Author Topic: Australian Investing Thread  (Read 890672 times)

casserole_dish

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Re: Australian Investing Thread
« Reply #3850 on: February 08, 2018, 05:04:47 AM »
I want to provide a reflection/update on several posts I made regarding shares in Amaysim that I bought in February last year. (Yes I'm a naughty stock picking boy).

....

I used to be one of those people, glad I've changed.

Feels like I'm in a Gamblers Anonymous meeting..

In saying that, after watching the jittery market and being paralysed by indecision, I've put a buy order in at a lowish price for more VDHG, I'll probs keep lowering the price though if the market goes down

Ozlady

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Re: Australian Investing Thread
« Reply #3851 on: February 08, 2018, 10:57:08 PM »
Tried to pick up  AFIC today at 6.06; but failed...at this price it is below NTA...

I am in acquisition mode atm...


Llewellyn2006

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Re: Australian Investing Thread
« Reply #3852 on: February 09, 2018, 12:58:52 AM »
I want to provide a reflection/update on several posts I made regarding shares in Amaysim that I bought in February last year. (Yes I'm a naughty stock picking boy). Back then it was a bog standard mobile retailer, chasing the bottom end of the market (cheap light users, great customer service)............

Stick to your guns and trust your gut. If shit doesn't feel right it is ok to sell up.

Good advice. I've had a couple of similar instances when I've sold out of a stock when I thought they'd had a good run but it couldn't last......Telstra and Qantas. I bought into Telstra at $3.67 and by the time they got to around $6.30 my gut feeling was that they were running out of steam and wouldn't get much higher. I sold a parcel at $6.34 and the rest at $6.50. Now they're around $3.50 (I think that's where they were the last time I looked some time ago) and haven't been anywhere near their past highs for years. I bought Qantas at $3.17 and they went up 80% in less than a year. That sort of return was too good to potentially leave on the table so I sold and thought I can live with the CGT consequences. Now they're at $5.09 so I'm comfortable with that.

Gut instinct is worth listening to.

Llewellyn2006

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Re: Australian Investing Thread
« Reply #3853 on: February 09, 2018, 01:00:39 AM »
Tried to pick up  AFIC today at 6.06; but failed...at this price it is below NTA...

I am in acquisition mode atm...

Just gone ex-div as well. I think if you hang on you'll get them. I don't think this correction is finished yet.

bigchrisb

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Re: Australian Investing Thread
« Reply #3854 on: February 09, 2018, 02:40:03 AM »
I want to provide a reflection/update on several posts I made regarding shares in Amaysim that I bought in February last year. (Yes I'm a naughty stock picking boy). Back then it was a bog standard mobile retailer, chasing the bottom end of the market (cheap light users, great customer service)............

Stick to your guns and trust your gut. If shit doesn't feel right it is ok to sell up.

Good advice. I've had a couple of similar instances when I've sold out of a stock when I thought they'd had a good run but it couldn't last......Telstra and Qantas. I bought into Telstra at $3.67 and by the time they got to around $6.30 my gut feeling was that they were running out of steam and wouldn't get much higher. I sold a parcel at $6.34 and the rest at $6.50. Now they're around $3.50 (I think that's where they were the last time I looked some time ago) and haven't been anywhere near their past highs for years. I bought Qantas at $3.17 and they went up 80% in less than a year. That sort of return was too good to potentially leave on the table so I sold and thought I can live with the CGT consequences. Now they're at $5.09 so I'm comfortable with that.

Gut instinct is worth listening to.
Sometimes... I thought csl had run too hard when it went from $30 to $55 and sold half my stake to take some profits.  It's now at $140...

My calcs don't put afi at a discount at the moment. It was at a premium on 31 Jan. It's moved almost in step with the asx300 since (both down about 3%), except the index hasn't lost a dividend from nta. So it's now at a greater premium to before the feburary wobble.
And yes, the current "crash" talk has been a net fall of 3% on the Australian market over Feb. The US market has moved more, but less so in aud, as our exchange rate has shifted and offset about 5% of the 10% move.
For me, there is still a long way to go before I'll start shifting asset allocation and deploying extra cash.

centastic

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Re: Australian Investing Thread
« Reply #3855 on: February 09, 2018, 04:54:59 PM »
Too many acquisitions, management too optimistic in integrating the businesses and cross selling, too much spin, not enough substance.

The parallels were there and so I sold AYS last month.

