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

@Nodrog and @Big A - thank you for giving some perspective to the idea and something to think about (deeply)...

@Nodrog -2nd paragraph really make one think why going after direct shares as majourity of us will only knows the main ones listed under VAS or other ETFs

Re LICs - I have found it challenging in the past where I was holding very small # of shares and the amount if divis I was getting with no CG. Just with my personal exoerience not many Financial Advisors are fan of LICs- any thoughts?

@Big A - thank you for sharing your journey and appreciate the oppeness re fund nanes etc. Just want to confirm that tge funds you have mentioned they are trying to beat the index abd charge certain performance fee? May I know if their performance of beating index is Net % (after all fee and charges)?

Generic Question:- what is the difference to buying Vanguard product directly on ASX vs buying by becoming members with Vanguard?

 

Thank you @Shazz@ - I will look into this and ask if I have any ouestions. I am not very familiar with this one.

 

Good post. Have you found it hard not 'doubling up' on certain stocks/indexes given the number of funds you're a part of?

 

Hats off mate 30 stocks- you should share the hot tip

5 LICs - WHF, ARG, AFI, QVE/FGG/MLT
(1 from these 3) and one of the Magellan group LIC? Just guessing it - please do not mind lol

 

No tips mate....those stocks are free for all to see...just look at the top 20/30 stocks held by the oldest LICs - ARG, AUI, WHF, MLT, AFI etc and buy those with a decent dividend.

 

Yes the aim of actively managed funds is to protect your capital while outperforming the index. Easier said than done. Yes when they quote there performance figures it’s net of fees. I’m well aware though that just because they have outperformed the last few years it doesn’t mean they will continue to outperform. But I don’t know if I am comfortable with being 100% index just yet.

When I first started 4 years ago I had about double the actively managed funds. Dumbed a heap of them last year.

 

There would definitely be double ups between the different funds. Don’t see it as an issue. Most fund managers tend to buy the big names. Bennelong ex 20 gives me something different as it avoids the asx20.
Having a few different funds is more about manager risk / strategy rather than different stock exposure. My original advisor had me spread across 15 different funds. I’m down to 9.
Keep in mind total funds your investing also is a factor to how much you spread your funds. 6 figures compared to 7 figure sums. Not that investing more capital across more funds necessarily gives you a better result. But for me playing with 7 figures and hopefully getting the equities portfolio to 8 figure sum one day I wouldn’t be comfortable having all in just 2 or 3 funds.

 

Thank you...do you have control to buy/sell on your own in BT Wrap (like on Commsec or Nabtrade) or you buy regular shares seprately and this portfolio is set and forget.

 

You are overthinking it. Decide on your domestic/local split (I am near enough to 50:50 myself) then buy the lowest number of lowest fee ETFs to acheive this.

I think it takes time in the market to realise your own limitations. Performance ranking of market participants could probably be listed as:

1. 2% of active managed funds, and even then usually only for a few years
2. Low fee index tracking funds
3. Vast majority of investment professionals after fees
4. Long term retail investors (if they are honest with themselves)
5. Excited newbie retail investors buying individual stocks with limited research
6. Retail investors messing around with short term trading, derivatives, exotic products, technical analysis, subscription based trading "systems", cryprocurrency etc.

Aim for at least 2, not 5, I speak from personal experience!

 

@Blueskies - do you mean 2 Quality ETFs?

 

Yes you can have control to buy and sell both the funds or individual shares. You do need a broker to initially set up the account with BT. But once done you can take full control and have the advisor taken off it. I have only ever bought 3 individual shares and have no intention of buying anymore individual shares. I have now moved those individual share holdings onto the BT platform.

 

No, I mean this :

2. Low fee index tracking funds

Not this:

5. Excited newbie retail investors buying individual stocks with limited research

 

I was in a similar position to the OP a year or so back.

A large sum of money, and questions about how and where to invest it.

I paid money to a financial advisor, and also deep-dived into the wonderland of posts here and elsewhere.

Being the hands-on type (and having read the research) I chose not to use the financial advisors advice and thus saved 2.5%.

Next, and scariest, was lump sum versus dollar cost averaging. Having read the research, I went all in.

For 10 months I was patting myself on the back.

The current market conniptions have been an unpleasant but overdue wakeup call.

My finely honed and obsessed-over portfolio is doing OK (comparably) thanks to sensible asset diversification.

But, if I am honest, just whacking the money into VDHG (via the wholesale fund) with extra bonds to suit (or even easier VDBA) would have been close in performance and much easier.

As for structure, everything was in my name as the person with lowest tax liability.

I was convinced by one financial advisor to set up a discretionary trust and sold everything to prepare for it thinking I was being cunning.

Then the same advisor's tax dude then told me that (given the age of my family) a trust had no real advantage and I should leave it my name.

At least I was able to take some profit.

So get good structure advice early.

As for buying a Vanguard ETF vs the managed fund, the ETF is based on the underlying funds so one would think the returns should be the same.

But they are not. Total return is usually pretty close (allowing for fees), but for some reason the funds tend to have higher distributions and thus slightly less capital growth.

I chose the wholesale funds because reporting and adding additional funds (via BPay) is easier.

 

@sfdoddsy thank you for sharing your experience. In my case it be under my name as higher tax bracket and can claim interest at tax times.

My understanding is in Managed Fund you are liable for the CGT even if you join the party at later stage compared to seprately managed account....still reading and trying to find balance if SMA is bettter than just a Bell direct/Comm sec

 

You may want to reassess that. Based on some of the holdings you mentioned there is a good chance you will have a net positive position (dividends greater than interest bill) which means you will add to your taxable income in the higher bracket.

 

Also if you are holding in your name you would be copping the CG on this particular trade which after discount would be added to your income for the year.

 

Yep, keep it simple. "Little Book of Common Sense Investing" opened my eyes. Are you guys leveraging or going cash?

 

At the moment cash only