Share this page:
Stay connected:
Welcome to the Citywire Money Forums, where members share investment ideas and discuss everything to do with their money.

You'll need to log in or set up an account to start new discussions or reply to existing ones. See you inside!

Notification

Icon
Error

Investment Trusts, Woodford, Barnett, Equity Income, struggling...
Brock
Posted: 08 May 2018 11:43:33(UTC)
#1

Joined: 08/08/2017(UTC)
Posts: 8

Thanks: 3 times
Was thanked: 2 time(s) in 2 post(s)
Thoughts on the following would be gratefully received as I'm struggling

Background

Within a H-L SIPP I hold mostly UK based ITs. Holding time for most trusts is 10+ years and I've been pleased with the performance over the long-term.

In 3 years time at 55 I plan to draw 25% PCLS and because of this I've not been in any hurry to reinvest the sale proceeds from part of a SLS holding generated in December last year. I'm potentially going to breach the lifetime allowance so very aggressive investments don't appeal due to potential downside if it goes horribly wrong and if it does goes well a potential 55% tax charge.

At 55 once I've gone into drawdown and taken PCLS I don't think I'll need withdrawals (but who knows) for quite a few years so will be happy to continue to invest most of the SIPP for the long- term.

2000 and 2008 wasn't brilliant but I always aimed to invest for the long- term and accept volatility as part of equity investing. Historically, where possible, I have prefered ITs to trackers, UTs and ETFs but maybe it's time for a change.

Current holdings are

CTY 2.50%
DIVI 2.50%
EDIN 10%
FGT 25%
JEO 5%
Woodford Eq Inc 14%
PLI 5%
SLS 5%
Cash 31%

My questions are

1. If I sell the Woodford EQ Inc holding what should I do with the proceeds?
2. Would you be doing anything different in my shoes?


If you've read this far thanks for your time and any ideas you might have.



PS Is it just me or does there seem to be a lack of love for Woodford and Barnett on these pages?
dyfed
Posted: 08 May 2018 11:54:52(UTC)
#2

Joined: 01/09/2016(UTC)
Posts: 402

Thanks: 596 times
Was thanked: 592 time(s) in 243 post(s)
Re the LTA
You may know that this has been falling for several years now and that it was possible to register to protect at various levels if you agreed not to add further funds to your SIPP? If you haven't already done this, may be worth checking what the current level is and how you protect at this. I have always found HL helpful about this sort of factual information.

PS not currently a Barnett/Woodford fan
1 user thanked dyfed for this post.
Brock on 08/05/2018(UTC)
Brock
Posted: 08 May 2018 12:56:17(UTC)
#3

Joined: 08/08/2017(UTC)
Posts: 8

Thanks: 3 times
Was thanked: 2 time(s) in 2 post(s)
@ dyfed

Thanks dyfed, re the LTA I'm stuck, nothing more I can do so just trying to concentrate on what I do have some control over.

I'm looking for ideas, if a trust is on a steep premium I don't mind holding cash until it's more sensibly priced, I'm not sure I believe there is ever a genuine 'bargain' to be had so happy to buy trusts or other investments at a fair price for the long-term.

One option if I stay with with the equity income funds is to sell Woodford, buy the similar PLI on a 10% discount and stop paying H-L 0.45% a year to hold it, after a year the stamp duty's covered, the discount could widen or narrow but at least I can sell in due course at a know price.
kWIKSAVE
Posted: 08 May 2018 15:46:19(UTC)
#4

Joined: 14/08/2013(UTC)
Posts: 436

Thanks: 135 times
Was thanked: 382 time(s) in 238 post(s)
Sell Woodford Equity Income. It's a bummer.

Reinvest in Liontrust Special Situations.

Good to have a cash buffer in view of 3 year time horizon to retirement.
Split Cap Jim
Posted: 08 May 2018 17:52:57(UTC)
#5

Joined: 30/04/2016(UTC)
Posts: 17

Thanks: 1 times
Was thanked: 25 time(s) in 11 post(s)
The Lifetime Allowance is misnamed and not well understood - very poor article in Saturday's Times about it - still giving the impression that the amount paid in rather than investment returns is the issue. Anybody with 400k in the pot and 10 years until retirement should hit the 1m hurdle with reasonable growth.

For the Woodford, you might want to think about Fidelity Special Values (FSV) or JP Morgan Midcap (JMF) - I switched from Keystone (KIT) a couple of years ago and have no complaints.

