ISA Investors: How to Rebalance Your Portfolio

As the ISA deadline looms, investors should consider their portfolio holistically and aim to have a portfolio that is well positioned to achieve their investment goals

Richard Whitehall 8 March, 2017 | 8:00AM
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Short of ISA ideas? This week as part of our Guide to ISA Investing we reveal the top rated and top performing stock and fund ideas – as well as sharing where the experts stash their cash, the latest news from the 2017 Budget Report and how to reduce your tax bill.



Richard Whitehall: As the ISA deadline looms, investors have been bombarded by recommendations to buy top-performing stocks, funds or sectors. I would encourage investors not to be swayed and consider their portfolio holistically. Ensure their portfolio is positioned to achieve their investment goals for the long term. There are two issues that I'd highlight for investors that they may be looking at over the next couple of weeks.

Firstly, the last 12 months have seen stellar returns across asset classes. The FTSE All-Share is up 23%. Broad global indices are up 36% and even investment-grade is up 11%. What that means is that any cash holding that an investor has had has been significantly reduced. Cash is not exciting, but I think it does have a part to play for most investors in their portfolio, not least is a backstop against capital loss. So, now, maybe a prudent time for investors to add to cash.

The second point that I would highlight is that some investors may have had exposure to mining and energy sectors. Well, if so, congratulations, because the mining sector in the U.K., for example, has been up 95%. But that does mean that those investments will now be a much higher proportion of an investor's portfolio. So, taking money out of those areas or adding into other parts that have underperformed maybe sensible for some investors as the ISA deadline approaches.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Richard Whitehall

Richard Whitehall  is a portfolio manager for Morningstar Investment Management

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