Investing - I'm hacked off
Investing - I'm hacked off
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Simpo Two

Original Poster:

92,974 posts

295 months

Saturday 19th January 2008
quotequote all
For 10+ years I've had a reasonable (large to me) chunk of money invested in various places. I don't need it now, I want it to grow so I can live on it later. I've been with three different IFAs, had funds in god knows how many PEPs, ISAs, OEICs and what-not - and the result is always the same. They go up 10% - hurrah - then they go down 10% - boo. I get detailed letters telling me about volatility etc. I'm seriously wondering if it's worth the trouble. The only people who never lose, of course, are the people in the chain taking 1, 2, 3, 4% of everything along the line. Are they just getting rich at my expense?

Part of me is thinking of selling the whole bloody lot and shoving it in a building society, where growth may not be so spectacular but at least I won't see my gains vanish before my eyes.

What does the panel think?

thewave

14,870 posts

239 months

Saturday 19th January 2008
quotequote all
People are always too complacent leaving their money in funds and assuming it always has the same management, this is not the case, a decent manger will move (as will any decent employee) to where he can make more money, and his services are more valued.

My opinion is, yes, funds etc are fine, but review them, check to see if it's performing, if it's not, change it.


Simpo Two

Original Poster:

92,974 posts

295 months

Saturday 19th January 2008
quotequote all
Agreed, the current IFA is actually a director at a firm of stockbrokers. And they have a chap that looks at screens and buys and sells things. But it doesn't seem to make any difference. I get a quarterly statement about 1/4" thick full of lists of shares and what's been bought and sold, but it still seems to go up and down with the markets. Lost 10% in the last 3 months.

Somewhere, surely, there must be a fund manager who says 'Shit, this is going down, let's stick it into cash' rather than 'Oh well, it'll come back eventually'. I hate the term 'long term investment' - from ym experience that's what gets trotted out and really meabs 'We can't be bothered to check it'. Any muppet can ride the market. Or am I expecting too much? Does anyone have any recommendations? Perhaps the PEP/ISA/OEIC wrappers are costing too much of any gain - perhaps I'd be better off dealing with individual shares?

atom111

1,039 posts

255 months

Saturday 19th January 2008
quotequote all
Are there companies that would actively manage modest sums to make best of all returns? As that what seems to be required here.

NoelWatson

11,710 posts

272 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
For 10+ years I've had a reasonable (large to me) chunk of money invested in various places. I don't need it now, I want it to grow so I can live on it later. I've been with three different IFAs, had funds in god knows how many PEPs, ISAs, OEICs and what-not - and the result is always the same. They go up 10% - hurrah - then they go down 10% - boo. I get detailed letters telling me about volatility etc. I'm seriously wondering if it's worth the trouble. The only people who never lose, of course, are the people in the chain taking 1, 2, 3, 4% of everything along the line. Are they just getting rich at my expense?

Part of me is thinking of selling the whole bloody lot and shoving it in a building society, where growth may not be so spectacular but at least I won't see my gains vanish before my eyes.

What does the panel think?
Unfortunately the average actively managed fund, after charges, underperforms the index. Also, past performance is to guide to future returns (I will dig out dcoument if you are interested).
To answer you question, yes, they are getting rich at your expense. As Buffett says, most people are better off with a low cost index tracker

http://www.reuters.com/article/fundsFundsNews/idUS...

Simpo Two

Original Poster:

92,974 posts

295 months

Saturday 19th January 2008
quotequote all
atom111 said:
Are there companies that would actively manage modest sums to make best of all returns? As that what seems to be required here.
Well, to be precise £175K currently in the situation above, and £46K on deposit.

NoelWatson said:
Unfortunately the average actively managed fund, after charges, underperforms the index. Also, past performance is to guide to future returns (I will dig out dcoument if you are interested).
When I hear anyone say 'In the last 5 years our fund has grown by 98%' that probably means every man and his dog will pile in and it'll go back down. When the good news has come out, it's already too late IMHO. When they start advertising funds, you have to think it's because investors are drying up.

