Fundsmith again.

TBC15

https://forums.moneysavingexpert.com/discussion/comment/81966211#Comment_81966211

We are talking about both, all good food for thought. For me the volatility is worth the extra returns, it’s the spice of life. But I must admit as I get older a less spicy diet starts to look attractive.

What attracted me to Blue whale? I was looking for a companion to Fundsmith. Blue whale was touted as having the returns of Fundsmith in its sights and as Peter Hargreaves gave Stephen Yiu £25m of his hard-earned cash to kick off, sounded like a recommendation.

When do I sell and when do I buy? As I’m now into my 7th year of retirement selling and buying usually involves moving investments from the trading account to the ISA and replenishing the cash bucket.

I really should spend a bit more time checking the constituents of my portfolio.

aroominyork

Other growth-oriented houses such as Baillie Gifford and Lindsell Train have also suffered. The graph below is BG's American fund but the story is similar across other geographies. Is Blue Whale different?… who knows. You pays your money and you takes your choice.

Rollinghome

https://forums.moneysavingexpert.com/discussion/comment/81966682#Comment_81966682

I'd assume telex is thinking along the lines of selling when the market is down and then immediately reinvesting into something similarly depressed. The aim being to end up with assets of the same value but rebased having paid less cgt.

Can be helpful when doing a bed and ISA, or bed and spouse, for the same stock. Eg. Global tracker holding worth £100k including £5k gain. Price falls 5% so gain disappears and no CGT payable. Sell and buy a similar tracker, or buy the same one in an ISA or spouse’s account.

Rollinghome

https://forums.moneysavingexpert.com/discussion/comment/81966718#Comment_81966718

A good illustration of why the old addage of "Time in market…" etc. should be adopted with caution, particularly for specific investments.

Bostonerimus1

https://forums.moneysavingexpert.com/discussion/comment/81966693#Comment_81966693

Of course you could look at the volatility of Blue Whale and see extra losses rather than returns, it just depends on when you sample the price.

I see nothing to recommend Blue Whale over anything else other than "vibes". I've watched Stephen Yiu being interviewed and he comes out with the same "fundamental analysis and long term holds" stuff that has been stated before; it's similar to "it's a game of two halves" and "it's about putting the ball in the back of the net, Brian". The portfolio has a lot of tech which has seen significant growth recently, but I see nothing revolutionary.

I predict Blue Whale will take a similar path to Fundsmith. Also having some firm criteria to buy and sell it is important to mitigate the problems the OP is describing.

talexuser

https://forums.moneysavingexpert.com/discussion/comment/81966682#Comment_81966682

You're right, but the decision to sell and pay tax is a tight one because the remaining Fundsmith is so tiny a part of the whole any differences in growth will hardly make any difference to the total portfolio performance. A drop could well be a good time to rebalance and top up the next fund on the list on the hope of the rebound, whether one of the actives, or one of the passives, assuming they outperform any Fundsmith future trend..

talexuser

As an aside Blue Whale has been on the list for years but I could be too late now. It has a lot of high tech and if you are already worried about the US and big 7 proportion in trackers the next correction could be painful. I avoided Scottish Mortgage for a similar scary ride. I don't understand the AI boom and can't believe the valuations it engenders. If an orange person gets control of interest rates surely a big bust will follow a fast boom?

csgohan4

To be honest Fundsmith does bear some similarities to SMT performance with the latter more tech heavy

As with any type of these funds, they may be the flavour of the month before the market rotates and changes, as they did with the latter a few years ago when they got too heavy with TSLA.

I am yet to be convinced on these types of funds imo, but personal preference and risk appetite

masonic

https://forums.moneysavingexpert.com/discussion/comment/81967213#Comment_81967213

If it is such a "tiny part of the whole" then any difference in tax will surely also hardly make any difference. The tax is likely to be far less significant than the potential difference in future compound growth. Is the mental bandwidth being devoted to this issue justifiable on that basis? It certainly seems to me like a good argument to rip off the band aid and move on.

talexuser

Yes, you're right. Just 4k8 of extra cashflow is different from figures up and down on a spreadsheet. But that doesn't change the fact you are right (ripping band aid a good analogy).