Managed Funds Funds for servicibilty advice??

Discussion in 'Shares & Funds' started by Rooster, 22nd Jul, 2007.

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  1. Rooster

    Rooster New Member

    Joined:
    1st Jul, 2015
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    London
    Hi Folks!!

    Long time reader, first time poster here.

    Looking for some general advice on my share investing…please!

    Have a touch over 250k equity in my IP’s at the moment. Have been looking at and reading about the Navra Retail Fund and various LIC’s.

    Essentially looking to increase servicibilty as IP’s are slightly negatively geared and would like to do this with Navra. My proposal was to draw down the 250k to a LOC and then also set up a margin loan, while restricting that to a 50% LVR.

    I would like to leave some of that money aside in the LOC for possible future deposits on IP’s I come across, but am unsure how much to invest in say “Navra” first up.

    So saying I left aside 100k for future property, would putting 300k in Navra (150k from LOC, 150k Margin) be a very “eggs in one basket” mistake. And do you consider any LIC’s to be of good value at this stage? ARG, AFI etc

    Hope this makes sense and thanks for a great website!!

    Rooster
     
    Rooster, 22nd Jul, 2007
    #1
  2. Simon Hampel

    Simon Hampel Founder Staff Member

    Joined:
    3rd Jun, 2015
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    Location:
    Sydney
    If you consider that an investment in the Navra AUS fund actually gets you an investment spread across the following blue chip shares:

    AIO, ANZ, BEN, BHP, BLD, BSL, BXB, CCL, CSR, FCL, FGL, FXJ, GTP, ILU, LNN, MBL, NAB, ORI, OSH, OST, PBL, RIO, STO, TAH, TLSCA, TOL, WBC, WDC, WES, WOW, WPL

    ... it's really not that "eggs in one basket" in my opinion. The main risk from doing so isn't the spread of shares, it's "manager risk" where the decisions the fund manager makes (or their trading system) badly underperforms. We've seen Navra be pretty consistent so far - although it's yet to be proven in a downwards or extended sideways market.

    The only other thing to consider is the tax implications of investing in an income fund - although if you have negatively geared properties that's not so much of an issue - you'd have plenty of losses to soak up that income (which is kind of the point of investing in the income fund - to balance the losses).

    Do you have a specific goal for the money (eg $Xpa in income) ?
     
    Simon Hampel, 22nd Jul, 2007
    #2
  3. Bantam Roosta

    Bantam Roosta Well-Known Member

    Joined:
    1st Jul, 2015
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    Location:
    Canberra, ACT
    In my opinion, no. Currently keeping my eye of AFI, ARG, AUI & MLT and all have caught up a lot in price over the last few weeks. I think ARG and AFI are fair value but not cheap and MLT is well over priced again, but this seems to happen a lot with MLT. They all move in fairly regular cycles and bargains can be picked up fairly often.

    I'm only an amateur and 80% of my opinion of these stocks are based on their NTA's at any given time.

    BR
     
    Bantam Roosta, 22nd Jul, 2007
    #3