Aberdeen ISA

pattycake

A year or so ago I invested £8000 (£4K for 06-07 and £4K for 07-08) into Aberdeen Property Share Fund. This was on the advice of an IFA who knew I was risk averse. I have recently received my statement and my investment is now worth £5195.89.

I know what has happened to property in the last year but was this a sensible investment for me in March/April 2007 or should I be having strong words with the IFA?

Thank you.

RayWolfe

You received terrible advice. If I advised you to put all your eggs in one basket, would you have agreed? Of course not. So you do have some culpability.

Seen_the_light_4

If you stated you were risk averse, should you have even invested in shares?

I would have though a regular savings account, although not offering the same returns as these type of funds before they hit the buffers, was more suitable.

earlgrey_3

Would totally agree with Ray it sounds nonsense putting two years allowance into a single fund.

The only proviso is that you don't say what other investments you have so if for example you already have a very large amounts in equities and bonds it could be seen as balancing your portfolio. That said, I can't see that putting money into property last year could ever be thought low risk.

Ian_W

earlgrey wrote: »

The only proviso is that you don't say what other investments you have so if for example you already have a very large amounts in equities and bonds it could be seen as balancing your portfolio.

I don't think that would be the case as it isn't a "bricks and mortar" type fund which physically owns property and potentially benefits from rents as well any increases in property value which might act as a diversifier away from shares etc.

ABERDEEN PROPERTY SHARE is 99.8% invested in shares in listed property co's [mostly in the UK] so has the double whammy of a general stock market risk of decline and a very sector specific risk BOTH of which have happened over the past year. Trustnet shows it to have 3rd quartile volatility in the very volatile "specialist" sector so my guess FWIW is it's at least a medium/high and possibly even classed as a high risk fund.

pattycake you should turn up the original documentation the IFA gave you and see what is says about your attitude to risk and the reason for recommending this fund. From what you've posted you may have a good case for a formal complaint of mis-selling [begger the strong words!] and that it turn could lead to compensation - but without knowing what was documented it's only a maybe and I'm certainly no expert.

dunstonh

Aberdeen property share fund is very high risk. (on a simple 1 to 10 scale, it would be at 9).

Based on what you have said, this appears to be a mis-sale and you should make a complaint.

1 - fund is very high risk but you are not.
2 - single fund investing is not good advice. Especially in such a high risk fund.

However, it would be worth checking your documentation first to see what that says.

pattycake

Thanks for your input. At the time I had a lump sum of £50K to invest and this was just a part of it. It is the only money I personally have in equities. The rest is in building society accounts/bonds/regular saving accounts etc all (hopefully) very safe. I have the maximum in cash ISAs from inception, plus what used to be a TOISA.

I will look through my paperwork and see what I can find. We had used this particular guy in the past and been pleased with his advice and on a personal level, I like him very much. However, I am not happy to find I have lost so much money and now to hear that I was risking my cash.

dunstonh

Ahh, now its looking less like a mis-sale (although 100% of the equities into that fund was not a great decision). The portfolio is averaged so having £8k of £50k in equities is low risk even if the £8k is in very high risk. However, as I said, it could have been done a lot better. 8x£1k into different funds would have been safer.