Peter Thornhill 2018

This is not my situation, but anyone who has non deductible debt on say PPOR and a share portfolio, should borrow 100% to buy shares and channel any repayments/equity/dividends into reducing the non deductible debt. Just another form of so-called debt recycling. If you do that, the shares would generally be negatively geared. Admittedly, not everyone is in that situation.

 

This could be the case, but interest rates at about 4% and growing values may mean little to no loss. Also capital gain harvesting to remove any loss as well.

But where a trustee is owner it is important not to make a loss as franking credits would be lost.

 

Get your big picture goals sorted first such as if you’d like to retire early? Super savings won’t be available to you before 60 or more likely by 65 by the time you get to that age.

Perhaps it’s best to keep Super simple by choosing low a low cost preset option (eg HostPlus Balanced index fund) then choose your own LICs / ETFs outside Super?

Not advice.

 

Yes, generally agree. Note that some equity investors use margin loans so rates closer to ~6.5% and not ~4.0% like resi. Also, a good portfolio should include some OS exposure (Eg 40%) which is mainly US. The US market has average dividend yield of 1.7% and no franking (am using VTS as good proxy for US market), so good tax losses to be had with the right portfolio.

 

Don't think Thornhill would agree (for right or wrong).

 

Terry is a good and helpful contributor but I disagree that you need an AFSL to answer those questions. If you read the LIC thread, other threads on this and other forums, and DYOR you should be able to answer the questions for yourself. It will be a lot cheaper and the answers will be from someone you can trust.

I was asking myself this question the other day, and you should ask yourself too: why do they have this legal requirement for providing financial advice? Do you think it might be protectionism? After all, given recent news about crooked members of the financial services industry, it is apparent that the accreditation to provide financial advice is about as valuable as a piece of toilet paper.

With regard to your questions, there is no one-size-fits-all answer - it is dependent on your situation.

BTW, I am not talking about legal and structural advice, that requires an expert like Terry. But knowing how you want to invest your money, let's call it your investment philosophy, can only really be answered by you.

Not licensed to give financial advice.

 

To set up a SMSF you need a reasonable sum or the fees will impact you too much to make it worthwhile. Remember, something like Hostplus Balanced Index Fund has fees of 0.02%. I've heard different figures bandied around here but if you were paying $2000 per year for your SMSF you'd need a balance of $10 million to keep fees on par with Hostplus. Then, even if you were to create your own SMSF, what is the chance that you will beat Hostplus over a 35 year period? Based on Buffet's bet with the hedge funds, I'd say very little chance. If you did happen to beat Hostplus, consider how much time and effort would go into the SMSF over 35 years. Time that you could have spent drinking beer or hanging out with your family.

Finally, you can always transfer from your low cost super into a SMSF with negligible transaction costs at a later date. The converse is not true as the setup and exit fees for a SMSF are considerable.

No advice.

 

What weighting does Peter recommend?

 

He doesn't believe any is necessary.

Couldn't find the link I was looking for, this will suffice

"Because we live here I restrict the majority of my capital to the Australian market. I have a legacy of my UK pension fund in the UK, but the majority of our big Australian companies are international companies - such as Cochlea & CSL - both fabulous companies and they're global. You have exactly the same thing in every major economy. So I don't specifically go looking overseas because you then end up with the currency risk laid on top and you don't want that with your retirement income!" - Peter Thornhill - interview with an investing genius

Are Peter's great investment results of a superior strategy or the right strategy at the right time? It is possibly a little from column a and column b

 

Did anyone read the Switzer Daily article of 'The 7 habits of highly effective investors'. It sounds a lot like he is describing Peter Thornhill's investing approach without actually naming him or others.

 

http://www.switzer.com.au/the-exper...t/the-7-habits-of-highly-effective-investors/

 

Switzer hasn’t been very accurate with the story if it’s Thornhill he’s referring to. Peter wouldn’t own an ETF if you held a gun to his head. Originally he was concerned about counter-part risk but regardless of that there’s too many resources, AReits and non dividend payers in an ETF for his liking. He’s always been a huge fan of old style LICs. He’s been progressively reducing his direct share holdings and using the proceeds to concentrate more of his wealth in his four local LICs.

Peter cops some criticism here at times but you have to give it to him he certainly sticks to his plan no matter what.

 

Not sure if it is all meant to come across as criticism (my comments aren't), it is important to point out some of the exceptional returns aren't purely related to the PT strategy to have a balanced discussion.

The PT investing approach forms the core of what I am planning to do, the main difference been I have added international exposure.

 

Sorry mate, poor choice of word. My comment certainly wasn’t directed at you. I agree that the focus on exceptional returns could lead to new investors having unrealistic expectations. The message is best kept to “Shares for income” vs the usual focus on highly volatile capital.

 

You certainly seem worried about offending at the moment, is it your new "not advice" . Next time you don't excuse yourself I am going to think it is an attack on poor hodor

Repeated discussion is a great way to stay the course when investing, especially with my thick skull.

 

We’ve run out of home brew so I’m not of sound mind at the moment. Excuse anything I say. Bugger I’ve excused myself again.

 

Dover shutdown puts $20b in limbo

Ouch.

 

Is that where his son works?