Intelligent Money - your investment questions answered

[JulianPH]

CAH706 said:

Thanks Julian ... I’d looked everywhere bar the first page ! Doh!

Typical! No problem.

[Testaburger]

Morning, Julian,

Just a quickie - I sent you an email a couple of days ago, I’m sure you’re extremely busy but let me know if you haven’t received it. Hope you’re well mate.

[JulianPH]

Testaburger said:

Morning, Julian,

Just a quickie - I sent you an email a couple of days ago, I’m sure you’re extremely busy but let me know if you haven’t received it. Hope you’re well mate.

Hi mate, very well thanks and I trust the same with you.

That will be the third email I have not seen this week.

Give me 5 minutes and i'll dig it out and get back to you.

Cheers

[bitchstewie]

JulianPH said:

In exactly the same way.

I placed my order to buy on Friday when I had no idea what the close of business (forward) unit price would be.

So whilst I knew markets were falling at the time, I had no idea where they would close (just a strong instinct). They could have ended up going in any direction.

Sorry, I probably didn't explain this very well!

[JoeBolt]

JulianPH said:

JoeBolt said:

JulianPH said:

.................... I chucked some more money into PH Equity on Friday (so will buy on Monday's price) ........................

Can you explain this please Julian? Do you mean the money went in after the markets closed on Friday, which is why the transaction won't go through until Monday?

I'm a new IM Private Client. I'm currently paying this year's ISA allowance into my account, initially as "Cash (Pending Future Investment)". I'm obviously keen to take advantage of the current economic situation.

How long does it take for IM to complete an instruction to move cash already in the account, to one of your investment products, PH Equity for example?

Hi JoeBolt

Monday's dealing price will be Friday's close of business price, if that makes sense.

So it is not that the money went after markets closed, it is that the money is invested the following working day at the closure price of the previous day.

Basically, you can't buy into any market movements on the day they are happening as all unit prices are daily, at the close of business.

Cash in your account is usually moved the day we receive your instruction, but if this is later on in the day it can spill over to the next working day.

You will always buy at the previous day's close of business.

I specifically wanted to buy at the close of business price on Friday as I could see markets we still faling on Friday and I wanted to mop up as much of this as possible.

I hope that makes sense. If not or it raises anything further then please just shout!

Cheers

Julian

Thanks Julian, it does make sense.

I wish I'd know earlier that it was possible to transfer funds from another ISA provider to IM to be held as "Cash (Pending Future Investment)".

This is where I'm putting new money (this year's ISA allowance), but earlier in the week, on Tue 25 Feb, my transfer from Standard Life to IM completed and it all went straight into my investment choice, IM Optimum Global Growth. OK, I've probably benefited a little from the market fall at the start of the week but it would have been better to hold it in cash to begin with. I just didn't know it was an option at the time. Hopefully it shouldn't make much difference in the long run.

[Brads67]

JoeBolt said:

Thanks Julian, it does make sense.

I wish I'd know earlier that it was possible to transfer funds from another ISA provider to IM to be held as "Cash (Pending Future Investment)".

This is where I'm putting new money (this year's ISA allowance), but earlier in the week, on Tue 25 Feb, my transfer from Standard Life to IM completed and it all went straight into my investment choice, IM Optimum Global Growth. OK, I've probably benefited a little from the market fall at the start of the week but it would have been better to hold it in cash to begin with. I just didn't know it was an option at the time. Hopefully it shouldn't make much difference in the long run.

To be fair, you would only have benefited if you had known about the upcoming blip. I can't imagine many hold cash pending becasue they are waiting on a drop in share price (maybe they do, I'm no stock broker).
My question was mainly about making the company doing my transfer hold it as cash until I transfer it to IM. Rather than let them invest it.

[JulianPH]

JoeBolt said:

Thanks Julian, it does make sense.

I wish I'd know earlier that it was possible to transfer funds from another ISA provider to IM to be held as "Cash (Pending Future Investment)".

This is where I'm putting new money (this year's ISA allowance), but earlier in the week, on Tue 25 Feb, my transfer from Standard Life to IM completed and it all went straight into my investment choice, IM Optimum Global Growth. OK, I've probably benefited a little from the market fall at the start of the week but it would have been better to hold it in cash to begin with. I just didn't know it was an option at the time. Hopefully it shouldn't make much difference in the long run.

If it is any conciliation, the days your money was out of the market (from when Standard Life put it into cash for the transfer, to us receiving - still in cash - and then it being invested) probably saved you at least half of the market losses you would have experienced had you stayed with Standard life.

Having just been in cash for most of the down turn, you can always instruct us to return you to this tomorrow and then you can pick the point you want to get back in.

Obviously, if markets continue to fall this will work well for you, but if you don't reinvest at the right time you will miss out on any bounce back (or general recovery).

