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Taking a lift to the top of the mountain....

Stocks and Shares ISA , Choosing funds for ISA's, risk factors for funds etc
Investment strategy discussions not dealt with elsewhere.
Itsallaguess
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Taking a lift to the top of the mountain....

#163510

Postby Itsallaguess » September 1st, 2018, 10:29 am

A recent thread from OLTB discussed the performance of his 'other Portfolios' -

https://www.lemonfool.co.uk/viewtopic.php?f=56&t=13460

The headline performance of the two portfolios discussed were as follows -

Passive portfolio - The XIRR for this portfolio over the last 12 months has been 5.15% and in addition, the income generated from this portfolio has been 1.69%.

IT portfolio - The XIRR on the IT portfolio over the past 12 months was 5.63% and yield was 2.8%.

In a reply on the above thread, ap8889 has raised the following point -

VWRL total return over last 12 months is 10.9%.

Vanguard LS 80% is 7.56%.

Rather than deal with a very complicated IT portfolio, a simpler approach might save fees?


Now, this is a timely point for me, as someone who has recently started to dip their toes into some of the Vanguard low-fee products. I've just checked my last Vanguard Lifestrategy 80% purchase, and since being purchased in April of this year, it's currently showing a rise of 8.77% in my non-ISA shares account.

Having given this some thought, I think there's two distinct issues at play here -

1. Outright performance

2. Personal enjoyment from being more hands-on

I personally think there's a level of enjoyment to be had from being more 'hands-on' with an investment portfolio, and that this 'enjoyment' might even come at a price.

That price might be financial, in terms of some performance difference, and it might be personal, in terms of the time and effort taken to enjoy a more hands-on approach, but the question I keep asking myself is -

'Am I happy to pay a price (financial/time/effort), if it means that I gain some personal enjoyment and satisfaction from the process?'

Does this come down to the 'taking a lift to the top of the mountain' question?

If there was a pleasurable walk to the top of a mountain, but also a lift that would get you to the same place, would those getting the lift consider the walkers were wasting their time and energy?

If they were having to pack a lunch due to the length of time the walk took, would they be 'wasting their money' on that lunch, given that they'd not need it if they took the lift?

Personally, as a keen walker, I don't think they would be wasting their time, effort, or money, but I can see why some people might think they were.

Is it the same with personal investment?

Do some of us gain pleasure from the walk itself?

I think I do, but the performance of some of the cheap Vanguard funds do make me think more about this, recently...

Cheers,

Itsallaguess

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Re: Taking a lift to the top of the mountain....

#163514

Postby Lootman » September 1st, 2018, 10:46 am

I made what I believe was a similar point recently about how HYP is supposed to be a "hands off" strategy but then observed that some here seem to invest an inordinate amount of energy into measuring, monitoring and managing their supposedly low-maintenance portfolio. It is as if investors feel an irresistible urge to expend time and effort into the project even if they are determined to not "tinker" and just let things go were they will.

In terms of passive versus active, I share your dilemma and resolve it by doing both, i.e. using passive and index funds for the core of my portfolio, and then using active methods around the edges where I think (rightly or wrongly) that I have an edge. The latter keeps it fun and interesting for me but at no great ultimate risk to my net worth.

I say "passive AND index funds" because to me there is a distinction between a pure cap-weighted index fund and the more specialised passive vehicles that we see with some ETFs.

For the active component, I use individual shares, ITs and options.

Put another way, pursue beta to sleep at night and alpha for fun. But either way, you still have to do your asset allocation and that's not really a passive process even though Vanguard does a decent job of trying.

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Re: Taking a lift to the top of the mountain....

#163522

Postby tjh290633 » September 1st, 2018, 11:22 am

I started out with unit trusts, all with a different focus, long before trackers had been invented. A few ordinary shares and fixed interest stocks were inherited and most of those found there way into more unit funds, aimed at income. Unit linked life assurance came along with tax relief. A few more shares were added, some from privatisation or IPOs. Then along came PEPs and I set out on that route. The existing shares and most of the unit trusts were moved into PEPs. So I ended up with a mixture of ordinary shares and unit trusts, virtually all in tax shelters.

