NEST Sharia - changes to fund.

BlackKnightMonty

Brie said:

why have you received this text?  are you already registered with NEST to be in a Sharia Fund?  

Frankly I didn't know there was a way to have a preference.  Then again my participation in NEST is unlikely to give me much more than enough to go to the chip shop when I retire in a year or 2. 

Yes, I am with NEST. I have over £30k built up in the Sharia fund.

Amoux

APWhiteSavvy said:

From someone on Reddit who just chatted with a NEST rep:

From November we'll invest around 30% of the Sharia Fund in sukuk. Sukuk are an Islamic version of bonds. The remaining 70% of the fund will continue to be invested in Islamic-compliant equities (i.e. company shares), following the same strategy as before.

This is what I assumed would be the case. I will probably switch to the Higher Risk fund in November as the asset allocation is now going to be about the same, but the HR fund is more diversified. 

I'm actually wondering if it's worth even having the auto-enrolment given the poor choice of funds. Putting my contributions in a better managed fund would probably outweigh any small contribution my employer makes. 

DE_612183

I thinking of transferring all out of Nest into something else - but not sure what yet - possibly one that's easier to manage online like L&G...

Andy_L

DE_612183 said:

I don't get how if the bonds don't receive interest how it is an investment?

AIUI Sharia forbids receiving interest on a loan (ie cash savings in a bank/BS that they then loan out aren't compliant) but allows investment returns since you are sharing both the risk of investing in the company & the rewards.

Arguably there's a bit of theological/financial sleight of hand in some Sharia products to make what would otherwise be interest by any secular measure look like an investment return instead

dunstonh

BlackKnightMonty said:

Universidad said:

BlackKnightMonty said:

NEST Sharia outperforms all other NEST funds, including high risk.

Has outperformed other NEST funds over the last few years.

I do worry about the number of threads where people are switching to a fund that has been performing well.

It's always nice to hit a good run, like various Sharia funds have had, but surely the point of index funds is not to worry about timing the market.

Pretty sure Sharia has outperformed all the other NEST funds since NEST was started in ~2011.

It would have been by far the worst fund in the NEST range over the decade before that though.

Its no surprise that a fund heavy in tech has done well in a period when tech has been the standout area.

BlackKnightMonty

dunstonh said:

BlackKnightMonty said:

Universidad said:

BlackKnightMonty said:

NEST Sharia outperforms all other NEST funds, including high risk.

Has outperformed other NEST funds over the last few years.

I do worry about the number of threads where people are switching to a fund that has been performing well.

It's always nice to hit a good run, like various Sharia funds have had, but surely the point of index funds is not to worry about timing the market.

Pretty sure Sharia has outperformed all the other NEST funds since NEST was started in ~2011.

It would have been by far the worst fund in the NEST range over the decade before that though.

Its no surprise that a fund heavy in tech has done well in a period when tech has been the standout area.

That would be truly quite the feat given NEST didn’t exist before 2008!

dunstonh

BlackKnightMonty said:

dunstonh said:

BlackKnightMonty said:

Universidad said:

BlackKnightMonty said:

NEST Sharia outperforms all other NEST funds, including high risk.

Has outperformed other NEST funds over the last few years.

I do worry about the number of threads where people are switching to a fund that has been performing well.

It's always nice to hit a good run, like various Sharia funds have had, but surely the point of index funds is not to worry about timing the market.

Pretty sure Sharia has outperformed all the other NEST funds since NEST was started in ~2011.

It would have been by far the worst fund in the NEST range over the decade before that though.

Its no surprise that a fund heavy in tech has done well in a period when tech has been the standout area.

That would be truly quite the feat given NEST didn’t exist before 2008!

The world didn't start in 2008.  We know the asset mix of Nest and from that we can tell how it would have broadly performed in past periods.

BlackKnightMonty

dunstonh said:

BlackKnightMonty said:

dunstonh said:

BlackKnightMonty said:

Universidad said:

BlackKnightMonty said:

NEST Sharia outperforms all other NEST funds, including high risk.

Has outperformed other NEST funds over the last few years.

I do worry about the number of threads where people are switching to a fund that has been performing well.

It's always nice to hit a good run, like various Sharia funds have had, but surely the point of index funds is not to worry about timing the market.

Pretty sure Sharia has outperformed all the other NEST funds since NEST was started in ~2011.

It would have been by far the worst fund in the NEST range over the decade before that though.

Its no surprise that a fund heavy in tech has done well in a period when tech has been the standout area.

That would be truly quite the feat given NEST didn’t exist before 2008!

The world didn't start in 2008.  We know the asset mix of Nest and from that we can tell how it would have broadly performed in past periods.

Lovely. Well - an interesting point - but somewhat redundant.

dunstonh

BlackKnightMonty said:

dunstonh said:

BlackKnightMonty said:

dunstonh said:

BlackKnightMonty said:

Universidad said:

BlackKnightMonty said:

NEST Sharia outperforms all other NEST funds, including high risk.

Has outperformed other NEST funds over the last few years.

I do worry about the number of threads where people are switching to a fund that has been performing well.

It's always nice to hit a good run, like various Sharia funds have had, but surely the point of index funds is not to worry about timing the market.

Pretty sure Sharia has outperformed all the other NEST funds since NEST was started in ~2011.

It would have been by far the worst fund in the NEST range over the decade before that though.

Its no surprise that a fund heavy in tech has done well in a period when tech has been the standout area.

That would be truly quite the feat given NEST didn’t exist before 2008!

The world didn't start in 2008.  We know the asset mix of Nest and from that we can tell how it would have broadly performed in past periods.

Lovely. Well - an interesting point - but somewhat redundant.

I disagree with it being somewhat redundant.   Knowledge of your downsides and upsides is key to investing.      If you invest only thinking about the upside and not the downside, then you are in for a rude awakening.

Ivkoto

If I am not wrong it tracks Dow Jones Islamic Market Titans 100 Index. The index has been launched 30.12.1995 and since then, the annualised return is 11.9% ( not bad )
The technology sector is almost half of the fund.
How bad it will perform I don't know, but I doubt there will be similar event, like dot com crash.