Your questions answered Vol 2 - IM Private Clients

[Carbon Sasquatch]

JulianPH said:

I hope this answers your question, but suspect it may throw up more!

Thanks - I'm certainly interested.

Initially seeing stuff in different buckets is somewhat reassuring - I'm about to retire, so knowing I have 1-2 years in cash means I'm not getting cold feet. However, rebalancing buckets, even just 1 or 2 times a year will soon stop feeling like fun...

[Simpo Two]

JulianPH said:

That's a bit like the 20 years it took me to become an overnight success!

It would be very interesting to extrapolate 'IML' back a year and see how it would have compared to the current products over that time. If the line comes out top you can take a holiday

[Consigliere]

JulianPH said:

Hello all

......
Cheers

Julian





PS Sorry this was long winded, by the time we launch we will have it down to s sentence or two!

Hi Julian, that was cracking, now could you do me a favour and explain it to me as if i were a 5 year old please :-)

[Simpo Two]

Consigliere said:

Hi Julian, that was cracking, now could you do me a favour and explain it to me as if i were a 5 year old please :-)

'We do the shuffling so you don't have to'.




Meantime, I see my prediction for inflation at 10% by the end of the year is unfortunately coming true In fact I may revise it to 12%.

[Carbon Sasquatch]

anonymous said:

[redacted]

Depends how long you require said income to last for

[Consigliere]

Simpo Two said:

'We do the shuffling so you don't have to'.




Meantime, I see my prediction for inflation at 10% by the end of the year is unfortunately coming true In fact I may revise it to 12%.

I think IML will be a yes for me because i cant even shuffle a pack of cards!

[Gallons Per Mile]

So what is IML supposed to to? Pick the best bits of IM, put them in a pot and return higher highs or average it all out a bit and return higher than index trackers but more smoothly than having just a couple of portfolios you picked yourself?

[Mr Whippy]

Simpo Two said:

Meantime, I see my prediction for inflation at 10% by the end of the year is unfortunately coming true In fact I may revise it to 12%.

Isn’t it somewhat irrelevant depending on intentions?

Ie, if you’re filling your home heating oil tank, inflation on kerosene is the issue.
And we know the price of kerosene could be half the price in 12 months time.

If you’re long term saving for retirement with cash earned today, leading growth equities have lost about 20%, or two years worth of high inflation, so a whole boat load cheaper.


Goods will likely fall in price when oil prices fall.

Energy will likely fall in price too.

Food likely to fall in price.

So yes, “inflation” could be 10%, but will it be 10% for you?

What might it be a year later? Negative? Low single digit, offsetting the high?


All in, it’s not bad until it’s bad.

For now we could all defer a great deal of our exposure to it.

And we could take advantage of huge negative inflation on high quality stocks.

[anonymous-user]

Consigliere said:

JulianPH said:

Hello all

......
Cheers

Julian





PS Sorry this was long winded, by the time we launch we will have it down to s sentence or two!

Hi Julian, that was cracking, now could you do me a favour and explain it to me as if i were a 5 year old please :-)

This.

Is it just an "invest and forget"? I am not clever with all this but when I read it, it sounds like you need us to (individually?) tell you our risk appetite and you do the rest? But it sounds much more appropriate to the less, er, invested (educated, involved or clued-up) investor like me.

[Simpo Two]

Mr Whippy said:

Simpo Two said:

Meantime, I see my prediction for inflation at 10% by the end of the year is unfortunately coming true In fact I may revise it to 12%.

Isn’t it somewhat irrelevant depending on intentions?

Ie, if you’re filling your home heating oil tank, inflation on kerosene is the issue.
And we know the price of kerosene could be half the price in 12 months time.

If you’re long term saving for retirement with cash earned today, leading growth equities have lost about 20%, or two years worth of high inflation, so a whole boat load cheaper.


Goods will likely fall in price when oil prices fall.

Energy will likely fall in price too.

Food likely to fall in price.

So yes, “inflation” could be 10%, but will it be 10% for you?

