ETF ETFs the 'starting point' for Millennials

Discussion in 'Shares & Funds' started by twisted strategies, 16th Mar, 2018.

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  1. twisted strategies

    twisted strategies Well-Known Member

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    ETFs the 'starting point' for Millennials

    i disagree with this article ( but then i am a grumpy old Bary Boomer , NOT a Millennial .)

    i do find some ETFs useful but i also find LICs and REITs have an important place in my strategies .as well .

    the fine print you need to read in EACH ETF is just as torturous as the paperwork on interest-bearing securities

    ( DYOR )
     
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  2. Hodor

    Hodor Well-Known Member

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    Problem is the article doesn't specify the type of ETF.

    Low cost index ETFs are perfect for those with a long horizon.

    Smart beta, leveraged and options trading ETFs are a mine field.
     
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  3. twisted strategies

    twisted strategies Well-Known Member

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    and that is my main point of the ETF issue , just like buying a residential property , there is a lot of tiny details to be aware of ( before the cash is paid ).

    there is plenty of research needed into EVERY ETF needed ( even when from the same company or of a similar style .. say 'high-dividend yield ' )
     
  4. MoneyNotorious

    MoneyNotorious Member

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    Great read and contribution TS!

    You are so right that ETF's require a s-tonne of research as they do appear like a really great starting point to millennial such as myself - but smart millennials who understand that there is life after your 20's, you don't have to travel NOW and spending $15 on avo on toast with chai kale latte is a joke.

    But as you say, there are so many hidden mines that people like me could get engulfed in. I am really interested in AREITS however as being in construction I've learned to love the industry and sort of keep up to date with whats going on. What should I look out for?
     
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  5. twisted strategies

    twisted strategies Well-Known Member

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    RISK !!!!

    construction relies heavily on borrowing ( as much as 45% ) and long time frames for completion dates

    many a builder /employee or contractor has had a nasty experience when credit dries up or property prices crash ( great money in the good times , and possibly bankruptcy in the bad times

    now not every construction firm fails , but some HUGE ones have ( even recently in the UK .

    these booms and busts are cyclic ( just like mining booms/busts )

    HOWEVER some companies survive decade after decade ( and others don't last a full decade ).

    i used to hold SLF ( an ETF focused on the ASX top 200 REIT ) but sold at a modest profit as it wasn't delivering on my expectations ( even in the 'good times ' )
     
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  6. Hodor

    Hodor Well-Known Member

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    Do you want your investment returns highly weighted around your income?

    Great to invest in what you know, be aware of the concentration of risk
     
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  7. twisted strategies

    twisted strategies Well-Known Member

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    similar to being in an employer based super-fund ( the portfolio heavily weighted to the employer's stocks )

    great until you have some rough spots

    however if you use the theory of the ( Aussie ) economy is just one big beast viewed from different angles ....

    i got a nasty lesson from construction firms moving heavily into projects in the Middle East ( mostly Dubai ) ... so the beast you know ( better than one you don't ) ??

    i went for highly diversified ( sectors and nations ) but i am hoping for some to survive , not pinning my hopes on 3 big winners