Join our investing community

Getting entry fee rebate through margin loan?

Discussion in 'Managed Funds & Index Funds' started by FrankGrimes, 5th Jan, 2007.

  1. FrankGrimes

    FrankGrimes Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    110
    Location:
    Sydney, NSW
    Hi all

    I'm looking to put some money into some of the CFS funds, but the only thing that turns me off is the 4% entry fee. I know you can get around this entry fee by using someone like investsmart.

    But I don't have the capital and the application will be made directly by the margin lender (BT). Are there any alternatives to getting this money back?

    4% seems excessive to me.
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,623
    Location:
    Sydney, Australia
    How much do you have to invest ?

    If you can margin it up to $100,000 - you can invest in the CFS Wholesale funds and not pay any entry or exit fees.

    You don't need to put the $100,000 into a single fund, you can split it across as many of their Wholesale funds as you like.
     
  3. MrDarcy

    MrDarcy Well-Known Member

    Joined:
    13th Sep, 2005
    Posts:
    283
    Location:
    Sydney
    I get the PDS from directinvest etc, fill it in and send to margin lenders.

    I use BT (and other margin lenders) and never, ever pay the 4%.
     
  4. seaview

    seaview Well-Known Member

    Joined:
    8th Jun, 2006
    Posts:
    77
    Location:
    NEWCASTLE
    WOW, MR DARCY,

    That is useful to know. I wish I had known that a few weeks ago when I was banging my head trying to work out this same problem. When I called directaccess they said they could not work with margin loans.
    Anyway, I ended up haggling McQuarie down a bit; haggling a Navra adviser down a bit for another fund; going wholesale on CFS (so no fee); but I had to pay the full 4% for Australian Unity Fund. OUCH. I did consider actually getting a cash advance from margin loan, buying the units in my name through directaccess, then lodging units with margin lender to bring LVR back down. It was all too hard and I would miss distribution, so I just copped the fee. But I won't again, thanks to you.

    Cheers :)
     
  5. masterjunko

    masterjunko Member

    Joined:
    21st Dec, 2006
    Posts:
    16
    Location:
    Sydney, NSW
    Thank you, Sim.
    Very useful info.
     
  6. FrankGrimes

    FrankGrimes Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    110
    Location:
    Sydney, NSW
    Thanks mate, you have saved me a tidy sum of cash. Glad I asked!

    Sim, my total portfolio is about 90k, and most of it is in Vanguard funds already. So wholesale not an option yet :(