Did you mean PNL (rather than PIL) in your existing holdings?
2 users thanked Split Cap Jim for this post.
Brock on 09/05/2018(UTC), dd on 16/05/2018(UTC)
King Lodos
Posted: 08 May 2018 18:40:44(UTC)
#8

Joined: 05/01/2016(UTC)
Posts: 3,055

Thanks: 723 times
Was thanked: 4782 time(s) in 1855 post(s)
I'd ask two questions:
– Am I good at picking outperforming funds, and do I consistently get the timing right?
– Do I enjoy researching and picking funds?

If not, I'd think it's such an easy decision to switch to something like Vanguard Lifestrategy 80 or 100, or the Global All-Cap Index .. Something which requires no thought and input: simply owning the market.

The great advantage of a world tracker or Lifestrategy product is you've got everything, and you're not paying a host of managers for the privilege .. Whatever happens – whether Amazon winds up owning half the world, or Luxembourg becomes the next global superpower, your portfolio will always reflect the world you're in .. And while there'll always be a handful of funds doing better over any 5-10 year period, to do consistently better, over 15-20+ years, is a lot harder – and finding those funds may take considerable work or luck.
15 users thanked King Lodos for this post.
philip gosling on 08/05/2018(UTC), Will Morris on 08/05/2018(UTC), Peter59 on 08/05/2018(UTC), FarmerDoc on 09/05/2018(UTC), dlp6666 on 09/05/2018(UTC), mcminvest on 09/05/2018(UTC), Stephen Garsed on 09/05/2018(UTC), Guest on 11/05/2018(UTC), antigricer on 11/05/2018(UTC), Guest on 12/05/2018(UTC), Rickenbacker Al on 13/05/2018(UTC), Richard_L on 13/05/2018(UTC), Greylocks on 15/05/2018(UTC), Catch The Pigeon on 15/05/2018(UTC), A M on 31/05/2018(UTC)
Joe 90
Posted: 08 May 2018 19:37:50(UTC)
#9

Joined: 14/01/2018(UTC)
Posts: 45

Thanks: 30 times
Was thanked: 21 time(s) in 12 post(s)
As usual some sound advice from KL. I am currently making suggestions to my sister on how to re-structure her investment portfolio and will recommend putting everything into a Vanguard life strategy fund. I’m now asking myself why I don’t do the same!
4 users thanked Joe 90 for this post.
King Lodos on 08/05/2018(UTC), dlp6666 on 09/05/2018(UTC), mcminvest on 09/05/2018(UTC), antigricer on 11/05/2018(UTC)
Tom Bards
Posted: 08 May 2018 19:43:27(UTC)
#10

Joined: 28/06/2017(UTC)
Posts: 126

Thanks: 2 times
Was thanked: 154 time(s) in 82 post(s)
Joe 90;61944 wrote:
As usual some sound advice from KL. I am currently making suggestions to my sister on how to re-structure her investment portfolio and will recommend putting everything into a Vanguard life strategy fund. I’m now asking myself why I don’t do the same!



Be careful. Many members on here suggest things which they themselves do not follow. One is inclined to think that those who do this think they are somehow special or endowed with knowledge the rest of us don't have which is, of course, ludicrous.
1 user thanked Tom Bards for this post.
Freddy4Skin on 08/05/2018(UTC)
King Lodos
Posted: 08 May 2018 20:26:12(UTC)
#11

Joined: 05/01/2016(UTC)
Posts: 3,055

Thanks: 723 times
Was thanked: 4782 time(s) in 1855 post(s)
Tom Bards;61946 wrote:
Be careful. Many members on here suggest things which they themselves do not follow. One is inclined to think that those who do this think they are somehow special or endowed with knowledge the rest of us don't have which is, of course, ludicrous.


You don't understand what's being suggested.

It's like saying you can go and work your way up the ladder in the hardest industry on earth; or you can sit back and take the average salary for doing nothing.

You can tell people who do well investing actively, because they know how hard it is .. You can tell people who don't do well, or don't calculate their returns properly, because they want you to do the same as them (that's them projecting their self-doubt – and that's a personality you wouldn't want managing your money) .. Same with my work in machine learning – most people can't do it .. It's just a fact .. And success in life is really about finding those things and doing them
7 users thanked King Lodos for this post.
Peter59 on 08/05/2018(UTC), Guest on 09/05/2018(UTC), mcminvest on 09/05/2018(UTC), Mr Helpful on 09/05/2018(UTC), antigricer on 11/05/2018(UTC), Rickenbacker Al on 13/05/2018(UTC), dd on 16/05/2018(UTC)
Brock
Posted: 09 May 2018 08:21:24(UTC)
#6

Joined: 08/08/2017(UTC)
Posts: 8

Thanks: 3 times
Was thanked: 2 time(s) in 2 post(s)
Split Cap Jim;61936 wrote:
The Lifetime Allowance is misnamed and not well understood - very poor article in Saturday's Times about it - still giving the impression that the amount paid in rather than investment returns is the issue. Anybody with 400k in the pot and 10 years until retirement should hit the 1m hurdle with reasonable growth.