I sold mine at a similar time basically because they were "diworsifying" from their core business, and their 28 day billing cycle change pissed off a LOT of people.

So two reasons which were similar to yours in that I just didn't have faith in the decisions management were making.

chasingthegoodlife

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Re: Australian Investing Thread
« Reply #3856 on: February 09, 2018, 05:46:03 PM »
I really enjoy reading the reflections and commentary here from those who invest in individual shares, specific market sector etfs and so on.

Even though my portfolio is made up entirely of VAS and VGS, it's interesting to understand how y'all are making decisions on how to invest. And it confirms that right now I just don't have the time to do the same :)

steveo

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Re: Australian Investing Thread
« Reply #3857 on: February 09, 2018, 07:49:04 PM »
I really enjoy reading the reflections and commentary here from those who invest in individual shares, specific market sector etfs and so on.

Even though my portfolio is made up entirely of VAS and VGS, it's interesting to understand how y'all are making decisions on how to invest. And it confirms that right now I just don't have the time to do the same :)

I have no interest in picking shares. I figure the end result will probably be in my favour anyway so I don't see any reward for actually taking the time to pick shares.

Solvent

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Re: Australian Investing Thread
« Reply #3858 on: February 15, 2018, 02:11:45 AM »
So I consider myself a relatively knowledgeable investor, but still need to lean on some of you here for opinions.

My target asset allocation has 5% gold. I currently have no exposure. What is the best way to get exposure to the gold price through an Australian brokerage? I want:

  • Financial exposure, I've zero interest in holding physical gold
  • Unhedged to the AUD
  • Low feed
  • Exchange traded

Perusing the ASX's list I see relatively few options, mostly quite high-fee. PMGOLD seems to be the best but the link leads to a dead ticker? What's up with that?
Measure prosperity by less activity, not more. Do fewer useless things.
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marty998

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Re: Australian Investing Thread
« Reply #3859 on: February 15, 2018, 03:26:00 AM »
There's an ETF on the ASX - stock ticker is "GOLD" (easy one to remember).

The ETF is backed by physical Gold held by HSBC in London. It tracks the gold price, less a management fee of 0.40% p.a, so you don't get perfect exposure and your Gold investment will always be worth less than the gold price.


centastic

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Re: Australian Investing Thread
« Reply #3860 on: February 16, 2018, 12:31:25 AM »
I own PMGOLD. Innovative product, and I recommend you do some reading of the prospectus (down the bottom here: https://www.perthmint.com/storage/perth-mint-gold-asx.html) and anything Bron Suchecki wrote about it on his Gold Chat blog before purchasing.

Essentially it is a warrant to have physical gold sent to your home address should you choose to exercise said warrant. They don't keep physical gold in a vault (hence the cheap fee), but instead will make your ingots from incoming gold. It's (currently) guaranteed by the WA Government.

It should appear when you search for it on your online trading interface, either as PMGOLD or PMGOLD-A or something.

mustachepungoeshere

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Re: Australian Investing Thread
« Reply #3861 on: February 18, 2018, 12:01:00 PM »
This is one of @marty998’s regular haunts so...

HAPPY BIRTHDAY!

Enjoy your special day. Can’t wait to celebrate with you.

marty998

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Re: Australian Investing Thread
« Reply #3862 on: February 18, 2018, 01:35:31 PM »
This is one of @marty998’s regular haunts so...

HAPPY BIRTHDAY!

Enjoy your special day. Can’t wait to celebrate with you.

Thankyou :) I'll try and stop by your office today to say hi, if we're not out for lunch with my team.

misterhorsey

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Re: Australian Investing Thread
« Reply #3863 on: February 18, 2018, 04:34:58 PM »
Just on Gold,  I came across this interesting fact in a book I just finished:

"Gold has its bugs. They argue that if there is a loss of confidence in the dollar - or even if there isn't - gold is an obvious asset for international investors, including central banks, to scramble into.  In practice, of course, central banks have been scrambling in precisely the opposite direction for the better part of a century. Where gold account for nearly 70 percent of central banks' international reserves in 1913, its share today is barely 10 percent. In every year since 1988, central banks have been selling, not buying gold.

Why have they done so is clear. Financial instruments are more convenient for emergency financial transactions. When a currency is under pressure and the central bank is forced to support it, it is simpler just to buy that currency for dollars than to first sell gold in order to obtain the requisite dollars."