More recently I have been investigating in ITs for my grandchildren and dabbled a little in AIM shares. The one thing I have not done is to go for trackers or passive funds, although I am passive in all the collective Investments. Mostly the dividends are reinvested, although I take the distribution from two of the now OIECs which nominally gets recycled into the regular investments into the grandchildren's bare trust ITs.

I have to confess that monitoring the progress or otherwise of my now share ISA is an enjoyable activity. Deciding where to reinvest accumulated income, whether to trim back overweight shares or to dispose of low yielding shares, takes a little time, but does not preclude other activities.

For me there is more pleasure in being hands on than in being passive. It is particularly rewarding when my own efforts do better than comparable investments. Not always, of course, but over the long term it has been so.

TJH

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Re: Taking a lift to the top of the mountain....

#163558

Postby Raptor » September 1st, 2018, 1:32 pm

My entry into "shares" was through the IT companies I worked for either giving me "free" shares for joining and staying with them or as part of a "share scheme". As I was young and in need of money after an expensive divorce, everything was "Capital" centric. As I got "older" (and wiser), I looked at what packages I could get out of my future employees, this gradually moved towards "pension" contributions rather than shares. So it was not till a "redundancy" came about and I decided I had enough of the "world" I had been in for nearly 30 years that I looked at "shares" as an income. Fortunately, I had a DB pension with IBM hanging around and as I was coming up to 50 asked them about taking it. My surprise was how much "cash" they were willing to give me. This was the basis to me buying a 15 share HYP all in one go (boy did I make mistakes with that one as it was before I found TMF), but as I found myself with lots of time I enjoyed the investing and monitoring part. Excel had always been one of my "strong" points so building, monitoring and tracking was another enjoyable exercise (wish I had known about HYPTUSS and "stepone" in those days though). So yes for 12 years the "journey" was made more enjoyable by the interaction rather then the inaction. Then, what happened, my Mum got dementia and I took over all the finances (had already been doing some of it for a while), a discussion on TMF about what would you do if you "no longer wanted to do or could" manage your portfolio, made me look again, also the penison changes meant I could "manage" my own pension funds. So I moved everything into a SIPP with HL and 50% went on HYP and 50% on "income" IT's. Since then have decided that I would move much more over to IT's (initially it was 85% shares, now down to 73%) and more recently looking at "growth & income" IT's.

So far the walking up the mountain has been enjoyable but having the ability to jump on and off the lift is nice to have. Will I switch to other funds as I go along the journey, not ruled out.

Still re-invest 85% of dividends. No new money going in, but that may change when I get my "state" pension next year. My daughter is in the position she doesn't need me to "support" her and decided last year to use her savings to start an income centric portfolio and currently has a 14 share portfolio. She is not too bothered about the capital (which is strange for a 33 year old) and annoys her boyfriend who is "capital" centric (has been quite successful too, or so he tells me).

Like TJH, it is a real pleasure to look at what I have done with my efforts and see that I seem to be better off than the "experts". Not always, St James Wealth did a brilliant job of collecting all my various pension pots together and making a very decent "profit" for me. Pity that they were "poor" when it came to drawdown.

Raptor.

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Re: Taking a lift to the top of the mountain....

#163571

Postby everhopeful » September 1st, 2018, 2:37 pm

I certainly walk up the mountain even sometimes beneath the lift that carries the less active to the upper slopes. So it is with my portfolio. I can live comfortably on my pension so the investments are a pot for the children to inherit. In this situation a growth strategy would seem logical, but in the same way that despite having plenty of bhp under the bonnet I find myself driving slowly, I have moved to a more cautious stance with much more fixed income and bond proxy holdings but very little passive.. I enjoy the hands on management and reassure myself that any underperformance is at least partially mitigated by not paying a wealth manager. I just hope the Grim Reaper will give me enough notice to convert it all to Vanguard etc before my wife has to take it on.
There was an interesting article on active versus passive investing on the back page of today's FT.

