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IFA merging, proposed move to new platform and funds

Including Financial Independence and Retiring Early (FIRE)
MartynC27
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Re: IFA merging, proposed move to new platform and funds

#303606

Postby MartynC27 » April 27th, 2020, 2:32 pm

Hariseldon58 wrote:@xxd09
Your suggestion of a Global Index Fund and Global Bond Fund hedged to the pound is at the heart of the Vanguard Life Strategy approach , except that has a third component of additional exposure to UK Equities and UK bonds, to create a modest home bias.

It clearly has much merit but at present with low interest rates I have removed my bond component and gone for a heavy exposure to NS&I Income Bonds, pretty much instant access and 1.16% yield, better than gilts but of equal security.


If you are using NS&I Income Bonds (which are instant access and very secure) instead of a typical Vanguard Aggregated Bond fund hedged to the pound (or the Bonds held in Lifestrategy fund) then do you hold the approximately same sort of ratio of Bonds to Equities. i.e. an investor may hold his age as a percentage in Bonds and the rest in Global equities ?

xxd09
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Re: IFA merging, proposed move to new platform and funds

#303657

Postby xxd09 » April 27th, 2020, 6:00 pm

Yes-a bond is a bond. Which variety of bond you use is a matter of personal preference
The bond part of your portfolio is there to cushion equity volatility ,preserve your portfolio value in tough times -like now etc etc
Cash has its place too- most retirees would aim to have 2 years living expenses in cash-not a bad idea for pre retirees -if they can afford it.
xxd09

Hariseldon58
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Re: IFA merging, proposed move to new platform and funds

#303689

Postby Hariseldon58 » April 27th, 2020, 8:29 pm

@martync27

I previously held a mix of NS&I Income Bonds and US Treasury Bonds, some other USD corporates, unhedged , I chose to convert these bonds to NS&I Income Bonds. This provided gains in early April.

The NS&I element is 18% of the portfolio plus an additional 5% is a directly held property on a lease with 5 year’s remaining. The remainder is the equity portfolio as described.

The property rent was paid for the last quarter and I have reasonable hopes that the rent will be paid in the future.

Thus the equity is 77% of the portfolio, so broadly similar (ish) to a Vanguard LifeStrategy 80.

The NS&I Income Bonds would fund 12 years income at a comfortable level, without any dividends from the equity portfolio. This seems a reasonable margin of safety.

If I followed the age in bonds, I would be in Vanguard LifeStrategy 40, but that would rather lack ambition ! ( It would work perfectly well, probably enough to live our lives out on the bonds portfolio) the equity would be a bonus / inflation protection.

We are fortunate that portfolio growth after 13 years in early retirement, to be effectively over funded! Such that any Vanguard LifeStrategy style portfolio from 20 to 100 would work going forward. Clearly we have been lucky that the last 13 years have been good despite a poor start to the period in 2007-2009. It could easily have gone the other way, it’s important to realise that the right outcome, does not mean the initial decision to run a portfolio that was 90%+ equity was correct

My view going forward is that 75% to 80% equity is right for me, rationally I can a strong argument for 65/70% equity portfolio but I prefer higher risk, mainly because my drawdown rate for a comfortable life is only around 1.5%, prior to Covid we traveled extensively and spent more, it will be some time before that resumes...

There is a paradox in that those who need the most growth and return will tend to have the smaller portfolio and probably can least afford the risk of a high equity %...

I don’t think there is a correct level of bonds, but a range that could work, refined by the individuals capacity to take risk and their ability to mentally tolerate risk.

xxd09
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Re: IFA merging, proposed move to new platform and funds

#303708

Postby xxd09 » April 27th, 2020, 10:34 pm

Hariseldon58-if you have come through the current downturn with that % of Bonds (23%)in your Portfolio you are well funded indeed
Most of us are not in that happy position
I have made enough and 30/65/5 does it for me-Bonds /Equities/Cash-ridden out 3 downturns now
Aged 73 now and will not ever be less than 30% equities
Most people will be in between our positions
There is a saying “If you have won the game (made enough) stop playing “
This is my position
xxd09

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Re: IFA merging, proposed move to new platform and funds

#341713

Postby BennGunn » September 21st, 2020, 1:43 pm

Well the six months is up and its time to make a decision

The logic of flat fees is compelling and after a moderate amount of research I'm favouring moving my portfolio to Interactive Investor and have built a virtual portfolio.

One thing I'd like to check: I'm assuming that the funds available within the "Virtual" Portfolio are available for the actual investment?

I'd be grateful if someone could confirm

For ref the funds I'm proposing to invest in are:

Baillie Gifford Gbl Discovery B Acc
Baillie Gifford Inv Grd Bd B Inc
Vanguard Global Bond Index Fund GBP Hedged Acc
Vanguard FTSE Dev Wld exUKEqIdxInsPl£Acc
Axa Framlington uk growth z gbp acc
iShares CIF UK Glt AlStIdx D Acc
Vanguard FTSE D Wld ex-U.K.Eqty Ind Acc
Vanguard FTSE UK AllShrIdx Acc
Vanguard Gbl Bd Index Hdg A
Vanguard UK Infla Lkd Glt Id Acc

I appreciate that portfolio may look complicated but it has the advantage that it reflects my current portfolio which I'm pretty happy with

nmdhqbc
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Re: IFA merging, proposed move to new platform and funds

#341719

Postby nmdhqbc » September 21st, 2020, 2:08 pm

BennGunn wrote:after a moderate amount of research I'm favouring moving my portfolio to Interactive Investor


I searched the thread for "iWeb" and no results so want to make sure you've considered it. Cheaper than II I think. £25 one off opening fee then £5 a trade. Only downsides are some open ended funds may not be available vs other brokers. You can search in the link below to check if yours are there. Also I don't think they do regular investing. You'd need to login and instigate buys and sells yourself each time.

https://www.markets.iweb-sharedealing.c ... es-centre/


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