Discussion
Chaps,
Does anyone here have anything invested in, or any dealings with, Fundsmith? I came across them at the Boat Show a week or so ago and their sales schtick seemed pretty good (don't they all?) They show double-digit growth in the last 12 months, and 5% in December alone. It was started by Terry Smith, who has put a chunk of his own cash in. They charge a 1% flat rate as commission.
I'm an investing novice (no, make that non-starter), and I don't understand that difference between the different bits of what they list (Equity Fund, Equities, UK Bonds and Cash, and their 'T' class, 'R' class and 'I' class shares). However I do know that we have a reasonable amount of money in a scheme run by the IFA Towry Law, which is costing me a lot more than 1% and has made a significant loss in the last 12 months.
We are saving a goodly chunk into the Towry Law investments each month, and I am wondering whether it is wise to carry on throwing good money after bad. Observations on Fundsmith and other options would be welcome!
Oli.
Does anyone here have anything invested in, or any dealings with, Fundsmith? I came across them at the Boat Show a week or so ago and their sales schtick seemed pretty good (don't they all?) They show double-digit growth in the last 12 months, and 5% in December alone. It was started by Terry Smith, who has put a chunk of his own cash in. They charge a 1% flat rate as commission.
I'm an investing novice (no, make that non-starter), and I don't understand that difference between the different bits of what they list (Equity Fund, Equities, UK Bonds and Cash, and their 'T' class, 'R' class and 'I' class shares). However I do know that we have a reasonable amount of money in a scheme run by the IFA Towry Law, which is costing me a lot more than 1% and has made a significant loss in the last 12 months.
We are saving a goodly chunk into the Towry Law investments each month, and I am wondering whether it is wise to carry on throwing good money after bad. Observations on Fundsmith and other options would be welcome!
Oli.
Get away from Towry Law whatever you do!! I'm not saying Fundsmith is your answer, they seem to make a big deal of their 1% AMC but really thats about normal if you are buying the right funds through platforms or direct like many IFA's are now. If an IFA puts you in to Fundsmith then the AMC is 1.50% as there is a 0.50% trail in there for the IFA. As always when it comes to investing make sure you have the correct product that holds the fund and this depends entirely upon your personal situation! By this I mean you can have the best fund in the world and make lots of money from it but if you are going to have to pay 60% of it to HMRC then it was not the best investment practice because your fantastic fund was held in the wrong environment for YOU!
I think Fundsmith will look good and perform "well" compared to other managed funds in the current uncertain environment and will be a steady plodder in the long term, if thats for you then thats fine but don't feel like you are missing out on things if and when other funds go up 30% in a year and Fundsmith has only done 8%.
As for the T R I class shares then they just have different charging structures looking at it:
T = direct investment so no IFA so 1% AMC
R = IFA invested so 1.50% AMC
I = For institutional investors with £5Million minimum and AMC is 0.90%
I think you can choose between taking an Income from the fund or letting it Accumulate - thats obviously up to you. It seems there are no initial charges to get in to and then out of the fund and it trades daily so you will have fairly quick access to your capital. I see they also do their own packaged ISA's which would be a simple and cheap way of doing them I guess.
So to summise it looks a steady plodder and in hindsight a very good fund to be in since its launch, but to be honest I would make sure that Towry have got your funds in the right products as the product charges eat away more cash/growth more than any fund charges in my experience! Also please do your own research or get yourself independent advice.
I think Fundsmith will look good and perform "well" compared to other managed funds in the current uncertain environment and will be a steady plodder in the long term, if thats for you then thats fine but don't feel like you are missing out on things if and when other funds go up 30% in a year and Fundsmith has only done 8%.
As for the T R I class shares then they just have different charging structures looking at it:
T = direct investment so no IFA so 1% AMC
R = IFA invested so 1.50% AMC
I = For institutional investors with £5Million minimum and AMC is 0.90%
I think you can choose between taking an Income from the fund or letting it Accumulate - thats obviously up to you. It seems there are no initial charges to get in to and then out of the fund and it trades daily so you will have fairly quick access to your capital. I see they also do their own packaged ISA's which would be a simple and cheap way of doing them I guess.
So to summise it looks a steady plodder and in hindsight a very good fund to be in since its launch, but to be honest I would make sure that Towry have got your funds in the right products as the product charges eat away more cash/growth more than any fund charges in my experience! Also please do your own research or get yourself independent advice.
Edited by F458 on Wednesday 18th January 18:31
F458,
Thanks for your post. You have raised a number of things which I hadn't thought of before (told you I was a novice at all this!) and I think I need to look into this whole area before. The money we have with TL is invested in their 'Wealth Management' scheme and, I understand, invested in a number of other things with the overall investment managed by TL. However to say that I am not impressed with it is a mild understatement, for a number of reasons. They charge (I think) 1.68% per year, and a similar amount as an entry fee - which is a reasonable amount more than fundsmith, for sure.
