Santander Multi Fund Index 1RA

Martyn_H

Is it worth hanging onto this fund as the performance has been very lacklustre over the past three years? What other low risk Santander funds should I be looking at?

(Sorry, this should be in the Savings & Investments section)

Thank you.

dunstonh

Is it worth hanging onto this fund as the performance has been very lacklustre over the past three years?

Its returns are relative to the underlying investments. It holds 85% in bonds, and a good chunk of that in gilts.    Gilts have just come off their worst period in over 100 years..

What other low risk Santander funds should I be looking at?

Risk is not as easy as that.   Indeed, by going too "low risk", you have actually increased the risk.       The risk levels are more about volatility 

Assets generally perform inline with their expected range (up or down) around 95% of the time.   5% of the time, they will performance outside of that.   In 2022, gilts had two events that fell within that 5%.     So, unusual to get 1 but very unusual to get 2.  Global events conspired to create a perfect storm for bonds, in particular gilts.

For context, a portfolio of 100% equities has doubled over the last 7 years.    However, a portfolio of 100% bonds is slightly into negative over 7 years.      Your chosen fund is 85% bonds.  

The fund itself with the underlying assets it has is not bad.  The fund is expensive but you expect that from a bank.  Santanders platform rate is 0.35% as well which is at the upper end too.     You are almost getting into low cost IFA territory without the benefit of an IFA  (low cost IFA would be cira 0.8x% all in and yours is 0.69%.  Quality DIY would on similar basis would be around 0.3x%)

However, the real issue is your choice to go extraordinarily low in equities and very high in bonds.   I think you need to have a serious think about your equity/bond ratio decision and then when are clear on what you should select, then look at alternatives.