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Nutmeg ISA – Our Experience of Nutmeg Investment Over Eight Years


Let me share our Nutmeg ISA investing experience from the last eight years.

When we opened our first stocks and shares ISA in April 2013, Nutmeg, the low-cost digital wealth manager, was in its infancy. John and I came across Nutmeg in early 2013; we researched the platform, thought about it, wrote about investing in Nutmeg, and only after that open our first account with them.

Later that year, we open a second Nutmeg ISA account in my name.

(I have two other stocks and shares ISA account – an ISA with Vanguard UK and an ISA with Blue Whale Investment Fund.)

Before we go any further, our experience of Nutmeg stocks and shares ISA is unique and entirely independent – our sole aim is to help you make up your mind about opening an ISA and investing.

If you decide to open a Nutmeg investment account during, or after, reading this article, you can do so using the links included – join through The Money Principle and you get six months FREE investing (no management fee); I will get a small commission which would allow me to continue researching and writing.

Why did we decide to open stocks and shares ISA with Nutmeg?

What attracted us to invest in Nutmeg ISA?

At the time, it appeared that investing in Nutmeg stocks and shares ISA deals away with most impediments we saw to investing in the stock market. More specifically, investing in Nutmeg ISA:

  • Is low-cost compared to managed funds (this was especially striking back in 2013 when digital wealth managers were few and market trading brokers charged high fees)?
  • Is as passive as you get and low knowledge entry costs (e.g., you can invest without knowing much about the workings of the stock market, and you don’t have to devote your life to researching stocks).
  • Nutmeg portfolios are researched and decided upon by high-calibre investing experts, including Nobel prize winners.
  • ISA is a tax-sheltered account, meaning that while investing after-tax money, investment growth and drawdown are not taxed (it is the opposite to retirement accounts).

When we opened our Nutmeg ISA accounts, we had no experience of investing in the stock market, no understanding of investing in digital wealth managers, and no reliable track record for the platform.

Still, we took a deep breath and opened our ISA stocks and shares ISAs.

It has been close to eight years now since we have been invested with Nutmeg. I have reviewed Nutmeg investing before, and I have told you why I love Nutmeg.

(No, it is not an exaggeration – I love Nutmeg with the even-headed love of a long-term relationship.)

Today, I wish to share some of the lessons I have learned through investing in stocks and shares Nutmeg ISA.

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What is Stocks and Shares ISA?

Stocks and share ISA, also known as investing ISA, is a tax-advantaged account where you can invest in various investment classes, e.g., equities, bonds, ETFs, index funds, mutual funds, etc.

Many financial bodies offer stocks and shares ISA, including traditional banks, building societies, and online digital wealth managers. You may wish to ask which is the best stocks and shares ISA, but I would urge you to reframe your question: while I have worked out a formula to help you decide which ISA is best for you, how much your investment ISA returns depends on many factors.

You can learn more about stocks and shares ISA investing here.

What is Nutmeg financial?

Nutmeg is a digital wealth manager operating in the UK, aiming to democratize wealth management and investing by building and managing sophisticated global, diversified investment portfolios. These portfolios are constructed by Exchange Traded Funds (ETSs) and carry different levels of investment risk.

Nutmeg offer General Investing Accounts, Stocks and Shares ISA, Lifetime ISA, Junior ISA, and pension accounts.

You can learn more about Nutmeg investing from this review.

Nutmeg ISA – how have our accounts performed?

We have two stocks and shares Nutmeg ISA accounts – one is mine, and one is John’s (for new readers, John is my husband). We opened our accounts in 2013, but John opened his in April, and I opened mine in November.

I’ll show you how our ISA Nutmeg accounts have, but here is what you must know before that:

  • We always contributed equally to our Nutmeg ISAs – ISA is an individual account, but this doesn’t mean you cannot share. (Okay, I have contributed slightly over £1,000 more, but this is small fish.)
  • John has always been the more cautious of us, and initially, he set his risk level at 5; he changed his risk level to 8 only after years of watching and reminders by the Nutmeg team that it doesn’t match the results of their survey.
  • Being the more adventurous one, I set my risk level at nine from the outset. I did change that later and will tell you about it later (it was a mistake, but I would rather see it as a lesson).

Here is how our Nutmeg ISA portfolios have performed since 2013:

Nutmeg ISA performance overview (Maria)

Nutmeg ISA

(To open Nutmeg stocks and shares ISA with six months FREE investing, click on the image above.)

Nutmeg ISA performance overview (John)

Nutmeg ISA

(To open Nutmeg stocks and shares ISA with six months FREE investing, click on the image above.)

Nutmeg ISA performance over the last year (Maria)

stocks and shares Nutmeg ISA

(To open Nutmeg stocks and shares ISA with six months FREE investing, click on the image above.)

Nutmeg ISA performance over the last year (John)

stocks and shares Nutmeg ISA

(To open Nutmeg stocks and shares ISA with six months FREE investing, click on the image above.)