The choice is your though. I am heavily invested in IM Optimum Global Growth and whilst I feel your pain, I can also inform you it has held up better than global markets have.

Another thing to consider is looking at IM Optimum Cautious or even Defensive. This keeps you invested, just in a different way.

Give Nik a call if you would like to discuss (or post here/PM me).

Cheers

Julian

[JoeBolt]

Brads67 said:

JoeBolt said:

Thanks Julian, it does make sense.

I wish I'd know earlier that it was possible to transfer funds from another ISA provider to IM to be held as "Cash (Pending Future Investment)".

This is where I'm putting new money (this year's ISA allowance), but earlier in the week, on Tue 25 Feb, my transfer from Standard Life to IM completed and it all went straight into my investment choice, IM Optimum Global Growth. OK, I've probably benefited a little from the market fall at the start of the week but it would have been better to hold it in cash to begin with. I just didn't know it was an option at the time. Hopefully it shouldn't make much difference in the long run.

To be fair, you would only have benefited if you had known about the upcoming blip. I can't imagine many hold cash pending becasue they are waiting on a drop in share price (maybe they do, I'm no stock broker).
My question was mainly about making the company doing my transfer hold it as cash until I transfer it to IM. Rather than let them invest it.

People hold reserves of cash ready to take advantage of all forms of investment opportunities. I'm sure it is much better to get your funds over to where you intend to invest, rather than leave them with your old company.

No, of course I didn't know about the upcoming blip, but it was pretty obvious something was amiss on Monday 24th. Then there would have been enough time for me to change my mind, cancel my initial instruction and have the money transferred to a cash holding instead, had I know this was possible. No matter now. It's all hindsight and water under the bridge.

[JoeBolt]

JulianPH said:

JoeBolt said:

Thanks Julian, it does make sense.

I wish I'd know earlier that it was possible to transfer funds from another ISA provider to IM to be held as "Cash (Pending Future Investment)".

This is where I'm putting new money (this year's ISA allowance), but earlier in the week, on Tue 25 Feb, my transfer from Standard Life to IM completed and it all went straight into my investment choice, IM Optimum Global Growth. OK, I've probably benefited a little from the market fall at the start of the week but it would have been better to hold it in cash to begin with. I just didn't know it was an option at the time. Hopefully it shouldn't make much difference in the long run.

If it is any conciliation, the days your money was out of the market (from when Standard Life put it into cash for the transfer, to us receiving - still in cash - and then it being invested) probably saved you at least half of the market losses you would have experienced had you stayed with Standard life.

Having just been in cash for most of the down turn, you can always instruct us to return you to this tomorrow and then you can pick the point you want to get back in.

Obviously, if markets continue to fall this will work well for you, but if you don't reinvest at the right time you will miss out on any bounce back (or general recovery).

The choice is your though. I am heavily invested in IM Optimum Global Growth and whilst I feel your pain, I can also inform you it has held up better than global markets have.

Another thing to consider is looking at IM Optimum Cautious or even Defensive. This keeps you invested, just in a different way.

Give Nik a call if you would like to discuss (or post here/PM me).

Cheers

Julian

OK, thanks Julian. I appreciate that the timing of the transfer did work in my favour to some degree.

I'll send you a PM so I can include figures.

[JulianPH]

JoeBolt said:

OK, thanks Julian. I appreciate that the timing of the transfer did work in my favour to some degree.

I'll send you a PM so I can include figures.

You will probably be pleasantly surprised on your timing/savings!

I will most likely get back to you this evening or in the morning. My wife has lit a fire, which is a sign I need to start cooking dinner and spend time with her, rather than being sat in my study on a computer!

It is not that I am not brave, I am just not stupid!

Cheers



Edited for stupid typo

[JulianPH]

JulianPH said:

JoeBolt said:

OK, thanks Julian. I appreciate that the timing of the transfer did work in my favour to some degree.

I'll send you a PM so I can include figures.

You will probably be pleasantly surprised on your timing/savings!

I will most likely get back to you this evening or in the morning. My wife has lit a fire, which is a sign I need to start cooking dinner and spend time with her, rather than being sat in my study on a computer!

It is not that I am not brave, I am just not stupid!

Cheers



Edited for stupid typo


Just seen your PM and replied. Off for a quick beer under the pretence of the oven heating up!

Have a good evening!

Julian

[Burwood]

Hi Julian, quick question in junior isa wrapped funds for my kids. They are young, 5 and 11 and their grandparents make 250/month credit per. I’m sure they can do better than 3%. Any suggestions, find specific? Tia

[duckson]

Newbie potential investor here....hi. I was looking at this thread and Vanguard's offerings late last year, ended up opening a Marcus Savings account instead but obviously rates are low, have been for a long time and potentially will be for a long time. Anyway....

