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Colonial First State CapGT – Aspect Series 1

Discussion in 'Managed Funds & Index Funds' started by rossco, 24th Sep, 2010.

  1. rossco

    rossco New Member

    Joined:
    24th Sep, 2010
    Posts:
    1
    Location:
    brisbane
    Hi All,

    I'm new to this and currently having a look at a range of managed funds and etfs to trade in.
    I have seen this new Colonial CapGT Aspect Series 1 fund (a close-ended fund - applications close 29 October, 2010). being spruiked around the place and have a couple of questions:

    1. This fund features a Commonwealth Bank Security Deposit – a fixed‑rate investment over ten years that supports the capital guarantee.
    Can someone please exlain to me what this means? Is this a garunteed amount ofreturn when the fund rezaches maturity (2020)?

    2. Any other benefits/limitations of investing in a fund such as this?

    Alternatively, i'm considering the Schroder balanced fund if anyone has any comments on this as a long-term investment strategy.

    Cheers,
     
  2. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
    1st Jul, 2009
    Posts:
    703
    Location:
    SE Queensland
    Not being in control of my money for ten years! I'd hate that. This fund is relying on investors fear of loss. Sorry, not for me.





    Johny.
     
  3. jrc77

    jrc77 Well-Known Member

    Joined:
    26th May, 2008
    Posts:
    147
    I don't particularly like the way the capital protection works. Basically if you invest 100k, they put 58k in "fixed" interest type investment, and only invest the rest (42k) in shares. At the end of the term the fixed component will at least be equal to the 100k.

    If I wanted to protect capital this way, why wouldn't I just put 58k into a fixed interest account (or online savings account etc) and then only invest 42k in shares myself?

    Regards,

    Jason
     
  4. TMK

    TMK Member

    Joined:
    24th Oct, 2010
    Posts:
    6
    Location:
    Australia
    It is a strange product... effectively Aspect is a hedge fund using managed futures, so why would you capital protect something that should only play a small part of your portfolio.

    If markets perform poorly over the long term, the fund will be cash locked and will eventually return the principal at the end of the investment term, but 3% is a hefty price to pay for protection.

    All in all not the worst option, but not the most compelling either.

    TMK
     
  5. luyaoqin

    luyaoqin New Member

    Joined:
    28th Dec, 2010
    Posts:
    3
    Location:
    Brisbane,QLD
    I invest in Schroder balanced as well. I reckon this fund is not bad compared with its peers. Even though the past performance is not an indicator for future, it appears comparatively stable and reasonable performance compared with other funds in the Multisector growth catagory.

    I hope someone can shed some lights on this fund as well.

    Thank you.