NoelWatson said:
To answer you question, yes, they are getting rich at your expense. As Buffett says, most people are better off with a low cost index tracker
Which also would have lost 10% over the last three months (FTSE250). I don't have the experience or time to track things every day/week and take profits, then lie low until they fall and then reinvest to get the next rise. But somebody must do, surely? Am I asking the impossible?

NoelWatson

11,710 posts

272 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
atom111 said:
Are there companies that would actively manage modest sums to make best of all returns? As that what seems to be required here.
Well, to be precise £175K currently in the situation above, and £46K on deposit.

NoelWatson said:
Unfortunately the average actively managed fund, after charges, underperforms the index. Also, past performance is to guide to future returns (I will dig out dcoument if you are interested).
When I hear anyone say 'In the last 5 years our fund has grown by 98%' that probably means every man and his dog will pile in and it'll go back down. When the good news has come out, it's already too late IMHO. When they start advertising funds, you have to think it's because investors are drying up.

NoelWatson said:
To answer you question, yes, they are getting rich at your expense. As Buffett says, most people are better off with a low cost index tracker
Which also would have lost 10% over the last three months (FTSE250). I don't have the experience or time to track things every day/week and take profits, then lie low until they fall and then reinvest to get the next rise. But somebody must do, surely? Am I asking the impossible?
Unfortunately noone can predict the future, not even fund managers!! Timing the market is impossible. My investments are down a lot over the last few months, but as I am investing for 20 years, it doesn't bother me too much.

atom111

1,039 posts

255 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
atom111 said:
Are there companies that would actively manage modest sums to make best of all returns? As that what seems to be required here.
Well, to be precise £175K currently in the situation above, and £46K on deposit.
At that level are there not wealth management firms that would switch your funds actively based on your parameters. By actively manage it was more meant at the portfolio of investments as opposed to investments within a single fund.



stimmers

2,312 posts

233 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
For 10+ years I've had a reasonable (large to me) chunk of money invested in various places. I don't need it now, I want it to grow so I can live on it later. I've been with three different IFAs, had funds in god knows how many PEPs, ISAs, OEICs and what-not - and the result is always the same. They go up 10% - hurrah - then they go down 10% - boo. I get detailed letters telling me about volatility etc. I'm seriously wondering if it's worth the trouble. The only people who never lose, of course, are the people in the chain taking 1, 2, 3, 4% of everything along the line. Are they just getting rich at my expense?

Part of me is thinking of selling the whole bloody lot and shoving it in a building society, where growth may not be so spectacular but at least I won't see my gains vanish before my eyes.

What does the panel think?
For exactly what you have highlighted above i have never bothered with investments of this type. Property has served me so well over the years. I made some big returns on some and some decent returns on others. I have never seen less than 30% growth in any property i have bought in a 3 year period.

The added bonus is that mostly its very little money down, rentals cover the payments and i have never seen any of my property decrease in value.

Over seas Agricultural Land is an exceptional investment at the moment. Especially the one below i have just sunk money into.

Greengold allows you to own approximately 12 acres of prime, managed, agricultural farm land for just US$40,000. The land comes with 10% guaranteed annual rent for 5 years and land prices are increasing by approximately 20-30% per annum.
With the growing demand for food and renewable energies in the World, we are offering a unique opportunity for investors to buy prime, managed, agricultural land in Argentina - The World's leading exporter and third largest producer of soybean oil. It is also the second largest exporter of corn and in 2006 signed trade agreements with China and India to supply crops for at least twenty years. Argentina currently export commodities to the EU, USA, Brazil, Chile, Japan, India and now China. The land will be used to grow food and carbon offset crops, which will generate a high annual income and capital growth for the next five years.

10% nett Guaranteed Annual Rent for 5 Years

Rent paid to client every 6 months

Rent is Guaranteed by a bond held by HSBC Bank

Estimated 20-30% Annual Capital Appreciation

Guaranteed Exit Strategy

Minimum Guaranteed Profit of 75% (If you hold land for 5 years)

Suitable for Self Invested Pension Plans (SIPP)

Featured in The Sunday Times as one of 'Five ways to earn 10% on your cash'

Client is free to sell whenever they desire

Only $40,000 required

Malh001

1,761 posts

258 months

Saturday 19th January 2008
quotequote all
Hello Stimmers,

Have you any further info/contact details for Greengold?

