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Rakhi Vasavada
Rakhi Vasavada, Financial Advisor
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Experience:  Attorney and Financial Expert. Have specialization in Financial Laws.Practice experience of over 13 years
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What return (%) over the last 3 years would the Executor of

Customer Question

What return (%) over the last 3 years would the Executor of an estate be expected to achieve through "prudent investment"? what investments would classify as such eg. Savings accounts? Government bonds? Funds?
Submitted: 2 years ago.
Category: Finance
Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

Hello and welcome. Thank you for providing an opportunity to assist you.

The question is little wider in scope and can be answered from many perspectives. The first and foremost thing that one has to consider is to have "clear" objectives of making an investments.

If we speak from neutral angle, the executor is expected to beat atleast the capital and money market / mutual funds returns significantly. He is expected to surpass them. Taking a benchmark, it is expected that while balancing the risk and return, returns of anywhere above 14% per annum is safe and prudent as well.

I am sure this would help.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question,

Warm Regards,
Rakhi Vasavada, Financial Advisor
Category: Finance
Satisfied Customers: 4536
Experience: Attorney and Financial Expert. Have specialization in Financial Laws.Practice experience of over 13 years
Rakhi Vasavada and other Finance Specialists are ready to help you
Customer: replied 2 years ago.

I would have thought that 14% in today's environment and for the last 3 years would be considered quite excessive considering that on average Uk 10 year government bond has yelded 2-3%, savings and notice (60days+) accounts have yelded 0.05-3% over the last 3 years.

Furthermore the legal rate in scotland awarded by courts relating to debt (legal rights are a debt to the estate) is 8%

Your thoughts please.

Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

Hello and welcome. Thank you for your reply.

I am aware of this. But from my point of view, if one does not significantly surpass these average rates, there is no point in managing the money. One is better off investing in a mutual fund with mix of debt and equity with more tilt on equity.

However, having said this, if one targets 14% and achieves somewhat 12% of so, even then it is excellent in all perspective.

My only point is -- if one does not signficantly surpass these benchmark returns, we are doing little help by managing the money ourselves.

Hope this makes sense.

I am sure this would help.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question,

Warm Regards,
Customer: replied 2 years ago.

Thank you

Would the mutual fund with mix of debt and equity with more tilt on equity guarantee the capital? which i would imagine is paramount.

Just to clarify,is your advice is applicable to Scottish law? I ask because i am trying to ascertain what would be an adequate interest rate to apply to a Scottish Legal Rights fund.

Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

If you can be little more clear, I believe you are trying to ascertain what interest / returns can be achieved by a executor if he goes on investing with "prudence". Am I clear on this ?

Yes, usually the mutual fund with equity composition of anything between 55-65% out of 100 can guarantee capital.

I am sure this would help. Please feel absoultely free to continue the conversation if you require.

Warm Regards

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