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Noob needs ISA and funds advice - 20k to invest asap
Mr J
Posted: 23 January 2018 20:41:51(UTC)
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Théo, As stated above I also think you should probably just get on and start to do something with your ISA. It is impossible to know whether in the first days, weeks, and months your investment will rise or fall. Getting started is often the biggest step and as HL have said people (particularly perhaps the sensible ones) tend to regret the things they didn’t do, rather than those they did. I often find that I have thoughts about an investment - perhaps a share that looks interesting, or an idea about a companies growth drivers, or a contrarian idea for an investment - and then decide to sleep on it, see what happens for a bit, etc. You can then easily get distracted by all the other things in life and before you know it you have let the moment pass - 6 months or a year later you are then thinking - why didn’t I actually buy some Microsoft shares when I could see they were growing on the back of cloud computing - why didn’t I buy some Amazon shares when they dipped to £9 and I thought about it but didn’t act - why didn’t I buy some Terry Smith 2 years ago and so on.

You can make a start by putting all the cash in your ISA and just putting £5000 in a fund on day 1, but better to act and start to learn through experience.
5 users thanked Mr J for this post.
Tim D on 23/01/2018(UTC), Luca Brasi on 23/01/2018(UTC), Theo Shackleton on 23/01/2018(UTC), Mickey on 23/01/2018(UTC), Guest on 25/01/2018(UTC)
Theo Shackleton
Posted: 06 February 2018 17:19:07(UTC)
#84

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Hello,

Quick question. I invested in a fund today. The unit price of that fund was around 180 quid at the time I purchased. But on my account interface (fidelity) it says the unit price I've ordered at is 199, which was yesterday's value. Does that mean I have bought at the higher price because they have quoted it as such, or will it adjust to reflect the time and date I bought at? It says the date of the order is today's date but it was late on, so ordered but not yet purchased. Anybody know when the purchase will be completed tomorrow?

Thanks
chubby bunny
Posted: 06 February 2018 17:34:47(UTC)
#85

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Theo Shackleton;56626 wrote:
Hello,

Quick question. I invested in a fund today. The unit price of that fund was around 180 quid at the time I purchased. But on my account interface (fidelity) it says the unit price I've ordered at is 199, which was yesterday's value. Does that mean I have bought at the higher price because they have quoted it as such, or will it adjust to reflect the time and date I bought at? It says the date of the order is today's date but it was late on, so ordered but not yet purchased. Anybody know when the purchase will be completed tomorrow?

Thanks


If you placed the buy order before 11am today, you should get today's price. Sometimes the prices and number of units are only corrected after the transactions have fully completed. Certain fund houses seem to take much longer to complete transactions than others: I think some of my orders have taken up to a week, but the buy/sell prices have always been correct in the end.
1 user thanked chubby bunny for this post.
Theo Shackleton on 06/02/2018(UTC)
kWIKSAVE
Posted: 06 February 2018 17:42:39(UTC)
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For shares

RELX , NATIONAL GRID, UNILEVER & WH SMITH - £5k each


FOR Oeics

Evenlode Global Income

Old Mutual UK Smaller Companies

Rathbone Global Opportunities

GAM Star Credit Opportunities - £5k each

Theo Shackleton
Posted: 06 February 2018 17:55:25(UTC)
#86

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chubby bunny;56629 wrote:
Theo Shackleton;56626 wrote:
Hello,

Quick question. I invested in a fund today. The unit price of that fund was around 180 quid at the time I purchased. But on my account interface (fidelity) it says the unit price I've ordered at is 199, which was yesterday's value. Does that mean I have bought at the higher price because they have quoted it as such, or will it adjust to reflect the time and date I bought at? It says the date of the order is today's date but it was late on, so ordered but not yet purchased. Anybody know when the purchase will be completed tomorrow?

Thanks


If you placed the buy order before 11am today, you should get today's price. Sometimes the prices and number of units are only corrected after the transactions have fully completed. Certain fund houses seem to take much longer to complete transactions than others: I think some of my orders have taken up to a week, but the buy/sell prices have always been correct in the end.


Thanks for this. So what I pay should be based on the price at the time of purchase? It seems insane to me that it could be otherwise but I'm just mindful that the unit price stated when I purchased was yesterday's. I assume they were using that as a guide price and that it is a little delayed. Does anybody use Fidelity and know when they are likely to purchase my fund units? I ordered today just before 5pm.
chubby bunny
Posted: 06 February 2018 18:18:56(UTC)
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Theo Shackleton;56634 wrote:
Thanks for this. So what I pay should be based on the price at the time of purchase? It seems insane to me that it could be otherwise but I'm just mindful that the unit price stated when I purchased was yesterday's. I assume they were using that as a guide price and that it is a little delayed. Does anybody use Fidelity and know when they are likely to purchase my fund units? I ordered today just before 5pm.


Order before 11am and you get that day's price, order after 11am you get the next day's price. Since you placed the order at 5pm today, your purchase will go through at tomorrow's price, which could be beneficial if markets continue to slump. Funds are only priced once a day. I am with Cavendish but they use Fidelity's platform and once you've logged in the website is identical.
Theo Shackleton
Posted: 06 February 2018 18:54:48(UTC)
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Thanks Bunny. I am also with Cavendish.