- Eichengreen, Barry, Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System, p147-148, Oxford University Press, 2011

(I wouldn't recommend the book by the way.  zzzzz zzzz zzzz)

It's pretty uncontroversial to say that Gold is probably of marginal interest to most people on this forum. And I personally am a fan of Warren Buffet's view on Gold.

But it's interesting to note that although the investment value of Gold owes its origins to its historical use as a currency reserve, the fact that it no longer forms the basis of currency reserves in the modern global economy has not taken away it's shine for a significant number of investors.

asosharp

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Re: Australian Investing Thread
« Reply #3864 on: February 18, 2018, 08:15:10 PM »
It's pretty uncontroversial to say that Gold is probably of marginal interest to most people on this forum. And I personally am a fan of Warren Buffet's view on Gold.

What's Buffet's view on it? That it's a no go?

misterhorsey

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Re: Australian Investing Thread
« Reply #3865 on: February 18, 2018, 11:49:13 PM »
This is from the 2011 Berkshire Hathaway Shareholder letter, in a passage where he is describing 3 different categories of investments: currency based investments (Bonds, mortgages, bank deposits etc), speculative commodities (tulips, gold etc), and investment in productive assets (businesses, farms, or real estate)

Page 18, http://www.berkshirehathaway.com/letters/2011ltr.pdf

Finance articles quote him endlessly, but no one gives the actual source.

I'll quote him in full as he has such an amusing turn of phrase:

The second major category of investments involves assets that will never produce anything, but that are purchased in the buyer’s hope that someone else – who also knows that the assets will be forever unproductive – will pay more for them in the future. Tulips, of all things, briefly became a favorite of such buyers in the 17th century.

This type of investment requires an expanding pool of buyers, who, in turn, are enticed because they believe the buying pool will expand still further. Owners are not inspired by what the asset itself can produce – it will remain lifeless forever – but rather by the belief that others will desire it even more avidly in the future.

The major asset in this category is gold, currently a huge favorite of investors who fear almost all other assets, especially paper money (of whose value, as noted, they are right to be fearful). Gold, however, has two significant shortcomings, being neither of much use nor procreative. True, gold has some industrial and decorative utility, but the demand for these purposes is both limited and incapable of soaking up new production. Meanwhile, if you own one ounce of gold for an eternity, you will still own one ounce at its end.

What motivates most gold purchasers is their belief that the ranks of the fearful will grow. During the past decade that belief has proved correct. Beyond that, the rising price has on its own generated additional buying enthusiasm, attracting purchasers who see the rise as validating an investment thesis. As “bandwagon” investors join any party, they create their own truth – for a while.

Over the past 15 years, both Internet stocks and houses have demonstrated the extraordinary excesses that can be created by combining an initially sensible thesis with well-publicized rising prices. In these bubbles, an army of originally skeptical investors succumbed to the “proof” delivered by the market, and the pool of buyers – for a time – expanded sufficiently to keep the bandwagon rolling. But bubbles blown large enough inevitably pop. And then the old proverb is confirmed once again: “What the wise man does in the beginning, the fool does in the end.”

Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce – gold’s price as I write this – its value would be $9.6 trillion. Call this cube pile A.

Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?

Beyond the staggering valuation given the existing stock of gold, current prices make today’s annual production of gold command about $160 billion. Buyers – whether jewelry and industrial users, frightened individuals, or speculators – must continually absorb this additional supply to merely maintain an equilibrium at present prices.

A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops – and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons). The 170,000 tons of gold will be unchanged in size and still incapable of producing anything. You can fondle the cube, but it will not respond.
Admittedly, when people a century from now are fearful, it’s likely many will still rush to gold. I’m confident, however, that the $9.6 trillion current valuation of pile A will compound over the century at a rate far inferior to that achieved by pile B.

centastic

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Re: Australian Investing Thread
« Reply #3866 on: February 22, 2018, 07:33:45 PM »
haha yes finance types do love to wheel out that old saw as their "final word" on gold.

Buffet is right, but he also (intentionally?) creates a false dichotomy, ie that you have to be either 100% invested in gold OR stocks. Some of the benefit of gold comes not from the expectation that it will increase in value over time, but from its ability to be used to buy said productive assets when they are on special. It's an uncorrelated asset that appreciates less quickly than shares or farmland unless it doesn't.

englyn

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Re: Australian Investing Thread
« Reply #3867 on: February 22, 2018, 09:56:04 PM »
I've been having a very interesting time playing around with https://portfoliocharts.com/portfolio/withdrawal-rates/
It points out elsewhere on the site that (as we know) the 4% rule is based in the US and gives the option to analyse asset allocation for a short list of other countries including Aus w.r.t safe withdrawal rate.

