Anyone Acting Defensively?

SouthCoastBoy

A large percentage of my equity investment is in a global tracker which is around 60 to 70 % us based, made crazy gains last few years, personally i cant see it lasting but who knows. I've got no plans to change it. I also hold around 730k in cash or stmm so that would keep me going for a while. 562k of that cash is outside a pension. Getting above 4% for my cash at the moment so hopefully just about keeping pace with inflation.

ukdw

I moved about 2 years worth of income into a cash fund a couple of weeks ago. Will probably use for a small annuity purchase 

NormalNorman

I've been building up CSH2 but still a small proportion overall. Couple of reasons. Plan on giving up full time work in the next few years so need a cash buffer of some sort and secondly should there be a meaningful dip in the market I can jump in.

Cobbler_tone

I'm 40% UK and World Equities, plus a target date plan which will have a tiny bit of equities. I've moved it around and had modest growth. Should maybe be heavier on equities but I don't have the appetite for bigger swings. Very happy considering the company contribution and fantastic tax breaks.
12 months to go but unsure of what I will do with it and not part of my main retirement plan. I'll either buy a FT annuity or draw it down over 5-6 years using UFPLS. Might depend on where the fund is at when I get there.

michaels

SouthCoastBoy said:

A large percentage of my equity investment is in a global tracker which is around 60 to 70 % us based, made crazy gains last few years, personally i cant see it lasting but who knows. I've got no plans to change it. I also hold around 730k in cash or stmm so that would keep me going for a while. 562k of that cash is outside a pension. Getting above 4% for my cash at the moment so hopefully just about keeping pace with inflation.

Surely with that much unwrapped cash, taxation of interest means you can't keep up with inflation?  Perhaps a linkers ladder biased towards low coupon bonds might be more efficient?

SouthCoastBoy

michaels said:

SouthCoastBoy said:

A large percentage of my equity investment is in a global tracker which is around 60 to 70 % us based, made crazy gains last few years, personally i cant see it lasting but who knows. I've got no plans to change it. I also hold around 730k in cash or stmm so that would keep me going for a while. 562k of that cash is outside a pension. Getting above 4% for my cash at the moment so hopefully just about keeping pace with inflation.

Surely with that much unwrapped cash, taxation of interest means you can't keep up with inflation?  Perhaps a linkers ladder biased towards low coupon bonds might be more efficient?

It is in cash isas, plus 100k in premium bonds which are tax free, we do have some cash outside an isa but not enough to go over the thresholds 

Secret2ndAccount

In July, I cashed in all of my STMM funds (£130k) and put the money into a mix of S&P500 and World Index. Up about 9% in <4 months so far; about 30% annualised rate of return.

SouthCoastBoy

Secret2ndAccount said:

In July, I cashed in all of my STMM funds (£130k) and put the money into a mix of S&P500 and World Index. Up about 9% in <4 months so far; about 30% annualised rate of return.

Yes, crazy isnt it, unsustainable in my view

Alexland

SouthCoastBoy said:

Yes, crazy isnt it, unsustainable in my view

There's a generation of investors who haven't experienced a long drawn out crash in equity markets or a sustained period where bonds outperform or the US doesn't outperform. Could lead to a decade of disappointment for some.

It feels great to be diversified right now.

There are other good things to invest in so we can sleep well while achieving our investment objectives.

Then as valuations change then we can rebalance into new opportunities.

Very nice and feels a lot less pressured than when equities were the only thing worth holding.

SVaz

If only we had a crystal ball, eh?
We’ve got £70k in stmm funds so could have made an extra £7k this year by keeping it in Global index tracker,  BUT, there could easily have been a major crash and lost £14k+ of the £70k that we need for income in 2027.  

Perhaps we should have directed our current contributions of £700 a month net into Fidelity index world instead of stmmf but I’d rather have certainty.