So at what time is the price set, at 11am?
chubby bunny
Posted: 06 February 2018 19:36:04(UTC)
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11am is just the time that Fidelity send all the deals through. Pricing time depends on the fund e.g. LF Woodford Equity Income at 12pm daily, Baillie Gifford Japanese Smaller Companies at 10am daily. You can check the pricing times in the Unit Information box on a fund's Trustnet page.
1 user thanked chubby bunny for this post.
Theo Shackleton on 09/02/2018(UTC)
Theo Shackleton
Posted: 09 February 2018 19:49:22(UTC)
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Does anybody know why accumulation versions of a fund are more expensive per unit than income ones? E.g. Vanguard life strategy 100 is 194 vs 177 per unit. I assume it is to do with the costs to the fund of reinvesting my growth (if any). However, it seems more cost effective for me to take the income from the cheaper version and then just buy more of the fund myself. There would be no buying costs for me to do this.
dyfed
Posted: 09 February 2018 20:35:53(UTC)
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Theo Shackleton;56843 wrote:
Does anybody know why accumulation versions of a fund are more expensive per unit than income ones? E.g. Vanguard life strategy 100 is 194 vs 177 per unit. I assume it is to do with the costs to the fund of reinvesting my growth (if any). However, it seems more cost effective for me to take the income from the cheaper version and then just buy more of the fund myself. There would be no buying costs for me to do this.


The income versions pay out dividends to you, the accumulation ones hold on to all the cash they get in from the shares/gilts/assets they hold and, as you say, reinvest it. So over time, although they started from the same point, the accumulation ones are worth more, but anyone holding the income version will get a dividend every so often . Personally I always go for the income version, but your tax situation may influence your choice: CGT perhaps on the accumulation units v income tax perhaps on the income - neither if you hold in a SIPP or ISA
1 user thanked dyfed for this post.
Theo Shackleton on 09/02/2018(UTC)
Theo Shackleton
Posted: 09 February 2018 21:30:19(UTC)
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Thanks for the response!

I have an isa and any income from dividends would go into that, so no tax implications. So then it seems more cost effective for me to reinvest income myself, even if it is into the same fund, rather than pay more per unit for the accumulation funds. Only difference would be convenience. My isa platform even has the option of reinvesting it for me so I don't need to do it, unless they charge a fee for that...

Any thoughts?

Also, any thoughts on Vanguard FTSE Dev World ex UK Equity Index? I'm looking at it as a less UK focused version of lifestrategy 100. But not sure whether the ftse part just means UK companies?
King Lodos
Posted: 09 February 2018 21:39:52(UTC)
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It should work out exactly the same choosing the accumulation fund, unless there is a fee for reinvesting.

When you buy £1,000 of either fund, you're getting £1,000 worth of those shares
Theo Shackleton
Posted: 09 February 2018 21:42:12(UTC)
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King Lodos;56853 wrote:
It should work out exactly the same choosing the accumulation fund, unless there is a fee for reinvesting.

When you buy £1,000 of either fund, you're getting £1,000 worth of those shares


But the unit costs are higher for the accunulation ones. So I get less units. Mm, I see what you mean.
King Lodos
Posted: 09 February 2018 21:46:44(UTC)
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Yeah, the unit's just an arbitrary measure .. The accumulation fund's units get bigger (with dividends reinvested) while the income fund, reinvested, buys you more units.

It's something I pay absolutely no attention to
1 user thanked King Lodos for this post.
Theo Shackleton on 09/02/2018(UTC)
Alan Selwood
Posted: 10 February 2018 00:58:59(UTC)
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If you don't need the income, and the units are in a SIPP or ISA, accum units are simpler.

If you don't need the income, and the units are not in a SIPP or ISA, the income units are simpler for when you ant to work out the CGT.

If you get charged to reinvest dividends and you don't need the income, buy accum units, but if not in SIPP or ISA, the CGT calculations are more difficult.

If you do need the income, use income units.

The value of an accum unit is the same as an income unit + the reinvested dividend. No value difference, apart from any charge for reinvesting dividends created by income units.

1 user thanked Alan Selwood for this post.
Theo Shackleton on 11/02/2018(UTC)
Jay Mi
Posted: 10 February 2018 15:46:15(UTC)
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Theo Shackleton;56854 wrote:
King Lodos;56853 wrote:
It should work out exactly the same choosing the accumulation fund, unless there is a fee for reinvesting.

When you buy £1,000 of either fund, you're getting £1,000 worth of those shares


But the unit costs are higher for the accunulation ones. So I get less units. Mm, I see what you mean.



Go on Barclays research centre. Funds, charting, have a look at two funds both started at the same time with inc and acc. Select the option of income reinvested both charts should pretty much be the same.

If you buy £1000 of shares at £100 each. And £1000 of shares at £500 each, If they both grow by 20% then you’re value of shares will still be the same in both.. The number of Units does not affect this.

Owning more units feels better tho. I do the same and prefer to avoid highly priced units, even though I know it makes no difference.
1 user thanked Jay Mi for this post.
Theo Shackleton on 11/02/2018(UTC)
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