What might it be a year later? Negative? Low single digit, offsetting the high?

All in, it’s not bad until it’s bad.

For now we could all defer a great deal of our exposure to it.

And we could take advantage of huge negative inflation on high quality stocks.

Essentially, everything you buy is more expensive, with a double whammy on energy. So you're poorer in real terms.

As for being able to hoover up cheap stocks, if you have the cash to do it, yes, But if most of your cash is already in stocks that have taken a hit you don't want to sell do you - you sit tight and wait to recover the losses.

[JulianPH]

Carbon Sasquatch said:

JulianPH said:

I hope this answers your question, but suspect it may throw up more!

Thanks - I'm certainly interested.

Initially seeing stuff in different buckets is somewhat reassuring - I'm about to retire, so knowing I have 1-2 years in cash means I'm not getting cold feet. However, rebalancing buckets, even just 1 or 2 times a year will soon stop feeling like fun...

I think seeing stuff in different buckets works really well for many, for exactly the reasons you give. You certainly should need to be rebalancing once or twice a year though as when the portfolios are selected to do this they are all reballanced internally for you.

You can set up IML to do exactly the same things, though it is not quite as 'visual' in that you could have a 5 year dated portfolio for drawing down the max over that period, sat next to it would be a set of growth portfolios with income dates set to kick in every five years. Each of these would be invested at different risk/reward levels for their respective growth periods.

Alternatively, you could use IML for one ongoing growth and income portfolio that is doing a similar thing, but without the labels.

Remember you can also mix and match between all of our approaches too. IML does not replace things, it just adds to your options.

Where it comes into its own is that you don't have to be involved at all if you don't want to. This doesn't mean you can't be!

I'll try and give you a very simple and general example. When we launched PHR it was because we saw an opportunity to make some pretty easy quick money. So we built it and made it available, but it was everybody's individual choice as to whether to use it and if so how much to put in it.

With IML, we would have just done this internally for you, moving you in as we thought fit and the same for coming out again, without your involvement.

Does that make sense?

[JulianPH]

Simpo Two said:

JulianPH said:

That's a bit like the 20 years it took me to become an overnight success!

It would be very interesting to extrapolate 'IML' back a year and see how it would have compared to the current products over that time. If the line comes out top you can take a holiday

It would be, but you would have to tell us your age, your requirement for income or growth and your projected investment timelines for these (which could be indefinate) first!

IML will be different for each individual based upon these factors, you see!

You then have to factor in that for everyone it is a moving feast, so what you may have today is likely to be different to what you had a year ago.

So whilst I fully see and understand your point here, you can't really apply a one year snapshot to a long term investment and generate anything meaningful when given all of the factors above.

[JulianPH]

Consigliere said:

Hi Julian, that was cracking, now could you do me a favour and explain it to me as if i were a 5 year old please :-)

Sure! Well I can try anyway!

What it means is that you can access everything IM has to offer, but without having to give it any thought or involvement. We do it all for you.

The financial and tax planning side of things remains identical, but the investments themselves are all completely managed for you and drawn from our best ideas in line with the circumstances of the day.

So you can fire and forget, put it on auto pilot, wash and go (ok, probably not the last one!).

You give us the parameters to work within (current age, target dates for access, income or growth requitements at those dates) and we take this and manage everything for you using our best ideas.

To use a really rubish car analogy, we can make investment providers early day taxis:

When you get in a cab for a very long journey you can chose the vehicle(s), but after this you must then tell the driver what roads you want to go downto reach your destination and he can drive you down them, managing the fiddly bits for you. This is pretty much how fund selection works.

Alternatively, you can now just tell him where you need to be and at what time, then let him select the best vehicles, manage the best routes and avoid the worst of the traffic where possible for you. That is how IML works.

I told you it was a rubbish analogy, but because I can't stop when I try to do this here it is in fewer words: Sat Nav replacing your AA road map!

[JulianPH]

anonymous said:

[redacted]

Morning mate, prices in Portugal are on the up, aren't they!

