Australian Investing Thread

[englyn]

Thank you for that helpful post Querty!

[Eamesy]

Thanks for the explanation qwerty

[Juan Ponce de León]

That was great querty thankyou so much!!!!! omg!!!

[FFA]

I have also been wondering about VGS vs. VTS+VEU. I would love to know what other people decide. I see that VGS is simpler but VTS+VEU looks more diversified and the management costs are lower. But I didn't even know about the foreign resident withholding tax thing.

here's the best source I've found: http://forums.whirlpool.net.au/archive/2449117

it's a good reference / analysis. I still think it boils down to VGS is a simpler option for most people, at a negligible cost increment. For those who like to optimise, by all means consider VTS/VEU.

just on diversification, some studies suggest there's limited benefit beyond 10-20 companies. So what's the value of 1,500 vs 6,000? the bigger point is missing emerging markets, but you can always cover it if you so desire with a touch of VGE (which i'm doing). again if you want the 80/20 solution, just use VGS, IMHO.

[Abundant life]

I started a new thread re my Superannuation and Centrelink dilemmas here:

http://forum.mrmoneymustache.com/investor-alley/aussie-superannuation-and-why-centrelink-is-a-pita/new/?topicseen#new

if any of you smart people would like to contribute I'd appreciate it.

[Aus_Stashington]

I haven't had the chance to read the whole thread yet so sorry if this has been covered.

I don't understand the benefit of fully franked shares.

This is my (probably flawed) understanding.

If there's no franking on distributions the company hasn't paid tax on its distributions and you pay at your full marginal rate -- 46.5% or whatever.
With fully franked shares you receive a refund of the 30% tax the company has paid -- and you pay the additional 16.5% tax yourself.

In both instances the total amount of tax paid on the distribution by a combination of you personally and the company is 46.5%. So at the end of the day you have the exact same amount of money in your bank either way?

To my understanding it is literally just avoiding double taxation, yet people seem to actively seek out fully franked shares?

[limeandpepper]

Thanks everyone for the discussion on VGS vs. VTS+VEU. Still pondering, but at this point in time I'm probably leaning towards VGS for simplicity's sake, and maybe I'll add a bit of VGE if I want to include emerging markets, thanks for that idea, FFA!

[chasingthegoodlife]

Aus_Stashington - my amateur take on it is that franking is important because you need to compare investment returns based on what you will have in your pocket after tax.

If two companies each pay a $10 per share dividend to you it doesn't really matter what tax the companies have paid up to that point, in both cases you got $10. Then, if Company 1 has no franking credits and your marginal tax rate is 30% you get $7 in you pocket. If Company 2 is fully franked you get $10. Company 2 is the better performer.

Of course, if Company 1 is paying out a higher dividend reflecting their lower operating expenses (tax paid) up to that point then you have to factor that into your calculations.

It's not MAGIC FREE MONEY but it's a boost to your return above the basic amount paid out, that you wouldn't receive from other type of investment like interest on a saving account. So you need to add that benefit onto the return so you can compare apples for apples.

If you go to the Vanguard website they have different sets of historical return figures for their products for  different tax brackets, which might be helpful in understand how the returns compare with other investment types eg property.


Sent from my iPhone using Tapatalk

[Aus_Stashington]

Thanks for the reply Chasing.

If you aren't considering franking % you aren't comparing apples to apples. Makes perfect sense now.

[andystkilda]

Posted this on Whirlpool but not getting much love there - Does anyone have any experience in how these 2 investment vehicles would behave if you were a non-resident for tax purposes?

YMAX and P2P lending like Ratesetter.

My understanding is that Ratesetter would be considered 'interest' income and therefore just be subject to a 10% withholding tax (assuming no other agreed rate in a tax treaty).

YMAX gives largely (usually ~80%) tax-deferred income which I believe a non-resident would still be entitled to receive without having to pay tax or even declare it. Then when a non-resident sells YMAX they are not liable for CGT so therefore never pay tax on this tax deferred income (which is deducted from the cost-base) or on any capital gains arising from a rise in value of the ETF.

Any thoughts?

[qwerty8675309]

Not 100% sure if this has been posted before, but this is a nice simple tool to get a few interesting stats about your asset allocation

http://beta.betterwealth.com.au/portfolio/anon?pageurl=/portfolio?hm=1

[Wadiman]

Who's got some bonds/bond funds in their portfolio?

