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Unitisation question

For discussion of the practicalities of setting up and operating income-portfolios which follow the HYP Group Guidelines. READ Guidelines before posting
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Arborbridge
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Re: Unitisation question

#193760

Postby Arborbridge » January 15th, 2019, 3:45 pm

Breelander wrote:
ElectronicFur wrote:All sounds like too much effort. I will just go back to forgetting all about unitisation I think!


No, don't forget about it - just start unitising from today onwards. Calculation units as you go along is no real effort at all. It's only if you try to work it back in time that you get headaches.


I do so agree. I wish I had known about unitisation years before I started on the HYP road. It's really very useful for comparison purposes. As it was, I lost two or three year of my HYP building before someone on TMF explained how to unitise, and I've always been thankful for that.

Arb,

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Re: Unitisation question

#193871

Postby ElectronicFur » January 15th, 2019, 11:19 pm

As I'm no longer adding new money and living off the income now it seems pointless.

Dod101
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Re: Unitisation question

#208216

Postby Dod101 » March 17th, 2019, 3:40 pm

Every so often I look at this much recommended unitisation business but like ElectronicFur I withdraw all my dividends to live off and the portfolio is self contained with no or very little new capital going in and almost none coming out. I have thus never seen the point in unitisation although I suppose with the very few such transactions, it would not be much work.

OTOH I am not sure what it would achieve and I am not a spreadsheet addict. I simply track my dividends on an annual basis, and I want two things, a steadily increasing cash amount and I want to know the yield on the year end value. Of course I use a pivot table to analyse my dividends, but that is it.

Stats and info are only of use if you are going to use it to help improve the outcome.

Dod

MDW1954
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Re: Unitisation question

#208258

Postby MDW1954 » March 17th, 2019, 7:05 pm

Dod101 wrote:Every so often I look at this much recommended unitisation business but like ElectronicFur I withdraw all my dividends to live off and the portfolio is self contained with no or very little new capital going in and almost none coming out. I have thus never seen the point in unitisation although I suppose with the very few such transactions, it would not be much work.

OTOH I am not sure what it would achieve and I am not a spreadsheet addict. I simply track my dividends on an annual basis, and I want two things, a steadily increasing cash amount and I want to know the yield on the year end value. Of course I use a pivot table to analyse my dividends, but that is it.

Stats and info are only of use if you are going to use it to help improve the outcome.

Dod


Dod,

I'm a few years younger than you, and I applaud every word of this. The spreadsheet that I use to manage my HYP is quite complicated, but I've never seen the need to unitise. What I'm interested in is the income.

MDW1954

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Re: Unitisation question

#208263

Postby tjh290633 » March 17th, 2019, 7:22 pm

I adopted unitisation to make sure that I was not deluding myself.

TJH

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Re: Unitisation question

#208269

Postby funduffer » March 17th, 2019, 7:51 pm

I do what arb does, but just inc units, because I spend some and reinvest some.

I can then compare income unit price with the FTSE AS index as my benchmark for capital growth.

And look at income per unit to calculate dividend growth versus inflation.

I calculate this once a month, or when I buy or sell something.

I do the same for my IT portfolio, so I can compare the two.

FD

MDW1954
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Re: Unitisation question

#208282

Postby MDW1954 » March 17th, 2019, 8:52 pm

tjh290633 wrote:I adopted unitisation to make sure that I was not deluding myself.

TJH


I'm not competing with either an index, or anybody else. I don't need unitisation to tell me if my income is going up. Granted, I'm still putting money into the HYP, so that is to be expected. But it's very easy to mentally compartmentalise the impact of purchases, and in any case, dividend drag muddies the water anyway.

But we digress. Each to their own.

I only felt the need to applaud Dod's bravery in owning up to non-unitisation simply because it seems to be almost de rigeur around here, these days.

MDW1954

Arborbridge
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Re: Unitisation question

#208283

Postby Arborbridge » March 17th, 2019, 8:57 pm

Dod101 wrote:Every so often I look at this much recommended unitisation business but like ElectronicFur I withdraw all my dividends to live off and the portfolio is self contained with no or very little new capital going in and almost none coming out. I have thus never seen the point in unitisation although I suppose with the very few such transactions, it would not be much work.

OTOH I am not sure what it would achieve and I am not a spreadsheet addict. I simply track my dividends on an annual basis, and I want two things, a steadily increasing cash amount and I want to know the yield on the year end value. Of course I use a pivot table to analyse my dividends, but that is it.

Stats and info are only of use if you are going to use it to help improve the outcome.

Dod


I can see your POV, and it's right for you. You developed your ideas years ago and if it works well enough to provide your income, I can see why you don't bother to measure anything. You do sacrifice some information: for example, you probably can't answer the question: am I investing more effectively than a professional manager. I believe you can only find that by unitising or perhaps by XIRR for TR.

However, my position was more like TJH's comment: I wanted to test how well my investments - in particular HYP, which I had just begun - stacked up with regard to other ways of investing my recently obtained pension pot. After all, HYP was new and experimental for me, so I needed to check what was going on.
As he put it: "to make sure I was not deluding myself".

