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"One and done" fund for GIA
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Daniel B
Posted: 27 February 2025 08:56:01(UTC)
#1

Joined: 09/04/2012(UTC)
Posts: 78
Hello everyone. I am fortunate enough to have used up my ISA allowance for the year and also to have made a decent amount of pension contributions. These are both invested in 100% equities (mostly an MSCI World tracker, Alliance Witan, and JGGI) because I hope I won't need to touch them for at least 15 years. I'm happy with this "long-term" part of my portfolio.

I have some spare cash for which I don't have any immediate need and would like to invest. I have therefore opened a general investment account and will use half the funds to build a "bond ladder" of directly held gilts maturing over the next five years (which will likely be used to pay down my mortgage when the fixed term ends).

For the other half (which I will continue to contribute to out of excess disposable income), I would like to have some equity exposure, but with lower volatility than the 100% equity funds I hold in my SIPP and ISA. Ideally this would be a "one and done" fund which holds a mixed portfolio of equities and diversifiers without me having to rebalance or make asset allocation decisions myself. The obvious candidate is Vanguard Lifestrategy (at either 40, 60 or 80%, depending on my risk tolerance). My concern with these is that they only diversifier they hold is bonds, and I'm less optimistic about medium and long duration bonds because I think inflation will be higher than consensus over the next 5-10 years.

Does anyone have any other suggestions for "one and done" mixed asset funds which might fit the bill here?
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smg8
Posted: 27 February 2025 09:05:12(UTC)
#2

Joined: 26/04/2020(UTC)
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You could look at;

- Troy Trojan at the defensive end of the scale but suspect it may be too defensive for what you want
- BNY Mellon Multi Asset Balanced which is something I hold in my ISA (lower volatility than stocks, equity like returns)
- AJ Bell passive range which are actively managed (with underlying passives) hence they all avoided long duration and held up very well in 2022. Can choose various risk levels
- Vanguard Sustainable Life 60-70% equity which is an actively managed fund benchmarked against a 60/40 tracker

Other than Trojan, these are all low fee options.
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3 users thanked smg8 for this post.
Pre Ka on 27/02/2025(UTC), Strauss on 27/02/2025(UTC), Daniel B on 27/02/2025(UTC)
Elspeth Beaton
Posted: 27 February 2025 09:12:26(UTC)
#4

Joined: 11/12/2019(UTC)
Posts: 227
The search for the “perfect” diversifier to equities is a perennial quest
It is also a minefield for the amateur investors as “alternatives “ tend to be complicated,expensive and requiring a lot of financial knowledge - not an amateur investor’s ideal situation
However out there is,gold,commodities,REITs plus the delights of the more complicated bond world ie index linkers,ladders thereof etc etc
Most amateurs come back to a mixture of short term (5-8 years) government bonds and cash
Premium Bonds might be a consideration
The simplest is just to use a global bond index bond index fund hedged to the pound for bond asset allocation
No easy answers but lots of choices
Probably the biggest drawback will be paying income tax so aiming to fill pensions and ISAs plus you are allowed to £1000 interest tax free in a high interest bank account
xxd09
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Thrugelmir
Posted: 27 February 2025 09:21:01(UTC)
#5

Joined: 01/06/2012(UTC)
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Be worth considering what return you'd need to make to beat that of low coupon Gilts. Given the favourable taxable treatment. While little better than watching paint dry. Is this there sufficient equity risk premium on offer?
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3 users thanked Thrugelmir for this post.
ALAN P on 27/02/2025(UTC), Guest on 27/02/2025(UTC), The Penguin on 28/02/2025(UTC)
Mike ...
Posted: 27 February 2025 13:55:27(UTC)
#7

Joined: 16/03/2023(UTC)
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Premium bonds?

That’s another £50k shielded from tax.
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1 user thanked Mike ... for this post.
Big boy on 27/02/2025(UTC)
Daniel B
Posted: 27 February 2025 14:54:27(UTC)
#3

Joined: 09/04/2012(UTC)
Posts: 78
smg8;335905 wrote:
You could look at;

- Troy Trojan at the defensive end of the scale but suspect it may be too defensive for what you want
- BNY Mellon Multi Asset Balanced which is something I hold in my ISA (lower volatility than stocks, equity like returns)
- AJ Bell passive range which are actively managed (with underlying passives) hence they all avoided long duration and held up very well in 2022. Can choose various risk levels
- Vanguard Sustainable Life 60-70% equity which is an actively managed fund benchmarked against a 60/40 tracker

Other than Trojan, these are all low fee options.


Thank you, these are all helpful suggestions. The BNY Mellon Multi Asset fund in particular looks worthy of a closer look.
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Daniel B
Posted: 27 February 2025 14:58:33(UTC)
#6

Joined: 09/04/2012(UTC)
Posts: 78
Thrugelmir;335911 wrote:
Be worth considering what return you'd need to make to beat that of low coupon Gilts. Given the favourable taxable treatment. While little better than watching paint dry. Is this there sufficient equity risk premium on offer?


Half of the fund will be in a "bond ladder" made up of low coupon gilts (T26A, TN28, TG29, TG30, TG31). I would like to add equity risk to the other half of the portfolio because, although the tax-adjusted yield on these bonds looks favourable, I am concerned that inflation may be higher than expected over the next 5-10 years. I think equities can provide a useful inflation hedge.
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Daniel B
Posted: 27 February 2025 14:59:55(UTC)
#8

Joined: 09/04/2012(UTC)
Posts: 78
Mike ...;335958 wrote:
Premium bonds?

That’s another £50k shielded from tax.


Good one, although already full! (In fact what I do is use Premium Bonds as a cash savings account every year, then withdraw £20k after the April draw to make that year's ISA contributions. I then have a year to refill the pot before the next April rolls around).
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2 users thanked Daniel B for this post.
Big boy on 27/02/2025(UTC), Jay P on 27/02/2025(UTC)
Mr Spock
Posted: 27 February 2025 16:13:59(UTC)
#9

Joined: 19/07/2019(UTC)
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My pick

HSBC Global Strategy Balanced (or Dynamic) Portfolio.
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Jay P on 27/02/2025(UTC), Cm258 on 27/02/2025(UTC)
Sara G
Posted: 27 February 2025 16:15:08(UTC)
#11

Joined: 07/05/2015(UTC)
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Just to note that you need to watch out for tax issues if you go for a fund. Avoid accumulation units, and check for any additional income received that you might have to declare.

If you're looking for broad equities exposure, but without too high a dividend, then something like FCIT might be worth a look. I hold it in my GIA (with GSCT, SSON, EWI, AGT, PNL and CGT as satellites). Or more JGGI? I think there might be an advantage to 'two or three and done' as opposed to one, as it might help with offsetting any CGT liability over time.
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6 users thanked Sara G for this post.
Taltunes on 27/02/2025(UTC), Sheerman on 27/02/2025(UTC), ALAN P on 27/02/2025(UTC), Keith Clunk on 27/02/2025(UTC), bearcub on 27/02/2025(UTC), The Penguin on 28/02/2025(UTC)
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