Have an aussie bond ETF (IAF) but also want some international fixed interest.

Have looked at Vanguard's latest offerings (VCF and VIF) but the yield and long average duration don't look too appealing.

Ishares IHHY looks like it has a high yield and relatively low average duration but the liquidity seems very low with only $2M under management and the fee is high (0.56%).   The other option is IHCB but yield is low.

How have you incorporated international fixed income into your portfolio?

[coin]

I have VAF in my portfolio, mostly as as hedge - I have a strategy and I stick to it.

[steveo]

I have VAF in my portfolio, mostly as as hedge - I have a strategy and I stick to it.

I use VAF as well.

[Wadiman]

Nobody for international fixed?  I do like the additional diversity.

[FFA]

andystkilda, might be best to call up betashares and ask them, maybe they can assist. I had an unlisted property trust when I was tax non resident, and I think they took 30% withholding tax despite the tax deferred income. Once you declare your tax status as non-resident the fund should deduct the appropriate amount of withholding tax, so they should know really. As a side note i'm surprised YMAX would have so much tax deferred income, any idea why is that ?

qwerty, useful link, thanks. I looked up a 50/50 vas/vgs portfolio and funny 9 of the top 10 holdings are Oz. Apple just scrapes in a #10.

wadiman, I used to hold bonds in my Super instead of outside Super. with Sunsuper they have an international index FI option which is low fees. However I quit it a year or two ago and kept all my bonds in the Australian FI option as I was getting quite concerned about the unconventional monetary policy / ultra low interest / QE /etc. For me those concerns are still there, at least the RBA has maintained a 2% interest rate through all this... so far ! Outside super I hold a lot in HISA's at 3.37-3.6%. I took a 5 yr TD about a year ago at 4.15% but you can't find such rates anymore. Tough these days for savers !

[steveo]

qwerty, useful link, thanks. I looked up a 50/50 vas/vgs portfolio and funny 9 of the top 10 holdings are Oz. Apple just scrapes in a #10.

I looked this up as well for my portfolio. I'm overweight CBA. I also work there and have staff provided shares. I don't like it but I'll deal with it over time.

[andystkilda]

Once you declare your tax status as non-resident the fund should deduct the appropriate amount of withholding tax, so they should know really. As a side note i'm surprised YMAX would have so much tax deferred income, any idea why is that ?

They said the tax-deferred income was from their 'option trading strategies' - that's all they could give me.
May be something to do with a way you can calculate profits on option-trades and somehow tie the tax liability to the underlying asset, therefore the tax liability only arises when the underlying asset is sold?

[FFA]

Once you declare your tax status as non-resident the fund should deduct the appropriate amount of withholding tax, so they should know really. As a side note i'm surprised YMAX would have so much tax deferred income, any idea why is that ?

They said the tax-deferred income was from their 'option trading strategies' - that's all they could give me.
May be something to do with a way you can calculate profits on option-trades and somehow tie the tax liability to the underlying asset, therefore the tax liability only arises when the underlying asset is sold?

thanks for the feedback, sounds a bit dodgy to a layperson such as myself, but i'm sure they have an army of accountants (or perhaps just one big 'un) telling them it's all okay.

I also reckon the betashares hvst etf is somewhat aggressive on the tax side. it openly markets itself as a franking credit harvesting strategy. I would've thought the ATO could attack it if they want to, under their blanket rule that investments cannot be primarily focused on tax reduction.

i'm no tax expert but I have a personal dislike of aggressive tax minimisation, so these kind of products are out for me.

[Shaz_Au]

Hi,

I thought I'd post my question on discretionary trusts (family trusts) in Australia as a new topic. If you are able to help then please check it out.

http://forum.mrmoneymustache.com/investor-alley/australia-discretionary-trusts/

Thanks,
Shaz

[chasingthegoodlife]

Regarding my previous post about why franking credits are important, although the overall reason was correct, on investigation the way the tax benefit is calculated is a bit more complicated than the example I gave.

The ATO's publication You and Your Shares was very helpful in understanding how this works https://www.ato.gov.au/uploadedFiles/Content/MEI/downloads/You-and-your-shares-2015.pdf

[qwerty8675309]

An interesting survey about the reddit Australian FIRE community -

https://www.reddit.com/r/fiaustralia/comments/4g108s/where_as_a_group_are_we_at_with_our_fire_a_quick/

Some of the stats are pretty amazing, particularly the income levels and the savings rates

[nick69]

This week I bit the bullet and bought my 1st batch of VAS.
My first ever trade in an ETF so hopefully it pans out as I plan on adding quite of bit of it to my portfolio over the coming years.

