Worth using a Discretionary Fund Manager?

poseidon1

Beddie said:

"I would describe myself as very cautious just now"

That probably means you are not really suitable for stock market investments. But if you would like to dabble, maybe move £5/10k into an S&S ISA yourself. I wouldn't use that adviser company personally. Some would, as they value the support, but if you can go it alone it'll be much cheaper.

As mentioned above, iweb is cheap and part of Lloyds Bank, so a reliable choice.

Something like HSBC Global strategy might be suitable, as you can choose differing risk levels:

https://www.hsbc.co.uk/investments/products/hsbc-global-strategy-portfolios/

You can hold these funds in iweb.

Thanks for highlighting the HSBC strategy funds in the multi asset space. Must admit, although having in the past utilised ( profitably) HSBC' s ftse 100 and 250 tracker funds, their multi asset strategy funds had previously escaped my notice.

On the back of other  favourable endorsements of the strategy funds, and their respective track records, I have rotated some Fundsmith Equity monies into each of HSBC's  Dynamic and  Adventurous strategies. These seem more in keeping with my appetite for risk, with the Balanced strategy seeming just a bit too tame in its objectives. Have lit the touch paper,  will now stand back  see how they do in the next 3 to 5 years compared to the past 5 years for Fundsmith.

Apologies for having highjacked the OP's thread with this disclosure, but does illustrate how issues raised in one aspect of investing, can assist someone in another.

Thanks again👍

Alexland

poseidon1 said:

On the back of other  favourable endorsements of the strategy funds, and their respective track records, I have rotated some Fundsmith Equity monies into each of HSBC's  Dynamic and  Adventurous strategies. These seem more in keeping with my appetite for risk, with the Balanced strategy seeming just a bit too tame in its objectives. Have lit the touch paper,  will now stand back  see how they do in the next 3 to 5 years compared to the past 5 years for Fundsmith.

The sweet spots in the the HSBC GS range are the Balanced for less than 10 years and Dynamic for over 10 years assuming the customer is happy with the likely volatility profile.

For the cautious or conservative then my view is that for now you might as well stick to a money market fund or cash savings account unless you want to take a bet on the direction of exchange or interest rates.

For the Adventurous which is around 90% equities then I think you might as well go 100% equities with a global tracker for almost half the price like Fidelity Index World (if you don't want EM) or HSBC FTSE All World (if you want EM).

truescot

Hey everyone, just thought I'd jump back on to update that I have spent the last few weeks (when life has allowed) reading and rereading various posts on this and other related threads, watching videos, reading websites, listening to podcast etc to get my head round some of the basics of investing and trying to work out the best approach for me. Where I am for now;

• My initial comments of being "very cautious" I now realise was less related to risk, and more related to a unwillingness to jump into something I feel I don't know enough about, but being reluctant to pay for who does (unnecessarily) 
• I have decided to definitely not use the DFM at Wealth at Work but the conversations i have had with him have helped my understadinng.
• With an investment period of 10years plus for this particalur 40k, I am going to keep my own and my wifes annual ISA allowance in their high rate cash ISAs at the current time, possibly until next financial year, then move one or both into a (probably HSBC or Vanguard) Global Index Fund with a balanced risk profile. I will then set up regular contributions to both going forward.
• I will be keeping a sensible emergency/nice living fund in the highest rate easy access savings accounts, ensuring I am maximising this between myself (high rate tax payer) and my wife (basic rate)
• I will also take the next few weeks and months to continue to educate myself and decide whether the above is sensible whilst still enjoying life!

One last thing - one of the ISAs is on the Trading212 platform, and as I like to keep things simple, I am considering using it as my investment platform if and when I do take the plunge, especally due to the low fees. Any comments around that?

Albermarle

truescot said:

Hey everyone, just thought I'd jump back on to update that I have spent the last few weeks (when life has allowed) reading and rereading various posts on this and other related threads, watching videos, reading websites, listening to podcast etc to get my head round some of the basics of investing and trying to work out the best approach for me. Where I am for now;

• My initial comments of being "very cautious" I now realise was less related to risk, and more related to a unwillingness to jump into something I feel I don't know enough about, but being reluctant to pay for who does (unnecessarily) 
• I have decided to definitely not use the DFM at Wealth at Work but the conversations i have had with him have helped my understadinng.
• With an investment period of 10years plus for this particalur 40k, I am going to keep my own and my wifes annual ISA allowance in their high rate cash ISAs at the current time, possibly until next financial year, then move one or both into a (probably HSBC or Vanguard) Global Index Fund with a balanced risk profile. I will then set up regular contributions to both going forward.
• I will be keeping a sensible emergency/nice living fund in the highest rate easy access savings accounts, ensuring I am maximising this between myself (high rate tax payer) and my wife (basic rate)
• I will also take the next few weeks and months to continue to educate myself and decide whether the above is sensible whilst still enjoying life!

One last thing - one of the ISAs is on the Trading212 platform, and as I like to keep things simple, I am considering using it as my investment platform if and when I do take the plunge, especally due to the low fees. Any comments around that?

then move one or both into a (probably HSBC or Vanguard) Global Index Fund with a balanced risk profile. 

A global index fund is 100% equity, so has a quite high risk rating.

For a balanced risk profile you need a multi asset fund that only contains around 60% equities.

Eyeful

As he does mentions a balanced risk profile, I think he actually means a low cost passive low cost Global Multi Asset Fund.
Like the HSBC Global Strategy Balanced Portfolio.

truescot

Eyeful said:

As he does mentions a balanced risk profile, I think he actually means a low cost passive low cost Global Multi Asset Fund.
Like the HSBC Global Strategy Balanced Portfolio.

Yes that's exactly what I meant thanks. Still getting used to the various terms 🤣.

Does what I suggest sound reasonable?. I appreciate there is no right or wrong.

Eyeful

It sounds reasonable to me.

Those that sell you the stuff, want to make it complex and encourage you to keep changing things, that's how they they make their money from you.
 All that does in the long term is to transfer a large chunk of your money into their pockets.
Keeping things simple, puts you in control, lowers costs and lets you get on with life.

Or as Jack Bogle (who started Vanguard) puts it:
The investment industries motto is " Don't just stand there, do something! "
My motto is " Don't do something, just stand there! "

For the investor without knowledge, time or inclination to learn about investing, picking a low cost passive Major Global Index Fund or ETF will put them ahead of many active funds with their higher charges & fees, run by professionals.

Choosing a Multi Asset fund with a share/bond split at a level they are comfortable with, will hopefully encourage newbies to not panic and sell when large falls in the markets occur or as they watch the ups & down swings of the share prices.