Bear market

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  • Joe_Bloggs
    Joe_Bloggs Posts: 4,535 Forumite
    edited 13 May 2018 at 3:27PM
    @sixpence.
    If you throw your money in to global investments funds whilst the pound is at rock bottom you will get a considerable exposure to global foreign currency valuations of the pound.
    The pound valuation of the globally priced investment will decrease if the pound rises as a traded currency and also increases as the pound falls. This is nothing new but it is a personal irritation .


    I cannot see Brexit adding to the strength to the value of the pound

    J_B.
  • jamei305
    jamei305 Posts: 635 Forumite
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    Joe_Bloggs wrote: »
    @sixpence.
    If you throw your money in to global investments funds whilst the pound is at rock bottom you will get exposure to global foreign currency valuations that will value the investment lower when the pound rises and then value it higher when the pound falls. This is nothing new but it is a personal irritation .


    When is the pound at "rock bottom"? For example, it might currently be the highest it will be for twenty years.
  • dunstonh
    dunstonh Posts: 116,288 Forumite
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    Yeah I think I'll do this. I had 9K to put in my VLS in January and I'm so glad I drip fed it because the fund dropped about 5%.
    Statistically, most phased investments result in lower returns than those that invest on day 1.

    So, whilst it worked before, will it work again? The odds are against you. But you never know.

    There is also the issue that if you are worried about this sort of thing, are you really investing within your risk profile?
    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.
  • jimjames
    jimjames Posts: 17,588 Forumite
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    Treesie wrote: »
    You could ... if you knew when it was and which stocks were the right stocks. There is no easy way to become rich on the stock market.

    I think you're wrong. I'm not sure if you missed out the word "quick". There is a very easy way to become rich and that's to invest long term and let compounding do its work.
    Remember the saying: if it looks too good to be true it almost certainly is.
  • sixpence.
    sixpence. Posts: 295 Forumite
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    dunstonh wrote: »
    Statistically, most phased investments result in lower returns than those that invest on day 1.

    So, whilst it worked before, will it work again? The odds are against you. But you never know.

    There is also the issue that if you are worried about this sort of thing, are you really investing within your risk profile?

    I'm would say I'm worried about it to be honest. I just want to get the best deal I can, which, ironically, as you say, means investing it in a lump sum.
  • sixpence.
    sixpence. Posts: 295 Forumite
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    ValiantSon wrote: »

    All those losses on VLS have now recovered.

    Yup, and I've had more growth because I bought low :)
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    Prism wrote: »
    Agreed, its impossible to judge. In february I added 10K to my Scottish Mortgage holding after a 5% drop. In the next couple of days it dropped another 7%. From the lowest point it is now up 20% however I am up about 13%. Around this time in february there were commentators saying that this was the begining of the crash.

    With SMT's 4 largest holdings amount to some 30% of the portfolio. Worth knowing what you are actually indirectly investing in. As it bears little correlation to many market indices.
  • Prism
    Prism Posts: 3,797 Forumite
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    Thrugelmir wrote: »
    With SMT's 4 largest holdings amount to some 30% of the portfolio. Worth knowing what you are actually indirectly investing in. As it bears little correlation to many market indices.

    Its quite a bit more consumer focused than many other funds but its still pretty much in correlation with the global index (FTSE or MCSI). If there is a down side too it I would say that its lacking in defensive equities - I have other funds for that.

    I absolutely agree you should know what you are invested in with these high conviction managed funds.
  • capital0ne
    capital0ne Posts: 872 Forumite
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    dividendhero wrote: »
    I'd suggest you "drip feed".

    Invest 1k now (or tomorrow as it's Sunday today!)
    Another 1k in 6 weeks
    remaining 1k 6 weeks later.

    I'ts easier to take baby steps this way and you know effects of any price fluctuations will be reduced
    Unless of course the market goes up say 5% in the next 6 weeks, then what, hold off on the Next £1k

    And 6 weeks later it falls 10% then what add £2k or just £1k in case it falls further.

    Don't muck around, invest the full £3k tomorrow. Leave it for at least 3 years.
    If you can't do that investing isn't for you. And I guess that means a pension isn't for you either because that will be invested in the market that could fall.
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