Woodford Predictions
Comments
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I use active funds for dividend-based income. I believe that's where detailed research and thus a fund manager has value. I don't care about "beating the market", all I want to do is to be close to the market average, so passive funds work for me when looking at the market more broadly (I hold both active and passive funds). But then I am decumulating rather than chasing aggressive growth.0
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OldMusicGuy wrote: ». But then I am decumulating rather than chasing aggressive growth.
Growth is still important to keep up with inflation.“So we beat on, boats against the current, borne back ceaselessly into the past.”0 -
Which is why around market average returns in the long term is fine for me. And I don't really believe in "inflation" because I will be deflating my lifestyle significantlybostonerimus wrote: »Growth is still important to keep up with inflation.
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OldMusicGuy wrote: »Which is why around market average returns in the long term is fine for me. And I don't really believe in "inflation" because I will be deflating my lifestyle significantly
I take a similar view except I tend to think it is my lifestyle seems to be deflating without any encouragement from me
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OldMusicGuy wrote: »Which is why around market average returns in the long term is fine for me. And I don't really believe in "inflation" because I will be deflating my lifestyle significantly
Yes, surveys show that spending does decrease somewhat with age. However, many people have extra costs like home care and just living longer than expected, so I think it's best to plan for the worst......or maybe that should be the best as far as longevity goes. I expect returns after inflation of around 5% from my purely index approach, but that's only based on historical data.“So we beat on, boats against the current, borne back ceaselessly into the past.”0 -
I might be missing something, as I'm an amateur, but Woodford's fund has only been around for 3.5 years. Everyone tells me a 5 year period is minimum to be in the stock market. And his 3.5 year performance is being judged on a 25 year track record with his other fund(s). Isn't that a bit premature? I'm sure he's given interviews like this many times over the previous 25 years. I'm not judging him for many years yet, especially given the craziness of the state of the world right now and the financial markets.0
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stardust09 wrote: »I might be missing something, as I'm an amateur, but Woodford's fund has only been around for 3.5 years.
Ironically Best just published their latest top rated funds lists and Woodford comes out way out top of their Income sector recommendations over 3 years, and 16% ahead of the Vanguard UK Income index. Naturally we have to wait to see how it all pans out over 5 years and more, but I'm always amazed how those that profess to adhere to long term investing react to relative short term performance, let alone how tracker fans try to pretend there are no managers that consistently outperform over the long term when there actually are a few.0 -
stardust09 wrote: »especially given the craziness of the state of the world right now and the financial markets.
Particularly when you get companies such as Just Eat joining the FTSE 100. Current market valuation £5.42 billion. Forecast profits for 2017 around the £160 million mark. That's a demanding rating. When discreionary spend could vanish overnight.
Trackers of course get sucked in. As have to hold the stock. Creating a self perpetuating vortex.0 -
Ironically Best just published their latest top rated funds lists and Woodford comes out way out top of their Income sector recommendations over 3 years, and 16% ahead of the Vanguard UK Income index. Naturally we have to wait to see how it all pans out over 5 years and more, but I'm always amazed how those that profess to adhere to long term investing react to relative short term performance, let alone how tracker fans try to pretend there are no managers that consistently outperform over the long term when there actually are a few.
Tracker fans know that some active managers will beat them. If you look backwards you can obviously see the winners and the small number that have done consistently well over the long term. The trick is to pick those winners in the future. Managers like Woodford have done well in that past, but he's now having a number of below average years. He might do well next year. If you use trackers you are accepting "average" performance and IMO stepping back from the hubris of the active investing to a place where you can be more certain of your returns and thus better plan for the future.“So we beat on, boats against the current, borne back ceaselessly into the past.”0 -
bostonerimus wrote: »......ne well in that past, but he's now having a number of below average years. He might do well next year. If you use trackers you are accepting "average" performance and IMO stepping back from the hubris of the active investing to a place where you can be more certain of your returns and thus better plan for the future.
I dont see that passive funds provide any more certain returns than active ones, arguably the reverse especially if the index itself is highly volatile. Active funds can be managed to reduce volatility. If you look at the UK All Companies sector and sort by Trustnet Risk score out of some 242 reporting funds the FTSE100 trackers are all in the highest quartile and the FTSE AllShare trackers in the 2nd highest quartile.
A hypothetical managed fund that succeeded in continuously generating the long term average return would show up in the statistics with a wide variation about the index. But that would say more about the index than the fund.0
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