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Re: Taking a lift to the top of the mountain....

#163628

Postby spiderbill » September 1st, 2018, 9:58 pm

Mountains can be dangerous places. IMO the experience and knowledge gained in learning how to climb them is invaluable if the weather turns nasty when you're up there and your lift stops working and can't take you down again! And that packed lunch might just save your life!

cheers
Spiderbill
(currently at my house in the Slovenian mountains where I'm happy to use my quad bike to shorten some of the walks but knowing full well that I need to stay fit enough to tackle them on foot from time to time - plus you can't take landscape photos from a moving bike ;-) )

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Re: Taking a lift to the top of the mountain....

#163676

Postby Itsallaguess » September 2nd, 2018, 8:51 am

Lootman wrote:
I made what I believe was a similar point recently about how HYP is supposed to be a "hands off" strategy but then observed that some here seem to invest an inordinate amount of energy into measuring, monitoring and managing their supposedly low-maintenance portfolio.

It is as if investors feel an irresistible urge to expend time and effort into the project even if they are determined to not "tinker" and just let things go were they will.


I think this is an important point, and one that gets raised lots of times with regards to the duality of what is perhaps 'sold' as a simple, hands-off HYP strategy, and the fact that lots of people seem to spend a great deal of time 'on it', but as someone who would probably put themselves in that particular bracket, I do want to take the opportunity to try to explain my own position on this.

It's interesting that you use the word 'project' here, as I think this can explicitly help to explain my own approach to my HYP, and where I think many of us that you might see as 'invest(ing) an inordinate amount of energy into measuring, monitoring and managing their supposedly low-maintenance portfolio', can perhaps help to justify doing so.

My HYP has the potential to seriously influence any early-retirement plans that I may like to have the option of in later life. Without going into too many details, such options might become viable in what we might consider to be the 'medium term', so not right on the horizon, but both near enough to justify serious consideration now, and far enough away that the performance of the HYP between now and then is likely to have a large influence of both the viability and the timing of any such early-retirement options.

So, given the above, and taking into account our 'normal' huge and 'lumpy' chapters of most of our lives, I hope we can agree that my HYP has the potential to play a massive part in what might be a very important 'trigger point' in my life....

As such, and to take your own phrase above, my HYP 'Project' is very, very important to me.....

So, that's the background, and having explained that, I think it's then important to appreciate that performing a 'fire-and-forget' investment into such a HYP vehicle, where its sole purpose is to help provide the above early-retirement options, would in my mind be a fantastically optimistic approach to take.

Throw a load of cash into the HYP box, shut the lid, and then open it in 20 years time to see if it's delivered on my original expectations? I don't think so....would anyone be brave enough to do that?

Where I do spend most of my time on my HYP, it's in tracking this 'Project'.....making sure that the original premise of the 'Project', and any subsequent investment and re-investment that has occurred (I'm still working, and so inject new capital into the HYP each year, and also re-invest all dividend-income from it...) is still working hard to deliver on that original job-spec.

Some of that time is spent checking that previous 'project-assumptions' have been delivered on (delivered-income in the form of dividends, growth assumptions of existing dividend-income, etc..), and some of it is spent on tweaking future assumptions, and projecting out expectations for near, medium, and long-term dividend-income based on previous deliverables, and then confirming that the above processes are still aligned with my original plans for the HYP deliverables, in terms of where I 'would like to be', to give me the future options that I would like to have...

I wouldn't say that it's a great deal of time, as like many of us I have some spreadsheets set up that now take very little time to update and monitor, but in terms of all of the time that I spend on my HYP, I'd probably say that 10% of the time would be spent on what I would properly describe as 'Investment Activities', and 90% of the time would then be spent on these 'Project Management' activities related to my HYP.