The difficulty in trying to compare my portfolios up to that time was: how to handle new cash input? If one has a clsoed system with no inputs or outputs, there isn't a problem. But in my case of "portfolio building" there was, and that's why I leapt on the idea when someone explained how to unitise.

Eventually, I will probably stop because I will have learnt all that's necessary - but given that my system is set up and takes little effort, I'll carry on for the time being. It is still the only way I can compare my portfolio performance with professional ones, or with a basket of other funds such as ITs and OEICS.

Arb.

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Re: Unitisation question

#208284

Postby Arborbridge » March 17th, 2019, 9:02 pm

MDW1954 wrote:
tjh290633 wrote:I adopted unitisation to make sure that I was not deluding myself.

TJH


I'm not competing with either an index, or anybody else. I don't need unitisation to tell me if my income is going up. Granted, I'm still putting money into the HYP, so that is to be expected. But it's very easy to mentally compartmentalise the impact of purchases, and in any case, dividend drag muddies the water anyway.

But we digress. Each to their own.

I only felt the need to applaud Dod's bravery in owning up to non-unitisation simply because it seems to be almost de rigeur around here, these days.

MDW1954


Well, your income might be going up. but is it going up as much as it would in some other fund? Aren't you even vaguely curious. If not, then I guess we just have quite different mentalities.

As far as being de rigeur: I don't think it is. However, being an enthusiast myself, I can't help trying to encourage others :)

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Re: Unitisation question

#208291

Postby MDW1954 » March 17th, 2019, 9:37 pm

Arborbridge wrote:
MDW1954 wrote:
tjh290633 wrote:I adopted unitisation to make sure that I was not deluding myself.

TJH


I'm not competing with either an index, or anybody else. I don't need unitisation to tell me if my income is going up. Granted, I'm still putting money into the HYP, so that is to be expected. But it's very easy to mentally compartmentalise the impact of purchases, and in any case, dividend drag muddies the water anyway.

But we digress. Each to their own.

I only felt the need to applaud Dod's bravery in owning up to non-unitisation simply because it seems to be almost de rigeur around here, these days.

MDW1954


Aren't you even vaguely curious? If not, then I guess we just have quite different mentalities.



Arb,

Nope, not in the least. (As for "different mentalities", I'm often told by a few people close to me that I'm "on the spectrum", so perhaps that explains it.)

For me, HYPing delivers what I wanted it to, when I switched from index tracker investing in 2005, having turned 50.

I have a HYP, a clutch of ITs, and a (very) few funds, and I'm happy.

MDW1954

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Re: Unitisation question

#208301

Postby Dod101 » March 17th, 2019, 10:13 pm

Interesting comments, all of them. I am simply stating what I do. As anyone who reads what I write knows, I am not in the least complacent; therein lies great danger but I do not care whether I am beating a professional manager, nor whether I am doing better or worse than anyone else in fact. In my early days I might have found unitisation useful, but in my 'fenced off' portfolio I do not think it would help me. I withdraw virtually all my dividends and if I have a surplus (which is becoming the case) then it goes to grandchildren in one form or another.

Dod

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Re: Unitisation question

#208324

Postby idpickering » March 18th, 2019, 6:29 am

Dod101 wrote:Interesting comments, all of them. I am simply stating what I do. As anyone who reads what I write knows, I am not in the least complacent; therein lies great danger but I do not care whether I am beating a professional manager, nor whether I am doing better or worse than anyone else in fact. In my early days I might have found unitisation useful, but in my 'fenced off' portfolio I do not think it would help me. I withdraw virtually all my dividends and if I have a surplus (which is becoming the case) then it goes to grandchildren in one form or another.

Dod


I'm with Dod in not doing unitisation. I don't see the need to be honest. But as stated by another poster above, "each to their own", and I respect that right.

Ian.

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Re: Unitisation question

#208336

Postby BrummieDave » March 18th, 2019, 8:44 am

idpickering wrote:
Dod101 wrote:Interesting comments, all of them. I am simply stating what I do. As anyone who reads what I write knows, I am not in the least complacent; therein lies great danger but I do not care whether I am beating a professional manager, nor whether I am doing better or worse than anyone else in fact. In my early days I might have found unitisation useful, but in my 'fenced off' portfolio I do not think it would help me. I withdraw virtually all my dividends and if I have a surplus (which is becoming the case) then it goes to grandchildren in one form or another.

Dod


I'm with Dod in not doing unitisation. I don't see the need to be honest. But as stated by another poster above, "each to their own", and I respect that right.

Ian.


I used to be ambivalent about it, but now I'm not so sure.

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Re: Unitisation question

#208470

Postby moorfield » March 18th, 2019, 6:23 pm

I continue to use accumulation units, but the only use I have for these is to redact the nominal income here that my portfolio generates each year (ie. £nominal/unit) - that nominal income vs. a future target is my primary measure of how well I am progressing. Otherwise I use XIRR on the cashflows contributed into my portfolio to get a feel for rate of return.


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