Diversification advice | P2P Independent Forum

plaguedbyfoibles
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Diversification advice Oct 2, 2022 20:08:08 GMT via mobile

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Post by plaguedbyfoibles on Oct 2, 2022 20:08:08 GMT

Intending on opening a Stocks and Shares ISA (effectively the UK equivalent of a Roth IRA used for equity investing, for any Americans out there) with Vanguard, with my first investment being an index fund, pursuing a dollar cost averaging / drip feed strategy.

Given the volatility of sterling right now, should I prioritise a US oriented index fund rather than a FTSE one?

Or should I treat the sterling crisis as short term noise and instead diversify, via Vanguard, using a fund that invests in UK, US and global equities?

I earn £30,000 per annum at my current employer (who have a performance linked bonuses structure in place for which I am eligible), have about £60,000 in savings, have £3,416.85 as of 24th September 2022 from my previous workplace pension, and have no debt whatsoever, either short- or long-term (I did not pursue tertiary education).

Currently, I am 27 years of age.

littleoldlady
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Diversification advice Oct 2, 2022 20:19:05 GMT Ace likes this

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Post by littleoldlady on Oct 2, 2022 20:19:05 GMT

If I knew the answers I would be relaxing on a beach instead of reading p2p forums. I can only give you my opinion and that is that I would put the money into your pension rather than an ISA - unless you think you will need the funds for a property purchase or something before the drawdown date. You would still have the problem of deciding which investment vehicle to choose but one person's guess is as good as anyone else's.

All my posts are my personal opinion and are not advice. History suggests that, if anything, it would be more profitable to do the opposite of whatever I do, but whatever you do will not be any responsibility of mine.

Ace
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Diversification advice Oct 2, 2022 21:35:14 GMT Ton ⓉⓞⓃ, ozboy, and 2 more like this

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Post by Ace on Oct 2, 2022 21:35:14 GMT

By coming to the decision that you want a tracker you've already come to the wise conclusion that your stock picking skills are probably not better than the 90% of investment managers that fail to beat the indexes over the long term. Why not take the next logical step and conclude that, like the vast majority of the rest of us, you don't know which sectors or regions will outperform which next, and just pick a global tracker (e.g. VWRL) in either a pension or an ISA to maximise your personal circumstances and tax efficiency.

I'm an equity investor in AxiaFunder and a minor equity investor in Brickowner, Crowdstacker, Proplend, CrowdProperty, Assetz Capital, Elfin Market, Qardus, Loanpad, Shojin & CapitalRise (and regrettably Fund Ourselves and ABLrate). All info and opinions stated are in a personal capacity. This time next year I'll be a miwionaire Rodders!