Cheers

Mal

Simpo Two

Original Poster:

92,974 posts

295 months

Saturday 19th January 2008
quotequote all
stimmers said:
Greengold allows you to own approximately 12 acres of prime, managed, agricultural farm land for just US$40,000. The land comes with 10% guaranteed annual rent for 5 years and land prices are increasing by approximately 20-30% per annum.
With the growing demand for food and renewable energies in the World, we are offering a unique opportunity for investors to buy prime, managed, agricultural land in Argentina - The World's leading exporter and third largest producer of soybean oil. It is also the second largest exporter of corn and in 2006 signed trade agreements with China and India to supply crops for at least twenty years. Argentina currently export commodities to the EU, USA, Brazil, Chile, Japan, India and now China. The land will be used to grow food and carbon offset crops, which will generate a high annual income and capital growth for the next five years.

10% nett Guaranteed Annual Rent for 5 Years

Rent paid to client every 6 months

Rent is Guaranteed by a bond held by HSBC Bank

Estimated 20-30% Annual Capital Appreciation

Guaranteed Exit Strategy

Minimum Guaranteed Profit of 75% (If you hold land for 5 years)

Suitable for Self Invested Pension Plans (SIPP)

Featured in The Sunday Times as one of 'Five ways to earn 10% on your cash'

Client is free to sell whenever they desire

Only $40,000 required
That does sound rather like the 'Make a Million out of our Share Tips!!' type leaflets.. As a generally intelligent but (in this area) ignorant person, how is one supposed to tell whether that's a genuine bona fide deal or that it will all go pear-shaped and some Argentinian despot will run off with the money and the land?

I'm seriously thinking of selling everything, get some interest (boring but reliable as markets fall) waiting for property to crash and then buying a second house. Which is exactly what I should have done in March 2000 of course!

NoelWatson

11,710 posts

272 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
stimmers said:
Greengold allows you to own approximately 12 acres of prime, managed, agricultural farm land for just US$40,000. The land comes with 10% guaranteed annual rent for 5 years and land prices are increasing by approximately 20-30% per annum.
With the growing demand for food and renewable energies in the World, we are offering a unique opportunity for investors to buy prime, managed, agricultural land in Argentina - The World's leading exporter and third largest producer of soybean oil. It is also the second largest exporter of corn and in 2006 signed trade agreements with China and India to supply crops for at least twenty years. Argentina currently export commodities to the EU, USA, Brazil, Chile, Japan, India and now China. The land will be used to grow food and carbon offset crops, which will generate a high annual income and capital growth for the next five years.

10% nett Guaranteed Annual Rent for 5 Years

Rent paid to client every 6 months

Rent is Guaranteed by a bond held by HSBC Bank

Estimated 20-30% Annual Capital Appreciation

Guaranteed Exit Strategy

Minimum Guaranteed Profit of 75% (If you hold land for 5 years)

Suitable for Self Invested Pension Plans (SIPP)

Featured in The Sunday Times as one of 'Five ways to earn 10% on your cash'

Client is free to sell whenever they desire

Only $40,000 required
That does sound rather like the 'Make a Million out of our Share Tips!!' type leaflets..
Agreed. How can something be risk free yet return more than a risk free asset. Apart from AAA rated CDOs. Allegedly

Edited by NoelWatson on Sunday 20th January 08:54

stimmers

2,312 posts

233 months

Saturday 19th January 2008
quotequote all
I have bought property and land with the company before, which i have had great returns on. This time i was going to Peru for a month to travel, so i actually went to Buenos Aires after for a week. I was looked after by the CEO or their Argentina office. He showed me the city, my past investments and how they have grown, i witnessed first hand the economy and we went through in detail everything to do with this investment. I was left in absolutely no doubt that this was a seriously good investment opportunity. I also was visited in my office in Berkley Square by the guy in charge of selling this investment in the UK and also i have been to their headquarters near Cambridge. The company was featured in the Sunday Times Fast Track 100 in 2005 and 2006.
All the investment i have put money into have been heavily invested in by the company its self, so if it goes tits up, they lose big time.

