More structure in SIPP Portfolio 10 years to go

7_year_mission

Longtime reader first time post I think.    I have 10 years to go till retirement and I have been looking to restructure my investments.  I currently have an odd mixture in SIPP that have evolved through me dabbling, they is a reason and research behind each one.   At the end of 2025 I realised a more serious approach was needed and some protection and structure to my current portfolio was needed.

Current scenario - No real strategy or structure over 34 investments trusts, funds, and individual shares that delivered 14.8% last year.

New Scenario – Creating a 70/30 Portfolio that is offers some balance and protection to a core of Growth and Value investments and then some accelerators to boost growth on areas I believe have the capacity to perform well in 2026.

·        Global CORE  35%  (FCIT, Vanguard Global All Cap Index)  - Work in Progress

·        Value/Special 20%   (SMT, CTY, AGT, MYI, Oakley Capital)  - Work in Progress

·        High Alpha 15% Biotech (Polar Capital and RTX 8%) – DONE (EM India and China – Work in Progress)  

·        Defensive 30% (Aegon Absolute Return, PNL, CGT, RL Short term) – DONE

As you can see a big tilt into Private Equity and Biotech and EM.   Also, I think when diving deeper looking through the investments, I will see some significant overlap in EM, Private Equity, and some heavy concentrations in individual companies which I am looking to iron out.  This will be my task over the next 2 weeks is to define the invests and check overlaps etc…

Value about 400k to date, contributions likely to average 30k per year based on current salary and role.

Firstly thoughts are welcome on the above, now I have created a more defensive part I am going to take my time to restructure and change the rest, and yes it crosses my mind daily that I am maybe trying to hard and a simpler setup of investments would deliver similar returns, polite thoughts welcome.

Bobziz

What kind of return are you looking for/do you need to achieve 'Your number' and how much risk do you think you need to take ? 

7_year_mission

Bobziz said:

What kind of return are you looking for/do you need to achieve 'Your number' and how much risk do you think you need to take ? 

Thanks I would be looking to 6.5% but potential out perform based on high alpha topics 

Bostonerimus1

What's wrong with a single multi-asset fund?

7_year_mission

The multi asset fund was an option, another was simply something Like HSBC Dynamic Strategy or just something like FCIT or ALW.   But the goal is to have the defensive side to counter downturn and allow me to deploy not timing the market.   I also think that I can seem some significant growth this year with the Biotech and PE theme.   Which will hopefully drive high total growth over the year.    When I say 6.5% that is an number I could live would I really want to push performance and shave time off my plan...   

Bobziz

Is that 6.5% real or nominal ?

What benefit do you see from your defensive picks over say a combination of a short dated gilt fund and an intermediate gilt or global aggregate bond fund ?

7_year_mission

Bobziz said:

Is that 6.5% real or nominal ?

What benefit do you see from your defencive picks over say a combination of a short dated gilt fund and an intermediate gilt or global aggregate bond fund ?

On the defensive picks these offered the protection I wanted short term but I will explore what you are suggesting from a gilt and bond perspective as slightly newer ground for me.   These initial defensive moves may evolve by the end of 2026, based on some better understanding.    I am looking at real return over 10 years.

I am not ruling out simplicity and not ruling out taking more risk at the right time.  

Linton

7_year_mission said:

Longtime reader first time post I think.    I have 10 years to go till retirement and I have been looking to restructure my investments.  I currently have an odd mixture in SIPP that have evolved through me dabbling, they is a reason and research behind each one.   At the end of 2025 I realised a more serious approach was needed and some protection and structure to my current portfolio was needed.

Current scenario - No real strategy or structure over 34 investments trusts, funds, and individual shares that delivered 14.8% last year.

New Scenario – Creating a 70/30 Portfolio that is offers some balance and protection to a core of Growth and Value investments and then some accelerators to boost growth on areas I believe have the capacity to perform well in 2026.

·        Global CORE  35%  (FCIT, Vanguard Global All Cap Index)  - Work in Progress

·        Value/Special 20%   (SMT, CTY, AGT, MYI, Oakley Capital)  - Work in Progress

·        High Alpha 15% Biotech (Polar Capital and RTX 8%) – DONE (EM India and China – Work in Progress)  

·        Defensive 30% (Aegon Absolute Return, PNL, CGT, RL Short term) – DONE

As you can see a big tilt into Private Equity and Biotech and EM.   Also, I think when diving deeper looking through the investments, I will see some significant overlap in EM, Private Equity, and some heavy concentrations in individual companies which I am looking to iron out.  This will be my task over the next 2 weeks is to define the invests and check overlaps etc…

Value about 400k to date, contributions likely to average 30k per year based on current salary and role.

Firstly thoughts are welcome on the above, now I have created a more defensive part I am going to take my time to restructure and change the rest, and yes it crosses my mind daily that I am maybe trying to hard and a simpler setup of investments would deliver similar returns, polite thoughts welcome.

SMT is very highly "Growth" oriented (36% Tech) with minimal Value holdings and a recent history of significant volatility.  So very different to CTY, AGT and MYI.  You could say its alpha of around -4  is low but this means high alpha in the wrong direction! 

I dont see much point in holding both FCIT and VGAC - their asset allocations are pretty similar as is their performance graph. 

RTX  (formerly Raytheon and United Technologies) would appear to be a US aerospace and defence company with nothing to do with biotech.  Perhaps I have the wrong investment.  If this is the one it would seem to be a rather strange choice (or perhaps not after recent events) and as an individual company very different to your more diversified funds.

I would not include India and China in the same category as Polar Biotech and RTX as they represent the 2nd and 4th largest markets in the world.  They should perhaps be a tilt to the core holdings if you feel they are inadequately represented in the existing funds.

It my view the Global Core at only 35% is rather low compared with the size of the more focussed tranches (they cant really be seen as "tilts").  It is not a typical 70/30 portfolio.

7_year_mission

Thanks for the feedback - Yes the more I think about it the more I see issues...   RTX was a Typo meant RTW, looking at the Indian China - there is coverage in SMT and MYI so am removing and look at increasing allocation in the core.   The tilt on this will still be PE and Biotech...   Across the portfolio now about 10% each so now it read more like 50% Core(Growth/Value) 20% Across Biotech and 30% defensive....    More coffee and reading required...    

Bostonerimus1

7_year_mission said:

The multi asset fund was an option, another was simply something Like HSBC Dynamic Strategy or just something like FCIT or ALW.   But the goal is to have the defensive side to counter downturn and allow me to deploy not timing the market.   I also think that I can seem some significant growth this year with the Biotech and PE theme.   Which will hopefully drive high total growth over the year.    When I say 6.5% that is an number I could live would I really want to push performance and shave time off my plan...   

So VLS100 and VLS20 plus a cash buffer. You take from cash and VLS20 when equites are down and vis a versa. Implement one of the many withdrawal methods that appeals to you.

https://www.bogleheads.org/wiki/Withdrawal_methods

Don't over think things. 

Linton

In my view the best way of configuring a portfolio is....

1) Define what you want from the portfolio giving dates, desired return, acceptable level of risk etc
2) Decide the overall asset allocations between asset classes and the characteristics of each allocation that will best achieve (1)
3) Identify a minimum set of funds that can provide the specified asset allocation from (2)

The problem we have here seems to be that the objectives of the portfolio are not clear.