London Fashion Week: the companies leading the way towards sustainable fashion
As fashion week is wrapping up in New York and buyers and editors set their sites on London for this...
A good friend, fellow millennial and loyal reader of the millennial series recently told me that she’s planning to open her first ISA (yay!) but still feels intimated by investing and so is considering a cash ISA with her bank instead of stocks & shares to dip her toe. Wanting to keep the money invested for at least the next 3 years, and a naturally risk averse person, I wanted to see what other options were available to her.
FundCalibre has 22* Elite Rated lower-risk funds that have the potential to outperform the 1.7% fixed rate cash ISA she is considering. These 22 funds range from property to multi-manager to bonds so there’s quite a few asset classes from which to choose and possible create a small portfolio that could still be within her level of risk tolerance and time horizon.
‘In investing, what is comfortable is rarely profitable.’
– Robert Arnott, American entrepreneur
When you look at the investment risk spectrum, cash is always the lowest risk option: you won’t lose your money – the only risk is that you don’t make much either, and it possibly doesn’t keep up with inflation, meaning your £1,000 today buys you less in the future.
Next up are bonds. While they are deemed less risky than equities, you can lose money still. But they do have the potential for capital growth and usually provide a yield that is higher than the interest paid on cash accounts. Baillie Gifford Strategic Bond is worth a look.
If you don’t fancy bond funds, another option is multi-asset funds, which are often popular with first-time investors as smaller sums of money can be spread across different assets classes, giving some helpful diversification and reassurance that your ‘nest-egg’ is not in one basket so to speak.
Rathbone Strategic Growth Portfolio, which holds 59% in equities**, or Premier Multi-Asset Monthly Income, which sits in the IA Mixed Investment 20-60% Shares sector meaning it can hold between 20-60% equities, are two such examples.
Making your first investment can be daunting, but once you’ve taken that first step it can not only be very rewarding, but interesting too.
|1||Rathbone Strategic Growth Portfolio||8.35%|
|2||Baillie Gifford Strategic Bond||6.21%|
|3||Premier Multi-Asset Monthly Income||6.14%|
|4||Rathbone Ethical Bond||5.93%|
|5||BMO MM Navigator Distribution||5.32%|
*Elite Rated funds with a FundCalibre risk rating of 3.5 or less
**Fund factsheet, 30 April 2019
***Source: FE Analytics, total returns in sterling, 13 June 2016 to 14 June 2019