Sharia index tracker versus global (ethical) equity in workplace pension (USS)

swindiff

I just switched some of my investment builder from one fund to another.  If there was a charge I would have expected that to show in the transaction history, but there is nothing in there?

2nd_time_buyer

swindiff said:

I just switched some of my investment builder from one fund to another.  If there was a charge I would have expected that to show in the transaction history, but there is nothing in there?

I was wondering that too but I presumed they just take it out of the units bought/sold. Either way there is not an abundance of transparency. 

Linton

BlackKnightMonty said:

FIREmenow said:

BlackKnightMonty said:

You can get longer term projections on the NEST Sharia Fund here;

https://markets.ft.com/data/funds/tearsheet/holdings?s=GB00BFZNFH05:GBP

and here:

https://www.trustnet.com/factsheets/p/klls/nest-sharia-pn

Thanks, what I had in mind was backtesting how a portfolio of the top 100 global large caps would have performed over multiple 20 year periods in history, to come somewhere close to the Sharia fund's makeup. But I think that is beyond me and needs software subscriptions!

The FT link takes you back greater than ten years if the data is there. But you have to fiddle with the charts and choose ‘all’ years.

20 years ago was a very long time ago. The world is a very different place. Do you need such a lengthy perspective on a fund?

Yes because the the best performing companies/sectors/countries change over time  A sector cannot be top of the performance list indefinitely otherwise it would push out all other sectors.  The effects are particularly pronounced when prices in a sector are based on unjustifiable hopes rather than rational financial assessment. This leads to wild enthusiasm with followed by severe disappointment.

The problem with Sharia funds, particularly Sharia index funds, is that they are highly dependent on the tech sector since finance is contrary to the rules.

You need more than 20 years comparison data to avoid being misled by the medium term booms and busts.

 

FIREmenow

2nd_time_buyer said:

swindiff said:

I just switched some of my investment builder from one fund to another.  If there was a charge I would have expected that to show in the transaction history, but there is nothing in there?

I was wondering that too but I presumed they just take it out of the units bought/sold. Either way there is not an abundance of transparency. 

For my additional contribution last month, the transaction amount matches my pay slip, and the price and units given to 4dp suggest there was no fee. The unit figure is rounded up to 4dp. They can't embed a one-off cost in the unit price can they? If not, it suggests there was no fee on this transaction. This was the Ethical Equity fund.

Is it possible that some transaction costs are so negligible per person, that they would only levy them if either costs rise significantly or some funds had very low regular investment? If they have a flat transaction fee, might it not be worth the faff of calculating and passing this on to members, but they keep the option open by not quoting it and saying it could change at any time?

I'm keen to understand all this. Does anyone try to track their personal returns using a transaction history cross-referenced with fund performance graphs?

It seems the only way to easily get access to a fund's unit price is to buy some, or ask someone else who has if you've stopped contributing to it.

If the underlying funds can be changed at any time (and more so, if the split between multiple underlying funds can also change) how do they quantify what 1 unit of the USS fund is actually worth on an ongoing basis? Will they have more detailed records somewhere of the underlying units and valuations? When you get to retirement and they give you the final figures, how do you check them without this? This is melting my brain!

Related to this, does anyone know if USS is willing to attempt an in-specie transfer out for the funds or underlying funds that are also on the open market, then the rest would be cashed out? (not sure if any do match the version you would have access to in a sipp, so this might be a moot point meaning it would always be a cash transfer).

Cornish_mum

Hi Firemenow, it’s definitely possible to get a full transaction report, with every purchase amount, date and the unit price for what you bought as a xlxs. I downloaded ours a couple of years ago. I think it’s in the transaction sub menu on my USS.

FIREmenow

Hi Cornish_Mum,
Thanks, I have that but was querying whether you can easily check the live unit price to see how the funds are performing over time.

It looks like if you view the funds performance graph, it's possible to hover over each day and get the unit price, which is better than nothing!

slenderkitten

BlackKnightMonty said:

I can see some strong similarities with the UK NEST pension fund which offers a range of cautious to higher risk fund options.

You can only choose one fund. The best performing fund to date is the Sharia fund. It’s similar to yours in that it is less diversified and tech heavy.

