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All Star Manager Portfolio
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Do you have any examples?
Which were the best global growth funds five years ago, and how do they compare to MSCI Emerging Markets?
See Should I invest some money in a equity fund?.
The benchmark for global growth funds is MSCI World, not MSCI Emerging Markets.0 -
FATHEROFTWO, you should seriously consider whether you want to put all of the money into the market at one time. With high volatility you can significantly reduce your risk by investing it gradually over the course of a year. You do also reduce your profits if it happens that the day you would have invested was the lowest possible buying day but since you have an interest in low risk that's a good trade to make.
It's impossible for you to meet your 10% target because the bond funds have 10% or more risk. You're more like 30%, which isn't too bad since risk aside you are acting as though you're interested in growth at the cost of extra risk.
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I bought shares about seven years ago and learned my lesson in investing with one particular share and decided after that to drip feed to even out distortions.I was fortunate to invest a lump sum though in April 2003 at the lowes part I the markeet and saw an immediate profit.
It is a strategy I have followed but I am now In a good position that I have lump sum to invest.
Its difficult to call the bottom.
Thats stating the obvious I know.
However my all share tracker is down about 15 percent and I had considered averaging down by investing a lump sum as Im not convinced by the L&G all share tracker that it does give the best value as it underperforms the index .Probably due to the commision it pays.
Drip feeding is a consideration as I watch the market progress
Which of the Bond Funds exceed the 10 percent downside and why?0 -
See Should I invest some money in a equity fund?.
The benchmark for global growth funds is MSCI World, not MSCI Emerging Markets.
The much-vaunted Neptune Global Equity has its top three geographical holdings as UK, Russia and China. Only one of these is in MSCI World. The other two are MSCI Emerging Markets.
MSCI World is a developed (i.e. stable) market index.0 -
FATHEROFTWO, say all the bond funds have only ten percent variation then you'll probably go over ten percent if you have anything with higher volatility, unless it's negatively correlated with bond movements and of low enough value that the bonds can counteract its movement. Bonds currently have some extra default risk, so it's not certain that they are as cautious as they usually are, even more so for any junk bond funds.
I agree with the others who've commented on the high UK amount. To me it looks like too much correlation with the UK market and I think that you'd benefit from adding more global bonds and maybe 1k each of African and Middle Eastern markets. You might also consider 1k in a gold or gold and other precious metals fund and 1k in a soft commodity (food) fund. These four 1k possibilities are individually high risk but are quite likely to move in a different direction or at least out of sync with the rest and reduce the volatility of the whole portfolio.
Personally I haven't been very keen on the UK and have just 15% of my non-cash investments in the UK at the moment. That'll probably be increasing over this year, though.
meester, that's one that might usefully be benchmarked against MSCI Emerging Markets, at least as a secondary comparison. I considered mentioning it in my own post suggesting exactly that because it's so far from the global growth benchmark. Decided it wasn't worth it for an odd exception to the sector practice. Something like Artemis Global Growth is more usual, though it goes a fair way from the benchmark at times, it doesn't go anywhere near as far from it as the Neptune fund.0 -
FATHEROFTWO wrote: »Strangely enough During my elimination process of going through the Funds I had selected Funds that Jupiter Merlin had selected last year and by the time I had eliminated Funds these by chance these funds were also removed and replaced and replaced by Funds that I had selected.It showed me that the process I was following was similar to theirs.
It may be an idea to chech which Funds Jupiter Merlin Have and just buy them,then I would save myself extra commision.
The correlation is interesting maybe you are the new John Chatfeild-Roberts!
But how often do they change holdings, what access to information do they have that is not publicly available, how often are the funds top ten reported, how many of their holdings are not shown in the top ten, and finally how many are not available to individual investors?If it takes a man a week to walk to walk a fortnight how long does it take a fly with tackity boots on to walk through a barrel of treacle?0 -
Browntrout wrote: »The correlation is interesting maybe you are the new John Chatfeild-Roberts!
But how often do they change holdings, what access to information do they have that is not publicly available, how often are the funds top ten reported, how many of their holdings are not shown in the top ten, and finally how many are not available to individual investors?
I think if you access the jupiter merlin portfolio it is available online
I think it is published once a month as well.
I believe the only one not available is the American Findlay park Fund as its closed0 -
Just to throw another diversifier in there - as mentioned above there are commodities to consider which are not correlated highly to the other asset classes and so can provide some decent diversification. Perhaps consider 1-2% of your portfolio being allocated to commodities?
The MFM iFunds Commodities ETF fund has a good mix of commodity ETFs in it and is actively managed to attain a decent return, there's some talk of commodities on the forum at the moment in the last 2-3 pages of threads if you want some more opinion.