[steveo]

http://www.smh.com.au/sport/soccer/lucas-neill-from-socceroos-captain-to-bankrupt-recluse-20160506-gooikc.html

I thought that this was interesting. It's about doing everything wrong.

[sammie123]

Hello all,

My goal is to save for retirement and would like to initially start with 6k in the VAS ETF for the long term due to the low fees, with dividends re-invested and a yearly 1k-5k contribution. I've read and read and it seems VAS is recommended a lot so I thought maybe I'd start with this  as my first investment and use it as a set and forget and see how it does after 10 or so years.

Reading about how compound interest works in a mutual fund over a 30 year period had me thinking about how this would reflect in the situation of me buying $6000 worth of VAS and wanting the same outcome.

My questions would be:

-are the dividends re-invested used to by more VAS units
-does it make it harder to calculate capital gains on units if I participate in the DRP
-what happens if the amount is not enough to buy the extra unit, what happens to that portion of money
-would you suggest VAS for the long term as in 20years or is it something you would suggest selling as soon as there were significant gains
-i also read about allocations between different ETF's. If I had 6k in VAS and I wanted VEU and VTS would I have to buy the ETF separately or can i split that 6k between the 3 ETF's? Is there a charge for this?

most importantly
-is there any compounding effect in buying and holding ETF for the long term (end balance similar to a managed fund after 30 years)
OR am I only banking on the growth of the unit price overtime

How well do you think these VAS holdings would do, compared to a mutual fund given the timeframe, initial capital and yearly contributions.

Sorry for the silly questions, I have read many forums and am now asking questions to what I still don't understand before jumping into VAS or a mutual fund. The amount I get from a compounding calculator for a mutual fund at retirement age is something I'm after and I was wondering how or if that would work in holding VAS before investing in it with the wrong expectations.

If you could help me with the questions above or suggest any advice/product for my goal, that would be highly appreciated.

Thanks in advance,
Sammie

[BattlaP]

-are the dividends re-invested used to by more VAS units

Yes.

-does it make it harder to calculate capital gains on units if I participate in the DRP

I know for yearly tax purposes they send you out a summary that you can just plug in, and also they send stuff to the tax office so eTax normally just auto-fills it for me. If you mean after you sell units - I don't know, never sold any units.

-what happens if the amount is not enough to buy the extra unit, what happens to that portion of money

You can own fractions of units.

-would you suggest VAS for the long term as in 20years or is it something you would suggest selling as soon as there were significant gains

Buy and buy and buy and never sell until you are an old, rich man/woman.

-i also read about allocations between different ETF's. If I had 6k in VAS and I wanted VEU and VTS would I have to buy the ETF separately or can i split that 6k between the 3 ETF's? Is there a charge for this?

Depends if you are talking about the ETFs (traded on the market) or the Managed Funds (purchased through Vanguard). The managed funds each require a minimum buy-in of $5000. The ETFs have no minimum and you can buy whatever units you want of whatever ETFs just like you could shares in different companies.

most importantly
-is there any compounding effect in buying and holding ETF for the long term (end balance similar to a managed fund after 30 years)
OR am I only banking on the growth of the unit price overtime

The compounding comes from your dividend reinvestment as well as the value of the shares held over time. This is no different to how the managed funds/mutual funds work. Increase in the value of any stock is literally capital growth + any dividends paid out/reinvested.

How well do you think these VAS holdings would do, compared to a mutual fund given the timeframe, initial capital and yearly contributions.

Over the long-term, index ETFs such as VAS, will definitely outperform mutual funds in the same sector. A small percentage of mutual funds will outperform each year, but because it's never the same funds outperforming for very long, the inevitable victor is the index.

Sorry for the silly questions, I have read many forums and am now asking questions to what I still don't understand before jumping into VAS or a mutual fund.

There were no silly questions in there.

I got a little confused in how you seemed to use the terms 'mutual fund' and 'managed fund' interchangeably. Try to understand the differences between Vanguard ETFs, Vanguard Managed Funds, and all other non-index tracking 'mutual funds'. Vanguard's ETFs and Managed Funds track the same indexes, but are purchased differently and have different expense ratios.

