Vanguard LifeStrategy
Discussion
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance?
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance? Phooey said:
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance?
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from. I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance? NRS said:
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from.
^^^ and that's my point. Most DIY'ers will f**k up. It'd probably be fun if you only had the odd couple of grand but when we are talking large amounts / pensions etc, I think you need to know a little more than a little 
. I don't think I would be able to resist the odd tinker here and there
NRS said:
Phooey said:
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance?
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from. I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance? Phooey - Thanks for the mention! and vote of confidence
NRS said:
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from.
When highly paid stock pickers and researchers frequently get it wrong, what chance does the average John Doe have in actually bettering the market?The only two points in time that really matter are when you buy, and when you sell. Everything in between is just market fluctuations. While you are busy getting on with life.
What most people need is a simple way of reflecting the market in a diversified way for a low fee.
Vanguard LifeStrategy funds are a pretty good way of achieving those objective. But on the day that you sell, it is possible that an alternative solution might just have made you a few percents more.
You need the cake and the icing. The cherry on top depends on a quantum of good luck as well. However this cherry can easily be diminished by paying 0.5, or 1 percent fees annually.
rdjohn said:
Derek Chevalier said:
Care to provide evidence on the liquidity of Lifestrategy funds? I'm not sure why you feel it is related to Woodford?
https://documentscdn.financialexpress.net/Literature/2C771383E2B81CEC1F6C0C1BF3745745/105256116.pdfhttps://www.trustnet.com/factsheets/o/acdt/vanguar...
The 2018 report suggests that the fund holds about 1% of assets as cash (much less in 2017), so if there was a big financial shock to the market, like October 87, and if say 20% of fundholders want to suddenly cash out, the managers are unable to meet their requests - they also need to protect the other 80%. In this respect all equity funds tend to operate in this manner.
However, during normal trading conditions, if the OP wanted to switch / cash out then there would not be a problem.
On the positive side, the wide spread of funds invested in makes it highly unlikely that a Woodford scenario would happen as this was primarily caused by poor stock picking.
Phooey said:
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%).
Once you have undertaken the initial reading/research (which I appreciate takes time), ongoing work should be minimal, maybe rebalance once a year (or not for LS products), periodically recheck the product offerings to keep abreast of new tracker products etc (maybe slightly cheaper etc, but we are talking small amounts given the current offerings). I'm not convinced there's any real value to be had paying much attention to what's currently happening in the economy for a typical investor with a multi decade horizon. I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%).
With something like Vanguard LS 80 costing 0.26% (inc (current) transaction costs), I'd expect (depending on amount invested) you could do a bit better than 0.24% for platform.
rdjohn said:
Vanguard LifeStrategy funds are a pretty good way of achieving those objective. But on the day that you sell, it is possible that an alternative solution might just have made you a few percents more.
If you look at how LS has performed relative to other offerings such as multi-asset funds/DFMs, the chances are not great https://finalytiq.co.uk/art-delivering-negative-al...
I actually moved into lifestrategy in a big way in early May, a mixture of 60, 80 and 100% equities. Mainly the 60% version.
Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
dmahon said:
I actually moved into lifestrategy in a big way in early May, a mixture of 60, 80 and 100% equities. Mainly the 60% version.
Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
Risk and volatility aren't the same thing but as a newcomer to investing last year was an interesting induction for me, especially the December shenanigans.Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
It made me de-risk which is an ongoing process as it's tempting to simply keep running your winners.
It's easy to say this but 8% is not much of a wobble, and if you think that's outside your comfort zone you certainly don't want to be looking at the 80/100 versions of LifeStrategy or any similar allocation of equities and the 60 is debatable IMO.
Also remember that the more you lose the more it takes to claw it back i.e. a 10% loss needs an 11% gain just to get even.
b
hstewie said:
hstewie said:dmahon said:
I actually moved into lifestrategy in a big way in early May, a mixture of 60, 80 and 100% equities. Mainly the 60% version.
Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
Risk and volatility aren't the same thing but as a newcomer to investing last year was an interesting induction for me, especially the December shenanigans.Without trying to time the market, I was buying in through the trade war concerns with Mexico and China. A lot of that has since abated.
As of today I’m 8%+ up on my stash, which is most of my net worth.
I’m actually a bit spooked by this as I was looking for something much less volatile. Even though I’m for a 20 year time horizon, I would be having kitttens over an 8% loss in 6 weeks.
Wonder if I need to move to a lesser equity weighting as I dont need to aggressively chase returns.
