Kids money!

[gettingolderbutcooler]

The kids stocks and shares ISA at H&L are currently up about £2,500 from original investment of £17k.
Is it sensible to take out that profit? Just leave the original £17k? I was just thinking if it goes gosh over the next 5 years, at least they will still have that profit.
Not sure if we are even allowed to do that.
And if I should, I suppose it could go into their cash ISA?
Thank you!

Goes down 😜

If you look at it over five years it invariably goes up, it may drop a bit from time to time, but it then goes up again. Recent chaos is priced in now and it's going up again. If you had, say 6 months until one of them was going to purchase a house I'd say keep it as cash, but if you are talking 5+ years stick.

Thanks!

What is the S&S invested in? UK market?

Taking profit is trading behaviour which means that once the price is low, you should try to buy some more so that you can take profit when it comes up again. If you take out 2,500 now, what if the price continues to surge? You would have lost the % increase on that 2,000 worth of S&S. And it would be more expensive for you to buy it back at a higher price.

The beauty of S&S is that you can leave it and not worry about the short term fluctuations because you are really looking at the overall performance of the market over time, which your dcs will generally have a long time to smooth out. You would not make as much (unless you are some shrewd trader who has time to monitor and time the market, most people aren't) if you keep taking small profits.

Unless you need the money soon, I would just leave it in there. If you cannot sleep because of paper losses, then S&S is not within your risk appetite.

Personally, I am continuing to invest monthly in S&S because prices are relatively low. Look up dollar cost averaging and index funds. I am going to say the usual caveat which is speak to a financial advisor who can advise you on your risk profile and what are sensible investments for your dcs.

If it is a Junior ISA - so in their name - then you cannot take the money out. It could be moved between funds within the JISA wrapper, so could put some into a bond fund but those are no guarantee of not making a loss.

Conditions under which a JISA can be withdrawn from/closed: www.gov.uk/guidance/junior-individual-savings-accounts-for-managers-jisas-managing-jisas#withdrawals-from-a-jisa

Partial transfer from S&S JISA to a Cash JISA may be possible. You would need to ask the provider(s) about that. Partial transfers, when they are done, is generally a whole tax year, so if in a tax year £2k had been paid in to the S&S JISA that £2k may be able to be transferred.
Talk to HL, see if partial transfer is something they would do. Then see if any Cash JISA provider would accept such a transfer.

@blueshoes
@nannynick
Thanks to you too.
It's in something called Man Alpha, a Japanese investment package?
Honestly I was flummoxed by choice when I opened it. I had to randomly choose an investment 'portfolio'- I thought that it would be chosen for me by HL!

Trying to time the market tends to reduce how much you end up with, rather than increase it.

Maybe rather than this it’s worth having a think about which fund you want to be in. Generally something more broadly spread than you’ve gone for would be normal; something like the Vanguard LifeStrategy 100.

@ImmigrantAlice
I'll look into that. Thank you.

As far as I'm aware I could sell shares within my DC h and l stock ISA and that would stay as cash?
I can't remove it anywhere else?
It stays as cash or I could buy more with it.

My DC have vanguard life strategy plus, vanguard Japan index and some others to be honest I need to stream line it.

As long as everything remains inside the ISA wrapper then yes, you can sell shares out for cash, hold the cash, and / or buy other shares however you like.

What you cannot do is remove the funds from the ISA then freely put it all back in.

Just checking… you haven’t randomly just chucked 17 grand in a Japanese fund you know nothing about have you? If so that is incredibly risky.

regardless of getting money out, I’d be looking a bit more carefully at your investment choices.

@Bunnycat101
😔I have.
Honestly, I'm not really an idiot. It's just that I chose HL and I thought they'd choose it for me- then I was landed with a range of choices.

Oh. I actually might be an idiot then. 😟

Personally I’d take the gains and look at a more balanced portfolio. I did something similar when I first started investing but only with very small sums thankfully because my choices were far too risky for a newbie investor and were not really well thought though

ideally you want to spread your risk a bit more across multiple sectors and countries. Picking one country is quite a gamble.

@Bunnycat101
It's called Man GLG Japan Core Alpha.
It's gone up quite a lot!
I just don't understand that when I opened the S&S junior Isa, it made me choose? They didn't say- oh invest in this managed portfolio.
So I don't know what this Japan thing is but it's doing quite well- now up £2800.
So when you say 'spread your risk more' I don't know how I choose to do that?
I looked at the Vanguard and fidelity junior Isas just now.
I can transfer it to them, but will they choose the s&s for me?
Bloody hell I'm just a nurse not a bloody Wall Street banker and I'm lost.