It’s the fund I have chosen for my NEST and it is performing extraordinary well. (The fund went up 2.7% on Friday). No doubt tech is looking bubbly. But even with ups and downs I know that it is the best choice for me.

You can see a link to the latest report below. 27.2% growth over the last 12 months!

https://app.powerbi.com/view?r=eyJrIjoiODVlYjQ1YjItYzI0NS00OGM1LTkzYTMtNmUwM2U2MTg2OTZjIiwidCI6IjBhNzJmMDMyLTFkMDktNDU3ZS1iYTAyLWU1NjU2OTU0ODZjZiJ9

Thanks i've switched to the Sharia fund last week the balance jumped up £100 since then, when my pension had stalled the value didn't seem to change. Wish i knew about all this years ago.

FIREmenow

slenderkitten said:

BlackKnightMonty said:

I can see some strong similarities with the UK NEST pension fund which offers a range of cautious to higher risk fund options.

You can only choose one fund. The best performing fund to date is the Sharia fund. It’s similar to yours in that it is less diversified and tech heavy.

It’s the fund I have chosen for my NEST and it is performing extraordinary well. (The fund went up 2.7% on Friday). No doubt tech is looking bubbly. But even with ups and downs I know that it is the best choice for me.

You can see a link to the latest report below. 27.2% growth over the last 12 months!

https://app.powerbi.com/view?r=eyJrIjoiODVlYjQ1YjItYzI0NS00OGM1LTkzYTMtNmUwM2U2MTg2OTZjIiwidCI6IjBhNzJmMDMyLTFkMDktNDU3ZS1iYTAyLWU1NjU2OTU0ODZjZiJ9

Thanks i've switched to the Sharia fund last week the balance jumped up £100 since then, when my pension had stalled the value didn't seem to change. Wish i knew about all this years ago.

I personally wouldn't switch a whole pension pot to the Sharia fund. It only invests in 100 companies so is not diverse, and if the tech sector crashes that would have a huge impact as it's mostly made up of the big tech companies.

Every time your balance jumps up, bear in mind it could jump down just as quickly, it is a very volatile fund.

slenderkitten

FIREmenow said:

slenderkitten said:

BlackKnightMonty said:

I can see some strong similarities with the UK NEST pension fund which offers a range of cautious to higher risk fund options.

You can only choose one fund. The best performing fund to date is the Sharia fund. It’s similar to yours in that it is less diversified and tech heavy.

It’s the fund I have chosen for my NEST and it is performing extraordinary well. (The fund went up 2.7% on Friday). No doubt tech is looking bubbly. But even with ups and downs I know that it is the best choice for me.

You can see a link to the latest report below. 27.2% growth over the last 12 months!

https://app.powerbi.com/view?r=eyJrIjoiODVlYjQ1YjItYzI0NS00OGM1LTkzYTMtNmUwM2U2MTg2OTZjIiwidCI6IjBhNzJmMDMyLTFkMDktNDU3ZS1iYTAyLWU1NjU2OTU0ODZjZiJ9

Thanks i've switched to the Sharia fund last week the balance jumped up £100 since then, when my pension had stalled the value didn't seem to change. Wish i knew about all this years ago.

I personally wouldn't switch a whole pension pot to the Sharia fund. It only invests in 100 companies so is not diverse, and if the tech sector crashes that would have a huge impact as it's mostly made up of the big tech companies.

Every time your balance jumps up, bear in mind it could jump down just as quickly, it is a very volatile fund.

I don't think I can split it, i have it in the Nest scheme it only gave option to change the fund

BlackKnightMonty

You can’t split it in NEST, you can only pick one fund.

FWIW I think the tech boom has at least another 6 months of growth in it, certainly until the US election is concluded.

Is it a massive bubble or technology 5.0?

No one knows. I repeat, no one knows.

But huge sums are being made in AI (look at NVidia’s earning performance - actual earning and profit made - it’s breathtaking). Business is investing heavily in AI to streamline and tighten processes and data management. Data is everything.

So I suspect the latter. It looks to me like  a US onshore industrial boom akin to the 1960’s; and tech is in a transformative era. This isn’t a bunch of grads messing with VC money; it’s the real, mature, deal. The likes of Microsoft, Apple, Meta, Google, Amazon. These are the worlds biggest companies.

so I am happy to stick with the Sharia fund and chance my luck/judgement/timing.

caveat emptor!