Archived article: This article was correct at the time of publishing. Tax, investments and pension rules can change over time so the information below may not be current.

How to pick the right ISA investments

Choosing where to invest your ISA allowance is a big decision, particularly in today’s ever-challenging environment, so it’s easy to keep putting it off. Below is our five-point plan to help you pick out ISA investments that will work for you.

Lee Dooley Lee Dooley
06 January 2014

1. Don’t invest purely on past performance

Before you invest in a fund, it’s worth understanding why it has performed well. Is it down to careful stock selection or could it simply be a high-risk sector that’s had a great year or two? In a similar way, is the manager who generated the performance still in place or might they have now left the fund?

2. Don’t focus on fads

Try not to buy into the latest fashion until you have considered the contrarian view. If you do go for it, take care not to put all of your eggs in one basket.

3. Consider your goals

Think carefully about the type of investor you are. How long are you investing for? How much income do you want to generate? How comfortable are you with the idea of your investments falling in value? The answers to these questions will help you determine which funds you should consider.

4. Aim for a mix of investments

A good investment mix can enhance your portfolio’s performance and is important when considering levels of risk. We believe that most investors should consider investing across a variety of asset classes that are likely to move in different ways to each other, as well as spreading your equity investments across large, medium and smaller companies around the world.

5. Get the level of support you need

Not everybody is an investment guru and not everybody has the time or inclination to build and monitor their own investments on an on-going basis so use the tools available to you. Investing via a ready-made portfolio for example gives you easy access to selection of funds put together by the experts. This is also a great way of making sure your mix of investments is suitable as you can set the investment criteria and risk levels. There are also low-cost managed solutions if you would rather leave the on-going maintenance to the professionals.

Investment ideas for your ISA:

Download Our Top ISA Investment Ideas to find out our highest rated funds for your ISA.


Ready-made ISA portfolios:

Our ready-made portfolios offer an easy way to start investing across a number of top-rated funds. Choose your investment approach and level of risk and invest in a selection of high conviction and well diversified funds constructed by our research team.

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A managed solution:

Our Multi-Asset Portfolios are an excellent, cost-effective option if you would rather leave the choosing and managing of your investments to the professionals.

  • Choose from five investment strategies, each designed to meet different investment needs and attitudes to risk
  • Each portfolio contains a well-diversified mix of extensively researched investments
  • Invest from just £500

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The value of investments, and the income derived from them, can go down as well as up and you can get back less than you originally invested. Prevailing tax rates and reliefs are dependent on your individual circumstances and are subject to change.