How do I find out about other funds? I guess the answer is to talk to an IFA!
Are you an IFA by trade? Can you recommend how to find a good one? You seem to have knowledge which I think I need.
Oli.
Thanks for your post. You have raised a number of things which I hadn't thought of before (told you I was a novice at all this!) and I think I need to look into this whole area before. The money we have with TL is invested in their 'Wealth Management' scheme and, I understand, invested in a number of other things with the overall investment managed by TL. However to say that I am not impressed with it is a mild understatement, for a number of reasons. They charge (I think) 1.68% per year, and a similar amount as an entry fee - which is a reasonable amount more than fundsmith, for sure.
How do I find out about other funds? I guess the answer is to talk to an IFA!
Are you an IFA by trade? Can you recommend how to find a good one? You seem to have knowledge which I think I need.
Oli.
Hi
I've had an investment since the second day Fundsmith opened for funds. It's great for me.
In the early 90's Smith wrote a book ("Accounting for Growth") which exposed the accountancy practices of the times. He issued a sell note on Barclays when working for BZW (Barclays was their parent company). That cost him his job. Anyway a straight-talking chap which is unusual in this field.
This Telegraph article may help you - http://www.telegraph.co.uk/finance/personalfinance...
I've had an investment since the second day Fundsmith opened for funds. It's great for me.
In the early 90's Smith wrote a book ("Accounting for Growth") which exposed the accountancy practices of the times. He issued a sell note on Barclays when working for BZW (Barclays was their parent company). That cost him his job. Anyway a straight-talking chap which is unusual in this field.
This Telegraph article may help you - http://www.telegraph.co.uk/finance/personalfinance...
Theres absolutely nothing wrong with Fundsmith. They have a way of doing things and the numbers have been fairly good. I wouldn't go overboard about about Terry Smith having put his own money in to it, this is not by any means unique and is one that the marketing departments love to trot out. Bolton has his own money in China Special Sits, but if you're worth tens, if not hundreds of millions the numbers concerned need to be put in to context, not to mention what they might be getting paid in relation managing/marketing the fund.
With regard to Towry, you need to be aware that this lot are really going to struggle to be able to call themselves IFAs post 2012. You have to ask what is independent about putting every client in to their own inhouse portfolios ? Its a salesforce, and they're selling one particular investment solution, not advice. Its not whole of market and its very expensive.
It doesn't benchmark well on any level.
T.
With regard to Towry, you need to be aware that this lot are really going to struggle to be able to call themselves IFAs post 2012. You have to ask what is independent about putting every client in to their own inhouse portfolios ? Its a salesforce, and they're selling one particular investment solution, not advice. Its not whole of market and its very expensive.
It doesn't benchmark well on any level.
T.
zcacogp - perhaps it would be best for you to message me with the following details or as much as you know or have got:
What are the 'investments' you are putting money in to every month with TL? Are they pensions? ISAS? Bonds? Direct Investments? etc etc.. What products have you got basically?
What are the most recent valuations?
What funds/TL portfolio is it in?
Are you taking any income out? Withdrawls or income?
Are you employed?
How old are you?
What is your attitude to risk? How much are you willing to lose before you feel uncomfortable?
What tax band are you in?
If you message me that then I will have a look at it and get back to you, some friends of mine were with TL and were in a bit of a mess and confused with it all also!! I think really though you need to have a basic understanding of what you have got where and what it all means!! Really TL should have explained all this to you as that is what you are paying them 1-3% a year trail commission for..
As I have said I do know some good IFA's but really its probably best to go on recommendations from your family/friends and find someone else that way maybe? As a previous poster has already said TL are not really "Independent" if they are just putting everybody in their own managed funds!! They are not going to the whole of market to find a product/s and fund selection which suits YOU and that is an IFA's job!!
What are the 'investments' you are putting money in to every month with TL? Are they pensions? ISAS? Bonds? Direct Investments? etc etc.. What products have you got basically?
What are the most recent valuations?
What funds/TL portfolio is it in?
Are you taking any income out? Withdrawls or income?
Are you employed?
How old are you?
What is your attitude to risk? How much are you willing to lose before you feel uncomfortable?
What tax band are you in?
If you message me that then I will have a look at it and get back to you, some friends of mine were with TL and were in a bit of a mess and confused with it all also!! I think really though you need to have a basic understanding of what you have got where and what it all means!! Really TL should have explained all this to you as that is what you are paying them 1-3% a year trail commission for..
As I have said I do know some good IFA's but really its probably best to go on recommendations from your family/friends and find someone else that way maybe? As a previous poster has already said TL are not really "Independent" if they are just putting everybody in their own managed funds!! They are not going to the whole of market to find a product/s and fund selection which suits YOU and that is an IFA's job!!
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