For the Woodford, you might want to think about Fidelity Special Values (FSV) or JP Morgan Midcap (JMF) - I switched from Keystone (KIT) a couple of years ago and have no complaints.

Did you mean PNL (rather than PIL) in your existing holdings?



My mistake Split Cap Jim, should have typed PLI, thanks for the suggestions will take a look. (I held Fidelity Special Situations for many years when Antony Bolton ran the fund, is FSV a similar fund but an IT rather than an open ended fund?)
Split Cap Jim
Posted: 10 May 2018 17:44:52(UTC)
#7

Joined: 30/04/2016(UTC)
Posts: 17

Thanks: 1 times
Was thanked: 25 time(s) in 11 post(s)
Brock;61960 wrote:
Split Cap Jim;61936 wrote:
The Lifetime Allowance is misnamed and not well understood - very poor article in Saturday's Times about it - still giving the impression that the amount paid in rather than investment returns is the issue. Anybody with 400k in the pot and 10 years until retirement should hit the 1m hurdle with reasonable growth.

For the Woodford, you might want to think about Fidelity Special Values (FSV) or JP Morgan Midcap (JMF) - I switched from Keystone (KIT) a couple of years ago and have no complaints.

Did you mean PNL (rather than PIL) in your existing holdings?



My mistake Split Cap Jim, should have typed PLI, thanks for the suggestions will take a look. (I held Fidelity Special Situations for many years when Antony Bolton ran the fund, is FSV a similar fund but an IT rather than an open ended fund?)


Yes Fidelity Special Values is the IT - uses gearing but has better long term performance. Plenty of articles about the trust on the main citywire site.
Newbie
Posted: 11 May 2018 18:28:45(UTC)
#12

Joined: 31/01/2012(UTC)
Posts: 2

Hello

You may wish to consider the following

UK

Castlefield UK Buffetology
Chelverton UK Equity Income / Growth
Livingbridge UK Microcap

Global
Baillie Gifford Long term global growth / Scottish Mortgage
Standard Life Global Smaller Companies / Baillie Gifford Global DIscovery

Specialists

Allianz Technology
India Capital Growth
Baillie Gifford Shin Nippon / Japanese Smaller Companies
The new Baillie Gifford US Growth Trust

Hope this helps


mark spurrier
Posted: 12 May 2018 13:20:51(UTC)
#13

Joined: 17/01/2018(UTC)
Posts: 57

Thanks: 1 times
Was thanked: 54 time(s) in 29 post(s)
Brock;61908 wrote:
Thoughts on the following would be gratefully received as I'm struggling

Background

Within a H-L SIPP I hold mostly UK based ITs. Holding time for most trusts is 10+ years and I've been pleased with the performance over the long-term.

In 3 years time at 55 I plan to draw 25% PCLS and because of this I've not been in any hurry to reinvest the sale proceeds from part of a SLS holding generated in December last year. I'm potentially going to breach the lifetime allowance so very aggressive investments don't appeal due to potential downside if it goes horribly wrong and if it does goes well a potential 55% tax charge.

At 55 once I've gone into drawdown and taken PCLS I don't think I'll need withdrawals (but who knows) for quite a few years so will be happy to continue to invest most of the SIPP for the long- term.

2000 and 2008 wasn't brilliant but I always aimed to invest for the long- term and accept volatility as part of equity investing. Historically, where possible, I have prefered ITs to trackers, UTs and ETFs but maybe it's time for a change.

Current holdings are

CTY 2.50%
DIVI 2.50%
EDIN 10%
FGT 25%
JEO 5%
Woodford Eq Inc 14%
PLI 5%
SLS 5%
Cash 31%

My questions are

1. If I sell the Woodford EQ Inc holding what should I do with the proceeds?
2. Would you be doing anything different in my shoes?


If you've read this far thanks for your time and any ideas you might have.



PS Is it just me or does there seem to be a lack of love for Woodford and Barnett on these pages?



