Where to put 1.2 million savings now?

Discussion in 'Share Investing Strategies, Theories & Education' started by Butterfly88, 20th Apr, 2020.

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  1. Butterfly88

    Butterfly88 Well-Known Member

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    Hi all.

    So hubby and I had a plan to invest in stocks about 18 months ago after selling our PPOR to move to South Korea and live as expats for two years. The plan was to slowly build up a portfolio that would pay us a wage so that we could segue way into an early retirement. Initially, the FA told us to stay put as he was not confident about us buying in aggressively, so we put our 1.2 million into a term deposit and collected the gain.

    End of last year the FA suggested parking most of our savings in the Vanguard Conservative Index fund where it made a small gain and seemed relatively safe. To-date our hard-won nest egg is now down about 6 per cent. With all the talk of impending doom we're now really worried about what to do now. Do we cut our losses and get the cash back into the bank and wait to buy in after the market tanks? Do we leave it in the fund where it is vulnerable to further losses? The last conversation with the FA did not enlighten us.

    Happy to hear the thoughts of other newbies.
     
  2. Trainee

    Trainee Well-Known Member

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    You dont have a ppor though. Can you retire without a place to live? Would you want to live in an expensive place like syd or melb?

    so you know that the market is going to tank? And you will buy at the right time? Why do you think this?
     
  3. MTR

    MTR Material Girl Premium Member

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    get it out, sit on cash as lots more lows to come

    be in the box seat
     
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  4. Butterfly88

    Butterfly88 Well-Known Member

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    Hiya. We have a property in Sydney, and it's currently tenanted. So no problem there, just homeless for now as we had to leave our apartment in ROK.
     
  5. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Cash or gold sounds good

    ta
    rolf
     
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  6. Butterfly88

    Butterfly88 Well-Known Member

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    Yep. This is our gut feeling. Worried we will get more burnt and also not be liquid enough to take advantage of any opportunities...
     
  7. Lindsay_W

    Lindsay_W Well-Known Member

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    What did your FA say in response to this question?
     
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  8. Butterfly88

    Butterfly88 Well-Known Member

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    In our last conversation he was unsure where was safe at all...not alarmist but just really unsure which is not usual.
     
  9. MTR

    MTR Material Girl Premium Member

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    Make up 6% loss and much more at the end with buying at the bottom
     
  10. Ross36

    Ross36 Well-Known Member

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    If your money isn't safe in vanguard conservative its not safe anywhere. That's a very low exposure to shares, around 30%. Its called conservative for a reason.

    Going safer isn't the issue, it's how to go into more risky assets. If it was me I'd be implementing a transition to VGAD over a 5yr period, something like 20% per year. You can add a performane kicker to feel like you're in control - maybe every 10% drop you convert another 10% of the original amount. This tends to not work optimally though. There is plenty of "evidence" that just switching to all shares straight away is best but the stress and tail risk isn't worth it for most people. For me I'm transitioning over a long timeframe just to stop me stressing. It also leaves me cash to invest in real estate etc. if I choose.

    One thing I am confident in - gold sucks and cash is a guaranteed way for long term loss of capital. They are not long term options.

    Not advice, just thoughts.
     
  11. mdk

    mdk Active Member

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    Hi Butterfly88 - Not sure shares are for you based on your post.

    Down 6% capital value and your wanting to move to another asset class?
    Worried about impending doom?
    Wait to buy in after the market tanks?

    It sounds like a period of self education may be the best direction for you. There are fantastic threads in this InvestChat section to start with. Once you have clear understanding of the lay of the land you, perhaps then you can make an informed decision for yourself as to if shares are the asset class for you.
     
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  12. Ted Varrick

    Ted Varrick Well-Known Member

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    You could try the Australian Bond Exchange if you feel equities are a bit too volatile for you.

    I have used them myself, as part of having a balanced portfolio in my SMSF.
     
  13. Willy

    Willy Well-Known Member

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    What date was that again?
     
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  14. MTR

    MTR Material Girl Premium Member

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    who knows?? But why take a risk in bear market

    Take your money just sit back and wait.

    There are strategies when to buy in but patience is required. Dont buy in till we positive signs we are a long time off this
     
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  15. Brumbie

    Brumbie Well-Known Member

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    Agreed. You are buying companies. For the life of me I do not understand how anyone can value most companies at present and looking forward over the next 12 mths. Buying an index is gambling black/red now in my view. Unless you can analyse for value and stock pick, just sit back in iso and drink martini's and wait for a better hand. Maybe DCA over the next year or so?
    I am personally totally out since Feb. I am investing in investment grade bonds that have been called or maturing in 4-6 weeks and just rolling it over. Due to market stresses we are making a small CG plus coupon for an average of 0.65% per month return so far. The amount you have is big enough to do this in the wholesale market and not tie up your money.
     
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  16. Fargo

    Fargo Well-Known Member

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    Put about 200k in Maven I think that maybe the minimum, I am , at least have a talk to Matt. This guy doesnt need to push his fund he makes enough without having to spruik. He is only opening up his fund to the public after years of popular pressure/ persuasion. With an amount like that you can get access to the best fund managers. Only invest in Funds where the managers are heavily invested themselves. Introducing Maven Funds Management .
     
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  17. Lindsay_W

    Lindsay_W Well-Known Member

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    Don't forget, you haven't lost anything yet, you only make a loss when you sell while -6%
     
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  18. Butterfly88

    Butterfly88 Well-Known Member

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    Hi there. Yep now we are in lockdown that is what I am doing, long way to go but doing it now I have the time. One of the reasons I've become active in here again...Cheers.
     
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  19. Marg4000

    Marg4000 Well-Known Member

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    Certainly true, but cash can be a way of riding out volatility in the shorter term.
     
  20. mrdobalina

    mrdobalina Well-Known Member

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    Buy some oil futures? :)
     
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