Just went 95% cash in Super - Share Market Correction

Given when I buy equities I look upon it as purchasing a future income stream I have no intention of selling when there’s no need to. I do however take advantage of any gloom to add to that income stream. The focus on income enables me to ignore the more volatile capital movements, removes any guesswork and takes the stress out of it.

 

Which December are you talking about 30%?.. Some people think water can run up hill if the future government passed a new regulation

 

I don’t understand the mystery with all this, it’s obviously Dec 2008.

Now where’s my:



Woohoo, GFC here we go again.

Greed is Good -
... Nodrog Gekko

 

Six months time all this will be just a bump in the road ..

 

My apologies @Phar Lap. My mind does tend to go in various directions simultaneously and even I have trouble following my thoughts.

The convoluted matter is the OP moved to cash at a downward movement in share prices with a view to move back in when it was considered worthwhile to do so. Stripping away all the fluff it is a form of performance chasing. Fair enough as it's a view the person has as well as the right to take action of that view. It is possible they have the skill, or at least a belief in their skill, as to the timing on when to re-enter.

It was this train of thought caused me to contemplate the suggestion doing the rounds of publishing the Top 10 performing superannuation funds.

What is the likelihood of a number of individuals start chasing performance when there is no guarantee that performance is assured? For example, MTAA had a great performance percentage in some of it's products leading up to the GFC. Not so much since I understand.

And it could depend on which investment option a member selects within a particular superannuation fund. Plus not all descriptions between funds are exactly the same. Conservative in MTAA may be different to that in Australian Super.

I suppose have a lot of doubts over various concepts being bandied about as being a simple fix to poorly performing superannuation funds. It tends to assume a level of ability which may not be there and akin to a Size 7 glove being able to fit a Size 10 hand - and the wrong hand at that.

Should we be allowed to meddle despite it being "our" superannuation?

I need another coffee.

 

Some of the Industry Fund performance comparison between their balance funds vs say index balanced funds is rubbish. Some Industry Funds include property and infrastructure etc in the defensive component of the portfolio then compare it to an index balanced fund where the defensive component of the fund is in very low risk high grade bonds. Absolute con job.

 

IMO if you have more than a short term horizon and are not an expert at picking stocks/funds then an index fund is where most of your money should be.

Very few fund managers have ever beaten the index over a long period. Period.

 

Great thoughts from all, cheers.

Also, depends upon the individuals circumstances. Our super is not the be-all, end-all, investment source for wealth, never has been. But since it is compulsory, well why not maximise it. And hats off to OP for having a go.

However, my thoughts on super have always been, "what if I cark it before I get to preservation age" etc...?

I want investments I can control and access real time live.

And then simply, live !

 

Fortunately I am an expert in picking those managers, in hindsight !

 

Don't ask me. I'm happy when my super goes down because I go: hey, I can buy units at a discount... and I do. Then I'm happy when my super goes up because: hey, look how much my super is worth now!

So, I'm happy either way

 

I am happy when my Super goes down around the end of June/early July, the bigger the crash, the better .

This means our Super balance is lowered, means our mandatory pension payment (currently 4%) is reduced which means the wife has less spending money (and more cash stays in our smsf) .

Then, it is great if our Super keeps going up for the rest of the year. One happy hubby, one not-so-happy wife .

 

Whatever happened to "Happy Wife, Happy Life ?"

Or is that too PC for this forum...?

 

We are so stuck in the last century .

 

I moved all my funds to Hostplus Balanced..initially to the conservative balance and now the Balance fund. I moved initially in early Jan....all loses have now been recovered and now moving to making more returns this year...

 

We didn’t do a thing 4 months ago.

In the last 4 months, our returns are 3.5% net of fees (as there weren’t any).

On a simple maths basis, that is 10.5% annual return which isn’t bad, given all the volatility and negativity in the market.

 

Silly question I guess, but you did mean you moved in January last year, not this year?

 

As per the first post in this thread, the OP moved to mostly cash in October last year, so would have moved back in this January.

 

Thanks - forgot it was the OP speaking!

 

We did during the recent correction but it wasn’t selling. Threw another $350K into the market during that time with more going to International equities than ASX. I never calculate returns as data gives me a headache. But it appears that correction has recovered so my assumption (as I haven’t bothered to check) is our existing portfolio is at least back where it was or better and there’s a healthy gain on the new cash invested.

But really it’s all a bit meaningless as a long term income focused investor other than it’s nice to be able to purchase “discounted” future income streams at times. I try my best to remain emotionless about market movements as excitement can quickly turn to despair given the nature of markets.

The recent correction wasn’t really much of a blip on the radar. I haven’t got a clue when a more serious event will occur but I don’t particularly like what I see globally at this stage of the cycle. Doesn’t mean I’m trying to predict when something will happen and sell assets in advance etc but just be prepared for it when it does happen.

 

If you haven't needed it by then, leave it to your spouse/kids, favourite stable/trainer, charity etc.