Investing at different life stages and strategy

Discussion in 'Share Investing Strategies, Theories & Education' started by Hodor, 1st Oct, 2016.

Join Australia's most dynamic and respected property investment community
  1. Nodrog

    Nodrog Well-Known Member

    Joined:
    28th Jun, 2015
    Posts:
    11,377
    Location:
    Buderim
    Yes, very good points.

    Also there's no shortage of predominantly LIC investors around who use ETF's such as VAS as a backstop for when there's an absence of value in their chosen LICs. And if in difficult market times one wishes to deploy capital from one holding to another the liquidity of STW in particular cannot be overstated. With some LICs the liquidity can dry up. However I use that to my advantage by buying off some poor soul who's panicking to get out of an illiquid LIC. Shame on me!

    Great to see how each investor approaches things differently. There's always something to be learned. And because of each investor's unique circumstances both financially and psychologically there's no such thing as a "one size fits all"!
     
  2. twisted strategies

    twisted strategies Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    1,461
    Location:
    QLD
    now i avoided those mistakes ( to a large extent ) mainly due to my contarian ways , and because i didn't like the (geo) political risks that normally accompany both .

    that subtle variance to novice behaviour did reap rewards ( but cost a lot of sleep , let's use TFC [ now free-carried ] as an example ,)
    early on in my holding (in 2011-2012 ) it was displaying all the hall-marks of a Ponzi-like plantation scheme , sporting identities as ambassadors included .

    now sandalwood is a valuable crop but has long waiting times and other risks , and was costing sleep quality , so i calculated a good price to rescue that investment cash at ( and did so ) leaving the 'profits' to DRP in their haphazard way .... since then TFC has starting into sandalwood used in pharma products and i am doubly glad now i chose to recover and and invest elsewhere that cash .
     
  3. twisted strategies

    twisted strategies Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    1,461
    Location:
    QLD


    i don't remember why i chose VAS over STW initially ( but it and other rivals were considered )

    but GOOD ETFs employ ( 3rd party contract or do it in-house ) 'market makers ' to guarantee a certain amount of liquidity buffer.

    so you may have easily traded with the 'market-maker' sweepers.

    ALSO pease note many ETFs can be legally short-sold ( including by ,i imagine, the 'market-makers ' )

    i am not set up the short-sell ( or even day-trade ) with shares but others are ( semi-professional traders and such )

    being aware of unusual strategies may help create more of them (imo ) not totally a bad thing .

    with the exception of HVST , my held ETFs are primarily 'insurance plays ' ( giving me exposure to current market valuations , in shares i may never hold directly )

    currently held ETFs are VAS , VHY , SYI , QFN , IHD and HVST

    your would think the 3 'high yield ' focused ETFs would have significant overlap but that is seldom the case ( as strange as it seems )
     
  4. Nodrog

    Nodrog Well-Known Member

    Joined:
    28th Jun, 2015
    Posts:
    11,377
    Location:
    Buderim
    You may have chosen VAS (0.15) based on MER. It was noticeably cheaper than STW (0.286) but that has changed. VAS being ASX 300 vs STW ASX 200 gives more exposure to small caps. But that can also at times mean more exposure to spec mining rubbish. Finally from memory I think STW's distribution was only twice a year whereas VAS was quarterly. Both are the same now. STW has tended to be popular because of its excellent liquidity and smaller bid / ask spread.

    Yes so the story goes. But some argue that a number of ETFs haven't been put to the test in a major crash. Counterparts risk is still a concern in some quarters.

    I did hold a few of these so called smart beta ETFs at one stage but when I looked into them further I found the rigid rules resulted in undesirable stuff in the portfolio at times with high portfolio churn and turnover. VHY moved from quarterly to 6 monthly rebalancing in an attempt to reduce turnover but the issue is still problematic in my view. The resultant CGT may not be such an issue in a Super fund. And of course the fees are higher. I personally no longer invest in smart beta ETFs anymore.
     
  5. Gormie

    Gormie Active Member

    Joined:
    12th May, 2017
    Posts:
    33
    Location:
    Melbourne
    As a dividend investor I am interested in buying YMAX and possibly HVST. Both offer excellent divs but the SP of each declined about 5% in the last 12 months. It seems to me the SP of HVST will be in a permanent decline as capital is exchanged for divs, but YMAX should show a small increase in SP over the longer term. I am interested in the opinion of others.
     
  6. Nodrog

    Nodrog Well-Known Member

    Joined:
    28th Jun, 2015
    Posts:
    11,377
    Location:
    Buderim
    Yes, I'm also a very keen dividend investor.

    Just need to be careful the extra income is not at excessive expense to capital. That is it's still important to take into account total returns.

    There is a new LIC that will be listing in the next couple of months which uses a similar approach to YMAX. That is the use of options to boost yield and lower volatility. The fee is a bit higher than YMAX but the returns are potentially likely to be noticeably better.

    Refer to this thread for more info:

    QV Income Limited (QVI)
     
    2 people like this.
  7. twisted strategies

    twisted strategies Well-Known Member

    Joined:
    1st Jul, 2015
    Posts:
    1,461
    Location:
    QLD
    my current Top 10 ( by $value )
    WOW ( about 10% ) at very little cash risk .. less than $100.00 )
    BHP ( about 3% ) at an unpleasant paper loss
    MQG ( free-carried and extra profit taken )
    APE ( free-carried )
    CUP ( at a paper loss but as long as the divs keep coming .... )
    WES ( about 1% ) bought with the profits taken from elsewhere .( lets be pedantic and say full cash risk and minor paper profit )
    EQT ( some profit taken ) ( and in paper profit )
    TME ( in nice paper profit )
    CDM ( about break even )
    BOQ ( nice paper profit and some profit taken )

    currently VAS has slipped out of this list but could work it's way back via the DRP .

    with HVST i am looking to average down in the market corrections and dips , and HOPING the DRP will do some extra heavy lifting ( since this pays monthly )

    at retirement i would hope to switch HVST from full DRP , to 50% cash, 50% shares

    instead of YMAX i would probably prefer ILC or VLC ( vanilla ASX Top 20 ) or maybe ZOZI ( ASX Top 100 ) which is new and immature .
     

Buy Property Interstate WITHOUT Dropping $15k On Buyers Agents Each Time! Helping People Achieve PASSIVE INCOME Using Our Unique Data-Driven System, So You Can Confidently Buy Top 5% Growth & Cashflow Property, Anywhere In Australia