Does anyone have any comment on how accurate it is overall, and especially on the translation to Aus?

With much trial and error I've got the SWR up to 5% (!!) at 25 year retirement with a portfolio of 20% domestic shares, 35% world, 5% emerging world markets, 20% cash, 10% commodities, 10% REIT.

Where's the catch?

Ozstache

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Re: Australian Investing Thread
« Reply #3868 on: February 22, 2018, 10:13:27 PM »
Where's the catch?

The catch is that at a higher withdrawal rate, your portfolio's chance of survival is lower than it otherwise would be in the event of poor initial sequence of returns.

englyn

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Re: Australian Investing Thread
« Reply #3869 on: February 22, 2018, 10:34:16 PM »
I'm talking about an analysed safe withdrawal rate. According to portfoliocharts it's an asset allocation & withdrawal rate combo that has not had any failures in Aus over the periods under simulation.

If it's correct, I'm done buying total stock market funds 8-| and need to deploy cash into the other classes.

Latestarter55

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Re: Australian Investing Thread
« Reply #3870 on: February 22, 2018, 11:24:04 PM »
First post , lets just say I wish I'd found this web site some time ago.

My wife and I owe $110K on our home value at $1.5M. We have two investment units on interest only loans, which if sold, would provide enough funds to clear our home mortgage along with unit loans. That is  $100K+ from one unit which has been owned for four years. The second unit, we may break even, possibly lose a little. At present, we are losing $10K a year after interest payments water rates strata etc from the units.

We have $700K in super combine and we both currently contribute to our max pre tax limits with the intention of continuing to do so.

My question is that I’m leaning toward selling the units, clearing all loans and saving what we currently plough into loans with the view to building a portfolio of incoming producing shares. We have the capacity to save $80K a year. What is your view of this as a strategy ?

And yes....cashing in the house, moving somewhere cheaper and retiring is an option .... it just doesnt suit our current personal situation

englyn

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Re: Australian Investing Thread
« Reply #3871 on: February 22, 2018, 11:38:11 PM »
You stand to avoid ~$15k in CGT if you avoid selling that profitable unit until after you're no longer earning salary income.

mrmoonymartian

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Re: Australian Investing Thread
« Reply #3872 on: Today at 01:26:24 AM »
I've been having a very interesting time playing around with https://portfoliocharts.com/portfolio/withdrawal-rates/
It points out elsewhere on the site that (as we know) the 4% rule is based in the US and gives the option to analyse asset allocation for a short list of other countries including Aus w.r.t safe withdrawal rate.

Does anyone have any comment on how accurate it is overall, and especially on the translation to Aus?
Starting just before the 70's stagflation makes Aus stocks look worse than they are and gold look better than it is. You can change the start date when benchmarking to see how that changes things. Also remember that it ignores all taxes, franking credits and fees... so I wouldn't bet your house on a 5% SWR based on the output.

marty998

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Re: Australian Investing Thread
« Reply #3873 on: Today at 01:38:21 AM »
First post , lets just say I wish I'd found this web site some time ago.

My wife and I owe $110K on our home value at $1.5M. We have two investment units on interest only loans, which if sold, would provide enough funds to clear our home mortgage along with unit loans. That is  $100K+ from one unit which has been owned for four years. The second unit, we may break even, possibly lose a little. At present, we are losing $10K a year after interest payments water rates strata etc from the units.

We have $700K in super combine and we both currently contribute to our max pre tax limits with the intention of continuing to do so.

My question is that I’m leaning toward selling the units, clearing all loans and saving what we currently plough into loans with the view to building a portfolio of incoming producing shares. We have the capacity to save $80K a year. What is your view of this as a strategy ?

And yes....cashing in the house, moving somewhere cheaper and retiring is an option .... it just doesnt suit our current personal situation

Need a lot more info to answer this. Where are your units held? Suburb info would be useful to know, especially if there's an oversupply in the area and prices are likely to stagnate.

I'm not a fan of selling up assets, but at 10k negative gear (pre or post tax?) it seems like you have quite low yields.

Keeping the properties will help offset the tax bill from the dividends you'll start to earn as your share portfolios grow.