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Harry Gloom
Posted: 28 June 2023 13:46:58(UTC)
#19

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Another vote here for keeping it simple, 1 single low cost 100% equity index tracker fund/ETF, set and forget. Ignore the news and naysayers.

Your grandchildren will be very pleasantly surprised in 30-40 years
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4 users thanked Harry Gloom for this post.
LondonYank84 on 28/06/2023(UTC), Tim D on 28/06/2023(UTC), Grubber on 28/06/2023(UTC), Chalky W on 16/07/2023(UTC)
LondonYank84
Posted: 28 June 2023 20:03:34(UTC)
#20

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Your grandkids will have 60+ years of compounding. It feels like you’ll be doing them more harm than good with a smattering of active funds where managers will change over the years and costs will eat into returns. You don’t need to try to outperform the market when the market will do its job. Vanguard All Cap and call it a day.

https://ofdollarsanddata.com/you-dont-need-alpha/
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4 users thanked LondonYank84 for this post.
Tim D on 28/06/2023(UTC), Grubber on 28/06/2023(UTC), Harland Kearney on 29/06/2023(UTC), Chalky W on 16/07/2023(UTC)
Tim D
Posted: 28 June 2023 21:00:21(UTC)
#14

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William P;271406 wrote:
If it was me I would add some gold too - SGLN


Think it's interesting when people mention commodities for these long horizon portfolios for juniors. I mean, especially for a SIPP, would anyone ever really say "hey grandchild, see this gold ingot? I'm going to lock it away in a safe and 60 years from now it'll be yours and you'll thank me"? I suspect the mature recipient would thank the donor far more if they'd instead been gifted a diverse portfolio of stocks of the same initial value.
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1 user thanked Tim D for this post.
Keith Cobby on 30/06/2023(UTC)
Grubber
Posted: 28 June 2023 21:48:06(UTC)
#16

Joined: 07/12/2020(UTC)
Posts: 21
Tim D;271451 wrote:
William P;271406 wrote:
If it was me I would add some gold too - SGLN


Think it's interesting when people mention commodities for these long horizon portfolios for juniors. I mean, especially for a SIPP, would anyone ever really say "hey grandchild, see this gold ingot? I'm going to lock it away in a safe and 60 years from now it'll be yours and you'll thank me"? I suspect the mature recipient would thank the donor far more if they'd instead been gifted a diverse portfolio of stocks of the same initial value.


Agreed Tim about gold though clearly we believe in the inflation proofing nature of minerals
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Grubber
Posted: 28 June 2023 21:55:14(UTC)
#18

Joined: 07/12/2020(UTC)
Posts: 21
Thrugelmir;271408 wrote:
A further thought. One day your grandchildren are going to have to manage this portfolio for themselves. A tall order for what will be novice investors.


This is a good point - indeed we already find that we don’t really have the time or knowledge to be able to confidently manage the portfolio in any active way so we add once a year and have not yet considered the sale of any element or partial sale even.
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Grubber
Posted: 28 June 2023 22:01:40(UTC)
#6

Joined: 07/12/2020(UTC)
Posts: 21
Thrugelmir;271384 wrote:
Grubber;271380 wrote:

BLACKROCK WORLD MINING TRUST

CITY OF LONDON IT

HARBOURVEST GLOBAL PRIVATE EQUITY LIMITED

ISHARES GLOBAL CLEAN ENERGY UCITS ETF DIST

RIT CAPITAL PARTNERS

SCOTTISH MORTGAGE

Overall down slightly so would you add to existing holdings or diversify further?


What % are held in each fund?


@17.5% each except I Shares ETF @12.5%
£3600 to invest shortly
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Grubber
Posted: 28 June 2023 22:10:01(UTC)
#21

Joined: 07/12/2020(UTC)
Posts: 21
Thanks all -so very helpful and interesting consensus that is clearly in favour of managed funds ie invest and forget and enjoy the benefit of long term compounding the principle of which I fully understand.