I lump summed in to the market just in time to reap the fall rewards of the December drop. Have seen roughly a 20% swing in the 7 or so months invested
SJfW said:
Oh yes
I lump summed in to the market just in time to reap the fall rewards of the December drop. Have seen roughly a 20% swing in the 7 or so months invested
December was an interesting one.I lump summed in to the market just in time to reap the fall rewards of the December drop. Have seen roughly a 20% swing in the 7 or so months invested
I held my nerve and sat it out but it was perhaps a good valuable lesson early into this as to what my appetite for downside is.
JulianPH said:
NRS said:
Phooey said:
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance?
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from. I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance? My point was it is probably best to avoid watching the market and reacting to it, as you're likely to be too late, and therefore lose money anyway (for most people). However I do feel sometimes you can do a few things that might help. For example with oil, you know the producers will pick up before any service companies - so if you want to invest after a crash then it is better to be weighted towards the producers than service companies as a sector. Although that's not to say oil would be the best sector to be in either!
NRS said:
JulianPH said:
NRS said:
Phooey said:
Another vote for Intelligent Money here.
I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance?
It's probably actually a bad idea to follow the economy for changing it etc, as you'll get it wrong as much as right. At least to a certain point. Of course might be ok if you need to related to risk, or perhaps some sectors are clearly getting a bit toppy that might be better to move from. I think a lot depends on how hands on you want to be yourself - if you are happy to get your hands dirty, read (LOTS) and pay attention to what's happening in the economy, rebalance, study fact sheets etc then yes - you can strip it down to the bones (circa0.5%). But if like me you sleep better knowing better informed people are managing your money then someone like IM @ 0.87% (total) will more than add the additional 0.3-0.4% in value to yourself, AND your money. Like you I was (actually still am but wheels in motion - waiting to move but have a lot stuck in Woodford
) paying ongoing advisor fees. Why share a large portion of your growth with your IFA when you don't need no more than a little well-informed guidance? My point was it is probably best to avoid watching the market and reacting to it, as you're likely to be too late, and therefore lose money anyway (for most people). However I do feel sometimes you can do a few things that might help. For example with oil, you know the producers will pick up before any service companies - so if you want to invest after a crash then it is better to be weighted towards the producers than service companies as a sector. Although that's not to say oil would be the best sector to be in either!
Derek Chevalier said:
The smart hedge funds will have hoovered up any inefficiencies before the average DIY investor/fund manager can react.
This is somewhat confusing, You always say that any active management to not work. But here you are stating that very expensive active management (2% + 20%) will get the gains.Perhaps I am missing something...?
JulianPH said:
Derek Chevalier said:
The smart hedge funds will have hoovered up any inefficiencies before the average DIY investor/fund manager can react.
This is somewhat confusing, You always say that any active management to not work. But here you are stating that very expensive active management (2% + 20%) will get the gains.Perhaps I am missing something...?
The other point is described well by Buffet; he talks about the *good* active fund managers being very rare. And as retail customers, we can only go on past performance, which as we all know, isn't the best indicator of real talent.
So it is reasonable that, as Derek describes, certain active funds could hoover up new opportunities in the market, whilst at the same time still being the case that, for the average investor, active funds not being particularly better value than a selection of passive funds.
JulianPH said:
Derek Chevalier said:
The smart hedge funds will have hoovered up any inefficiencies before the average DIY investor/fund manager can react.
This is somewhat confusing, You always say that any active management to not work. But here you are stating that very expensive active management (2% + 20%) will get the gains.Perhaps I am missing something...?
Regarding hedge funds, I do believe some (not many) have an edge - by employing the brightest people, using the fastest computers and analysing an enormous amount of data.
For example:
https://en.wikipedia.org/wiki/Renaissance_Technolo...
But even here the edges are tiny, and typically limited to strategies such as future share price paths relative to each other rather than macro scale trading (how many successful macro hedge funds are there?). Also, some of the strategies are limited in terms of scale (which also impacts rising star fund managers as their book grows).
Of course, even for these firms their edge may not last forever as other competitors catch up.
I don't often see a similar edge in the fund management industry and this is reflected in their performance.
My point was not about the short term inefficiencies though - rather longer term sector (or sub-sector) trends that take longer - months or years. So going back to the example above about the oil industry, service companies cannot make bigger profits if the producers are not making more money to give them jobs. So you know the producers have to bounce before the service companies can. So if you want to be in oil then after a crash it makes more sense to be overweight towards the producers at first, as they will gain first. Of course, that is not to say the oil industry is the best place to be in the market at that time, or when the recovery would happen.
NickXX said:
bhstewie said:
hstewie said: Also remember that the more you lose the more it takes to claw it back i.e. a 10% loss needs an 11% gain just to get even.
Is anyone able to explain this graph to me - I don't understand the concept, particularly without time involved.So if £100 falls 50% to £50, that £50 would need to grow by 100% to get back to the original £100 (i.e. 50% growth will not cover a 50% loss).
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