As has been noted, we can do that, but cannot guarante how long it will last for! The reality is that all we can do is use our collective knoweldge and expericence to deliver the highest returns possible from which you can draw down an 'income' at the level of your choice.

You can set this at whatever level you wish, but the higher it is the harder your investments have to work to keep up with this, or money will start to run out.

This is why a long chat with Nik before starting down the drawdown route is always advisable. For example, a bad market cycle (such as the one we have all been experiencing) at the starting point of this can ruin plans. Waiting a while could change the shape of your income for many years to come.

[anonymous-user]

Do we need to book an appointment/ring and speak to Nick/Coops/whoever it is that posts cat photos (or others I've missed) in order to do this?

Cards on the table, I've got a SIPP with you, I want to retire at 65 (20 years time) with the biggest pot possible, but my pot is currently considerably smaller than the initial investment made a couple of years ago... Is this new service something that I could make benefit from?

(As I've alluded to before, I'm about as knowledgable at this game as I am at writing a nuclear engineering thesis in Hindi!)

[JulianPH]

anonymous said:

[redacted]

This is the point I would usually joke about my wife being Russian, but right now she would not find this funny at all and is completely mortified by what is happening.

Ironically, her family is three quarters what became Ukrainian and the final quarter is half Hungarian, leaving only one eighth of her what is now present day Russian. Still she is mortified.

Mind you, she was a commercial lawyer in the oil field sector, so is still bloodly lethal too!!!

[JulianPH]

Gallons Per Mile said:

So what is IML supposed to to? Pick the best bits of IM, put them in a pot and return higher highs or average it all out a bit and return higher than index trackers but more smoothly than having just a couple of portfolios you picked yourself?

The first bit mate!

Pick the best bits, put them in a pot, weight this pot to suit your circumstances and then produce the highest returns we can within those parameters.

Index trackers will be the base because we like them, stock selection will be the key to higher than market returns because we really like that too.

The aim is that the combination of the two approaches does indeed smooth returns out, but not by flattening them, which is usually the case when smoothing is sought/applied.

Equally, seeing just one value per pot, rather than multiple values of different components give a very visual smoothing effect without restricting returns at all.

[JulianPH]

OnTheBreadline said:

This.

Is it just an "invest and forget"? I am not clever with all this but when I read it, it sounds like you need us to (individually?) tell you our risk appetite and you do the rest? But it sounds much more appropriate to the less, er, invested (educated, involved or clued-up) investor like me.

Yep! Exactly that!

I explainded more fully in a previous answer above!

[anonymous-user]

JulianPH said:

OnTheBreadline said:

This.

Is it just an "invest and forget"? I am not clever with all this but when I read it, it sounds like you need us to (individually?) tell you our risk appetite and you do the rest? But it sounds much more appropriate to the less, er, invested (educated, involved or clued-up) investor like me.

Yep! Exactly that!

I explainded more fully in a previous answer above!

Brilliant thanks, will read and dgest.

[JulianPH]

OnTheBreadline said:

Do we need to book an appointment/ring and speak to Nick/Coops/whoever it is that posts cat photos (or others I've missed) in order to do this?

Cards on the table, I've got a SIPP with you, I want to retire at 65 (20 years time) with the biggest pot possible, but my pot is currently considerably smaller than the initial investment made a couple of years ago... Is this new service something that I could make benefit from?

(As I've alluded to before, I'm about as knowledgable at this game as I am at writing a nuclear engineering thesis in Hindi!)

When it is live at the end of the month you will be able to just select the option from your dashboard and we will do the rest.

Please feel free to speak to Nik - email, phone, face-to-face) whenever you like though, he will be more than happy to go over this and anything else with you.

Sorry your timing in joining us was not good, I can only hope and trust that you are down less with us that you would have been had you stayed where your were - and that you will also recover more quickly with us that you would have with your previous SIPP provider.

You have a very long way ahead of you and whilst it may not feel like it now, I can guarante that the current cycle will soon be a distant memory!

Cheers

Julian