Just went 95% cash in Super - Share Market Correction

Hostplus Capital Stable is only at 4.6% for last 6 months and 3.6% for 12 months, Care Supers Capital Stable is at 2.43% for 3 months and 4.97% for 12 months, the ASX200 is only up 16% YTD so you're doing well with yours

 

Heres my update, with some big gains since Kitdoctor declared the market Top I think on June 3. Now up since Jan+March SKO 52%, MP1 99.2% , ALC 186% , DDR 34%, ELO 118%. Now what I am up on what I bought Tuesday morning, AD8 15%, BTH, 20%, JIN 6% LVT 25% MP! 16% STG 15%.

 

Earning reports have been good so far but another week to go so the bears may have to wait awhile to finaly get it right. Don't care what other people think unless you are a contrarian. Dont listen to all the useless time wasting noise on this forum look at the fundamentals, sound founder lead companies with high revenue growth earning growth determines share price, some people here havbe dismissed that notion but haven't been able tp present ant shares that have out performed. I think the banks will drag down returns for people invested in the index.

 

This can be annoying at time as in the other day I read ATO would be sending please explain letters to SMSFs with most of their funds on a single asset class. Do these idiots ever stop to think that Super may be only one component of the members wealth. And for that matter even if one holds a locally domiciled International ETF is gets classier as Australian shares.

 

Oh great!

ATO to SK SMSF: We are concerned your Funds assets are 100% exposed to the share market. Those who know better do not consider this is an ideal asset allocation and may contravene the Funds investment strategy. We also note one member is well over the age of 65 and yet their account is still in the accumulation phase. Unless we receive acceptable advice on these aspect the account will be considered as an unclaimed superannuation fund. Under the law applying to unclaimed superannuation, despite the SK Fund not being a low balance one, please remit the fund to us and we'll look after it.

SK SMSF to ATO: Kindly FO. You have the ability to data match so link the SMSF TFN to the particular member's TFN, so do so, sit back, sip on your cup of tea, think, and then, when the penny finally drops, go "Oh, I see."

 

If you don`t mind was active or passive investing? Shares or funds? Good job ;-)

 

Passive.

Direct Australian shares, with some LICs (no managed funds).

 

I should have clarified I went conservative in Oct and then moved back to growth shares/property/infrastructure in Jan/Feb 2019. So I did not wear the massive losses but go 80% of the growth.

 

The fact the ATO is sending a letter doesnt mean they are idiots. They are making many people who do only have a single asset class be aware of the major risks. The ATO are a prudential regulator for SMSFs.

Some people may hold a single asset class in a smsf and have external super or other investments. However there are also a large number of people who setup small smsfs that made poor investments into a single illiquid asset. The single asset class that the ATO may have a greater concern with is a limited recourse borrowing with residential real estate. In a % of cases the ATO has a concern that contributions are being consumed within those funds. They see this data annually and have noted a high risk profile for small funds. At a recent smsf conference they noted a % of funds which receive contributions to sustain these property arrangements but no apparent growth or appreciation of member value is evident.

Other risk profiles likely to result in a letter may be 100% investment in a unlisted trust.

The likelihood of the ATO taking issue with 100% cash or 100% shares is likely low. Doubt they would write in such cases. Diversification across parcels of ETFs for example arent something the ATO data would capture from annual reporting.

 

Very impressed by those timing this volatile market to near perfection - and have apparently been successfully doing so since before the GFC.

Taking such bold positions, live 95% cash, require great confidence in your knowledge of the futuremarket - so kudos.

 

Appreciate the valid points in your post @Paul@PFI. Thanks.

Most like poking fun at the ATO (I do) but hopefully recongnise the difficult task it can face administering complex legislation.

 

Besides us grumpy old men need something to complain about.

 

No way to get it perfect. When I moved it to cash/fixed interest in Oct...the market was already down about 6-7%...but at least did not take another 12-20% haircut.

I myself are now....trying to steele myself for the market to crawl back to 2750-2800...hopefully before Oct...at that point I will go into conservative funds. I reckon there is a correction coming...lets see..I am still down 1% based on the events almost 2 weeks ago.

 

Had lunch yesterday with a friend who said, this last week, they'd dropped $60k on their shares

Now - don't be alarmed - to look at them you'd think they were on the pension, but they're not short of shares and property and like to travel

 

And so they should if that is what they want to do. Good on them.

The dollar amount of swing is one reason I stopped even looking at pricing my holdings. Didn't do any favours for my blood pressure. Was over it.

 

And during this time the dividend income likely didn’t drop one bit. In fact one of my LICs was about to announce an increase in dividends.

Another reason why I, probably to the irritation to some others, keep harping on about learning to focus on the “income” from shares rather than being fixated on “price”. SK you of course get it. I’ve known so many over the years who once they’ve done this found shares far less scary than previously. In fact they actually loved to see their shares collapse in price so they could buy some more “discounted” income streams.

Focus on price =



Focus on income =

 

Lordy, I'm dumb. I thought @Lizzie was saying her friend SOLD $60k of shares. Now I read it as being a reference to the price fluctuations.

I'm so thick sometimes.

 

Yes this was a big lightbulb moment for me to realise this thanks to you & others of similar mind here. Enjoy the strange looks I get when others are excited about market going up & I say 'Noooo this is terrible,there's nothing to buy '

 

There is a lot like that out there Lizzie like that,to most when markets do the opposite of the media-fw forecasters and their sound economic worrisome fore-casts and testing their own framework of analysis can't understand why things blow up and continuously bypass simple reality..
I think you find your lunchtime mates understand this quite well ,myself it's just a number on a page that will change every hour if investing for the long haul and all the small a large bumps along the road..