Jupiter European ISA, keep, transfer, or cash in?

genny

I've had a Jupiter Euro Fund ISA opened in 1999, opened with 7,000, recommended by an IFA. It's now worth a bit over 11,000.

If i'd have invested the same amount in a 5.5% building society account it'd be worth the same. So I'm not that impressed with the increase in value over 9 years, for a "stocks and shares isa".

If I close and cash it in, I assume I'll loose the ISA status, so should I hang onto it hoping it'll pick up in the long term (I don't need the money so happy to leave it there for years), or transfer it to another product at Jupiter, or is it just as easy to transfer to another company without loosing the tax free status?

I'm wary about taking more IFA advice, as I don't think this has performed well.

Thanks, Genny.

wriggly

Many European funds have performed poorly in the early years of this decade, and have only recently recovered, mainly due to the increase in the Euro against the pound.

If you need the money in the next 5 years, now might be a good time to cash out, while Euro shares are doing fairly well. Although the return might be disappointing, at least it matches a savings account and you haven't lost money. A lot of people have done worse.

If you take the advice of an IFA, you really should have a follow-up meeting at least once a year, in order to ensure their investment advice is still a good choice for your circumstances.

barak

genny wrote: »

I've had a Jupiter Euro Fund ISA opened in 1999 .....

If I close and cash it in, I assume I'll loose the ISA status, so should I hang onto it hoping it'll pick up in the long term (I don't need the money so happy to leave it there for years), or transfer it to another product at Jupiter, or is it just as easy to transfer to another company without loosing the tax free status? ..... Genny.

[1] You don't need to cash it in - you can transfer it into any other fund and keep the tax free status, provided you do the transfer correctly.

[2] Jupiter European was a top performer in the 1990s, but the manager left and it went through a period of rather ordinary performance. Recently it has been doing better.

What you should do really depends on what other investments you have. You probably need some advice - perhaps from a different IFA.

dunstonh

single fund investing is old fashioned and leads to lower returns in the long run as well as an increase in risk as your eggs are all in one sector.

You have too small amount to build proper sector allocation with most fund supermarkets but why not do 11 funds of £1000 each across the sectors and average them out to match your risk profile?

genny

Thank you all.

So even though the fund contains multiple company stocks, rather than just investing in a single set of shares, it's still considered a bad/old way to invest?

I remember the fund manager left around the time I purchased the fund, and since then it seems to have dropped off the radar.

I have quite a lot in cash and fixed rate accounts, but this is my only S+S ISA, I need to make the money work harder for me!

If I did split it into 11 x £1000 blocks, can I still retain the ISA wrapper, and would I be better off like this, or maybe 2 at 5.5K, or other splits? I know you aren't allowed to give direct advice/recommendations, but would I bet best moving to another fund house and then having 11 funds with them ISA wrapped, or?

dunstonh

So even though the fund contains multiple company stocks, rather than just investing in a single set of shares, it's still considered a bad/old way to invest?

The shares it holds are all in one geographical sector. Whilst the shares within the fund will perform differently, they will largely be driven by the European (exc UK) stockmarkets. No UK, US, Asia, specialist etc to diversify into. Plus, you have no fixed interest or property exposure (the latter may not have been good over the last 12 months but thats short term and i mention it as an example of additional asset class).

If I did split it into 11 x £1000 blocks, can I still retain the ISA wrapper

Yes. You just transfer it to a fund supermarket to allow you to have the wide choice available.

would I be better off like this, or maybe 2 at 5.5K, or other splits?

Depends on how you split it. 11 funds all investing in the European sector would make little or no difference. 11 funds investing in different areas diversifies you more. The diversification will reduce the risk although you may pick funds which are above and below your risk profile to average out to match your risk.

I know you aren't allowed to give direct advice/recommendations, but would I bet best moving to another fund house and then having 11 funds with them ISA wrapped, or?

No. The days of investing with a fund house directly are over. Its expensive, its limited in choice and you will reduce your investment potential. Only small contributions are still worth putting with fund houses (as a few still accept small amounts like £20pm)

undercoat11

You say you would have got the same in a building society - are you sure? Remember that we went through a phase of ridiculously low building society rates - 3% and such like.

Why not go through a funds supermarket and split it into various other funds? I have done that with some of my Fidelity funds which were performing poorly and it has been good. I have a few units here there and everywhere now.

turbobob

Its worth remembering the period you've invested over has had a number of terrible years for most equities (2000-2002) so it would take some time to recover from this. This historic FTSE All Share graph puts some of this in perspective quite nicely. Its a UK index but there is a lot of correlation with Europe. The falls in the early part of this decade made Black Monday look like a blip.

The Jupiter European fund has done rather better than a bank or building society return from 2003 to now anyway as can be seen in this performance chart. By diversifying you reduce the effect a big crash in any one area or asset class has on your overall investment.

dunstonh

5/6/99 to 5/6/2008 has seen the Jupiter fund return 148.9%

Thats significantly beaten cash savings rates.

In that same period:

property 100.3%
Index linked gilts 66.8%
FTSE all share 36.4%
Finex money deposit (savings accounts) 31.6%
RPI (inflation) 29.2%

So, the jupiter fund sits very well.

If i pick the period of 2003 onwards to match turbobob's post then you have ING Direct launching its high profile savings account that in that period the Jupiter fund grew 127.9% and ING 37.2%.

genny

Just had the valuation today, and it's now only worth 10K, quite a short period to lose £1000, so I'm going to hold onto it until it recovers and then hopefully move to a fund supermarket for some different funds (assuming this won't lose the ISA tax status if I transfer).

luckylizard

that's a classic mistake genny. don't hang on to it ' until it recovers'. all funds have fallen by a similar amount over the past month. transfer it to a fund supermarket and split it into a number of better funds now. they too will 'recover' and you'll have a better risk spread immediately. at least, that's what i'd do.;)