VLS not on Halifax SD?
Comments
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That is some amount of money you are confident of leaving with Halifax SD in the same fund. I guess I shouldn't be too anxious of just going over the £50k limit.
I agree about spreading eggs across baskets but rather than rigidly sticking to the £50k limit it's a judgement about what proportion of your overall wealth you can afford to risk to get low fees. I have a similar sized workplace pension and lots of years employment ahead to build one or two more.I'm sure you said a few weeks ago that you thought the HSBC Global Strategy funds had too much US equity?
Yes. That's my view if was your only investment - but about the same US exposure as VLS if you removed the additional 20% UK bias and redistributed the remaining 80% across 100% of the fund. I like some UK bias so I am holding a UK equities fund in my workplace scheme. I am trying to get the asset allocation right, with the lowest fees, across all my accounts rather than in each account.I think the HSBC GS Balanced sits quite nicely alongside the VLS60, so thinking of upping my investment in HSBC so I've got roughly the same amount in VLS and HSBC. The returns graph for both funds are almost identical for the last 5 years, but who knows which one would do better in an equity crash - maybe the VLS which is automatically rebalanced by buying more equities at falling prices to keep to the 60%, or maybe the HSBC fund would fare better being actively managed.
Well if you held both in equal proportions you would have a smaller circa 15% UK weighting. VLS prefers government bonds and HSBC prefers corporate bonds you would be sitting on the fence there too.
Alex.0 -
That is some amount of money you are confident of leaving with Halifax SD in the same fund. I guess I shouldn't be too anxious of just going over the £50k limit.
The £50,000 protection is only of use in instances of corporate fraud or negligence, so it is incredibly unlikely that it would be called upon. It isn't like the £85,000 on retail deposits. In the latter instance you are a creditor, in the former you are not. The chances are that should there be fraud because of an unscrupulous employee the institution would actually cover you anyway because a) most would likely feel morally obligated to do so, and b) the reputational damage of not doing so could be devastating to their business.
If you insist on keeping all investments below £50,000 then, as your investments grow, you are going to start running out of platforms to use! You will also incur considerable extra and unnecessary cost.0 -
ValiantSon wrote: »The £50,000 protection is only of use in instances of corporate fraud or negligence, so it is incredibly unlikely that it would be called upon. It isn't like the £85,000 on retail deposits. In the latter instance you are a creditor, in the former you are not. The chances are that should there be fraud because of an unscrupulous employee the institution would actually cover you anyway because a) most would likely feel morally obligated to do so, and b) the reputational damage of not doing so could be devastating to their business.0
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I agree the risk is very low, but it's still a risk. I'm not sure they would feel morally obliged to compensate you, and if it was just a few investors that lost funds through the fraud, I'm not sure that it would get the publicity that would do them reputational damage.
There are, undoubtedly, many businesses that would not feel a moral obligation, but I think the majority would. Furthermore, legal action could be taken against the company to recover losses and they are unlikely to want to have to go down that route.
Any fraud is likely to involve a large number of customers (unless the fraudster is a complete idiot). The spread of impact, therefore, is almost certainly something that would gain media attention (and it is well within the power of individuals to generate attention). The reputational damage is a significant risk.0 -
Well if you held both in equal proportions you would have a smaller circa 15% UK weighting. VLS prefers government bonds and HSBC prefers corporate bonds you would be sitting on the fence there too.0
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That's true, which I think is beneficial and diversifies further rather than having all my eggs in the one basket.
Yes but 50:50 split between VLS60 and GS Balanced is more than 1 notch above the risk scale than your current VLS40. With the higher equity exposure and corporate bonds GS Balanced is somewhere near VLS70 (if it existed) on the risk scale. So your 50:50 split would give somewhere near a VLS65 risk - about 25% higher than VLS40.0 -
Yes but 50:50 split between VLS60 and GS Balanced is more than 1 notch above the risk scale than your current VLS40. With the higher equity exposure and corporate bonds GS Balanced is somewhere near VLS70 (if it existed) on the risk scale. So your 50:50 split would give somewhere near a VLS65 risk - about 25% higher than VLS40.
I'm surprised you consider HSBC GS Bal much higher risk than VLS60, but you might be right with the corporate bonds. However the fact that the allocation is managed and more flexible than VLS might mean it's less of a risk and may drop less than the VLS60 in an equity crash and recover quicker?0 -
Yes HSBC GS Balanced seems to be between VLS60 and VLS80. It had 63% equities and the bonds carry greater correlation with equities and potential return.
I agree the VLS40 sounds very cautious but we are at different stages of life and I know you are very cautious about the FSCS limits - although £50k is also the value at which the Halifax SIPP charges double from £90 to £180 per year which I guess you are keen to avoid.
I don't get the feeling that Jane Davies takes a very active approach and from what I read online she had a fairly static asset allocation and sees the HSBC Open Funds series as solutions. Definitely no stock picking going on.
Alex0 -
The withdrawl of the the funds, well at least the availbility to trade online. With selling only available by phone. Is most likely down to MiFID 2. With the more onerous regulatory requirements seems as if there's been a considerable shake up.0
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Thrugelmir wrote: »The withdrawl of the the funds, well at least the availbility to trade online. With selling only available by phone. Is most likely down to MiFID 2. With the more onerous regulatory requirements seems as if there's been a considerable shake up.0
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