For me, to know that the original proposed deliverable of my HYP is progressing within the scope set out, is right up there as a high-priority, as equally important as many other high-priorities in my life. If other investors would be able to demand the same output from an investment-activity without any of the 'Project Management' tasks that I continue to undertake, well they're of course welcome to do so, but I'm really not sure how any confidence in long-terms plans like this can be gained without performing at least some in-flight monitoring of such a project.

So in reality, my HYP investment process itself really is quite hands-off, as you suggest it ought to be, taking up a really small amount of actual time per year, mostly around the time of the new tax year, and then relatively small amounts of time throughout the year when dividend-income might need re-investing.

The other time is spent just keeping an eye on things, and tweaking a few course-adjustments on the way towards what I hope to be my final destination, where really important options might become concrete for me.

The above has turned into a much longer post than I expected to make, but hopefully it helps to explain why I think it is possible to justify 'spending time' on a HYP investment process that is really supposed to be quite 'hands-off'.

For me, it's not a HYP, it's a project, and I spend most of my time project-managing, not investing, and I'm very happy to continue doing so....

Cheers,

Itsallaguess

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Re: Taking a lift to the top of the mountain....

#163691

Postby tjh290633 » September 2nd, 2018, 10:15 am

FredBloggs wrote:I am minded to comment (so I will), how about not going up the mountain yourself? Send somebody else up and keep an eye on how they're doing. If they aren't getting to the top in a suitably timely manner, sack them and engage another climber.

Accepting your proposition, are you not thereby climbing a different mountain?

In other words, actively trading but in collective Investments rather than individual shares?

TJH

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Re: Taking a lift to the top of the mountain....

#163723

Postby Lootman » September 2nd, 2018, 1:02 pm

Itsallaguess wrote:The above has turned into a much longer post than I expected to make, but hopefully it helps to explain why I think it is possible to justify 'spending time' on a HYP investment process that is really supposed to be quite 'hands-off'.

For me, it's not a HYP, it's a project, and I spend most of my time project-managing, not investing, and I'm very happy to continue doing so....

A good reply, thank you. If I may I'd suggest you are really doing two things there.

The first is tactical. The commitment to the HYP project remains but some annual tinkering might be needed to the portfolio to refine it for reasons of risk, income, returns, diversification and so on.

The second is strategic - you monitor the project to ensure that HYP itself is fit for purpose, the purpose being your retirement goals. After all, if you are going to have blind faith in it then it really would not require any measurement or monitoring at all. But is anyone that confident in it?

And I think that is all perfectly reasonable. The only strategy I'd be near 100% confident about is using index funds, within an asset allocation that I am comfortable with. For my HYP (I will call it that although it is not "pure" at all and more of just a general dividend strategy) is just a part and not all I am relying on. My biggest allocation is to the US market as I see that as the safest and growthiest in the world.

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Re: Taking a lift to the top of the mountain....

#163796

Postby SDN123 » September 2nd, 2018, 9:49 pm

Regarding the OP - I believe that the best accumulation strategy for me is passive investing through index funds (similar to a Tim Hale strategy).

I’m less clear on the best de-cummulation strategy (eg how to draw down money after I’ve retired). Given the total capital I’m likely to be able to accumulate I think that HYP is likely to be a good strategy for me.

In order to “practice” that strategy I run a small HYP (that I try to keep around 10% of my total investments). I find that I really enjoy “playing” (monitoring/ recording / etc) with the HYP - even though I rarely actually do anything other than top up shares. This “activity” has had a secondary effect in that I don’t bother much about, and hardly even look at, the 90% passive part of my portfolio.

My annual numbers (see reports on the HYP Strategy board) so far show that:
a) the passive portfolio is a better saving vechile for me than HYP and
b) HYP is a reasonable vechile for producing income.

My point is that having a small (10%) active portfolio has, on the face it, cost me money (capital) BUT I enjoy managing that part of the portfolio and I suspect that the very existence of the HYP has stopped me messing with, and messing up, the much larger passive portfolio. In other words fun and valuable.

