July ‘17 Performance

So the month has ended, and so its time to take stock of the performance across my portfolio, and compare it to the usual index of choice. This enables me to see how I am doing. As I covered in my “How I measure my returns” – basically I take the value of the portfolio at the end of last month, add on any contributions for the month, and that was my starting value. End value is the value at the end of the reporting period. Simples 🙂

So, what did July look like?

Portfolio Performance Notes
Company Pension -0.14% No income generated as all funds are in growth or reinvested
Personal Pension -1.34% No income generated as all funds are in growth or reinvested
ISA 1 0.69% No income generated as all funds are in growth or reinvested
ISA 2 0.17% The performance does not include the income that was paid out into my account, but is covered by the income so really need to consider both in conjunction
ISA 3 1.06% Although dividends are paid out, they remain in the ISA wrapper, and will get reinvested for growth. The performance figure includes both the Capital growth, and also income received which will get reinvested. The Income is the %age paid out by the portfolio but remains inside the wrapper to buy more goodies
ISA 4 1.15% Go T’ Pub ISA
FTSE-100 1.89% This excludes any dividends
FTSE-250 0.95% This excludes any dividends
FTSE-All 1.68% This excludes any dividends
S&P500 0.02% This excludes any dividends
Dow Jones 0.61% This excludes any dividends
VWRL 1.51% This also threw off a dividend of 0.7% on top of the growth
VHYL 1.58% This also threw off a dividend of 1.16% on top of the growth
GBP/USD 1.40% This was taken on the spot rate on the close of the last day of the month. Going forwards I will pick up the exchange rate from www.xe.com for consistency and real life 🙂

So, what to make of all this? All round, I think a pretty miserable month. Markets went higher by more than my investments.

My personal ISA had quite a bit of expenses this month in terms of trading costs and yet still surprisingly positive – I will be intrigued to see how much impact on my returns the switch into larger passive funds will be.

I am disappointed with my two pensions, however my Company Pension is still in the early days and, having been going for only a relatively short time, the contributions tend to make a large impact on the performance. Still for something I don’t even need to think about it is still growing relatively quickly!

Despite all that, in real monetary terms, my retirement pot still increased by almost 3% overall so I am not going to complain too loudly. At the start of this tax year I decided to have a little bit of fun with excel (I know how to live, right?!) and decided to take a view of, had I thrown £10,000 into each of my investment vehicles, what would that look like over time. Now, we are only 4 months in so it is really too early to tell, but I will certainly keep an eye on it, for those of you who like pretty colours and excel graphs, here it is:


Surprisingly, the best place to have parked your £10k, by over £200, was the pension with my IFA!! Even more surprising in second place was my ISA with my IFA.

This was certainly not what I was expecting especially when you read about all of the costs etc. associated with active funds, but there you go. However, this is also only 4 months of data – and to have a realistic view this really needs to be done over at least 5 years.

All things considered, the slow but steady rise to get to FI continues – although I am still not yet on track to hit my target retirement date. Since I started tracking my retirement forecast date (May ’16), I have brought forward the expected date to hit my number by a staggering 18 months. If that continues then by 2020 I should be on track, although that does still leave me the challenge that a lot of funds will be stuck in pensions I can’t access.

So, how was your July?

Company Pension: This consists of a number of actively managed funds – I don’t have any choice of trackers etc, but I will take the matching, that will more than cover the fees, and I will just live with it.
Personal Pension: This is managed by my FA and contains Actively Managed funds. I continue to contribute each month and the contribution is included in the performance – before my FA has taken their cut (e.g. if I put in £100, and they charged me £5, so only £95 went into the account, I would still class that as £100).
ISA 1: This is also managed by my FA, but no new contributions going in (nor planned).
ISA 2: This is also managed by my FA, however its slightly more complicated than that. There are 3 sub portfolios within, each of which have funds added each month, but each portfolio has different levels of contribution.
ISA 3: This is the ISA I manage myself. The last contributions added to it will be this tax year, 2016 – 2017 until some of my other ISAs  have grown to a similar size
ISA 4: This is the Go T’ Pub ISA that is being held for now for reference, but will start from the new tax year in 2017 – 2018

FiL goes on a spending spree!

So, having just sold down some of my holdings of companies, I find myself with some cash sitting in my ISA. This gives me the opportunity to continue rebalancing my portfolio to my newer target allocations.

At present, I am heavily under weight on trackers (in an attempt to reduce the overall risk of my portfolio) so with all this cash I need to purchase some trackers. Now given that I have seen the change in my mentality when I am using trackers, I know that I have to get back in as soon as possible and make sure I hit the next quarters payout – who cares if the price fluctuates up and down a bit.

So, before I dive into what I bought, a quick reflection on what has happened since I sold the stocks. Well not surprisingly, they have gone up slightly. I do find this slightly hard, and wishing that maybe I had just hung on, and who knows what will happen in the future. Yes, I will keep an eye on some of them to see if I can make the most of a cyclic opportunity. For now, I keep reminding myself that I did this to stabilise my portfolio, so in effect the trackers will be fire and forget.

The allocations are not equal but do have predefined target allocations that I can start tracking against.

Purchase #1: Vanguard FTSE-250 – VMID.

Erm hang on a minute? Didn’t I just sell a FTSE-250 tracker?! Well yes. Thanks to a great article over on Monevator, I thought to check on the fees. My old tracker, MIDD, was charging 0.4%, compared to the Vanguard offering at 0.1%. Given the difference in costs, I changed to take Vanguard, and accepting that Vanguard are forming a larger and larger part of my trackers, which is a little worrying but hey ho!

Average purchase cost: £31.68

Purchase #2: Vanguard Asia ex. Japan – VAPX.

Although I have exposure to Japan with my Investment Trust, I have very limited Asia exposure, and so I have tucked in to some Asian holdings. No doubt I will forget about the holding until I need to start topping up the holdings over time but for now it gives me a little diversity!

Average purchase cost: £19.95

Purchase #3: Vanguard European ex. UK – VERX.

Be it a desire to derisk Brexit, or just a desire to increase non UK holding (I find that VHYL is quite heavily US based) or give me some other random exposure, who will ever know 🙂 I wanted to explore some of the wider markets, especially as it means I can now remove my watch list European shares and not care about the exchange rate against the individual shares. I buy a slug of the shares and forget about it – bliss!

Average purchase cost: £25.99

What next?

So I still have some cash left over but I will leave that as cash for now. What I want to see is just how much dividends come in from these new holdings – another couple of months and see how that holds up before I purchase anything further. I have as always done my “back of fag packet” calculations but there is nothing quite like seeing the real dividends drip in.

The portfolio is finally getting close to my allocation – in fact according to my rules, the next purchase will, subject to market changes, be Investment Trusts to build that portion of the portfolio up.

With any luck over the course of this year the rebalancing will complete, and allow me to get back to trying to time the market (remember folks, don’t do that!).