simoan wrote:XFool wrote:If I may very briefly butt in on this 'private' HYP conversation.
Just out of curiosity, I ran the OP figures for HYP1 through an XIRR table on my spreadsheet. I simply took the annual income figures as all being delivered on 12 November every year (other assumptions would lead to other results).
Using that method, the figure I got for HYP1 was XIRR = 8.63%
Seeing this is a one-off investment of £75k made 23 years ago that has provided a total return of £277k, I think you can afford to be more simplistic. On a total return CAGR basis this is 5.85%. That’s in line with most people’s idea of the long-term return from UK equities being around 6%. If you think that’s acceptable, then so be it. But on a risk/reward basis it wouldn’t do for me, particularly given the very low interest rates that have been pre-dominant within the 23 year period in question, which have been extremely helpful to equity investment. And right now, the 5.85% is little more than the risk free rate you can get in a savings account.
And right now, being the operative phrase!! Right some other time in the past, a savings account would be a dead loss while HYP was still delivering.