SDN123

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Re: Taking a lift to the top of the mountain....

#163837

Postby OhNoNotimAgain » September 3rd, 2018, 8:50 am

Professional fund managers have an excuse to get out and "do something" to demonstrate the value they are adding.
The individual investor has no such incentive. Any attempt at adding alpha simply adds costs and has a 50% chance of reducing returns.
If he or she adds returns those returns must surmount the hurdle of the extra costs before net value is added. Moreover, those additional returns have been created by taking on extra risk. A 7 year bull market from 2009 to 2016 driven by QE has favoured risk taking. But risk is always there and will always reveal itself, eventually.

Over the last three years the average active UK fund has underperformed the UK index by 2.6%. Of course that won't be relevant to the readers of these boards because they are all abover average investors. However, it does demonstrate that, overall, fund management destroys value rather than increases it.

This article confirms the point

https://www.ft.com/content/a66581a6-e59 ... 7ddd37b130

Private equity and hedge fund managers have delivered lower returns after fees than investments in stock markets and property, according to a study that looked at leading pension schemes in the UK and Netherlands since 2010.

HF & PE funds are just managed funds on steroids.

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Re: Taking a lift to the top of the mountain....

#163854

Postby OZYU » September 3rd, 2018, 10:30 am

OhNoNotimAgain wrote:Professional fund managers have an excuse to get out and "do something" to demonstrate the value they are adding.
The individual investor has no such incentive. Any attempt at adding alpha simply adds costs and has a 50% chance of reducing returns.
If he or she adds returns those returns must surmount the hurdle of the extra costs before net value is added. Moreover, those additional returns have been created by taking on extra risk. A 7 year bull market from 2009 to 2016 driven by QE has favoured risk taking. But risk is always there and will always reveal itself, eventually.

Over the last three years the average active UK fund has underperformed the UK index by 2.6%. Of course that won't be relevant to the readers of these boards because they are all abover average investors. However, it does demonstrate that, overall, fund management destroys value rather than increases it.

This article confirms the point

https://www.ft.com/content/a66581a6-e59 ... 7ddd37b130

Private equity and hedge fund managers have delivered lower returns after fees than investments in stock markets and property, according to a study that looked at leading pension schemes in the UK and Netherlands since 2010.

HF & PE funds are just managed funds on steroids.



By quoting in relation to the overall dross field of managers who go through the motion at best, it does not give justice to the still quite numerous outstanding managers (I can think of at least a dozen without breaking sweat), they won't beat their market every year of course, but as a basket they do on a rolling three year basis, three year roll after three year roll with few exceptions. One just picks them with a bit of research, just like one tries to pick individual shares, carefully, that's all, not foolproof at individual level, far from it, but after a little practice quite doable at portfolio level.


Back to the OP. Nice thread. I believe there are key difference between the requirement in pot building (accumulation phase), which is imho about (assuming one's portfolio is unitised) increasing one's acc unit value in line with your chosen World Index, or composite such, (and if you can't achieve this regularly enough on a three year rolling basis by DIY, then consider switching to trackers or a basket of collectives. The trackers will by definition underperform that index slightly, and it is quite doable to have basket of collectives which does better than that, with a bit of research and experience), vs quite different requirements in the de-accumulation phase, which to my mind is often about making sure inc units and divis per inc unit growth both beat RPI on a rolling basis, or in the case of the Inc units, at least match it.


You will generally get to know if your accumulation phase, which of course includes whatever pensions you have picked up in addition to you portfolio, was successful enough if you don't find yourself desperately chasing too high a portfolio yield in retirement without a suitable
reserve.

But in the end the most important component of climbing this mountain is not so much about the stock markets returns, it is about seeking to progress as a person and in the workplace, plus the habit of saving early in life, as much as sensibly possible.


Ozyu

Moderator Message:
Post edited to remove text which could be construed as a personal attack. -- MDW1954

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Re: Taking a lift to the top of the mountain....