Still an idiot. I have tried not to be...😜

Having £17k invested in a random Japanese fund that you don't understand is extremely risky and inadvisable. If you want something you can just set and forget you'd be much better with a globally diversified multi-asset fund or index tracker such as;
Vanguard lifestrategy 100
Vanguard FTSE Global All Cap
Any FTSE All World Index tracker
Blackrock consensus 100

to name a few.

The above are diversified across world economies, both developed and emerging (rather than the risk being concentrated in a single economy like a Japan fund), and diversified across a very large number of companies in different fields (tech, oil, retail etc.), typically including a mix of large, medium and small companies. This approach spreads the risk so that you are not gambling it all on a single section of the Japanese economy doing well (because if instead it collapses then you've lost everything).

Once you have chosen where to invest your money, leave it alone. Don't keep trying to time the market, the evidence clearly shows that the more you meddle with your investments the poorer your overall return typically is. Even investment managers underperform the market on average, so your chances of outperforming by sticking your nose in is very slim. Keep in all equities until around 5 years before you/your child is likely to want to access the money, then consider switching to a lower risk (or even cash) holding to protect your capital.

@pbdr
Thank you.
I'm embarrassed now.

You are all right I think. I randomly chose this as I had to pick something. But pensions etc do a ftse tracker I think, according to husband, so we will look into that.

It's hard to call HL and discuss as they can't advise, and they always act like this is such small change to them and they don't seem to have much patience.

Sensible tracker is what I'll aim for!
I'll call Vanguard and Fidelity tomorrow.
Thanks xx

Hi OP, I don't think you need to call Vanguard or Fidelity.

You can buy their funds through the HL platform I believe. Even if you call them, Vanguard and Fidelity also won't advise which fund is best for you but they can give you a list of their funds - you can probably find thje list on their website or on HL's website anyway. To fund out information on the fund itself, check the website or otherwise you can just google the fund on Trustnet (I literally just enter "Trustnet Vanguard Life Strategy 100" into the google search box and the first link should take you to the Trustnet factsheet which explains what the fund invests in and the charges.

If you want to buy it, then ask HL to execute the transaction for you on their platform.

Thanks @blueshoes
I did have a Google of HL ftse tracker fund but couldn't see it.
But I will try and contact them and find out.
They don't make it easy....
X

So just looking at the spread of your fund you’re invested in 46 Japanese companies and paying a fair amount in fees for it. you’ve got about £3k invested in Japanese car manufacturers, £3k in Japanese banks, £2.5k in Japanese petrochemicals, £2k in Japanese property etc If you were to look at it like that you might not have pressed to buy button. You’ve been lucky to have made a lot of money though!

Hi OP, at the top of the HL website home page, click on Funds. Then in the Search Funds box that comes up, type FTSE. It shows all the FTSE tracker funds that HL offers on their platform.

You won't see any FTSE index funds offered by HL but they will be offered by firms like CT (Columbia Threadneedle), HSBC, Vanguard, Fidelity etc. Click into each link to see the charges and what it invests in. You'd want to choose between FTSE UK (All Share, 250 or 100) or Developed World etc. Just because it is 'FTSE', does not mean it is tracking the UK shares. The name is a clue as to what it invests in but you can click into the link to find out more. FTSE is a brand of indices.

I am not very good at telling the difference between the different funds. This is where I often get stuck. Other posters will be more knowlegeable. A rule of thumb is low charges / passive index tracking funds are the cheapest and eat into your return less over time.

Oh god @Bunnycat101 - blimey!!!!

@blueshoes
That's really helpful- so kind to check for me, thank you!
So I could just call them and ask to transfer it all to a lower risk portfolio (if that's the right word) where it is spread wider, and maybe tracks the FTSE 100 or 250.
Xx

Looking on their website, I don't think HL will pick a 'lower risk' portfolio for you on the phone. You either select which fund(s) you want to buy and how much of each or you pay for their advisory service. In the latter case, they will be acting as your financial advisor but I am not sure if they are totally independent or just selling you funds you can buy on their platform. If you are prepared to pay for advice you don't have to go through HL just because you are buying the funds from them, you can ask any IFA who will check your risk appetite and advise you on what to buy.

Take a look at these 2 pages on the HL website:

www.hl.co.uk/investment-services/investing-for-children
www.hl.co.uk/financial-advice

"Our website offers information about investing and saving, but not personal advice. If you're not sure which investments are right for you, please request advice, for example from our financial advisers."

Sorry to be dim, but what do most people do when they buy a junior ISA? Surely most ordinary people like me don't go through all this- they just join up and are given a low, medium or high risk portfolio?

It just seems overly complicated. 😟

But it's late and I'm tired and if I keep thinking about it my brain will fall out.