Building a Share Portfolio for Income

Discussion in 'Share Investing Strategies, Theories & Education' started by sash, 28th Mar, 2016.

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  1. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Have a read of Keithj thread on somersoft. I think it is in the interviews section.

    I would suggest a lower lvr. 30% would be safer.
     
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  2. The Falcon

    The Falcon Well-Known Member

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    @Blacky
    Banks like Deutsche will offer 4.1% on AUD to section 708 investors using their custodial services. Westpac and BT under. 5% on fixed paid in advance. You can negotiate like any other type of loan....

    Static LVR for long term accumulator not more than 40% and some ability to cover. Ideally around 30%. Bear in mind that getting close to call will stop you buying precisely at the time you should be...sometimes margin is counter productive that way.

    The other asset classes thread has piles of info. Everything covered.
     
    Last edited by a moderator: 28th Mar, 2016
  3. Kate Moloney

    Kate Moloney Well-Known Member

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  4. sash

    sash Well-Known Member

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    Thanks @The Falcon @Jess Peletier @Kate Moloney @Terry_w

    @The Falcon ... dumb question...what is a section 708 investor?

    Will look at Westpac and BT ....the group (WBC, RAMS, STG) has a hell of my loans so they should be looking after me ...one hopes. :) Thanks for the heads up.

    Keep the comments coming...trying to absorb as much as I can. These sort of opportunities only come once every 7-8 years in the share market. Last one was during the GFC.
     
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  5. Kate Moloney

    Kate Moloney Well-Known Member

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    You could short the property market :eek:o_O;):D:p
     
  6. The Falcon

    The Falcon Well-Known Member

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    708 = sophisticated investor.
     
  7. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Max of 7% in one stock = Minimum of 15 stocks.
    Save the trouble and effort of buying all shares individually. Buy an ETF which tracks top 20 stocks like iShares S&P/ASX 20 ETF | ILC

    Not a recommendation just an example.
     
  8. The Falcon

    The Falcon Well-Known Member

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    Ok quickly. Don't get hung up on starting yield. You are looking for dividend growth. What you are looking for is businesses with reliable earnings able to grow dividends over time. Share price appreciation will follow.

    Avoid ; materials (incl mining), agriculture, consumer discretionary, insurance, IPOs and anything that doesn't have a reliable dividend history.

    That is just merely a starting point....it goes on from there.

    Or just buy MLT and QVE.
     
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  9. GoldCoastBound

    GoldCoastBound Well-Known Member

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    The Falcon, how do those shares you mention differ to AFI shares on the ASX?...the AFI shares are always mentioned as safe and great fully franked dividends..
     
  10. Blacky

    Blacky Well-Known Member

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    based on what I know of you - you should qualify as a sophisticated investor. Just needs a letter from your accountant stating that you have $2.5mil++ in net assets OR $250k gross income for 2years previous.

    I looked into Westpac, and BT. But couldn't actually get to speak to a person in the right department. But then I don't actually bank with them so will have to try again. I could only get to 7%BT loan, in which case I may as well stick with my CBA account.

    I will have a look at the Deutch Bank.

    Thanks @Falcon.

    Blacky
     
  11. The Falcon

    The Falcon Well-Known Member

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    Both are also Listed investment companies, MLT is the 3rd largest by market cap and similar to both AFI and ARG, but less weight to materials and slightly lower fees.

    QVE is a new LIC by Investors mutual (Thornhills preferred small cap manager for what it's worth) with an ex20 value/quality mandate. Together in say 70/30 weighting will provide a lot more diversification than the index and long term outperformance IMHO. Higher fees but worth it in my view.

    MLT trading near NTA (slightly over) and QVE a few percent under currently.

    No warranty and not advice :)
     
  12. Soul

    Soul Well-Known Member

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    I have some of these stocks in my portfolio. Although they are part of ASX100, I would not classify them as leaders in their field. My thoughts are:

    -Banks are under pressure and technically do not look strong. There may be another round of capital raising to build up their balance sheets, i am not sure if some will cut dividends. I like ANZ for its Asia exposure though. Ken Bloomfield of Financial Clarity put up an article on banks months ago. Market Update - Financial Clarity

    -Suncorp, QBE are laggards in my opinion, fundamentals for QBE are improving though. Check out for dividend payout ratio.
    -Wesfarners looks good
    -Origin-High debt and low energy prices
     
  13. sash

    sash Well-Known Member

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    I wish....
    See your point...will definitely look at ETFs. @Skilled_Migrant @The Falcon ... do these ETF's pay regular divndends. The reason I ask this is I need the income to pay the interest and debt. The VHY fund looks good it seems to pay a 7% dividend though not all of it is franked. Thanks for the great input!
    Hmmm....bank speak to get the Private W(b)ankers onto your cash ;)
    Yes banks are under pressure but they will continue to do well just the nature of being in a Oligopoly. Suncorp got good reviews..it is bank with insurance exposure. Agree about Westpac. As for Origin...they are probably the largest energy supplier in Australia...an essential commodity. Yes margins are dropping but they are also getting very creative to respond to competition.
     
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  14. willair

    willair Well-Known Member Premium Member

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    This is just a simple chart,that anyone can make in less then 30 seconds,and i agree this period we are now in comes around every 7-9 years in between that time frame ,and the simple argument in equity markets are always full of media share trading "GURUS" everyone thinks the same backed up with statistics but that is only the data they see,and all past history,ignoring the information that is also there but they don't want too see or study,big mistake..60-80% overconfident margins on these 2 banks when you look at the highs and lows,there is success and failure in below chart chart..
    [​IMG]


    You would learn more by going too the next "AGM" in the equities that you have invested in ,get there early and watch who comes through the lift prior too the presentation look for some of the people that you will see from other AGM'S within Australia,over time you will get to know those people,then try and talk too them ,some will have 50 years experience and some of the people would have started investing in companies that are no longer there,and like a few that post in these sites have been through several downturns ,and that in the problem within,no body ever picks the bottom trend nor the top trending ,be very care full with any of the Banks right now ,from what one reads from what others don't want to read,tell me the bad loans from soon to be be belly up bad loans,from miners too bellyup high volume property investors are just starting too crank in,good luck Sash statistics is a sharpened knife that cuts both ways unlike Monopoly..imho..
     
    Last edited: 28th Mar, 2016
  15. sash

    sash Well-Known Member

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    Good post....ETFs look promising as stated by some on this site was reading posts from @radson @The Falcon @Skilled_Migrant @austing

    I really like the Vanguard ones in particular.......

     
  16. datto

    datto Well-Known Member

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    Can we just wait say 12 to 24 months to see what happens to the banks?

    We may then be in a better position to see where we're going.
     
  17. willair

    willair Well-Known Member Premium Member

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  18. S1mon

    S1mon Well-Known Member

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    sash you should head along to this. Just a LIC investor presentation but very informative (well the last one i went to was)..thats WAM, but FGG and FGX afterwards be good too. not that all LICs are the same but be a good intro to lics
     
  19. sash

    sash Well-Known Member

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    Thanks appreciate it.....keep the info coming guys...my learning here is on steriods.
     
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  20. S1mon

    S1mon Well-Known Member

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    i would throw in a few 'absolute return funds' also, for a bit of downside protection