Attitude to Fixed Income in 2014

[Unix]

You said : "Whereas if you choose the correct property you can make 20% in a year or more."

And considering this is a thread on investing I assumed you were implying a substantial return each year.

I don't know if you are aware but you can make 20% or more in a year on an equity if you choose the right one too.

Yes in A year not every year for 20 years. Equities can go to 0 quickly, property generally has limited downside. It sounds like you had a bad experience with property.

[fullyautomatix]

GG ignore the property rampers.

I think in general buying a property is a sound investment if you have boatloads of cash. But the OP was referring to a drip feed kind of investment where you invest 1K or something every month into various instruments. The only way to do a drip feed kind of investment into property is via property funds or buy a property on BTL mortgage. BTL has its own risks and problems and may not suit everybody.

Investing in Gold was considered risk free a few years ago and DP will come and clarify why so. But these days investing in gold and oil is very risky because of the volatility in commodity markets.

Investing in stock markets in individual shares as a long term plan will work in most cases. We are talking 10 - 15 years investment. But again this depends on your research. If you pick a dud like RBS and pump a few grand in it , it might disappear. But a company with good prospects will yield good returns longer term.

[tomtomagain]

I have only ever had a positive experience of property.

Individual shares can go to zero. But so can your house if it burns down.

Indexing spreads the risk. You can't index your house.

[fullyautomatix]

I have only ever had a positive experience of property.

Individual shares can go to zero. But so can your house if it burns down.

Indexing spreads the risk. You can't index your house.

House burn down might be covered by insurance.

The only negative about property is its not liquid. Involves a heck of a lot of buying and selling costs and maintenance can be expensive. They all add up. And if a Spain type situation develops the drop in price can be 40% and take years to recover. If you wanted to dispose off the property to free up some cash you cannot do at that point.

[Unix]

I have only ever had a positive experience of property.

Individual shares can go to zero. But so can your house if it burns down.

Indexing spreads the risk. You can't index your house.

Are you the new forum idiot, what happened to the old one?


If only there was some way you could pay a monthly amount that would cover the cost of building your house if it was damaged?

[Unix]

House burn down might be covered by insurance.

The only negative about property is its not liquid. Involves a heck of a lot of buying and selling costs and maintenance can be expensive. They all add up. And if a Spain type situation develops the drop in price can be 40% and take years to recover. If you wanted to dispose off the property to free up some cash you cannot do at that point.

If only there was some way of freeing up equity on your house without selling it....

[tomtomagain]

If only there was some way of freeing up equity on your house without selling it....

What do you mean? Like borrowing from the bank? Not really the same. Or you could go in for some really dumb "equity release scheme"

[tomtomagain]

Are you the new forum idiot, what happened to the old one?

They gave you time off for good behaviour.

My position is that I recommend a diverse portfolio comprising of shares, bonds, property & commodities. And I would recommend Vanguard Life Strategy as an excellent way of getting the diversification at a low cost.

You appear to recommend forgoing anything non-physical and putting all your eggs into a few properties.

I don't think you have thought through the risks of being overweight in property.

[tomtomagain]

House burn down might be covered by insurance.

No, really? I was using it as an example of something unexpected happening.

How about you have a nice house in the home counties and then someone builds a high speed rail line through the garden? Or the local council opens up a paeodophile rehabilitation centre next door?

[lukemg]

First of all a disclaimer: Never believe, trust or follow anyone else's financial advice without doing your own research. And that includes my advice.

I think that the Vanguard Lifestrategy fund is an excellent choice.
(Vanguard LifeStrategy funds turn passive investing catatonic)

It gives you instant global diversification in equities and bonds and automatic re-balancing to keep you within the limits you have decided are right for you.

WHS x10