#164067

Postby Lootman » September 4th, 2018, 9:13 am

SDN123 wrote:I’m less clear on the best de-cummulation strategy (eg how to draw down money after I’ve retired). Given the total capital I’m likely to be able to accumulate I think that HYP is likely to be a good strategy for me.

If the capital sum you have to provide income is insufficient to fund your needs if invested in, say, an index fund and only provides an adequate income via something like a HYP then I think that is the danger zone. You are relying on shares that the market is already coonferring a higher risk premium upon. In a good market that will work. In a down market then there could be trouble.

In my opinion you cannot compensate for not having enough capital to retire upon by merely pushing up the average yield of your portfolio.

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Re: Taking a lift to the top of the mountain....

#164128

Postby SDN123 » September 4th, 2018, 12:48 pm

Lootman wrote:
SDN123 wrote:I’m less clear on the best de-cummulation strategy (eg how to draw down money after I’ve retired). Given the total capital I’m likely to be able to accumulate I think that HYP is likely to be a good strategy for me.

If the capital sum you have to provide income is insufficient to fund your needs if invested in, say, an index fund and only provides an adequate income via something like a HYP then I think that is the danger zone. You are relying on shares that the market is already coonferring a higher risk premium upon. In a good market that will work. In a down market then there could be trouble.

In my opinion you cannot compensate for not having enough capital to retire upon by merely pushing up the average yield of your portfolio.


You make an excellent point which is the reason for me saying that I’m “less clear”.

Let’s say, for the sake of discussion, that an index linked gilt is risk free. You’ve suggested index funds as a method of drawing down from investments. I think that implies that you are willing to take some “risk premium” to increase income. A level of risk that, perhaps, you wouldn’t take if you had sufficient capital to just live from the income generated by (in my example) linkers. So, with insufficient income you’re will to take on some “voluntary” additional risk to compensate. I suspect that I won’t have enough capital to live off index funds. I am considering adding additional risk (compared to index funds) to get a higher yield. I think HYP may be a suitable strategy for me to add that extra risk (mitigated very slightly by lower fees.) I’m running the “experimental” HYP now to see if that is actually true. As stated above with the side benefits of it being an enjoyable exercise and enough distraction to stop me playing with the larger passive side of my investments.

SDN123

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Re: Taking a lift to the top of the mountain....

#165080

Postby DiamondEcho » September 8th, 2018, 10:56 am

Itsallaguess wrote:As such, and to take your own phrase above, my HYP 'Project' is very, very important to me.....
So, that's the background, and having explained that, I think it's then important to appreciate that performing a 'fire-and-forget' investment into such a HYP vehicle, where its sole purpose is to help provide the above early-retirement options, would in my mind be a fantastically optimistic approach to take.
Throw a load of cash into the HYP box, shut the lid, and then open it in 20 years time to see if it's delivered on my original expectations? I don't think so....would anyone be brave enough to do that?


I agree IAAG, and with your broader overall post. I think there is a contradiction within the scripted [scriptured?] HYP ethos that suggests that the mindset that was required to decide to be a long-term HYPer, is the mindset that come retirement-day can later happily lounge in the hammock without a care in the world. Surely: 'Leopards don't change their spots'?

A positive with HYP is it's low fee, and in parallel with the work that goes into it hopefully successful. The flip-side is it is your unique baby, entirely your day-to-day responsbility: So it's personal, like looking in a mirror every day if you care to.

I'm at a point where I can't see HYP as passive; ie it's simply not in my nature. And so to go more hand-off I suspect I'll have to segue into funds that provide a lower but less risky, less blame-attached, income stream, at least for the core of it. I suspect that in the near-term I'll need to keep a proportion as direct investments as a reason to get up and engage with the world each day.

Between HYP and the above mooted divestment I'm wondering if the tax structure within which it's all held perhaps matters more to the overall returns.

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Re: Taking a lift to the top of the mountain....

