Off-the-peg: The only questions you'll need to answer are about how much risk you are willing to take on
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Should you use a ready-made portfolio? How to work out if you can get the experts to do the hard work and pick investments that suit you

Investing can feel easier once you get into the swing; the difficult bit is knowing where to start. After all, there are tens of thousands of investment options out there, offered by a growing number of investment platforms.

I think ready-made portfolios can be a good starting point. These are off-the-peg portfolios and offered by most investment platforms. They are ideal for people who don’t want to spend their time handpicking funds and learning the ins and outs.

They don’t require you to make any decisions about what to invest in. The only questions you’ll need to answer are about how much risk you are willing to take on. 

As a rule of thumb, the more risk you take, the greater the chance of higher returns over the long term.

– Compare the best DIY investing platforms and stocks & shares Isas here

Off-the-peg: The only questions you'll need to answer are about how much risk you are willing to take on

Off-the-peg: The only questions you’ll need to answer are about how much risk you are willing to take on

At investment website Boring Money, where I am founder and chief executive, we test all of the major investment platforms regularly and independently evaluate their ready-made portfolios.

We crunch the numbers to see which have made the best returns for investors. Our figures cover the two years to the end of December 2022 and are total returns after all fees. Two years is a relatively short timeframe when it comes to investing and performance in the future may be quite different. But at least this gives a snapshot of how the platforms are faring.

We also have more than 25 test accounts, which we use to find out for ourselves what they are like for customer experience. As well as our own experiences, we also take into consideration the thousands of reviews of investment platforms on the website.

As a result, we have found the ready-made portfolios for investment Isas that offer what we believe is the best experience combined with the highest returns in recent years. We have put them into three categories: high, medium and low risk – see the tables opposite. Only you will know which category is right for you.

However, if your investment time horizon is ten years or more, then you could consider the highest-risk profiles – outlined in the first of our tables.

And if your horizon is nearer five years, then you should be considering lower-risk profiles – that’s the tables detailing medium and low-risk options.

Less than five years and cash may be your best bet.

Only three of the ten medium-risk portfolios analysed were up over the last two years.

That is because they tend to hold a high proportion of bonds, which have seen values plummet as interest rates have risen rapidly.

However, most have got off to a better start this year and hopefully they should recover further if interest rates do not continue to escalate.

For those people investing with shorter time horizons, or who don’t have an appetite for alarming ups and downs, the low-risk portfolios should be a good option.

In theory, they should offer a smoother investment ride; they will make less over the long term, but face less short-term volatility.

However, many performed poorly last year as they contain a high proportion of bonds, which struggled in the face of rising interest rates and the fallout from the mini-Budget. They should start to behave more calmly again, and did start to improve in the last three months of 2022.

The four low-risk options chosen did the best – or the least badly – over the last two years.

Holly Mackay is website Boring Money’s founder

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