Some more general advice I would give based on my own personal experience - if you're only just starting out investing in funds or in an investment portfolio in general, be wary of including too many funds in your portfolio to start with. Personally if I was starting from scratch again I would look to include no more than 10-12 funds in my portfolio for the first year anyway. It's so much easier to work with your portfolio and make any 'settling in' switches if need be.
Originally I spread a portfolio out across 20 funds after reading everywhere about the importance of portfolio diversification, with each 'asset class' holding spread across a minimum of at least 2 funds (and sometimes up to 4 or 5 in the case of UK equity and bond funds). However this soon became very difficult to manage in terms of recording dividend payments, tracking performance and even more so when it came to 'smoothing out' the portfolio during the early months. Now the portfolio is down to around 10 funds and is much more manageable.
Finally another book to consider if you're interested in portfolio theory is 'The Intelligent Asset Allocator: How to Build Your Portfolio to Maximize Returns and Minimize Risk' by William Bernstein. Is written primarily for a US audience and examples are all US centric, but the general theory behind it is quite general and very well written with medium-advanced maths on the theory side.
Was recommended to me by Jon3001 on these forums and I found it very useful for building a diversified portfolio - though as I say above I wish I'd not chosen so many funds initially!0 -
See next post entered in error0
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Hi Thanks for all the comments.
I have given it a fair bit of thought and just going through the portfolio and have revamped it a bit.
Firstly I agree with most of the posters that I am overweight in the Uk with too many funds so if you bear with me I will work through the first part ie UK sector
I am considering going with these Uk Funds
originally £22000 reduced to £15000
UK EQUITY INCOME (£10000)
I have disregarded Jupiter Income
and am considering reducing my investment in the following funds
Artemis Income £2000
Invesco Perp High Income £5000
Neptune Income £3000
UK ALL COMPANIES (£5000)
Reduced from £8000 to £5000 and have disregarded Artemis Uk Special Situations and Axa Framlington UK Select OPPS
Now considering
Old Mutual UK select Mid Cap £3000
Saracen Growth Fund Alpha £2000.
This has reduced the UK exposure considerably
I am also considering increasing the 2 US funds from a total of
£2000 to £3000
The comments about too much exposure to China is also taken on board.
I am looking at First state Asia Pacific leaders as that fits the manager criteria Ie Andrew Tulloch and will diversify my exposure in that sector.Also had a loom at Hugh Young selection and that is a consideration depending on sector allocation and an Emerging markets Fund possibly a BRIC
I will have to have a close look at a global growth Fund
Robin Geffin fits the criteria in his Neptune Fund and few others namely Artemis Global Growth and M&G global basics and a few others but will have to research them extensively first.
JPM Natural rescources and a BRIC Fund for a small amount of cash risk again research is the key.
Im still not 100 percent sure of the Risk element of the Corporate bonds/high yield Bonds and Global Bonds.
Has anyone and idea how I could compare the risk of each bond against say the risk of a UK EQUITY FUND ?
MANY THANKS0 -
Somebody above liked funds of funds and someone didn't. Yes the charges can be higher but on the other hand you are paying for expertise. Like so much of this it is a personal thing. I reckon they can be great for starting a new portfolio and also as core holdings for a developed portfolio - just my opinion. I think the Jupiter Merling Growth Fund has a total expense ratio of 2.53% which might be a little high but Messrs Chatfeild Roberts & team have a good record. The H-L Income and Growth Fund has a TER of 1.9% (again I trhink) which is quite low for a fund of funds and has a great selection of funds (again my opinion only).
Like some others I think the portfolio is a bit heavy in the UK but I am a huge fan of UK Equity Income. I would probably reduce the High Yield Bonds a bit say by 4K that would leave you with more for Europe (although 4k out of 50k isn't that low) & Global. Personally I would not go direct to US but via a Global Fund. Regarding Far East I would look at a generalist fund like Aberdeen Asia Pacific and I would definitely have a bit in a more general Emerging Markets fund like Lazard Emerging Markets or Aberdeen Emerging Markets.
I would perhaps consider reducing UK risk by haveing a more general fund like Jupiter UK Growth or M&G Recovery in there. Old Mutual Mid Cap has been fantastic but with all this volatility it might just be a bit too much 6% of your investment.
My suggestion to move out of Other Bonds a bit, will increase your risk profile somewhat, but a steady global fund, a slightly less 'risky' UK All Comps fund, and a more general Far East & Em Markets fund would mitigate this somewhat.
Actually I don't think your number of funds is way too high, except that I might have one less UK All Comps fund, one less other bond, and might be tempted by the H-L Income and growth fund instead of a couple of the income funds. I like the idea of spreading out a bit and then if a manager goes or the fund ceases to do well you have funds you know and trust to tip the investment into.
Well, sorry, this was longer than I thought and only my own view, but I hope it isn't too scrambled. What is really interesting is the number of different takes everyone has.0
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