The Vanguard Managed Funds have higher management costs but you can BPAY small amounts of money into them every week essentially like you would a savings account (there is still a buy/sell spread but it's a minor enough thing to ignore). They are great for trickling money into long-term, and when your balance gets over 100,000 you can shift into a wholesale fund where the management costs are close enough to the ETFs to be negligible (in my opinion).

The Vanguard ETFs are bought on the stock market and will cost you for each trade (cost varies depending on who you are with - nabtrade, commbank, etc). For this reason they are best purchased in bulk, ie save up and buy them all at once - monthly, quarterly or yearly.

Other non-index-tracking mutual funds are all different and I have no specific opinion on them except the general opinion that it is dumb to try and beat the index, so Vanguard is better.

[sammie123]

Thank you so much BattlaP for your informative response :) . I'm just itching to finally start investing in it after reading about it for the past 3 months. I noticed VAS was at $60 a few months back and is now at $67. If I were investing for the very long term as I said before, should it matter what price I buy in at or should I wait for it to drop a little further before I purchase? Anyone's opinion on this would be welcomed :)

thanks again!

[steveo]

Thank you so much BattlaP for your informative response :) . I'm just itching to finally start investing in it after reading about it for the past 3 months. I noticed VAS was at $60 a few months back and is now at $67. If I were investing for the very long term as I said before, should it matter what price I buy in at or should I wait for it to drop a little further before I purchase? Anyone's opinion on this would be welcomed :)

thanks again!

Ideally you want to buy at a low but how do you do that. I just buy when I have the money but I try to buy every 4-6 weeks. I buy when I have 10k to invest. It's up to you to figure out what works for you.

[stashgrower]

To add to BattlaP's response to your Q about DRP amount not being enough for whole units: if you're in ETFs (I don't know how mutual funds work for this, I'm guessing that is what BattlaP answered about), the amount of your DRP that is insufficient to buy a whole unit is tracked by Vanguard. Like savings, but without the compounding because it hasn't been reinvested yet. When the next dividend cycle comes round, if you then have enough for a whole unit, your credit will be used to buy more.

[steveo]

Nobody for international fixed?  I do like the additional diversity.

I'm wondering if this is a good idea as well. Does anyone know the pros and cons ?

[FFA]

Nobody for international fixed?  I do like the additional diversity.

I'm wondering if this is a good idea as well. Does anyone know the pros and cons ?

hi wadiman, steveo, i'm not.... generally I prefer cash over FI for my defensive assets, because if you scramble around you can still find better deposit rates 3.15-3.35% than govt bond yields. For the FI, I have a term deposit outside super, and an Australian FI option in super. For international FI you have FX risk, but it can be managed by taking a hedged ETF or fund. Apart from that it's a different interest rate environment, taking into account what the Fed, ECB, BOJ etc are doing. I would rather set my FI assets locally around what the RBA is doing, since that relates to the economy where I live and the inflation/growth/employment situation here. For growth assets it's good to diversify. For defensive I would rather link it back to my local situation to minimise any disconnect. I'm not sure if that is correct theoretically, but it makes sense to me.

[steveo]

Nobody for international fixed?  I do like the additional diversity.

I'm wondering if this is a good idea as well. Does anyone know the pros and cons ?

hi wadiman, steveo, i'm not.... generally I prefer cash over FI for my defensive assets, because if you scramble around you can still find better deposit rates 3.15-3.35% than govt bond yields. For the FI, I have a term deposit outside super, and an Australian FI option in super. For international FI you have FX risk, but it can be managed by taking a hedged ETF or fund. Apart from that it's a different interest rate environment, taking into account what the Fed, ECB, BOJ etc are doing. I would rather set my FI assets locally around what the RBA is doing, since that relates to the economy where I live and the inflation/growth/employment situation here. For growth assets it's good to diversify. For defensive I would rather link it back to my local situation to minimise any disconnect. I'm not sure if that is correct theoretically, but it makes sense to me.

Thanks - this is a good perspective.

The advantage that I can see is that you would have another uncorrelated asset especially if it was unhedged that you could use for rebalancing purposes. Still I'm searching for a good reason and that isn't really a good enough reason as foreign stocks may do the job just as well.

[stashgrower]

Thanks, FFA. Makes sense and adds more reasons to what I was thinking :)

[SamFinn]

I'm taking full advantage of the low interest rates to smash our non tax deductable debt

[Aussiegirl]

I'm taking full advantage of the low interest rates to smash our non tax deductable debt

Great idea SamFinn.  Those extra repayments now will make a huge difference as they compound.

[jan62]

posting to follow, have taken a while to read through entire thread and really helpful information here. I'm about to start ramping up my investing over the next few months so great to find Aussie information.

[Wadiman]

Nobody for international fixed?  I do like the additional diversity.

I'm wondering if this is a good idea as well. Does anyone know the pros and cons ?

hi wadiman, steveo, i'm not.... generally I prefer cash over FI for my defensive assets, because if you scramble around you can still find better deposit rates 3.15-3.35% than govt bond yields. For the FI, I have a term deposit outside super, and an Australian FI option in super. For international FI you have FX risk, but it can be managed by taking a hedged ETF or fund. Apart from that it's a different interest rate environment, taking into account what the Fed, ECB, BOJ etc are doing. I would rather set my FI assets locally around what the RBA is doing, since that relates to the economy where I live and the inflation/growth/employment situation here. For growth assets it's good to diversify. For defensive I would rather link it back to my local situation to minimise any disconnect. I'm not sure if that is correct theoretically, but it makes sense to me.

Thanks - this is a good perspective.

The advantage that I can see is that you would have another uncorrelated asset especially if it was unhedged that you could use for rebalancing purposes. Still I'm searching for a good reason and that isn't really a good enough reason as foreign stocks may do the job just as well.

I've decided to get into some International hedged FI simply due to the desire to get better diversification.  Notwithstanding the old adage of 'past performance isn't indicative of future performance', there have been a number of occasions over the past 15 years when international bonds have bettered aus bonds (https://www.vanguardinvestments.com.au/retail/ret/investor-resources/learning/calculators.jsp) in returns.  I have an equal % allocation to Aus bonds (IAF) and Int hedged bonds (VIF).  There have also been marked differences in returns between cash and FI over the years.  Anyhoo - I am comfortable with this approach and am also powering down the mortgage balance concurrently.

[Rustycage]

Might not necessarily be the ideal place for this post, but how are Australians looking at FIRE holding their investments?

I realise USA forumites have a bit more flexibility regarding withdrawal of funds from 401k's/IRA's, do we Australians have any options?

I'm currently holding most investments in my own name, and am looking to RE wayyyyyy before having access to super. Trust structures don't seem to be ideal for a single person either.

Any thoughts?

[JamesSyd]

Trust structures don't seem to be ideal for a single person either.

Any thoughts?

I believe trust structures for a single person can work, for example if you have a corporate beneficiary, you can pay out to that company which will pay the corporate tax rate (~30%) which for some people is a lot less then their current marginal tax rate. You can then pay out a franked dividend to yourself in the future when you are on a lower tax rate (i.e. not working)

[bigchrisb]

Trust structures don't seem to be ideal for a single person either.

Any thoughts?

I believe trust structures for a single person can work, for example if you have a corporate beneficiary, you can pay out to that company which will pay the corporate tax rate (~30%) which for some people is a lot less then their current marginal tax rate. You can then pay out a franked dividend to yourself in the future when you are on a lower tax rate (i.e. not working)

This is what i do. Invest in a trust, use a corporate beneficiary for earnings at 28.5% (soon 27.5?). The franking credits stay with the company, and can then be used (paid as a dividend) in a low income year. Shifts tax from high to low tax years over your life, and if circumstances change (partner/kids/support patents) you have maximum flexibility

[settlement]

Hi all,

I have decided to invest with interactive brokers. I have already got ETFs in euro with a european broker from when I lived in europe but don't want to lose out on currency risk as the oz dollar is currently weak against the euro. I want to buy similar shares to what i have in euro already: I have 75% MSCI World the other 25% in EM.

Any advice on how to invest in similar stocks? I'm not exactly used to the australian investing situation.

[potm]

With interactive brokers you will be able to keep buying the ETFs you currently have. You will just need to convert the money to euros which can be done at very good rates.

If you want Australian listed ETFs, look at VGS, VGE, VTS and VEU.

[settlement]

With interactive brokers you will be able to keep buying the ETFs you currently have. You will just need to convert the money to euros which can be done at very good rates.