My due diligence when investing my money is always extremely thorough.

stimmers

2,312 posts

233 months

Saturday 19th January 2008
quotequote all
Malh001 said:
Hello Stimmers,

Have you any further info/contact details for Greengold?

Cheers

Mal
Mal,

send me an e-mail and i will respond with my contact at the company. The details i posted are phase 1 and i think its in Phase 2 now

Thanks

Chris

stimmers

2,312 posts

233 months

Saturday 19th January 2008
quotequote all
Simpo Two said:
waiting for property to crash and then buying a second house
IMO only of course, but please don't expect the property market to 'crash'. I can see a time when property goes down, maybe a max of 10%. But then start to creep up again.

If property goes down any significant % then people will start buying up 'cheap' property and what does that do to the market? Rental money in London at the mo is very strong and there is demand for good rental properties. So there is still plenty of money out their in the market, its just needs to balance out a little from rentals to sales, once the media have had enough selling papers off doom and gloom storys and scaring everyone

Again, just my opinion

Ordinary Bloke

4,559 posts

228 months

Saturday 19th January 2008
quotequote all
I'm not an expert, but here's my current thinking. I'm welcome to feedback...

I don't it would have been difficult to play BTL, if I had the money a few years back I probably would have done. Instead, I maxed out my mortgage and did BTLive-in instead.

Index trackers look good, but in a falling market that will still mean a loss. But I understand they typically equal/beat 90% of the companies in that index, so Buffett's advice is good enough for me. But I won't be tracking FTSE or any European or US indices, as I feel they could fall.

It might be a good time to put money in the building societies, and see what happens next in the US economy (and how that affects Europe & UK). Waiting for a crash in property, then doing BTL sounds like a great plan. I wouldn't be too surprised to see small flats falling 20-30%, I understand many people don't agree with that (see other threads) but I think that would bring them back to affordable levels. Sadly, only the affluent will benefit.

But fundamentally, I doubt if the fund managers and advisors we've been paying have been doing anything you or I couldn't do using trackers, Maxi ISA's, a little common sense etc. So even if we let them manage our money, we still need to pay attention, and manage them (=be ready/willing to switch where our money is).

If anyone more knowledgeable than me wants to comment, can you also tell me how I choose a Maxi-ISA, is there a place where I can compare all of them to see which have best charges, conditions etc?

NoelWatson

11,710 posts

272 months

Saturday 19th January 2008
quotequote all
stimmers said:
Simpo Two said:
waiting for property to crash and then buying a second house
IMO only of course, but please don't expect the property market to 'crash'. I can see a time when property goes down, maybe a max of 10%. But then start to creep up again.

If property goes down any significant % then people will start buying up 'cheap' property and what does that do to the market? Rental money in London at the mo is very strong and there is demand for good rental properties. So there is still plenty of money out their in the market, its just needs to balance out a little from rentals to sales, once the media have had enough selling papers off doom and gloom storys and scaring everyone

Again, just my opinion
Probably belongs to the house prices thread, but the spread betters are pricing ~10% falls by the end of the year. Greater London went down around 6% in the last quarter

JustinP1

13,363 posts

260 months

Sunday 20th January 2008
quotequote all
NoelWatson said:
stimmers said:
Simpo Two said:
waiting for property to crash and then buying a second house
IMO only of course, but please don't expect the property market to 'crash'. I can see a time when property goes down, maybe a max of 10%. But then start to creep up again.

If property goes down any significant % then people will start buying up 'cheap' property and what does that do to the market? Rental money in London at the mo is very strong and there is demand for good rental properties. So there is still plenty of money out their in the market, its just needs to balance out a little from rentals to sales, once the media have had enough selling papers off doom and gloom storys and scaring everyone

Again, just my opinion
Probably belongs to the house prices thread, but the spread betters are pricing ~10% falls by the end of the year. Greater London went down around 6% in the last quarter
Where this becomes interesting is where and how the 10% is calculated. It of course must be remembered that if we are looking at straight average house price then it does not mean that house/flat X has lost 10%, just the prices of those houses sold in that period is 10% less - which may have been a quite different trend of housing to those bought/sold the period before.

