Transfer pension from Aviva to SIPP and investing in ITs

[taken2often]

Just came accross your Post. I invest for income over the past 20 odd years. The value goes up and own like a yoyo. The income rises each year. I go against the grain. I sell profit and keep loses. A loss is not a loss unless you sel it. I even buy more.

The current state of my portfilios is. 24 Fixed Income PIBS and Prefs. Investment Trusts 54. UK shares 15 US shares in Sipp 8.

It turns out I will never draw on the Sipp or even the ISA so they get reinvested each year, so the income is always growing. I no longer have any interest in the values. If they are down it is a buying opportunity.

Bob

[MrFoolish]

At this stage you should be looking at total return, rather than yield. When you start to draw down cash, then is the time to look at yield more, and adjust the portfolio as required.

TJH

Given your prevalence on the HYP board, I'm somewhat surprised to read you saying this.

[tjh290633]

At this stage you should be looking at total return, rather than yield. When you start to draw down cash, then is the time to look at yield more, and adjust the portfolio as required.

TJH

Given your prevalence on the HYP board, I'm somewhat surprised to read you saying this.

Back in the 1970s I realised that my higher yielding investments did better than those with a lower yield. I was mostly into unit trusts back then. That was giving me a better total return. What he needs to do now is to find which ITs give him the best TR. Later he can move towards better yields when the time comes to draw income. Better than nibbling away at capital.

TJH

[kempiejon]

Given your prevalence on the HYP board, I'm somewhat surprised to read you saying this.

Back in the 1970s I realised that my higher yielding investments did better than those with a lower yield. I was mostly into unit trusts back then. That was giving me a better total return. What he needs to do now is to find which ITs give him the best TR. Later he can move towards better yields when the time comes to draw income. Better than nibbling away at capital.

TJH

Having found the ITs with the best total return why not just stay with them for all time? The problem of course is knowing what that is. Sure natural yield avoids some selling decisions - but at the expense of the best TR later just to avoid nibbling capital?

[tjh290633]

Back in the 1970s I realised that my higher yielding investments did better than those with a lower yield. I was mostly into unit trusts back then. That was giving me a better total return. What he needs to do now is to find which ITs give him the best TR. Later he can move towards better yields when the time comes to draw income. Better than nibbling away at capital.

TJH

Having found the ITs with the best total return why not just stay with them for all time? The problem of course is knowing what that is. Sure natural yield avoids some selling decisions - but at the expense of the best TR later just to avoid nibbling capital?

That assumes that the best TR comes from lower yield ITs. I was looking into that, but need to update my figures.

The best TR may come from the higher yield ITs.

TR

[kempiejon]

I agree. At this stage you should be looking at total return, rather than yield. When you start to draw down cash, then is the time to look at yield more, and adjust the portfolio as required.

TJH

I know that I don't know where the best TR comes from but your suggestion was to swap to high yield from the best TR.

[Charlottesquare]

Having found the ITs with the best total return why not just stay with them for all time? The problem of course is knowing what that is. Sure natural yield avoids some selling decisions - but at the expense of the best TR later just to avoid nibbling capital?

That assumes that the best TR comes from lower yield ITs. I was looking into that, but need to update my figures.

The best TR may come from the higher yield ITs.

TR

My problem with yield v TR is I just cannot see past Scottish Mortgage, purchased as part of my late father's life interest trust in 2013, and even after its recent drop, the quarterly HL report to 31.1.2024 still shows it up 281.4% (was over 500%)

Now it does need considered that all income gets distributed whereas SMT in the main contributes little to this, but we aim with the 8 ITs we hold to overall roughly pay market div yield of a bit over 3% which we normally manage. The stark contrast is the 21.2% loss on Aberdeen Property and the 36.5% loss on Henderson far East, so capital gain overall 43.87% over ten years with all dividends distributed, this from a mixed bag of:

Aberdeen Property -21.2%
BlackRock World Mining +19.7%
City of London+7.2%
Henderson Far East-36.5%
JPM European Growth & Inc +77.8%
North America Income +65%
Scottish American +36.4%
Scottish Mortgage+281.4%