Next recession, trade wars, up to 50% portfolio losses
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Thanks VS
Yeah, I have 100k in pensions paying 10% in, company adding 5%, a btl property with 150k equity(value about 360k) mortgage of 350 per month, rent received £1250pm. 40k salary, do about another 10-15k in overtime. Wife self employed 15k year. No pension.
Got another 20-30k to invest also, but teenage kids that are no doubt gonna dent funds in the next decade!
Maybe 20k each in ls80&ls60 for now.
Why do people only talk about vanguards life strategy products when they offer so many others?0 -
Why do people only talk about vanguards life strategy products when they offer so many others?
They don't unless you limit yourself to certain websites or types of investor.Maybe 20k each in ls80&ls60 for now.
What does that achieve? One or the other would be more sensible.
Plus, if you are worried about a minor 10% blip then is VLS80 really appropriate? VLS60 is in 25% loss potential. So, both are more than double your worry point.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
What is anyone!!!8217;s !!!8216;worry point!!!8217; on their life savings?
Surely no one goes into s&s isa!!!8217;s expecting to make less than what cash isa!!!8217;s can offer, and should they show less than invested after 10,15 or 20 years this would cause a great deal of worry?
Is this not the case and everyone going into a s&s isa is prepared to gamble away 50% of it should the worst happen?
With the time frame of ten to twenty years and my finances outlined above, things have got to be pretty dire for me to not come out with a loss(although I accept that could happen)0 -
What is anyone!!!8217;s !!!8216;worry point!!!8217; on their life savings?
It varies.
It tends to change over time too. My first crash saw me worried and concerned. Nowadays its "here we go again". No big deal.
Experience and knowledge helps.Surely no one goes into s&s isa!!!8217;s expecting to make less than what cash isa!!!8217;s can offer, and should they show less than invested after 10,15 or 20 years this would cause a great deal of worry?
There have been 10 year periods of losses on regular contributions. You wouldnt expect it after 15-20.Is this not the case and everyone going into a s&s isa is prepared to gamble away 50% of it should the worst happen?
No. Some only have a 15% loss potential. Some have 25% loss potential. No-one should be viewing it as gambling. If you have a 50% loss tolerance you wouldnt be worrying about 10%. And you wouldnt be invested in either VLS60 or VLS80.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Nobody invests expecting to lose money in the long term, but we do invest knowing that there will be periods of downturn, and that paper losses will occur. The overall growth, however, is likely to exceed what can be earned in interest from any cash product (ISA or not).
In the long term, as long you are well-diversified (and a multi-asset fund like VLS is), you should not expect to make a loss. You only make a real loss if you sell when the investments are down, but even then, over the long term, they could be down on the previous 12 months, but still much higher than at the point of your initial investment.0 -
So what are people!!!8217;s deciding factors in going for vls60/80/100 for a ten or twenty year investment.
Studying charts, obviously 100 is they way to go, as long as one is prepared not to touch it0 -
AnotherJoe wrote: »Because statistics and back testing clearly show that staying invested is the optimum strategy for long term growth. Indeed a simple thought experiment shows this to be true for you. Are you a multi mega millionaire whose made millions through your astute market timing, abilty to buy at the bottom, sell at the top, predict the price of gold and dip in and out between them all ?
If the answer is "no" then why do you think you suddenly have gained that abilty ?
For short to medium term needs getting out may be the better plan but that should be done irrespective of your guess as to the markets.
The answer is most definitely "NO" I do not know how the markets will move and I haven't gained that ability, although I am a multi mega millionaire but don't tell the wife. I have taken action based on my enterpretation of what people, I consider experts, are saying on how the markets will move. As I said if my experts and I are wrong then I have lost a potential increase in my wealth. If they are right I have protected my current wealth.
Is putting my money in Virgin's 2 year fixed rate cash ISA paying 2%, better than keeping it invested? Because of fees paid to the fund manager of about 1% of my investments per year the calculation is not clear cut but simple enough. To beat the cash ISA, investments would have to have a yearly growth of 3%. The FTSE today almost did that in one day, finishing 2.35% higher at 7199.5. If I just looked at todays figure I would say I've made a mistake. However if I look back over the last month I find that the FTSE was even higher at over 7200, but has also been down below 6900.
Look back even further to the end of 1999. I was waiting for the FTSE to get above 7000 for the first time to start the new millenium. It missed by a whisker. Now eighteen years later the FTSE is still almost in the same place.
Where will it be in 2 years time? Will the bull run continue for this long? Will the FTSE be above 7428 (7000 compounded @3%)? My money is literally on it being below this figure. You want to stay put. That's good. You've made an informed decision. So have I. Mine is probably more defensive than yours, but that is my response to risk.0 -
Matthew2018 wrote: »The answer is most definitely "NO" I do not know how the markets will move and I haven't gained that ability, although I am a multi mega millionaire but don't tell the wife. I have taken action based on my enterpretation of what people, I consider experts, are saying on how the markets will move. As I said if my experts and I are wrong then I have lost a potential increase in my wealth. If they are right I have protected my current wealth.
I'm not going to get into what your "experts" have to say.
If you sell out now and put your money in savings accounts then you aren't protecting your "current wealth" because the interest rate you receive will be below inflation, therefore your "current wealth" is actually losing value. Far from protecting it, you have made a decision to reduce it.Matthew2018 wrote: »Is putting my money in Virgin's 2 year fixed rate cash ISA paying 2%, better than keeping it invested? Because of fees paid to the fund manager of about 1% of my investments per year the calculation is not clear cut but simple enough. To beat the cash ISA, investments would have to have a yearly growth of 3%. The FTSE today almost did that in one day, finishing 2.35% higher at 7199.5. If I just looked at todays figure I would say I've made a mistake. However if I look back over the last month I find that the FTSE was even higher at over 7200, but has also been down below 6900.
Look back even further to the end of 1999. I was waiting for the FTSE to get above 7000 for the first time to start the new millenium. It missed by a whisker. Now eighteen years later the FTSE is still almost in the same place.
Where will it be in 2 years time? Will the bull run continue for this long? Will the FTSE be above 7428 (7000 compounded @3%)? My money is literally on it being below this figure. You want to stay put. That's good. You've made an informed decision. So have I. Mine is probably more defensive than yours, but that is my response to risk.
It is entirely your decision, and if you are as risk averse as your posts suggest then you probably are better not staying invested.
The FTSE 100 is not necessarily the best metric to use to make decisions about global stocks.0 -
Matthew2018 wrote: »T You've made an informed decision. So have I.
None of us have made what I would call an informed decision as there simply aren't enough facts in investing. Nobody really has a clue what will happen over the coming years. The only real fact is that being invested in stocks and reinvesting dividends (which is why your FTSE example isn't very good) has been the best way of creating wealth over the last 100 years or so. The only thing you have to deal with is short term temporary losses.0 -
If it plunges and skyrockets in the same day they just change their initial headline to "markets volatile"
At the moment the BBC says "The FTSE 100 soars".
It's quite commical really! Tomorrow morning no doubt it will "plummet".
So what's the word for tomorrow?..I'm tempted by "plunge" again, it's a nice word. But the phrase "decend into the abyss of capitalistic oblivion" might be quite artistic for say somethng like a 3% drop.If you want to be rich, live like you're poor; if you want to be poor, live like you're rich.0
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