For example, in some areas, my own as an example, houses are quite limited, however there have been hundred or even thousands of one and two bed flats chucked up recently. Similarly, due to the financially uncertain times there are of course less people wanting to extend their borrowing to move up the ladder from a large detached to a larger detached.

Thus, in my area at least I would expect the overall average sale price to drop anyway just through this.

I don't think those in larger houses will lose that much per se - their asset may just become less liquid than before, as perhaps the people who *have* to sell up to move down the ladder, or to rent mean that the larger houses that are sold are either going to be those sold by an owner 'in distress' and looking for a quick and therefore lower sale, or a repossession.

As stimmers has said, whilst people are selling, that does mean that they still have to live somewhere, and therefore rent.

I think all that will happen is there will be a larger financial gap between those who have invested well - perhaps in property to let already, and those who have 'invested' their credit card balances to living above their means - who will end up funding the assets of the first party!



Edited by JustinP1 on Sunday 20th January 00:37

Dr Bob

637 posts

292 months

Sunday 20th January 2008
quotequote all
Ordinary Bloke said:
I'm not an expert, but here's my current thinking. I'm welcome to feedback...
Index trackers look good, but in a falling market that will still mean a loss. But I understand they typically equal/beat 90% of the companies in that index, so Buffett's advice is good enough for me. But I won't be tracking FTSE or any European or US indices, as I feel they could fall.
I'm no expert either, but as it's money that I don't need (and we're talking very modest sums here, nowhere near the OPs level of investment), and I'm in for the long term, I don't worry too much about the market falling (though ideally you'd put all your money in at the bottom of the market). Having had an index tracker ISA for about 4 years it's performance has been slightly better than the cash ISA which I whore about to get near the market leading interest rates...

CH

NoelWatson

11,710 posts

272 months

Sunday 20th January 2008
quotequote all
JustinP1 said:
NoelWatson said:
stimmers said:
Simpo Two said:
waiting for property to crash and then buying a second house
IMO only of course, but please don't expect the property market to 'crash'. I can see a time when property goes down, maybe a max of 10%. But then start to creep up again.

If property goes down any significant % then people will start buying up 'cheap' property and what does that do to the market? Rental money in London at the mo is very strong and there is demand for good rental properties. So there is still plenty of money out their in the market, its just needs to balance out a little from rentals to sales, once the media have had enough selling papers off doom and gloom storys and scaring everyone

Again, just my opinion
Probably belongs to the house prices thread, but the spread betters are pricing ~10% falls by the end of the year. Greater London went down around 6% in the last quarter
Where this becomes interesting is where and how the 10% is calculated. It of course must be remembered that if we are looking at straight average house price then it does not mean that house/flat X has lost 10%, just the prices of those houses sold in that period is 10% less - which may have been a quite different trend of housing to those bought/sold the period before.

For example, in some areas, my own as an example, houses are quite limited, however there have been hundred or even thousands of one and two bed flats chucked up recently. Similarly, due to the financially uncertain times there are of course less people wanting to extend their borrowing to move up the ladder from a large detached to a larger detached.

Thus, in my area at least I would expect the overall average sale price to drop anyway just through this.

I don't think those in larger houses will lose that much per se - their asset may just become less liquid than before, as perhaps the people who *have* to sell up to move down the ladder, or to rent mean that the larger houses that are sold are either going to be those sold by an owner 'in distress' and looking for a quick and therefore lower sale, or a repossession.

As stimmers has said, whilst people are selling, that does mean that they still have to live somewhere, and therefore rent.

I think all that will happen is there will be a larger financial gap between those who have invested well - perhaps in property to let already, and those who have 'invested' their credit card balances to living above their means - who will end up funding the assets of the first party!



Edited by JustinP1 on Sunday 20th January 00:37
It would appear that larger houses are affected as well

http://www.dailymail.co.uk/pages/live/articles/new...