Is it worth me investing for 4 to 5 years or would you not bother? I'm talking small fry to start with compared to most (£5k lump and maybe £100pm to start with...more cash i'd leave in the Marcus account for now but might drop lumps in over time).
Thing is my plan is to pay off my mortgage in 4.5 years time and so could need 80-90% of the funds in the ISA to go towards that. I'd keep it going for alot longer of course looking towards me being 60yrs old (i'm 44) and retirement.

I was looking at a IM Optimum Income and PH Equity split (80:20 maybe). Based on 4.5yrs would you say its a bit risky to go for the Income and I should be looking at the Defensive or Cautious and 100% in either? I've read PH Equity is deemed quite defensive so not sure of the difference between this and Defensive/Cautious (I thought it better splitting it rather than all eggs in one basket).

Pension wise I have a final salary pension with a FTSE100 company i've been in since i was 16 so its pretty decent (for me!) so just concentrating on S&S ISA (i've never had one before).

Thoughts?

[paddy328]

Hi everyone,
So, Julian and I have been mates for years (I detail all his cars) and whilst I know nothing about investments he certainly does.

He is a really genuine and honest bloke and whilst I have been round at his house this week doing his Aston Martin I have learned a lot about PH Equity.

It has got me into the idea of investing as I understand and know and use virtually every company in it. I know investment can go down as well as up as he stressed this to me and showed examples, but it is the first time I really got what an investment was all about. I will be telling all my clients about PH equity and will even invest myself when I’m able to. It seems madness to put your money anywhere else from what I can see.

Anyway, here is a picture of Julians DB9, looking all shiny, as much as my iPhone will show anyway. Polished and ceramic coated. No doubt, you will have also heard about IM’s awesome news on Friday! Hope to see some of you there at one of the events. Francis

[Ali2202]

Nice Car!

Really looking forward to seeing the damage-management and strategic expertise from IM in the coming weeks.

[JulianPH]

Burwood said:

Hi Julian, quick question in junior isa wrapped funds for my kids. They are young, 5 and 11 and their grandparents make 250/month credit per. I’m sure they can do better than 3%. Any suggestions, find specific? Tia

Morning Burwood

I'll start off by saying that 3% tax free from a zero risk cash JISA is not exactly bad and will keep the money ahead of inflation at current rates.

When it comes to doing better than this you have to move from savings (cash) to investment (equities, bonds, etc.) and whilst this has historically provided much higher long term returns than cash it does come with capital risk.

The FCA insist we highlight that the value of investments can fall as well as rise. I would go a step further and say the will fall as well as rise.

This is an inevitable part of investing, but over the long term market rises (including dividend payments) have outweighed and falls along the way leading to much higher overall returns.

As for specific suggestions, I am unable to do this as it would be regulated financial advice, which we do not offer. I can give you an overview of our different approaches though and feel free to have a chat with Nik ([e-mail]) for further insight:


IM Optimum

These are a range of portfolios that invest in low cost index trackers, but the structure is human managed and has a UK bias. The aim is to produce long term growth and income whilst managing volatility.

These portfolios are all clearly names to reflect these investment objectives and the level of risk/reward decreases with each one from IM Optimum Global Growth, IM Optimum Global Growth & Income, IM Optimum Income, IM Optimum Cautious to IM Optimum Defensive.

You can find out more about these portfolios, where they are invested and their past performance here:

https://private-client.intelligentmoney.com/im-opt...


IM Index

These are a rages of portfolios that also invest in low cost index trackers, but they are purely passive with no level of human management. The equities are all based upon global market capitalisation, so there is no UK bias and heavy US exposure (as the US is the world's largest market) and the bonds are 100% UK based to avoid currency risk (amongst other things).

These start with 100% equities (IM Index 100) and then move to 80% equities and 20% bonds (IM Index 80) and continue to replace equities with bonds in increments of 20% with IM Index 60, IM Index 40 to IM Index 20. The number in the title is you equities (stock market) exposure.

You can find out more about these portfolios here:

https://private-client.intelligentmoney.com/im-ind...


PH Equity

This is a buy and hold portfolio of 10 giant global brands, representing £3 trillion of market capitalisation. They are all household names and the largest holdings are Netflix, Amazon, Colgate Palmolive, Unilever and Diageo (which owns household name drink brands such as Guinness, Bell’s, Johnnie Walker, Smirnoff, Baileys, Gordon’s, Tanqueray and many others).

The smaller holdings are Apple, Nike, Domino's Pizza, Coca-Cola and Starbucks.