You have nearly 30% tied up in Woodford/barnett style funds.........i wouldn't be doing that. I would increase exposure on CTY it is defensive and doesn't make big bets on crap hoping it will turn around

You have lots of FGT, so do I, but I would split that with Fundsmith equity or similar to get some more global exposure - although the big weiths in FGT are all global - very little overlap between the two vehicles

I would consider some more smaller companies especially overseas (I like Japan)

You have way too much cash....unless you are thinking about dying soon. If you are going to be retired for many years and have dependents too you need to get that money working even if it is short duration bonds or Floating rate Notes.........something. Maybe non UK property ? TRY IT?
Freddy4Skin
Posted: 12 May 2018 14:22:36(UTC)
#14

Joined: 22/04/2014(UTC)
Posts: 98

Thanks: 186 times
Was thanked: 79 time(s) in 45 post(s)
mark spurrier;62185 wrote:
Brock;61908 wrote:
Thoughts on the following would be gratefully received as I'm struggling

Background

Within a H-L SIPP I hold mostly UK based ITs. Holding time for most trusts is 10+ years and I've been pleased with the performance over the long-term.

In 3 years time at 55 I plan to draw 25% PCLS and because of this I've not been in any hurry to reinvest the sale proceeds from part of a SLS holding generated in December last year. I'm potentially going to breach the lifetime allowance so very aggressive investments don't appeal due to potential downside if it goes horribly wrong and if it does goes well a potential 55% tax charge.

At 55 once I've gone into drawdown and taken PCLS I don't think I'll need withdrawals (but who knows) for quite a few years so will be happy to continue to invest most of the SIPP for the long- term.

2000 and 2008 wasn't brilliant but I always aimed to invest for the long- term and accept volatility as part of equity investing. Historically, where possible, I have prefered ITs to trackers, UTs and ETFs but maybe it's time for a change.

Current holdings are

CTY 2.50%
DIVI 2.50%
EDIN 10%
FGT 25%
JEO 5%
Woodford Eq Inc 14%
PLI 5%
SLS 5%
Cash 31%

My questions are

1. If I sell the Woodford EQ Inc holding what should I do with the proceeds?
2. Would you be doing anything different in my shoes?


If you've read this far thanks for your time and any ideas you might have.



PS Is it just me or does there seem to be a lack of love for Woodford and Barnett on these pages?



You have nearly 30% tied up in Woodford/barnett style funds.........i wouldn't be doing that. I would increase exposure on CTY it is defensive and doesn't make big bets on crap hoping it will turn around





Not a value investor then ?
1 user thanked Freddy4Skin for this post.
william barnes on 13/05/2018(UTC)
King Lodos
Posted: 12 May 2018 15:11:11(UTC)
#16

Joined: 05/01/2016(UTC)
Posts: 3,055

Thanks: 723 times
Was thanked: 4782 time(s) in 1855 post(s)
What concerns me – and I admit it's something I don't understand or am not aware of – is why Woodford and Barnett rotated into such low quality companies.

These 'red flashing lights' – a recession? That's usually when you want to be in higher quality names .. Valuations? It's all relative to what you can get elsewhere, which is not-very-much at the moment.

My red flashing light 3-4 years back was Biotech, because every 'mom & pop' investor thought you could get rich just buying Biotech funds, and it was evident 99% of fund managers didn't have a clue how to value companies where almost the entire value is in intellectual property priced in the speculative outcome of trials you'd need multiple doctorates to understand properly

4 users thanked King Lodos for this post.
john edwards on 12/05/2018(UTC), Jpb250 on 13/05/2018(UTC), Richard_L on 13/05/2018(UTC), Tim D on 13/05/2018(UTC)
Brock
Posted: 15 May 2018 12:22:13(UTC)
#17

Joined: 08/08/2017(UTC)
Posts: 8

Thanks: 3 times
Was thanked: 2 time(s) in 2 post(s)
UPDATE

Thank you for your comments and ideas.

Since the initial post I have SOLD Woodford, (@kwiksave the 'bummer' fund has been disposed of) this pushed the cash holding too high so I have added to holdings in

EDIN
PLI

On the basis it gives me exposure to similar stocks with the trusts trading at a discount plus it reduces the H-L fee. If discount widens I'm happy to buy more.

Bought some higher risk ITs for the long term, happy to add to these in due course

BRLA
JEMI
JII

Bought some small holdings in unpopular shares, happy to hold for the long or very short term and maybe add if prices drop further

BAT
BT
RB
VOD

I'm still holding enough cash to fund PCLS plus an extra 12%, with the slightly different brief any more suggestions that I could take a look at?

With thanks

mark spurrier
Posted: 26 May 2018 21:38:53(UTC)
#15

Joined: 17/01/2018(UTC)
Posts: 57

Thanks: 1 times
Was thanked: 54 time(s) in 29 post(s)
Freddy4Skin;62188 wrote:
mark spurrier;62185 wrote:
Brock;61908 wrote:
Thoughts on the following would be gratefully received as I'm struggling

Background

Within a H-L SIPP I hold mostly UK based ITs. Holding time for most trusts is 10+ years and I've been pleased with the performance over the long-term.

