Be prudent and address the imbalance in your portfolio

"I had always preferred to invest in bricks and mortar rather than investments, and own two properties in south west London which are valued at over £4m in total," says Gavin. "We let one of these on which we will maintain a small mortgage while tax relief still exists, and when this relief is eroded we will pay it off.

"I have been investing since I was in my 20s and made several investments in Fidelity funds. This was primarily because I photographed people such as star manager Antony Bolton so had an inkling of what his fund represented.

"I have also held F&C Responsible UK Equity Growth Fund (GB0033396481) in an individual savings account (Isa) since 2000 and my holding is now worth over £14,000.

"But our investment strategy changed after my wife inherited a portfolio of investments worth £124,000. We initially parked the information in a folder and continued with our busy lives, though did begin to transfer the investments into Isas. Some years on, out of curiosity, I had a closer look at the portfolio and realised it included some blue-chip stocks. There were also others that had achieved little and I didn't know much about. We decided we should sell some holdings, and buy what we thought we understood and could identify with. These were Amazon (AMZN:NSQ), ITV (ITV), GlaxoSmithKline (GSK), Vodafone (VOD) and Sky (SKY), and a number of funds including Polar Capital Technology Trust (PCT).

"Our most recent purchases were Great Western Mining Corporation (GWMO), Tlou Energy (TLOU) and GlaxoSmithKline.

"As we gathered our financial matters under one umbrella, we decided to look into our pensions which were practically non-existent as we didn't make regular payments. So we decided to transfer some of the investments into self-invested personal pensions (Sipps), where we now have our riskier holdings.

"We take a keener interest in investments than we used to - I subscribe to Investors Chronicle and even read the financial pages on occasions. But I would like to know if we are doing the right thing as our investment knowledge is limited.

"The portfolio has been neglected for many years so I suspect we should be looking for income to reinvest, as well as growth. Or should we sell our investments and put the proceeds into property? But I am concerned that doing this would mean we have too many eggs in one basket.

" Alternatively, should we leave the portfolio as it is - as we have done in the past - and review it in a few years?

NONE OF THE COMMENTARY BELOW SHOULD BE REGARDED AS ADVICE. IT IS GENERAL INFORMATION BASED ON A SNAPSHOT OF THIS READER'S CIRCUMSTANCES.

THE BIG PICTURE

Chris Dillow, Investors Chronicle's economist says:

You ask whether you should sell this portfolio and invest more in property. I think you shouldn't.

The prospects for equities are not great: the high ratio of global share prices to the money stock in particular is a worrying sign. But the prospects for property aren't great either - price gains are likely to be capped by the unaffordability of housing and, at best, weak growth in incomes. Property also incurs two big risks: cyclical risk, the tendency to do badly in recessions when you might also find your income falling, and liquidity risk, an inability to sell quickly.

As you are already heavily invested in property, another shift towards it would further unbalance your portfolio.

Instead, consider whether you have too much exposure to risky assets such as shares and property generally. If you needed to raise cash quickly, could you do this? Could you cope with, for example, a 10 per cent annual fall in your wealth? If the answer to these questions is no, think about shifting into cash. If it is yes, although a zero real return is unappealing, it's better than some plausible alternative possibilities.

Martin Bamford, managing director of Informed Choice, says:

It's admirable to hear you are taking a greater interest in financial matters after having paid little attention to them in the past. Your historic approach to managing the investment portfolio - invest and forget - will have mostly served you well over the years. But it's important that with your new found interest in money matters you don't interfere in the portfolio for the sake of it, which is the downfall of many newly enthusiastic investors.

Given the total value of your property assets, I think diversification across other asset classes makes real sense. Putting all of your eggs in one basket - especially when that basket is the expensive residential property market - is a high-risk approach to take.

Before making decisions about how to restructure and allocate the investment portfolio, you and your wife need to think about your long-term financial plans. You are in your early 50s, so your thoughts are probably turning to retirement and what life will look like when you are in your 60s, 70s and beyond. As a self-employed freelancer and owner of a limited company you are unlikely to want a traditional retirement, but will perhaps need your investments to support greater flexibility and choice as you get older.

You should continue to make use of your annual Isa and capital gains tax allowances, realising losses to offset against the sale of other holdings which are subject to capital gains. Putting money into your Sipps earns you tax relief on the contributions, although this needs to considered in the context of your wider retirement plans and how you will be extracting the money in the future.

Ben Yearsley, director at Shore Financial Planning, says:

You seem to be financially secure through your property ownership. You sound like you have some good properties and know how to make money from them. You also seem to be aware of the tax changes to interest payments regarding these properties. The benefits of becoming a new landlord will diminish as the 3 per cent additional stamp duty and lessening tax relief on debt kick in over the next few years. Both these changes will substantially eat into the profits of new and existing landlords.

So I wouldn't add to your property portfolio. It's by far the largest part of your wealth already, so diversification away from property with the rest of your assets seems prudent.  And as most of the rest of your wealth is in tax efficient Isas and Sipps, why remove it from them?

You appear to have very little in the way of pension savings. If this is your only pension pot, you and your wife have wasted a valuable tax allowance. Even with the more stringent rules today you can invest up to £40,000 per tax year and receive upfront tax relief. If these are your only pension savings you and your wife aren't anywhere near the lifetime allowance which is currently £1m. So you would only incur a restriction if you earn £150,000 or more each tax year, as your annual £40,000 allowance gets reduced by £1 for every £2 of earnings over this amount reducing your annual pension allowance to £10,000 if you earn over £210,000.

As well as getting upfront tax relief, pensions typically do not incur inheritance tax which will be a consideration with the current value of your estate.