Here are my observations:

  • Both portfolios have grown substantially. It is true, though, that growth follows consistent investing and starts accelerating after four-five years.
  • It has been a rather wild run for both stocks and shares ISAs – mine has been much more volatile, however. (Remember, my portfolio was set at high risk from the outset.)
  • My Nutmeg ISA has returned 39% overall, and John’s has returned 48%. Somewhere along the way, John’s stocks and shares Nutmeg ISA overtook mine and performed better. What can explain the nearly 10% difference?

I believe there are two reasons for John’s portfolio to perform better than mine.

First, his risk was moderate for the first four years, which means that while his ISA didn’t gain spectacularly, it didn’t dip below what he contributed either. Mine did. Here is when:

October 2014 Aug-Sept 2015 Jan-Feb 2016 December 2018 25 March 2020
Maria’s Nutmeg ISA dips  








6% below the contribution
John’s Nutmeg ISA dips 3.8% below the contribution


You see, while my stocks and shares ISA dipped below contribution five times in the last eight years, John’s ISA dipped only once. I believe this is because the conservative initial risk setting cut his initial losses and made steady but modest gains. Later, John’s account accommodated the wider swings that come with a higher risk setting.

And second, after the March 2020 drop, I did what I always tell you not to do – I chicken out and lowered the risk on my Nutmeg investment. John did nothing! Next thing, the markets swung up, and I found myself in the position everyone who succumbs to fear does – I caught the loss but not the gain.

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Lessons from eight years of Nutmeg stocks and shares ISA investment

Let me level up with you – our Nutmeg ISA accounts are not a highway to immense wealth. They are more like the scenic road we navigate with a pack mule. Still, opening an ISA with Nutmeg is very much worth it because:

  • Nutmeg investing is as passive as investing can be.
  • Nutmeg ISA returns steadily at approximately 5% per year after fees (even when you do silly things like the ones I did).
  • It drops in times of market crisis, but the loss is less than the index.

There are some lessons I must share (and you must take note of them because they come from experience).

Lesson 1: Open your stocks and shares ISA now, don’t ponder

When it comes to our cash, I tend to ponder.

Shall I open a stocks and shares ISA?

What if I lose it all?

What I learned is that it is best to open an ISA immediately and not ponder. Because opening stocks and shares ISA is like planting a seed – the tree will take years to mature and even longer to bear fruit.

Lesson 2: Minimise your fees

Nutmeg, like other online wealth managers, charges low fees.

This matters in the long run.

Lesson 3: Contribute regularly to your stocks and shares ISA

One thing that the last year taught me is that the stock market is a wild ride. My Nutmeg ISA loses and makes thousands of pounds from one day to the next.

‘Oh, good!’ – you may think. This investing lark is easy and very profitable – I just must buy low and sell high.

Yes, that is technically correct, except you never know which way the market will go. You may end up buying high and selling low.

A way around that is to contribute to your Nutmeg stocks and shares ISA every month without fail. Things have a way to even themselves out.

(The technical term for that is ‘dollar-cost averaging,’ but ultimately, it is a fancy name for a simple action.)

Lesson 4: Don’t lose your cool

Don’t lose your cool and never sell on a downward swing.

I did that and will never live it down – John keeps reminding me that his much more detached attitude is trumping my engaged investing.

The market swings; just sit it out.

Lesson 5: Look over the horizon

This one sounds poetic, but it is not.

Have sufficient easy access funds, so you don’t have to draw down your ISA in the next two years.

Why two years?

Because this is the way to prove your stocks and shares ISA against large market drops – even a decline of over 25% recovers within a year to eighteen months. (This is what analysis of past crashes shows.)

Nutmeg ISA: Final thoughts

Our Nutmeg ISA accounts have performed well over the last eight years – although no ‘stairwell to heaven’ Nutmeg investing is a slow and steady way to wealth.

Forget your fear of investing, leave your doubts behind and take advantage of a tax-free and passive way to invest. Investing in stocks and shares ISA is a rollercoaster and you must stay on!

We have other stocks and shares ISA accounts that I will tell you about over the next couple of weeks.

Don’t wait!

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2 thoughts on “Nutmeg ISA – Our Experience of Nutmeg Investment Over Eight Years”

  1. A great article with some wonderful practical advice, thank you. You mention Nutmeg (and presumabely all Robo platforms) is no stairwell to heaven. So what is?! I guess you’re implying higher risk strategies are effective, but do they not come with a need to develop considerable market knowledge?

    • @Mark: You are correct – the higher risk strategies may yield better results, and the trade-off is the need for in-depth knowledge. But this is not what I meant – there are funds that perform better than Nutmeg. For example, Blue Whale Capital Growth Fund has had an average return of 20% annually over the last four years. Thing is that Nutmeg has been low volatility option. That is why it is not a racehorse, it is more like a pack mule but tan investment portfolio need both, I believe.


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