HSBC FTSE 100 Index Tracker

eskbanker

Rich1234a said:

I appreciate everyone’s replies.  I was discussing investing some money with a friend and he said he has an hsbc ftse 100 index tracker and it had returned 11.8% in the last 5 years.  Some years it didn’t go up at all and other years it went up significantly.

I appreciate everyone’s feedback here and it seems like from a risk pov (I want lowish risk), it’s absolutely to the way to go.   I’ll have a read about some of the other options mentioned to me here.  Thanks again.

I don't know how you've managed to reach the above conclusion, when everyone has said the exact opposite, i.e. that investing solely in equities is emphatically not low risk!

Albermarle

Rich1234a said:

I appreciate everyone’s replies.  I was discussing investing some money with a friend and he said he has an hsbc ftse 100 index tracker and it had returned 11.8% in the last 5 years.  Some years it didn’t go up at all and other years it went up significantly.

I appreciate everyone’s feedback here and it seems like from a risk pov (I want lowish risk), it’s absolutely to the way to go.   I’ll have a read about some of the other options mentioned to me here.  Thanks again.

I would be wary of advice from friends, especially as the figures they mention are incorrect.
The FTSE 100 is 74% up in the last 5 years ( or on average nearly 15 % a year) , which is better than your friend said. 
However in the previous 5 years to that it went down about 5% (so on average 1% a year drop) 
From its peak in Jan 2000, it  only went  up 17% in 25 years, although you need to add dividends.

eskbanker

Albermarle said:

Rich1234a said:

I appreciate everyone’s replies.  I was discussing investing some money with a friend and he said he has an hsbc ftse 100 index tracker and it had returned 11.8% in the last 5 years.  Some years it didn’t go up at all and other years it went up significantly.

I appreciate everyone’s feedback here and it seems like from a risk pov (I want lowish risk), it’s absolutely to the way to go.   I’ll have a read about some of the other options mentioned to me here.  Thanks again.

I would be wary of advice from friends, especially as the figures they mention are incorrect.
The FTSE 100 is 74% up in the last 5 years ( or on average nearly 15 % a year) , which is better than your friend said. 
However in the previous 5 years to that it went down about 5% (so on average 1% a year drop) 
From its peak in Jan 2000, it  only went  up 17% in 25 years, although you need to add dividends.

Dividends do indeed form a very significant portion of total return on a FTSE 100 investment, so the HSBC tracker (in acc form) has grown by 107% over the last five years, albeit immediately after an 18% drop the previous year....

Any meaningful measurement of annual performance should be handled by working out compound annual growth rate rather than a simple average, so 74% growth over five years is more like 11.7% annually rather than 'nearly 15%', which is perhaps where OP's friend got the 11.8% figure from (if ignoring dividends!).

dunstonh

I appreciate everyone’s feedback here and it seems like from a risk pov (I want lowish risk), it’s absolutely to the way to go.  

Where have you got the impression is it low risk?
1) its high risk
2) its even higher risk when you hold it in isolation (its designed to be held in a wider portfolio and not in isolation)
3) its even higher risk as its limited to one part of the UK stockmarket (large cap) and not the whole UK stockmarket.

Your friend with the same fund is clearly not a good source of information unless they happen to hold the same fund but in a portfolio of other funds.  If they hold it in isolation, then they should be ignored as a source of quality information.

masonic

I guess some people just have to learn the hard way...

Ch1ll1Phlakes

Rich1234a said:

I appreciate everyone’s replies.  I was discussing investing some money with a friend and he said he has an hsbc ftse 100 index tracker and it had returned 11.8% in the last 5 years.  Some years it didn’t go up at all and other years it went up significantly.

I appreciate everyone’s feedback here and it seems like from a risk pov (I want lowish risk), it’s absolutely to the way to go.   I’ll have a read about some of the other options mentioned to me here.  Thanks again.

I think we've misinterpreted this. I think what they meant was "From the pov of "ok with risk", 100% in equities for example FTSE 100 tracker, is the way to go as higher risk can mean higher reward. But I want lower risk so I'll read about some of the options mentioned".

Maybe I'm wrong but I think this is want @Rich1234a meant.

Rich1234a

Thanks for everyone’s replies .. it was a typo I made … meaning, I understood it was NOT a low risk option.  Sorry for the confusion appreciate everyone’s advice.