Peter Thornhill 2017 #2

Discussion in 'Share Investing Strategies, Theories & Education' started by The Falcon, 21st May, 2017.

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  1. therealAusting

    therealAusting Well-Known Member

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    I just opened my Super statement for this year, it just arrived for the period ending July so a bit late I guess.
    It's with First State Super invested in their High Growth option.

    They sent out a booklet stating that they now have to report their fees to include all costs etc - due to some new regulation. I am not sure exactly what this means but when I turn the page (page 20) they have a table with the estimated costs. The cost for my choice of investment is .69%.

    To me this seems somewhat high. Surely their is a cheaper option that offers similar ("High Growth" = a high proportion of overseas shares) available.

    My ideal for super would be an industry fund that allows 100% VGS as it's a tax free environment anyway after 60.
     
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  2. Nodrog

    Nodrog Well-Known Member

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    @therealAusting, what the ... .

    I thought that pain in the ar*e had left the forum. Drove me mad with his endless rambling about LICs. He went on and on and on ..... and on .... Arrrrggggghhhhhh I don’t think I can take it anymore .....

    F833A33F-D2BF-412F-9CFF-B44AE91A944C.jpeg
     
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  3. therealAusting

    therealAusting Well-Known Member

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    Good one. Austing just won't fade away.

    He's to good to allow that to happen!
     
  4. SatayKing

    SatayKing Well-Known Member

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    Two of them! Sigh*

    It's likely the new reporting arrangements relates to the requirement to advise the ATO about amounts moving into and out of retirement phase accounts. All to do with the transfer balance cap I understand. The $1.6m cap could trigger a lot of these and surprise, surprise, members of super funds will be paying for it. But I'm nowhere near that cap is the cry! True but the ATO don't know that so just in case you are or could be............
     
  5. SatayKing

    SatayKing Well-Known Member

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    Yeah, I've heard of this approach previously. Some call it DCA. Others view it as permanent accumulation phase such as when your kitty is, say, $5,000 then buy.
     
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  6. pippen

    pippen Well-Known Member

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    Yep! He mentioned birthdays and Xmas time his kids were given more $$$ as gifts which turbocharged their investments from a young age!
     
  7. therealAusting

    therealAusting Well-Known Member

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    Hi Satay
    This doesn't refer to the amounts moving into and out of accounts. I'm also a way off the limit as well.
    What it refers to is the total costs of managing you account.
    Up until now they from what I can make out they only disclosed their managing costs as it related to FSS.

    This (maybe) did not also account for the funds they invested in's costs as well as 'borrowing and property operating costs' (from the pamphlet) and 'Transactional and operational costs' (also from the pamphlet). So that they come to a final figure of (on table 1 Estimated Investment fees page 20) a total investment fee of .67% for High Growth.

    When one can see that the new Vanguard product (VDHG) is only .27% the FSS fee seems rather high to my uneducated eyes. What I was asking is if there is a better/cheaper option for me than FSS.
     
  8. SatayKing

    SatayKing Well-Known Member

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    @therealAusting , I see. Though I do wonder if the total fee has such requirements I mentioned built in to the fee. Amotise all costs across all members.
     
  9. therealAusting

    therealAusting Well-Known Member

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    Hi Satay
    I don't know either.

    From what I can read from the pamphlet they are now including the costs of
    1. buying and selling, such as brokerage, stamp duty and sales commissions:(
    2.using derivative contracts to minimise impact of currency movements on investment returns
    &
    3.managing the fund securities lending program

    It seems to me (I may be wrong) that these costs were previously hidden from the average joe (like me).

    I actually had it in my mind from checking a couple of years back that the managing fee was about 0.2X(something) percent and was quite shocked to see it is actually 0.67 percent. Given the size of the fund (they are one of the biggest) they must be making a killing.
     
  10. ShireBoy

    ShireBoy Well-Known Member

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    Received my copy of Motivated Money this week. Already up to chapter 8. Nice easy reading. Enjoying it so far.
     