To be clear though am I to assume that to do so we need not just capital growth but income as well to enjoy the compounding effect?
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William P
Posted: 28 June 2023 22:26:10(UTC)
#15

Joined: 18/09/2018(UTC)
Posts: 295
Tim D;271451 wrote:
William P;271406 wrote:
If it was me I would add some gold too - SGLN


Think it's interesting when people mention commodities for these long horizon portfolios for juniors. I mean, especially for a SIPP, would anyone ever really say "hey grandchild, see this gold ingot? I'm going to lock it away in a safe and 60 years from now it'll be yours and you'll thank me"? I suspect the mature recipient would thank the donor far more if they'd instead been gifted a diverse portfolio of stocks of the same initial value.


Tim

I think 60 years is too long a time frame. If we work on the basis that the timeframe is 25 years at which point the money could be used to help say to buy a house etc. Nobody did this for me but that is the age when I would really have appreciated a leg up.

I know you are good with charts, can you do a chart for the last 25 years which compares:
1. 100% global equities
2. 85% global equities + 15% gold, rebalanced yearly

Thanks

WP
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Peter Bear
Posted: 29 June 2023 02:43:33(UTC)
#22

Joined: 04/01/2023(UTC)
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Grubber;271366 wrote:
We are investing for our grandchildren with SIPPs in their names. So long term growth is the principal aim. We favour Investment trusts and ETF funds. Our plan is to invest in minimum lumps of £1000 initially building each holding equally as the fund increases year on year using the £3600 annual allowance.
Where should we start investing?


You should start and end with equities.
Pound cost averaging in overtime.
JGGI and VWRL are, in my opinion, a great active passive blend.
The only problem is your dealing costs with IT's and ETF's.
To be honest you should really be buying Vanguard Global All Cap Accumulation units on the cheapest platform.
That would be their retirement sorted as well.
They just sell 3-4% of their pots annually.
Trust me, with hindsight, it really is that simple.
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1 user thanked Peter Bear for this post.
Fife Clive on 29/06/2023(UTC)
Fife Clive
Posted: 29 June 2023 06:30:15(UTC)
#9

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Grubber;271380 wrote:
Thanks for the suggestions so far which would be for grandchild 2.

We started a JSIPP for the first grandchild 2 years ago and this now holds

BLACKROCK WORLD MINING TRUST

CITY OF LONDON IT

HARBOURVEST GLOBAL PRIVATE EQUITY LIMITED

ISHARES GLOBAL CLEAN ENERGY UCITS ETF DIST

RIT CAPITAL PARTNERS

SCOTTISH MORTGAGE

Overall down slightly so would you add to existing holdings or diversify further?


Sorry to be blunt, just going to say it, that portfolio looks totally mental especially for an investor with a 60+ year time frame. I could see the rationale if it were a tactical position, with intention to rebalance within the portfolio, and adjust in future conditions. But are you going to do that? And when granddad shuffles off this mortal coil, is anyone going to be doing that? I shudder at the cumulative loss to fees over the investment horizon - that’s one hell of a hurdle to get over to beat a simple passive strategy.

Echo the majority of the people above:
1) open account with Fidelity (zero fees for junior products)
2) deploy money into Vanguard Global All Cap (or ETF equivalent VWRP if you really wanted - I don’t see the point)
3) forget about it until next year, when you repeat (2)

I’d also steer towards filling Junior ISAs first - a life-changing help to me at age 25 would have been £50k for a deposit, not a slightly larger pension pot accessible 30 years hence. Relax about the idea of giving up control and trust them to be raised with a sensible head on their shoulders
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4 users thanked Fife Clive for this post.
Cm258 on 29/06/2023(UTC), Frank Spencer on 29/06/2023(UTC), LondonYank84 on 30/06/2023(UTC), Guest on 30/06/2023(UTC)
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