B
Bearish
Guest
Well, its that time of the year again when I share my SSIA woes with all those on AAM.
I purchased a Quinn Life SSIA in May 2001. Its is 100% percent invested in the Eurostoxx 50. Having a look on how it did over the past 2 years is slightly painful. Its down approximately 22% in nominal terms (roughly lost about €1.6K so far). Which means that including inflation over the period, I’m down around 31%. More than the governments contribution. Now that hurts. This loss would of course have been a lot more if I had not been drip feeding the investment in every month- probably be down over 50% if I had put in a lump sum in May 2001!
Before anyone jumps out of the woodwork – I do realise that equity investments are long-term. However I would estimate that it will take at least 5-8 more years before I can make this money back and receive a decent average annualised return. Now I know that a lot of the AAM contributors favour index tracking as it low cost. I also know all about the studies showing that fund managers under-perform trackers. Both of these arguments I have previously stated I agree with. However a loss of 31% is still a loss. I wonder just how many people, with less experience of financial markets and less patience will seek to switch out of their equity based SSIAs? Is there anyone out there thinking of switching at the moment? Has the SSIA and Eircom fiasco permanently damaged the general Irish public’s appetite for investing in the markets?
Also I’d love to know how other equity related SSIAs have performed
I purchased a Quinn Life SSIA in May 2001. Its is 100% percent invested in the Eurostoxx 50. Having a look on how it did over the past 2 years is slightly painful. Its down approximately 22% in nominal terms (roughly lost about €1.6K so far). Which means that including inflation over the period, I’m down around 31%. More than the governments contribution. Now that hurts. This loss would of course have been a lot more if I had not been drip feeding the investment in every month- probably be down over 50% if I had put in a lump sum in May 2001!
Before anyone jumps out of the woodwork – I do realise that equity investments are long-term. However I would estimate that it will take at least 5-8 more years before I can make this money back and receive a decent average annualised return. Now I know that a lot of the AAM contributors favour index tracking as it low cost. I also know all about the studies showing that fund managers under-perform trackers. Both of these arguments I have previously stated I agree with. However a loss of 31% is still a loss. I wonder just how many people, with less experience of financial markets and less patience will seek to switch out of their equity based SSIAs? Is there anyone out there thinking of switching at the moment? Has the SSIA and Eircom fiasco permanently damaged the general Irish public’s appetite for investing in the markets?
Also I’d love to know how other equity related SSIAs have performed