Author Topic: Your views on a newbie's portfolio  (Read 2226 times)

drstarter33

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Your views on a newbie's portfolio
« on: January 03, 2015, 02:04:30 PM »
Hi folks, thanks for this wonderful forum, very inspiring!
I am a financial-idiot-turned-newbie-mustachian. aged 33,  living in the UK, aspiring to retire by 50, married and have a 6-months old.
Very recently I turned some of my 1.5% fixed cash deposits to an ISA (tax free) stock account.
My portfolio is attached here. I tried to keep 20% bonds and rest as equity - I think this is a good balance for my risk appetite/needs.
There are some exotic stuff in the portfolio to keep me excited -e.g. Russia, substantial small cap etc.
I am hoping to maintain this diversity as I start contributing 33% of my salary each month from now on.
Does this look completely stupid for a starter? what do you think?

MDM

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Re: Your views on a newbie's portfolio
« Reply #1 on: January 03, 2015, 02:13:23 PM »
I am a financial-idiot-turned-newbie-mustachian

I tried to keep 20% bonds and rest as equity - I think this is a good balance for my risk appetite/needs.

Does this look completely stupid for a starter? what do you think?

drstarter33, welcome to the forums. 

Your overall asset allocation (80/20 stocks/bonds) seems fine. 

Investing in 15 different funds, as a self-described "financial idiot" and "starter", seems overly complex and likely to cost you more in fees than the apparent diversification will provide in benefits. 

Good luck!

drstarter33

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Re: Your views on a newbie's portfolio
« Reply #2 on: January 03, 2015, 02:25:29 PM »
MDM, thanks for your feedback.

I must admit that I thought of this issue. But I am slightly nervous about some funds going kaput (again my ignorance means I worry about every news piece I read) and thought it will be safe to have some managed-funds (with TERs less than 1%) and some index-trackers. Is this something others do as well? Keen to know.

On the side lines, any tips on how to stop reading financial columns of newspapers? struggling with this at the moment!

Mr. Captain Cash

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Re: Your views on a newbie's portfolio
« Reply #3 on: January 03, 2015, 05:51:20 PM »
drstarter33,

First off welcome to the forums and becoming mustachian!

Much like MDM I think your balance of 80% stocks and 20% bonds is fine, but rather complex and the fees alone could diminish the benefits from the diversification.

I am interested to know the size of your investment portfolio when you are holding that many funds. As when your investment portfolio is in the initial stages I believe it makes more sense to hold a few index funds as much of your monthly capital is getting consumed by fees. I would look at the securities within your 15 funds and make sure that they do not have the majority of the same holdings. As you might have an index fund that has the majority of the same holdings as one of your mutual funds. Then you are paying additional fees for very similar holdings and these two funds would have a positive correlation and due very little to decrease your actual volatility.

I invest in five different index funds and believe I am well diversified. You can check out my portfolio here http://www.mrcaptaincash.com/cash-accumulators/

If you have any questions don't hesitate to shoot me an email at mrcaptaincash@hotmail.com. I would be happy to help.

drstarter33

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Re: Your views on a newbie's portfolio
« Reply #4 on: January 03, 2015, 06:32:42 PM »
Captain Cash, thanks for your fabulous suggestions. I will be going through the securities in these funds over the next few days.

I did a lump sum investment of around 40k when I transferred my fixed deposits to stocks over the last 3 weeks. My intention is to evaluate the performance of all managed funds over the next year and gradually reduce the high TER funds that overlap with index funds,  if all goes well.  By this time next year, I should have a much simplified pie chart.

BTW - great blog, enjoyed skimming through the season highlights!

Mr. Captain Cash

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Re: Your views on a newbie's portfolio
« Reply #5 on: January 04, 2015, 03:20:45 PM »
drstarter33,

That sounds like a solid plan and great job investing a lump sum of $40,000. I will be looking forward to your posts along the way to watch the changes in your investment portfolio.

Thanks for checking out the site, glad you enjoyed it.

Mr. Captain Cash