So no surprises really, very simple, very effective and highly concentrated. It effectively runs a bit like a tracker like a tracker in that it holds these companies with the weightings originally given to them and regularly rebalances these back to these original positions, but it is also fully managed, meaning we can change things if we feel we need to.

You can find out more about this portfolio here:

https://private-client.intelligentmoney.com/ph-equ...


You can select one portfolio that suits your requirements or mix and match to build something bespoke for you. You can also switch whenever you like.

I hope this has been a helpful overview and please feel free to chat thing through further with Nik.

Cheers

Julian

[CharlesdeGaulle]

Julian. This perhaps might be one best-suited for a mail to Nik, but is there a mechanism to invest in euros? I'm a UK taxpayer but my (tax-free) Continental salary is paid in euros and I'd like to invest monthly; do-able?

[JulianPH]

duckson said:

Newbie potential investor here....hi. I was looking at this thread and Vanguard's offerings late last year, ended up opening a Marcus Savings account instead but obviously rates are low, have been for a long time and potentially will be for a long time. Anyway....

Is it worth me investing for 4 to 5 years or would you not bother? I'm talking small fry to start with compared to most (£5k lump and maybe £100pm to start with...more cash i'd leave in the Marcus account for now but might drop lumps in over time).
Thing is my plan is to pay off my mortgage in 4.5 years time and so could need 80-90% of the funds in the ISA to go towards that. I'd keep it going for alot longer of course looking towards me being 60yrs old (i'm 44) and retirement.

I was looking at a IM Optimum Income and PH Equity split (80:20 maybe). Based on 4.5yrs would you say its a bit risky to go for the Income and I should be looking at the Defensive or Cautious and 100% in either? I've read PH Equity is deemed quite defensive so not sure of the difference between this and Defensive/Cautious (I thought it better splitting it rather than all eggs in one basket).

Pension wise I have a final salary pension with a FTSE100 company i've been in since i was 16 so its pretty decent (for me!) so just concentrating on S&S ISA (i've never had one before).

Thoughts?

Hi Stuart

A split between IM Optimum and PH Equity is a very popular position for a great number of our Private Clients, so your thinking is in like with the collective!

You could never consider PH Equity to be defensive in the same way IM Optimum Defensive is though. At the end of the day it is just 10 stocks, albeit 10 giant global brands.

The stocks were selected for defensive abilities during market downturns. Whilst it is still (at the time of writing!) up on the first two months of the year it has seen a 10% fall with the recent market falls. Whilst this is better than the markets themselves, IM Optimum Defensive was only down 0.89% over the same period.

With regards to eggs in baskets, whilst PH Equity is very concentrated, the entire point of IM Optimum is the sheer diversity in each portfolio.

Each portfolio holds many different underlying funds, which in turn have huge numbers of holdings across a range of different asset classes and global markets.

I have posted above an overview of the different investment approaches which you may find helpful and equally a chat with Nik ([e-mail] could also be helpful.

5 years is the standard minimum time frame for investing, so you are in the right region.

One further thing I should add is that if this money is initially to pay off the mortgage, have you considered using it to make mortgage overpayments instead to reduce the outstanding balance and interest payable?

Again, this is something you may which to chat over with Nik.

I hope that has been of some help, please shout with anything else.

Cheers

Julian

[JulianPH]

paddy328 said:

Hi everyone,
So, Julian and I have been mates for years (I detail all his cars) and whilst I know nothing about investments he certainly does.

He is a really genuine and honest bloke and whilst I have been round at his house this week doing his Aston Martin I have learned a lot about PH Equity.

It has got me into the idea of investing as I understand and know and use virtually every company in it. I know investment can go down as well as up as he stressed this to me and showed examples, but it is the first time I really got what an investment was all about. I will be telling all my clients about PH equity and will even invest myself when I’m able to. It seems madness to put your money anywhere else from what I can see.

Anyway, here is a picture of Julians DB9, looking all shiny, as much as my iPhone will show anyway. Polished and ceramic coated. No doubt, you will have also heard about IM’s awesome news on Friday! Hope to see some of you there at one of the events. Francis

Hello mate, I never thought I would see you on this corner of PH!

Thanks for you very kind word too!

When Laura came round after you had done the cars she just said "wow, they look brand new!"

Seriously, if anyone wants their pride and joy detailed to (better than) showroom condition then Francis is your go to man.

On PH he is to car detailing what Sarnie is to mortgages!

Cheers

[JulianPH]

Ali2202 said:

Nice Car!

Really looking forward to seeing the damage-management and strategic expertise from IM in the coming weeks.

Cheers!

The management with IM Optimum has reduced the impact of market falls already, but is obviously still down and Tim and I are going over positions daily.

It is very interesting times and screaming headlines, panic selling and institutional shorting on a large scale to profit from this.

I will keep PH updated from our perspective.