elsewhere.

I just moved some money and didn't have to think about how to invest it as I did what I've been doing for the last couple of decades...60% into a Vanguard US Equity Index fund and 40% into a global equity index fund that does not include the US.The return on the US fund is far better than the international fund.

FireatWill

Thanks for all your replies. Very interesting and helpful!

I believe the fee’s are 0.75%.

There aren’t many fund options listed with Creative Pensions, which is the workplace pension provider. It appears I am stuck with the current heavy UK waiting which is frustrating to say the least.

FireatWill

mortgageFTB said:

Ooof 32% in the Uk?! And only 17% in North America... No wonder the performance is sub par.

UK should be closer to ~4.5%.
US should be closer to ~60% (~70% if you’re  just developed markets).

You’ve been missing out on fantastic US gains, with that low N.America allocation.

I’d strongly consider moving funds into a market cap weighted fund/ETF with low fees, likely either doing a substantial partial transfer out of your workplace pension into a SIPP elsewhere.

That’s really interesting. I didn’t realise that was an option! So I can transfer a proportion of the the value out of my workplace pension and setup a SIPP, with say Vanguard?

QrizB

FireatWill said:

So I can transfer a proportion of the the value out of my workplace pension and setup a SIPP, with say Vanguard?

Some pension providers will let you, some won't. I don't know anything about your provider so you'll have to check / ask.

dunstonh

Bostonerimus1 said:

mortgageFTB said:

Ooof 32% in the Uk?! And only 17% in North America... No wonder the performance is sub par.

UK should be closer to ~4.5%.
US should be closer to ~60% (~70% if you’re  just developed markets).

You’ve been missing out on fantastic US gains, with that low N.America allocation.

I’d strongly consider moving funds into a market cap weighted fund/ETF with low fees, likely either doing a substantial partial transfer out of your workplace pension into a SIPP elsewhere.

I just moved some money and didn't have to think about how to invest it as I did what I've been doing for the last couple of decades...60% into a Vanguard US Equity Index fund and 40% into a global equity index fund that does not include the US.The return on the US fund is far better than the international fund.

Was.  Not is.

And the first decade of the millennium, it would have been the other way around.   What is the next decade going to be?

JohnWinder

‘I believe the fee’s are 0.75%.

There aren’t many fund options ... It appears I am stuck with the current heavy UK waiting which is frustrating to say the least

Let’s acknowledge that one fund, any fund, can easily get higher returns than another by 0.6%/year; indeed 1 or 2%/year if the funds are different enough. But in cases where the funds are not a lot different we can’t be sure which will return 0.6%/year more.
When you pay 0.75%/year in fees instead of 0.15% you can be sure how much you’d be better off with one vs the other with respect to fees. That’s why it’s important to be respectful of fees and not focus purely on fund composition. You seemed not to do that, thus my comment.