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  11. R-Hub

    R-Hub Well-Known Member

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    We try to create complex ways of investing. PT stays rock solid on his simple clear beliefs that work.:)

    Have to catch one of his talks!
     
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  12. Nodrog

    Nodrog Well-Known Member

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    Yeah one’s enough. @therealAusting wins:).
     
  13. R-Hub

    R-Hub Well-Known Member

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    I understand the error in my ways, with the link, ha.:(

    It's not a property vs shares thing, i think there both great and have both worked for me.
    I think this thread, PT book, videos and even Michael Holmes book. Get you to look at your investing beliefs, returns and investing types.
    Hences property and even one of the current topics in this thread super funds getting a good look over.

    Even PT book subtitle was 'You've invested well? Compared to what?':)
     
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  14. Ross36

    Ross36 Well-Known Member

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    Not often I get to add something that might be useful - I've done a fair bit of research (my own, do your own of course) into these specific to unisuper:
    1. The standard options like high growth, balanced etc. for unisuper have a reasonable cost to them, but you can choose to assign your money to specific individual segments that have typically a much lower fee. For example, the high growth option combining some australian, international shares and tiny chunks of real estate was 0.68%. I instead split 50% Australian equity income (kind of a proxy for PT style industrial with good dividends: fee = 0.42%), 25% International shares (lots of banks...: fee = 0.43%) and 25% global companies in Asia (still some banks but heavy on tech stocks like Alphabet and Apple: fee = 0.53%). Gives me sleep at night a bit better than standard High Growth (banks galore) and also lower fees. Here's a link to the fees:

    https://www.unisuper.com.au/~/media/files/forms and downloads/pds documents/accumulation 1/unisibr0003-ibr-fees-and-costs.pdf

    2. As for the DBS - just google unisuper defined benefits scheme and class action and you'll get the drift. The sneaky way they stopped indexing it to inflation was a game changer for me.

    Not advice, just rambling and adding my bit to a forum that Austing et al. have done so much for.
     
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  15. Anne11

    Anne11 Well-Known Member

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    The fees for the High growth etc.. is so that you don’t have to rebalance your asset allocation regarly yourself I guess. Your selection is certainly cheaper than the premixed option.
     
  16. Ross36

    Ross36 Well-Known Member

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    The cost of switching around is quite good - one free per year and less than $15 each time after that. I doubt I'd switch more than once per year though anyway, not smart or silly enough to think I could time the market that well.
     
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  17. therealAusting

    therealAusting Well-Known Member

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    I just google the UNI super defined benefit plan.
    It looks fairly unstable in that they are changing what the benefits actually are. They have also had funding issues.
    It's not one of the 'proper' plans where members know exactly what they will get. This fund seems able to change the rules with new members paying for older members benefits in some way, like they will recieve less for the same money in. Seems more like a pyramid plan.
    If it was me I'd go with their accumulation plan and make my own decisions.
     
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  18. Ross36

    Ross36 Well-Known Member

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    Agree 100%. They also have a rule that you can only get out of the DBS within the first 2 years, otherwise you're stuck in it. Too scary with the unknowns for me.
     
  19. Anne11

    Anne11 Well-Known Member

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    This is my understanding as well. They changed the rule in recent years. I was with Accummulation 2.
     
  20. Shady

    Shady Well-Known Member

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    I havent commented on this post but I spent a lot of time reading through the Thornhill philosophy and knowing that I'd likely forget about it if I didnt have any 'skin in the game' I decided to buy 4 of his recommended LICs.
    The four I bought on the 20th Feb this year(2017) were MLT up 3.56%, BKI up 1.18% ARG up 2.03% and WHF up 3.32%....Glad i didnt put much into these. Most of the other stocks and etfs i bought are up 10%-20%.

    Maybe next year will be better dor Thornhill followers
     
    Last edited: 14th Dec, 2017
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