Why Shares are Better Than Property

Discussion in 'Share Investing Strategies, Theories & Education' started by Terry_w, 17th Feb, 2017.

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  1. Daniela

    Daniela Well-Known Member

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    There is an element of property that no share can offer, in my opinion. It is the confidence that you make the decisions with only you in mind, and no one else. And that you know what's going on in the business, every second of the day and every day of the year. For those that are prepared to have others make decisions about their money and not knowing what the impact of these decisions will be on their money tomorrow, shares could very well be the answer. I could not live with this uncertainty, even if someone promises me much higher returns. I prefer 'lower gains' but which I can control and have very little uncertainty to achieving them. Consistently achieved over the years, these 'lower gains' are guaranteed to bring anyone a solid financial independence:)
     
  2. The Falcon

    The Falcon Well-Known Member

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    Certainty is an illusion.
     
  3. Gockie

    Gockie Life is good ☺️ Premium Member

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    Just a thread bump... time to revisit these threads :)
     
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  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Now you are seeing things in a different light?
     
  5. Gockie

    Gockie Life is good ☺️ Premium Member

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    My takeaway. I think my brain has a greater ability to sort the wheat from the chaff on this debate. :)
    I resonate with the posts that illustrate when people really know the subject, and i'm able to pull apart and deconstruct the weaker posts in my head.

    So that's a great personal step forward. I'm not saying I know heaps about shares, but I'm on the right track.
     
  6. chylld

    chylld Well-Known Member

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    Shares and funds are great for liquidity; I recently sold my 3 weakest managed funds (for a massive capital gain of $3k) and my bank account was credited in 2-5 business days. Also sold a share through CommSec which settled in 2 days.

    However the volatility means I wouldn't be comfortable using them as loan security. Preferable to recycle PPOR debt into property-secured investment loans.

    Currently holding:
    • 6 direct actively managed funds (average 11.68%/yr return after all fees and taxes inc future cgt obligation)
    • 2 active ETFs (24.43%)
    • 3 index ETFs (10.70%)
    • 2 LICs (18.45%)
    • 9 direct shares (9.68%)
     
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  7. Silverson

    Silverson Well-Known Member

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    Hard to argue with those returns.
     
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  8. Chris Au

    Chris Au Well-Known Member

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    And no management issues leading to a positive CF investment moving to a CF -ve investment (outside potential unpredictable nature of shares, which has been managed through taking a LIC / ETF approach).

    Each has a place, but shares better for retirement/income phase IMO
     
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  9. MTR

    MTR Well-Known Member

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    ..... How many years have you held these shares? My guess is you purchased these in a bull market and have yet to experience a bear ....???

    BTW I think everyone should diversify, it just makes sense.

    However, surely we would be delusional to think that we only see bull markets and these results % will be achieved continually, regardless of asset class......

    Would be interested in what others think?
     
    Last edited: 14th Apr, 2017
  10. chylld

    chylld Well-Known Member

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    Funds for almost 2 years, shares for about half a year. The numbers are extrapolated to %/yr from there and are (in my opinion) very high because of the recent bull market.

    My recent sell-off was in preparation for an upcoming crash; it would be foolish to think that the market will continue to perform as well as it has for the last few years. That said, I'm probably very wrong about a crash as I sold an IP last year thinking Sydney had reached its peak. Although, the market value I lost selling it early is about the same as my gains to date from investing most of the sales proceeds in funds/shares (the rest was spent on the toy in my profile pic :) )
     
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  11. MTR

    MTR Well-Known Member

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    OK, I better pay attention to your posts and what you are buying:)

    Seriously, there are so many posts on share investing on PC lately and this is IMO due to the fact that property yields are so low and investors are finding it far more difficult to source finance, shares have become a good fit and they are attracted to the yield.

    I also wonder how it will work when suddenly the share market goes from bull to bear market? Will we still see the same level of interest? Just curious really.

    I am sitting on the sidelines and waiting for the share crash? Too many people are saying that the share market is close to peak? No idea, am a newbie when it comes to shares.

    MTR:)
     
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  12. Gockie

    Gockie Life is good ☺️ Premium Member

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    Marisa, thanks for posting. Now I want you to ignore the fluctuations!

    image.png image.png image.png
    A few notes:
    1. Graphs 1 and 2 are equivalent... Just instead of plotted monthly, it's plotted twice. See how smooth it is?
    2. See graph 3? Follow the yellow line. Don't invest in the crap (resource stocks and Listed property trusts)
    3. Stay the course. Once you buy solid investments (eg. Long running LICs) Don't trade. Just use dips as a buying opportunity as they'll continue to pay dividends. Side note.... Buying CBA at $26 post GFC would have been the thing to do. Now it's around $86 and paying $4 in franked dividends per year. So we are all waiting for the next GFC type event to occur.....

    Simples.....

    Keep reading up, talking to other investors and if you want to get the word from the horses mouth, make the effort to get yourself over to a Peter Thornhill day.... Only $410, well worth the outlay....
     
    Last edited: 14th Apr, 2017
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  13. chylld

    chylld Well-Known Member

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    I'll save you the effort :D Here are some of my top performers:

    ASX:SOL : bought 5 months ago for $15.08, currently $18.95
    ASX:QBE : bought 4 months ago for $11.33, currently $12.63
    ASX:MVA : bought 4 months ago for $18.90, currently $21.34. This was recommended somewhere here on propertychat :)
    ASX:VAS : bought 5 months ago for $67.28, currently $74.73. Obviously another PC recommendation

    Forager Australian Shares managed fund : bought 1.5 years ago for $1.26, currently $1.97
    Cromwell Phoenix Opportunities fund (now closed) : bought 7 months ago for $1.65, currently $1.97
    Legg Mason Martin Currie Real Income A fund : bought 1.5 years ago for $1.51, currently $1.83

    edit: to balance these out, here's my worst performer (thankfully only a $10k investment)

    ASX:TRS (The Reject Shop) : bought 3 months ago for $7.83, sold last week for $4.35 :oops:
     
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  14. Invest_noob

    Invest_noob Well-Known Member

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    Thanks for posting this. In relation to your worst performer, why did you sell for $4.35 and not hold it long enough for the prices to go back up?
     
  15. chylld

    chylld Well-Known Member

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    TRS was bought as a recommendation from the Barefoot Blueprint newsletter. Earnings dropped so the share price dropped and there was no foreseeable reason why it would return to its previous levels.

    There were other shares also falling that I wanted (TLS and RFG) so I decided to shift my funds there as I believed they had more growth potential than TRS.
     
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  16. Gav

    Gav Well-Known Member

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    Somewhat off topic, but was wondering how you find the newsletter? Was thinking of subscribing but havent pulled the trigger yet.
    Thx
     
  17. chylld

    chylld Well-Known Member

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    I think it's great. Made the yearly subscription fee back in about 3 weeks.
     
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  18. c_west

    c_west Well-Known Member

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    Good post "Gosting"
     
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  19. Gockie

    Gockie Life is good ☺️ Premium Member

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    Lol.
    Disclaimer: I'm new to shares....
    But I found it easy to pick up what Thornhill teaches in one day. He is just brilliant in delivering his message. :D
     
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  20. Gav

    Gav Well-Known Member

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    Thx very much, that made my mind up...