#165088

Postby mickeypops » September 8th, 2018, 11:16 am

tjh290633 wrote:
FredBloggs wrote:I am minded to comment (so I will), how about not going up the mountain yourself? Send somebody else up and keep an eye on how they're doing. If they aren't getting to the top in a suitably timely manner, sack them and engage another climber.

Accepting your proposition, are you not thereby climbing a different mountain?

In other words, actively trading but in collective Investments rather than individual shares?

TJH


Interesting question! I first starting investing about six years ago and was drawn into the HYP philosophy. Within a couple of years I realised that I wasn't really quite comfortable with the quite large variations in individual share performances. I was checking the business news avidly looking for news reports into the companies I held and anxiously waiting for share price movements. I watched some company sectors tank (e.g.supermarkets, miners) and others do well.

I was drawn to Investment Trusts via LUNIs work on the old boards, and via Money Observer and John Baron's work. It all seemed a much calmer way forward and so I switched strategy, and became much less stressed about my investment choices.

So now, in terms of this thread, I think I'm climbing the same mountain as before, but as part of a large group of climbers, led by experienced and knowledgeable moutaineers. Much more comfortable a journey than a solo trek I think.

Great thread, BTW.

MP

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Re: Taking a lift to the top of the mountain....

#165535

Postby OhNoNotimAgain » September 10th, 2018, 5:45 pm

mickeypops wrote:
tjh290633 wrote:
FredBloggs wrote:I am minded to comment (so I will), how about not going up the mountain yourself? Send somebody else up and keep an eye on how they're doing. If they aren't getting to the top in a suitably timely manner, sack them and engage another climber.

Accepting your proposition, are you not thereby climbing a different mountain?

In other words, actively trading but in collective Investments rather than individual shares?

TJH


Interesting question! I first starting investing about six years ago and was drawn into the HYP philosophy. Within a couple of years I realised that I wasn't really quite comfortable with the quite large variations in individual share performances. I was checking the business news avidly looking for news reports into the companies I held and anxiously waiting for share price movements. I watched some company sectors tank (e.g.supermarkets, miners) and others do well.

I was drawn to Investment Trusts via LUNIs work on the old boards, and via Money Observer and John Baron's work. It all seemed a much calmer way forward and so I switched strategy, and became much less stressed about my investment choices.

So now, in terms of this thread, I think I'm climbing the same mountain as before, but as part of a large group of climbers, led by experienced and knowledgeable moutaineers. Much more comfortable a journey than a solo trek I think.

Great thread, BTW.

MP


The illusion of safety from the comfort of Group Think.

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Re: Taking a lift to the top of the mountain....

#165627

Postby Fluke » September 11th, 2018, 9:53 am

If memory serves pyad's original 'target audience' for the HYP were not so much climbers as parachutists, people who were ready to retire and had a pot of cash to invest. Spread the money between 15 to 20 shares and start enjoying the income from day one, don't worry about the shares they'll do whatever they're going to do, job done, no climb (management, planning, monitoring) necessary. They had in a sense parachuted in from above (or completed the climb by other means pick your analogy) and all they had to do was unscrew the tomato soup, unwrap the cheese sarny, sit back and enjoy the view.

The climbing only comes in when people started saying but hang on a minute, I rather like this strategy but I don't have a big pot of cash and I'm not ready to retire but I do have a regular income so maybe I can use this strategy as a means of getting to the top from below. Now that requires a climb and climbing requires a very different mind set to parachuting, climbing is slow and methodical and has many decision points and escape routes. Parachuting is fast and furious and it's over very quickly, no stopping to think about it and minimal scope for changing direction - very different mind set.

Climbing is not hands off, parachuting can be.

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Re: Taking a lift to the top of the mountain....

#165645

Postby IanTHughes » September 11th, 2018, 10:58 am

FredBloggs wrote:But........ The thread has little or nothing to do with HYPing, has it? It's about strategy. That may or may not include investing for income, but climbing the mountain rather suggests an accumulation strategy to me.

I agree. But surely this could refer to an HYP accumulating income?


Ian


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