L&G Multi-Index 5 I Acc
Options
_pete_
Posts: 213 Forumite
I'm interested in putting some of my pension pot into this fund but I notice it doesn't feature as often on this forum as the Vanguard LS60 or the HSBC Global Strategy Balanced Portfolio.
I currently have my pension portfolio split between the Vanguard and HSBC products, but I'd like to split my eggs between more than 2 baskets, so to speak (without getting into lots of different funds that need me to rebalance).
Is there any reason to view the L&G fund as a worse bet than the other two?
Thank you
I currently have my pension portfolio split between the Vanguard and HSBC products, but I'd like to split my eggs between more than 2 baskets, so to speak (without getting into lots of different funds that need me to rebalance).
Is there any reason to view the L&G fund as a worse bet than the other two?
Thank you
0
Comments
-
To quote the David Bowie song "fashion".
I think VLS are overhyped and dont like the UK-skew of the investments since that skews the industries they invest in.
You are really only putting your eggs in different baskets from the POV of the basket suppliers, its the same eggs from the same hens and it would be incredibly unlikely that they are conducting fraud on a scale whereby you'd lose out, having said that, in practice i doubt you'll see much if any difference between any of these funds so there's no harm done.0 -
It depends what outcome you are looking to 'bet' on.
Is there any reason to view the L&G fund as a worse bet than the other two?
If you look at their factsheet it has a graph showing not just the performance but also how over the last 5 years their risk profile positioning has varied within the 'risk profile 5' band, based on their target asset allocations and the supporting info they receive from Distribution Technology about DT's risk scale. So, if you have faith in DT's measurement tools (or at least, don't have any reason to distrust it), then it seems the fund will do what it says on the tin.
FWIW, my parents have it in their ISA. Not as the whole portfolio, but essentially 'filler' - that £x thousand of the portfolio is going to remain at a medium risk without anything needing to be done with it, and I can just look at the rest of their stuff without needing to worry about that bit.0 -
I currently have my pension portfolio split between the Vanguard and HSBC products, but I'd like to split my eggs between more than 2 baskets, so to speak (without getting into lots of different funds that need me to rebalance).
Your eggs are already split between thousands of baskets. At the moment those baskets are stored in two sheds (which have minimal risk of falling over). Switching some funds into L&G will mostly involve taking some of those thousands of baskets and moving them into a third shed marked L&G. You will still own mostly the same baskets. The exception to this is a very small proportion of baskets that are held by L&G but not HSBC and Vanguard. (Notably, I believe L&G holds bricks-and-mortar commercial property which the other two don't.)
Other than a marginal exposure to commercial property, what this will mainly achieve will be to make it more difficult to keep track of exactly how many eggs you have in your thousands of baskets, because now you have to look inside three sheds instead of one to work out how your eggs are spread across the various baskets.
Metaphors!0 -
The only thing I don't like about the L&G Multi Index funds is that they have separate buy and sell prices, which seems to me a bit like a hidden initial charge. VLS and HSBC GS funds just have the one price which I prefer.Is there any reason to view the L&G fund as a worse bet than the other two?0 -
The only thing I don't like about the L&G Multi Index funds is that they have separate buy and sell prices, which seems to me a bit like a hidden initial charge. VLS and HSBC GS funds just have the one price which I prefer.
As the investment will be for the long term and you will be building up a decent amount of value in it, you might say it's in your interests to have a spread between buy and sell prices - so that the costs of deploying new money or selling assets to redeem shares from people who want to leave, are borne by those people who are doing the joining and leaving; rather than by all investors as a whole.
In other words if you were trading in and out frequently, it would be better for you to be able to trade at the exact NAV and have the costs be borne by all the suckers who just sit there holding; they will get a lower performance. Whereas if you are in for a long term buy and hold, the longer you are in, the better it is for there to be a pseudo 'penalty' for joining or leaving.
The practical costs of running the fund will exist either way. Ironically, you're calling this bid offer spread a hidden cost because it costs you something, but actually - at least they are showing you that you'll pay it. If they don't publish a spread and just swing the price as necessary or absorb the costs against the ongoing investment performance, that's when it's a hidden cost.
If you don't buy that argument, the other thing to do is just consider that the small fraction of a percent on the money you put in for investment - spread over what will potentially be a multi-decade ownership period for much of those contributions - is basically nothing. 0 -
I wouldn't both holding multiple similar funds in the same account. I would just pick the one that most reflects my desired asset allocation. I would consider if I wanted home equity bias, the type of bonds, currency hedging and if I wanted more types of assets.
Alex0
This discussion has been closed.
Categories
- All Categories
- 343.2K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608.1K Mortgages, Homes & Bills
- 173.1K Life & Family
- 247.9K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards