$200K - Aiming to dump in ASX (Local/International/ETF/Direct Shares)-SMA/MF or likes of CommSec

Discussion in 'Shares & Funds' started by Never giveup, 10th Mar, 2020.

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  1. Never giveup

    Never giveup Well-Known Member

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    In light of the recent downfall work-wide there are numerous threads concentrating on ETFs, LICs, World Index, etc. etc.

    I am pulling some equity from PPOR and dumping in the market-aim is to get capital growth overtime (long term) and make use the regular divis to increase cash flow.

    SMA accounts are very popular these days as one can tailor the holding with regular re balancing (and some managed fund may also allow small investments like mine) and then the likes of CommSec, Nabtrade or bell direct for direct monitoring/trading.

    Fees also plays a part hence seeking recommendations/opinions and the best way to structure the holding from tax purposes as IR will be claimable.

    All LIC lovers please do not hate me- I am not excluding 'em totally however they will play part at later stage with other funds.

    Note: all disclaimer noted around"seek financial advise etc" and all genuine criticism is acceptable

    Bundle of thanks in advance
     
  2. Big A

    Big A Well-Known Member

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    The structure you hold your investments in will depend on you and your partners current earnings / future earnings, how much income your expecting your investments to deliver and what tax brackets that will put you in when you add it above your working income and roughly how large of an investment portfolio would you expect to accumulate between now and retirement.

    While I am not an expert by any means what I would consider, would be a discretionary family trust if there was family members that you could distribute to or a bucket company. Again this would be beneficial if holding in own name possibly puts you into the highest tax bracket.

    Then there’s the decision of how you would buy the equities or funds. This is not something I have a lot of experience in. For myself I went with a wrap platform that makes it much easier to manage the whole portfolio. This of course comes with a fee, but depending on the size of the portfolio it could be a worthwhile consideration.
     
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  3. Never giveup

    Never giveup Well-Known Member

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    Thank you @Big A

    I will be holding the investments under my name at this stage and my tax bracket will be 37% (under 180K) as claiming Intetest for this investment and IP.

    Is it ok to ask rough fee and the comp you have wrap account with?

    I have looked CFS and I think I was reading about AMP too
     
  4. Big A

    Big A Well-Known Member

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    I am using BT panorama wrap. Fees are .15% capped at $1500 per year. Plus $540 admin fee per account. So I have my personal account plus my and wife’s super account. Total 3 accounts paying $3000 across all 3 accounts. Super accounts also have some additional super management related fees, but from what I remember it’s minimal.

    As your total balance across the accounts gets well above $1mill it starts to become worth while.
     
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  5. Never giveup

    Never giveup Well-Known Member

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    Thank you @Big A

    1 mil sounds good but not there yet ;)
     
  6. Never giveup

    Never giveup Well-Known Member

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    I am hoping to hear from experienced investors who have hone through times like GFC or are into long term investing to guide me in setting up the portfolio for long term when things are at bargain.
     
  7. Never giveup

    Never giveup Well-Known Member

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    No recommendations from anyone..wow.
     
  8. number 5

    number 5 Well-Known Member

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    I don't post here too often but I read a lot.

    Everything you are searching for has already been posted.

    Use the search function.
     
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  9. Never giveup

    Never giveup Well-Known Member

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    When pouring that much money -I think bit of validation helps rather than just reading.

    Thank you though!
     
  10. Brady

    Brady Well-Known Member

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    I have similar amount to input. Even made a similar style post, it's pretty common at the moment.
    You have asked pretty open questions and a few of them.

    End of the day need to determine how you're going to do it and when.
    I haven't answered that question myself yet.
    Those that have answered have already said they're buying now and whenever they can, seems to be the common theme.

    I'm like you looking at leverage and what I consider to be a large amount.
    So would prefer to time the market.
    But I'm no expert so that's likely not to happen.

    Finding myself actually upset when the market rises now instead of falling, FOMO of the rise?

    The more I think about it the more I think I need to have some in now, therefore ok when it rises and happy to buy more as it drops.

    For tax, speak to your accountant will depend on your individual/family circumstance.

    What to buy, no idea - that's why I'm looking at VAS. Market with low management fee.
     
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  11. Never giveup

    Never giveup Well-Known Member

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    Thanks @Brady

    In my case, I have made my mind up re When to put money in market and for it is easy due to my personal circumstances. The main question for me will be how much at a time and to keep it clean I wouod like to put all hence seekings some guidance on various % levels to make 100%.

    So far I have shortlisted:
    Vas
    Transurban
    VGS
    Westpacu/ANZ (already hold some NAB)
    Definately CBA (if in price range circa $50)
    BHP

    If I go towards the SMA/WRAP- I am sure there are more options like CFS multi index etc.
     
  12. Brady

    Brady Well-Known Member

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    I'm no pro, but why hold
    WBC, ANZ, CBA, BHP individually they're all in the top 10 holdings of VAS.
    Probably should mention I'm also looking at VGS with other funds at later stage.

    So if you have made your mind up, when? Care to share?
    Just to confirm you're looking to put $200k in at once?
     
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  13. Never giveup

    Never giveup Well-Known Member

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    When:4 to 6 weeks and i have plan to hold VAS for long term howevever if I can pick likes of ANZ and WBC under $20 and in few years they hit $40 I can sell and use that money to payinto my PPOR and redraw more.....
     
  14. Lacrim

    Lacrim Well-Known Member

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    I think there's a place in one's portfolio for direct stocks - higher yield to offset the lower distributions from ETFs and LICs. I've shortlisted 30 stocks from 5 of my fav LICs.
     
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  15. Nodrog

    Nodrog Well-Known Member

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    Some data in regard to attempting to pick your own shares. Even highly skilled Mgrs out there have a horrible track record in trying to beat the index, so do you think you can do better? That in part is why I no longer invest in direct shares. The banks, WES are already very well represented in the index (VAS) so why buy them directly taking on increased risk. Also Unlike direct shares the index ETF won’t give you nasty surprises.

    226CDD64-A603-4502-AF93-3B89B5D4A560.jpeg
     
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  16. Never giveup

    Never giveup Well-Known Member

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    So the secret message is buy ETF in every category?

    Is it worth to take on Core and Satelite strategy where Core be the index ETF and satelite can be the fund to beat the market? (Thinking outside the box)
     
  17. Barny

    Barny Well-Known Member

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    You won't beat the market in the long run.
    You can buy those other company's you think are currently cheap/hammered like the banks. But keep it simple man, core will be made up of an index fund, vas.
    Many of us are doing something similar, today I bought in a little vas and banks. I'll continue to buy as it drops a certain percentage-perhaps another 10% and buy more and continue. If i feel it starts going up then I'll buy more. No rush, plenty of time.
     
  18. Nodrog

    Nodrog Well-Known Member

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    Equity wise there’s only two to three index ETFs needed as a CORE to cover Global markets. Most important are Australia (VAS) and unhedged Global “Developed” markets (VGS). The other which comes with higher risk is Emerging Markets (VGE) or some prefer Emerging Asia only (VAE).

    Then and this is optional one can add SATELLITES which can be Funds or direct shares. Ideally these should be very different to the CORE with potential for better returns than the index (very difficult to achieve). Other options are asset classes (sectors only really) that have less correlation with the Market such as property and infrastructure (but tend to tank with the rest of the market during major upheavals).

    Direct shares like the Banks and WES are just further concentrating these which are already well represented in VAS so not sure these are worthwhile Satellites?

    I personally used to hold direct shares like banks, WES, WOW etc in addition to the old LICs / Index ETFs in the Hunt for greater yield. I got tired of unexpected surprises and monitoring these direct shares so sold them. Traditional index ETFs / older LICs are just so simple, much less risky compared to direct shares and pretty much set and forget.

    Nowadays I don’t chase higher yield than the market but prefer greater diversification with less risk as opposed to concentrated direct share holdings. I’m much happier since doing this.

    Not advice.
     
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  19. Big A

    Big A Well-Known Member

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    It’s a tough question. I wouldn’t call myself an experienced investor. 4 years in equities but have spent a lot of time educating myself.

    Rather than tell you what you should do, I can tell you what I am doing and you can see if something similar can work for you.

    personally I wouldn’t took individual shares. As @Nodrog said, the chances of you outperforming the general market are thin. Most professional fund managers can’t do it.

    I have gone down the path of splitting the portfolio in 4 areas. Australian shares / international shares. VAS and VGS, though I use the wholesale versions via the BT platform. Then the other split is Australian shares / international shares via actively managed funds and again via the BT platform.

    So for active OZ I hold Hyperion Australian growth companies and bennelong Australia ex 20.
    Active international I hold, IFP global fund, Magellan global fund and Walter Scott global fund.

    I also hold two active infrastructure funds that would hold a mix of some Australian and international shares. Magellan infrastructure fund and Lazard infrastructure fund.

    Being that your starting capital is $200k I would look at a few less funds than what I hold. Maybe something like $50k 4 ways. The two index funds and two active funds. Active could also be had via LIC’s which you will find is very popular among PC members. I have stuck with the managed funds that have managed to beat the respective index if only just since I have held them.

    Some food for thought I guess. Hope this helps.
     
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  20. Shazz@

    [email protected] Well-Known Member

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    Or VDHG to keep it simple?
     
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