In 3 years time at 55 I plan to draw 25% PCLS and because of this I've not been in any hurry to reinvest the sale proceeds from part of a SLS holding generated in December last year. I'm potentially going to breach the lifetime allowance so very aggressive investments don't appeal due to potential downside if it goes horribly wrong and if it does goes well a potential 55% tax charge.

At 55 once I've gone into drawdown and taken PCLS I don't think I'll need withdrawals (but who knows) for quite a few years so will be happy to continue to invest most of the SIPP for the long- term.

2000 and 2008 wasn't brilliant but I always aimed to invest for the long- term and accept volatility as part of equity investing. Historically, where possible, I have prefered ITs to trackers, UTs and ETFs but maybe it's time for a change.

Current holdings are

CTY 2.50%
DIVI 2.50%
EDIN 10%
FGT 25%
JEO 5%
Woodford Eq Inc 14%
PLI 5%
SLS 5%
Cash 31%

My questions are

1. If I sell the Woodford EQ Inc holding what should I do with the proceeds?
2. Would you be doing anything different in my shoes?


If you've read this far thanks for your time and any ideas you might have.



PS Is it just me or does there seem to be a lack of love for Woodford and Barnett on these pages?



You have nearly 30% tied up in Woodford/barnett style funds.........i wouldn't be doing that. I would increase exposure on CTY it is defensive and doesn't make big bets on crap hoping it will turn around





Not a value investor then ?



It isn't about value investing. just that Woodford/barnett have the same views on what value equals. I have nothing against "value" but I am not convinced that their selections are value :)



mark spurrier
Posted: 26 May 2018 21:45:41(UTC)
#18

Joined: 17/01/2018(UTC)
Posts: 57

Thanks: 1 times
Was thanked: 54 time(s) in 29 post(s)
Brock;62337 wrote:
UPDATE

Thank you for your comments and ideas.

Since the initial post I have SOLD Woodford, (@kwiksave the 'bummer' fund has been disposed of) this pushed the cash holding too high so I have added to holdings in

EDIN
PLI

On the basis it gives me exposure to similar stocks with the trusts trading at a discount plus it reduces the H-L fee. If discount widens I'm happy to buy more.

Bought some higher risk ITs for the long term, happy to add to these in due course

BRLA
JEMI
JII

Bought some small holdings in unpopular shares, happy to hold for the long or very short term and maybe add if prices drop further

BAT
BT
RB
VOD

I'm still holding enough cash to fund PCLS plus an extra 12%, with the slightly different brief any more suggestions that I could take a look at?




With thanks





BAT - OK I guess.......... I think Phil Morris is a better bet
BT - Some shares are unloved for no good reason........ some are damned ugly and this is one of them. It is getting creamed in the market as the pricing is bad and the cost base too high. Service is really poor - they are getting killed in the commercial market
RB - II think this derated justifiably...... It was over priced and it still is.
VOD - I like this one
Jon Snow
Posted: 27 May 2018 00:09:23(UTC)
#20

Joined: 02/03/2014(UTC)
Posts: 1,107

Thanks: 794 times
Was thanked: 948 time(s) in 478 post(s)
I'd go for collective investments- mitigates risk.

20% of my SIPP is in CTY
25% of my SIPP is in HFEL

I'm in drawdown and take 50% of the dividends
as income and leave the rest.

I took the 25% tax free lump sum

I don't trust this government or any future
government to look after me and my family
as well as I can!
Mr Helpful
Posted: 27 May 2018 10:41:03(UTC)
#19

Joined: 04/11/2016(UTC)
Posts: 681

Thanks: 769 times
Was thanked: 923 time(s) in 428 post(s)
Brock;62337 wrote:
UPDATEI have added to holdings in
EDIN
PLI
Bought some higher risk ITs for the long term, happy to add to these in due course
BRLA
JEMI
JII
Bought some small holdings in unpopular shares, happy to hold for the long or very short term and maybe add if prices drop further
BAT
BT
RB
VOD
I'm still holding enough cash to fund PCLS plus an extra 12%, with the slightly different brief any more suggestions that I could take a look at?


Is this maybe a bit scattergun?
Perhaps view portfolio structure from top-down?
1. % Stocks v % Bonds/Alts/Cash weightings
2. Stocks : bias to Income or Growth or mixed weightings
3. Quoted v Private Equity weightings
4. Stock picking edge
5. Geographical region weightings
6. Currency exposures
7. Other

With a portfolio structure overview becomes somewhat easier to profer suggestions?
+ Reply to discussion

Markets

Other markets