Move the remainder of your non-tax-wrapped investments into your Isas as soon as possible – there is no point in paying additional tax. At present the annual allowance for these is £20,000. It is particularly important to move the dividend paying shares into your Isas or Sipps to avoid incurring dividend tax.

HOW TO IMPROVE THE PORTFOLIO

Chris Dillow says:

Despite your protestations of ignorance this portfolio actually makes some sense. It seems to be based upon renowned US investor Warren Buffett's principles that we should invest in defensive stocks with sufficient monopoly power to fend off potential competition. Unilever (ULVR), Amazon, Apple (AAPL:NSQ), British American Tobacco (BATS) and big pharmaceutical companies more or less fit this bill.

Your defensive bias won't wholly protect you if the market falls. But we know that defensives beat the market on average over the long run. So in this respect you're doing the right thing.

But I would warn you of two things.

This portfolio might be a little over-diversified which means you could end up with tracker fund type performance, but the extra expense of fund management charges and dealing fees. Consider consolidating the portfolio by selling some holdings and buying a global equity tracker fund. This would also make it easier to leave the portfolio alone for a considerable period.

And your fund holdings may duplicate your direct equity holdings. Polar Capital Technology Trust, for example, has a big holding in Apple and also holds Amazon, which increases your exposure to them.

This isn't necessarily a bad thing. But it poses a problem many investors have when they combine direct holdings with funds – that it's not so clear what a fund adds to the portfolio or what the direct holdings do that the fund doesn't.

When you are thinking about any stock or fund don't judge it in isolation. Instead, consider what each asset does that the rest of your portfolio doesn't. In some cases the answer is very little, which is another reason to consider trimming your holdings.

Martin Bamford says:

Once a purpose for this money has been agreed I would choose an investment philosophy or policy that will guide your decisions. This doesn't need to be more than a page, but should outline the areas in which you will and won't consider investing, maximum limits on individual holdings, and how the portfolio should be allocated across different regions and sectors. Documenting your own investment philosophy like this is a good way to avoid getting caught up in the excitement of a new investment opportunity, or exposing too much of your portfolio to one area and therefore increasing the risk too much.

You say that there are blue-chip stocks in your portfolio but also ones you don't really understand. I would suggest a foundation of sensible investing is knowing and understanding each component within your portfolio. If you don't understand what a company does or what role it plays in your wider portfolio, it probably makes sense to sell it.

Looking at the value of the portfolio, I would question as to whether it is cost-effective to hold individual company shares. You could gain better diversification and participation in different investment markets by investing in collective investment funds, including those you already hold, but also low-cost index tracker funds. The cost of buying and selling a few thousand pounds in a stock makes it inefficient, and it also limits your ability to reduce risk through diversification.

Ben Yearsley says:

Out of your portfolio worth about £373,830, approximately £160,000 is in funds and investment trusts with the balance in a mix of UK and international shares.

The share portfolio seems to be in reasonable shape. There is a nice spread of businesses from a wide variety of sectors which have different performance drivers. Some are growth-oriented and others are more value-focused, some are international earners and others have a domestic focus. 

But you incur currency risk with the likes of Amazon and Apple, which would have worked in your favour in 2016 but cost you money in 2017. If the pound strengthens against the US dollar, these holdings could lose you money.

You also hold some of the investments across a number of your accounts, for example, ITV which is in your wife's trading, Isa and Sipp accounts. Is this intentional?

And why have small holdings such as Rolls-Royce (RR.) with a value of only £1,600? Either have a proper position or not at all – what's the point of a £1,000 holding in a portfolio worth almost £374,000? If you believe in it, add more, if not, ditch it.

I am unsure of your strategy, and how these shares work with your funds and investment trusts. When are you looking to retire and how do you intend to support yourself? If it's through the property then the investment portfolio could be treated more like "play money." But if you will need to rely on it you need to think about what investments are in the portfolio, the longevity of it and what it is doing for you.

Your fund holdings are a mess. 

Nomura Global Dynamic Bond (IE00BTL1GV74) is a good fund but what's the point? It's the only bond fund in your portfolio and worth about £4,300. This means it won't move the dial of your overall wealth, and won't do anything to reduce the risk in the portfolio or boost the income. This is also the case with some of the other small holdings. If you hold Nomura Global Dynamic Bond for diversification then add more bond funds such as Jupiter Strategic Bond (GB00B4T6SD53), M&G Global Floating Rate High Yield (GB00BMP3SC51) and Artemis Strategic Bond (GB00B2PLJR10). But make them account for 10 to 15 per cent of your overall portfolio - not 1 per cent.

You are also likely to be getting further exposure to many of your individual shares in some of the funds. For example, AstraZeneca (AZN) and Imperial Brands (IMB) are the largest holdings in LF Woodford Equity Income (GB00BLRZQB71), Polar Capital Technology Trust holds Apple and Amazon, and Scottish Mortgage Investment Trust's (SMT) largest holding is Amazon. Individually the funds are fine - they just don't complement your direct share holdings.

I think the funds need an overhaul and you need to decide what you want from your investments. You seem to enjoy running the direct share holdings, in which case the funds need to be more focused on specialist areas such as healthcare, technology and overseas equity markets which the shares don't provide exposure to.

You could sell down your UK equity funds to boost the bond portfolio or add to overseas equities. Japan and Europe could definitely do with a boost – consider adding the Man GLG Japan CoreAlpha (GB00B0119B50), Baillie Gifford Japan Trust (BGFD), FP Crux European Special Situations (GB00BTJRQ064), Janus Henderson European Focus (GB00B54J0L85) funds.