Where to invest 100k for 3 years?
Discussion
sidicks said:
How much can you afford to lose?
This is very much the right question I think. 20% over three years is 6.3% per year. In the current environment I'd say that is a high return - nearly 4% over CPI. There are things out there that will generate that sort of yield in a fairly predictable manner (Schroders Income Maximiser or a stock such as RECI) but they are not without significant risk, even more so if you want to generate that 20% post tax (are or can the funds be sheltered in an ISA etc.?). If at the end of three years you're prepared to end up with 80 for the risk of getting 120, you have a lot wider spread of investments available to you that if your risk tolerance is zero, or close to zero. There also needs to be some element of understanding this risk surely?
It's no good someone saying they're prepared to lose 20% in order to potentially gain 20%...it needs to be framed as, say, 'You are 3 times more likely to gain than lose, with the outer boundaries being +/-20%', no?
It's no good someone saying they're prepared to lose 20% in order to potentially gain 20%...it needs to be framed as, say, 'You are 3 times more likely to gain than lose, with the outer boundaries being +/-20%', no?
20% on each of
1. A couple of good global managed equity funds (fundsmith and Lindsell train seem to be the default choice and have near perfect performance)
2. A good higher return corporate bond fund
3. A global tracker and a emerging market tracker.
Certainly not risk free though, if I were you I'd go higher risk for the first 18months, (China is currently cheap as the yuan has dropped off as the dollar has gained) then hopeful bank a chunk into cash or bond trackers but who knows what's around the corner.
1. A couple of good global managed equity funds (fundsmith and Lindsell train seem to be the default choice and have near perfect performance)
2. A good higher return corporate bond fund
3. A global tracker and a emerging market tracker.
Certainly not risk free though, if I were you I'd go higher risk for the first 18months, (China is currently cheap as the yuan has dropped off as the dollar has gained) then hopeful bank a chunk into cash or bond trackers but who knows what's around the corner.
Sheets Tabuer said:
Thanks for the input, I'm not risk averse but I'd rather avoid any huge drop so not all on red! I'd like a return over and above just sticking it in a savings account though, Ideally if I can make 10-20k on it in 3 years I'd be happy with that.
So what loss can you afford?If you can’t afford to get back less than £100k, then that gives you much less scope to achieve 6%+ returns, compared to the scenario where you can risk up to a 20% loss.
Sheets Tabuer said:
I could stand a 20% loss without issue.
In that case, some of the diversified equity strategies mentioned above could be valid. However, these would still give some chance of an outcome with a loss greater than 20%.To further reduce the chances loss of more than 20% you could put (say) 50% in a 3-year fixed rate bond and the rest in equity. You’d then need to suffer equity losses of more than 40% before your overalls losses exceeded 20%.
Obviously this approach reduces the ability of achieving returns of 6% or more.
You need to decide where the risk-return trade-off sits for you.
That was where my crazy idea of £40K into Fundsmith/Lindsell Train came from.
Over 3 years you could of course lose 50% of £40K but how likely is that?
Stick the £60K in NS&I bonds.
Personally I'd probably be more comfortable taking a higher risk with a smaller amount than a lesser risk but with all of it IYSWIM.
Over 3 years you could of course lose 50% of £40K but how likely is that?
Stick the £60K in NS&I bonds.
Personally I'd probably be more comfortable taking a higher risk with a smaller amount than a lesser risk but with all of it IYSWIM.
ELUSIVEJIM said:
Start following a few Whisky forums and purchase Macallan.
Double your investment in 3-4 years if you buy right. Even if you don't you will still make a profit.
Obviously you have to do your homework but the prices especially if you get at retail will only go up.
Limited editions or numbered bottles are the biggest increases.
Just need to store them and make sure the bottles are upright unlike Wine
Double your investment in 3-4 years if you buy right. Even if you don't you will still make a profit.
Obviously you have to do your homework but the prices especially if you get at retail will only go up.
Limited editions or numbered bottles are the biggest increases.
Just need to store them and make sure the bottles are upright unlike Wine
James_B said:
People writing things like the above are the reason why financial advice is a regulated activity in the U.K.
Anyone claiming that you will definitely make a profit is a shill or a fool, and should not be listened to.
You may mock but I know how my investments in this area has given fantastic returns.Anyone claiming that you will definitely make a profit is a shill or a fool, and should not be listened to.
And yes you can definitely make a profit if you buy right.
It's not hard with a bit of knowledge.
I presume would would invest in shares??
Peer to peer lending might do it. You're capital is at risk, but not that much of it, and you can spread accross lots of loans.
The housecrowd looks a good bet at the moment, their auto invest product is all backed by property and pays 7%. You can't get the money out for 12 months then two months notice after that.
Or maybe thin cats. £1000 minimum investment so you can spread wide with that, but it keeps out the small players.
The housecrowd looks a good bet at the moment, their auto invest product is all backed by property and pays 7%. You can't get the money out for 12 months then two months notice after that.
Or maybe thin cats. £1000 minimum investment so you can spread wide with that, but it keeps out the small players.
Gassing Station | Finance | Top of Page | What's New | My Stuff