ISA Investment Advice Sought

jaybird70

I currently have a M & S High Income Bond Isa which I set up two years ago. I have not invested my isa allowance into it for this year because I would like to diversify this years Isa amount into stocks and shares, would anyone out there beable to recommend a few for me to take a look at. Also out of interest is the M & S ISA still considered a good one within its category.

Thanks V much. for any help

Jay

carnet

The M&S High Income Fund is a Unit Trust (not Bond - despite what comes next ) - which falls into the " UK Other Bond" or "Fixed Income GBP" sector (depending on whose performance stats you look at).

It is outsourced to Rothchilds where it is run by Lucy Speake assisted by Ingrid Iverson, who have been managing it (very successfully) for 5.5 years.

It may invest in "fixed and variable rate securities and equities from around the world", but, in practice, usually has most of its assets in bonds - recent split was 27% High Yield Bonds, 71% Quality Bonds and the rest in cash.

Performance has been exceptionally good - 3/34 one year, 4/33 two yrs, 3/31 three yrs, 1/25 five years (Standard & Poor's, Oct. 2005).

FSA rules prevents the recommendation of regulated financial products such as funds on these boards - in any case, even if we could, we would require much more information from you such as attitude towards risk, time horizon etc. etc.

jaybird70

Thanks very much for your information.

dunstonh

Personally, I wouldnt use it. Only due to the limited range offered by M&S. Decent diversification within one provider isnt possible with M&S

M&S financial services was sold to HSBC last November. There is a good chance that they will cease the outsourcing and bring it in-house with the rest of the HSBC funds. It may even be integrated into the HSBC range. So there is some unknown with the future of the M&S range. That would be another reason why I wouldn't use it.

I'm showing different stats to Carnet. Different cut off points on stats information and some sources not including all funds can distort things. Some funds are classed in different sectors by some information providers. Both could be right on the given day. Here are mine (using Lipper as the info provider up to end of Sept 05):

over 1 year it was 40th out of 104 with 11.55%
over 2 years it was 56th out of 87 with 9.11% (average p.a.)
over 3 years it was 40th out of 78 with 10.75% (average p.a.)
over 5 years it was 2nd out of 43 with 10.19% (average p.a.)

carnet

dunstonh wrote:

Personally, I wouldnt use it. Only due to the limited range offered by M&S. Decent diversification within one provider isnt possible with M&S

If I was looking for income I might seriously consider this fund because of its relatively high yield and sterling performance since inception (provided all things remain constant - see below). There's nothing to stop one from investing in this, or any of the other 3 M&S funds (although, personally, I wouldn't touch any of the other ones ), as part of a supermarket portfolio. Haven't checked any of the other supermarkets but I do know they're included in HL's Vantage service.

M&S financial services was sold to HSBC last November. There is a good chance that they will cease the outsourcing and bring it in-house with the rest of the HSBC funds. It may even be integrated into the HSBC range. So there is some unknown with the future of the M&S range. That would be another reason why I wouldn't use it.

Now that would be a good reason - if it happens !

I'm showing different stats to Carnet. Different cut off points on stats information and some sources not including all funds can distort things. Some funds are classed in different sectors by some information providers. Both could be right on the given day. Here are mine (using Lipper as the info provider up to end of Sept 05):

over 1 year it was 40th out of 104 with 11.55%
over 2 years it was 56th out of 87 with 9.11% (average p.a.)
over 3 years it was 40th out of 78 with 10.75% (average p.a.)
over 5 years it was 2nd out of 43 with 10.19% (average p.a.)

Think the above figures must also include pure Corporate Bond Funds and/or High Yield Bond Funds. My figures were extracted from the S&P stats as published in Money Management 10/05 as included within a sector called "Fixed Income GBP" which excludes these. S&P/MM's current sector headings are an incomprehensible nightmare .

Looking at What Investment's 10/05 stats, (which are from Lipper too !), this fund, which is included under their "UK Other Bond" sector is showing the following figures;

1/45 over 6 months, 2/43 over 1 year, 8/35 over 3 yrs, 1/23 over 5 yrs


THE ABOVE IS JUST MY OWN PERSONAL VIEWS AND DOES NOT CONSTITUTE, AND SHOULD NOT BE CONSTRUED AS, FINANCIAL ADVICE.

dunstonh

A few corporate bonds are included in that list. Lipper have a corporate bond sector but its tagged UK corp bond. A look at some of the corp bonds in the list, they appear to have a higher concentration of overseas corp bonds or be high yield corp bonds.

Maybe there is a cut off to how much a fund must have UK based to be classed as a UK Corporate Bond. If overseas corp bonds within the fund exceed a certain amount, maybe they shove them into the Other Bond category.

As I said in my earlier post, different research providers list funds in different categories. So there are always some differences. I didn't exclude closed funds from my list and i included accumulation and income units where applicable.

Defaqto have it listed as 15/47 over 1 year (unit price only) or 10/47 (income re-invested)

Morningstar have it 7th (acc units) and 9th (inc units) out of 160 over 12 months under their sterling diversified bond category.