New HL MM fund

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82178920#Comment_82178920

It is called recency bias. People also tend to place greater value on their own experience over that of others. I do know of a name for that, but it can be equally irrational.

GeoffTF

I have just compared the charts. VAGS (global aggregate bonds hedged into GBP) has gained 1.11% and VWRP (global equities) has fallen 3.19% over the last month. That is despite a widespread fear that there is inflation ahead. These are unpredictable times. Past times were unpredictable too.

jimjames

https://forums.moneysavingexpert.com/discussion/comment/82178834#Comment_82178834

It wasn't really inflation that was the problem I thought. It was the change in rates from just above 0% to over 4% which was unprecedented in recent history.

OldScientist

https://forums.moneysavingexpert.com/discussion/comment/82178834#Comment_82178834

Rising yields are always nasty for intermediate and longer term bonds (e.g., period from 1950 to mis-1970s when 10-year yields rose from about 2.5% to 16%) even in nominal terms (for nominal bonds), but the recent period was particularly bad since rates went from a value of close to 0% to over 4% in the space of two years. Low yields and low coupons (for bonds issued after 2011 or so) meant that durations (of both individual bonds and the bond funds that held them) were high so the changes in price were large when yields rose.

Of course, inflation then just adds the icing on the cake (e.g., the 'All stocks' gilt index had a real annualised total return of about -2% between 1950 and 1975 - holding consols would have been even worse at -4.3%)!