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Worth using a Discretionary Fund Manager?
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You will have to assess the suitability for yourself but I am also a fan of the HSBC GS multi-asset series particularly the Balanced version which offers a good blend of equities and bonds. It might still drop around 30% in a bad stock market crash. Hopefully you will build up some gains before that happens but you never know something might go wrong in the world the day after you invest.
I am also a fan of iWeb as a basic but inexpensive platform with no ongoing charge owned by Halifax (Lloyds Banking Group) who as we know are too important to be allowed to fail (again...). If you do not need the income then go for the Accumulation version of the fund to avoid you needing to pay iWeb extra £5 trades to reinvest distributions/dividends. You could just pay £5 each once and not pay them again for years until you need to sell some/all the fund units.1 -
Alexland I agree, that's why at point 5 I suggests a Global Multi Asset Fund,
With these when they buy them, they could chose to go in at the cautious level with that level of bonds & shares as explained in the video of point 4.
If they do not want to hold the investment for at least 10 year, then they should just stick to a cash ISA & not invest at all.2 -
For the OP if you do think of going into Global Multi Asset Funds, start by taking a look at these two :-
https://www.hsbc.co.uk/investments/products/hsbc-global-strategy-portfolios/#balanced
https://www.vanguardinvestor.co.uk/investing-explained/what-are-lifestrategy-funds?intcmpgn=lifestrategyfunds_learnmore_li:-1:
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Eyeful said:Alexland I agree, that's why at point 5 I suggests a Global Multi Asset Fund,Eyeful said:With these when they buy them, they could chose to go in at the cautious level with that level of bonds & shares as explained in the video of point 4.
Market outlook for cash rates is that they will remain at similar levels to current even if they do drop a little. I don't see how a cautious fund would be likely to outperform either cash or money market rates unless interest rates dropped materially again but then could underperform if rates increased. It would be more of a bet on the future direction of rates.
If investing and taking a conscious decision to accept risk and volatility for the possibility of a better return than cash there doesn't seem much point going for anything lower than balanced risk level.
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The OP say they are "very cautious" and seem to not know about investing. So the cautious level, seems to me might be what they might be happy with, to get them into investing rather than just saving. They can always later change the level of share/bond split if they so wish.1
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I would describe myself as very cautious just now,
OP- You need to think about your attitude to risk in more depth.
In the world of investing being too cautious is a risk in itself, especially if you are investing for the long term.
Avoiding high risk options is fine if you are not that way inclined. The majority of individual investors tend to go for medium risk funds.
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eskbanker said:ChilliBob said:For a cheap and no frills platform I'd say iweb might be good - £100 to open but nothing extra per year. Dealing costs are £5. So whilst year one cost may seem steep when averaged out over subsequent years it's very cost effective.Open a new account with IWeb between 1 September 2023 and 31 December 2024 and you’ll pay no account opening charge, that’s a saving of £100. Offer terms applyhttps://www.iweb-sharedealing.co.uk/0
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Albermarle said:I would describe myself as very cautious just now,
OP- You need to think about your attitude to risk in more depth.
In the world of investing being too cautious is a risk in itself, especially if you are investing for the long term.
Avoiding high risk options is fine if you are not that way inclined. The majority of individual investors tend to go for medium risk funds.
As bizarre as it sounds "I'm very cautious" and "I'm 100% cash". (as an example, not saying this is you) are two statements that don't really tally in the long term.0 -
The OP may find this video of interest to them:-
https://www.youtube.com/watch?v=lGQ9KyQq8Jw&list=PLGBVJB1zelfHkrsUSY-ysS6BTTYDlmZud&index=5
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OP I think you should be using your 40k to make extra pension contributions and maybe also fund an ISA. This will give you flexibility and withdrawal options and also be tax efficient. You don't need a DFM IMO and one would probably end up being expensive in fees. You can essentially get the services of a DFM by investing in one of the large number of multi-asset funds available from companies like Vanguard and HSBC etc. So take some time to educate you self about the basics of investing, don't make things more complicated than necessary; just learn about the tax advantages of pensions, SIPPs and ISAs and understand about the various types of investment funds available. Don't be tempted to think that you can pay for success or that complicated strategies and portfolios will necessarily perform better than simple investments.And so we beat on, boats against the current, borne back ceaselessly into the past.4
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