If you want Australian listed ETFs, look at VGS, VGE, VTS and VEU.

Thanks for response. Is the money converted through the broker (and hence cheaper than going through currency fair and investing with my european broker to buy the same stocks)?

Is there an advantage (perhaps tax reasons?) to men buying australian listed etfs vs buying more of my current etfs?

[FFA]

lots of talk these days about deflation, low interest rates, deleveraging etc. 10 year govt bonds at 2% instead of the old 5%. And we should expect 4-5% average returns from shares instead of 7-8%. And this is here to stay for some time.

Any thoughts on this, if it's really different or just another cycle passing. Has a big impact on retirement plans though.

To some extent it's offset by lower inflation, i.e. returns 3% lower, but inflation 1-2% lower too, so the impact on SWR required is maybe 1-2% instead of the full 3%. But that 1-2% can add a lot of years on your working life !

[steveo]

FFA - these things are really hard to pick. It's different but only because it's all a little different.

I don't see a 4% WR being any less safe.

[FFA]

Frankly it's gone on already much longer than I expected. I thought we'd be out of these low interest rates by now, but the US is just inching out and the rest of world is going deeper into it still.
A lot of people are saying expect less from the sharemarket, but I guess it's in one ear out the other at the moment since we are at a recent market high.
Personally I feel a 4% WR is a little less safe than it used to be. Especially for mustachian types who consume less and may not benefit as much from the lower inflation (yet still pay council rates, insurance etc which seem to go up by 4-5% !)

[chasingthegoodlife]

All good points FFA, consistent with what I have read from commentators.

However, as I am 7+ years away myself, I have thought 'Is there any action I can take if I believe  this to be true?' and for me the answer is no. I don't want higher risk investments, and I don't want to stop investing and buy a giant TV instead. So I will worry about it closer to the day.

Is anyone here considering changing their investment strategy based on the current environment?

[steveo]

Is anyone here considering changing their investment strategy based on the current environment?

Good question. The answer is no.

The question really is can you have an investment strategy that is specific to our environment ? When I ask this question it makes me think that in reality that there is no difference between now and in the past. Of course there are tonnes of differences but a diversified low cost portfolio should work as well as any other option.

[bigchrisb]

I concur that it looks like the world is going to be "lower for longer", from inflation, to interest rates to investment returns.  My thoughts are:
- Lower nominal returns are partially offset by lower inflation, with a smaller impact on real returns.
- There isn't a lot I can do about it, as all asset classes seem to be impacted.  In accumulation phase, it isn't changing a lot.
- Perhaps the one difference is from how cheap debt and leverage is.  I'm less focused on paying down investment debt at the moment - I'm paying 4% interest and getting 6+% yield (including franking etc). That means I can bank a 2% spread per year, and keep exposure to any potential upside
- It might impact on how I feel about draw down rates.  However, I've been aiming at having a ~2% SWR rather than 4%, so not intending on changing this.  Even with no real returns, 2% SWR gives 50 years coverage.

(for anyone interested, the rationale for a lower SWR for me is mostly because I feel I'm on a very high income at the moment, and for various reasons I'd struggle to replicate it if I came back to work after FIRE.  An extra year working now would be like 3-4 extra years working then.  Hence I'd rather have a couple more years padding now, and lower risk of needing to return to work).

[insolent librarian]

However, as I am 7+ years away myself, I have thought 'Is there any action I can take if I believe  this to be true?' and for me the answer is no. I don't want higher risk investments, and I don't want to stop investing and buy a giant TV instead. So I will worry about it closer to the day.

Is anyone here considering changing their investment strategy based on the current environment?

Much like yourself, I've considered the risks, and there really isn't much I can do. I'm staying the course, which I think reflects well on past-me, who decided to setup the current strategy.
Two things I am thinking about are:
* With such low interest rates, is it worth getting the guaranteed 5% for paying off part of my HECS debt, as compared to the 3% I get for leaving it in the bank? Especially as that 5% option goes away at the end of the year.
* Is P2P lending something that could take up part of the Australian higher-risk part of my portfolio? (RateSetter had a promotion a few weeks back which was an almost guaranteed 10% return (invest $1000 and they gave you $100, assuming you got your capital back, you got $1100 + interest on the $1000 of ~6%). I'm still kicking myself slightly for not throwing some money in.)