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Macquarie reFleXion Dec 07- Variation Offer

Discussion in 'Managed Funds & Index Funds' started by wassie, 7th May, 2009.

  1. wassie

    wassie New Member

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    7th May, 2009
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    Location:
    Perth, WA
    Hi all,
    Have been enjoying this forum for a while so thought I should put my first post in.

    Having been a fortunate investor in the Mac ReFleXion Trust (Dec 2007) watching my $100K investment (Japan Focus, China, Euro & BRIC each $25K) get allocated 100% into cash over the last 18 months or so, its been with great anticipation that I have finally received the Variation Offer from Mac Bank.

    Was wondering if there are any other investors (or advisors) out there whom are considering actually accepting the variation in whole or in part (I assume it can be accepted individually per trust according to the request form) or deciding to take the hit and thus avoid a potential opportunity cost?

    Also interested to hear if any one has any (realistic) concerns over potential future adverse tax rulings against structured financial products, given the Govt is apparently going to be in need of some pocket change for the next 6 years.

    Cheers
     
  2. gazza

    gazza Well-Known Member

    Joined:
    15th Aug, 2005
    Posts:
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    Location:
    Canberra
    Hi Wassie

    Am in a similar position albeit with a different Macquarie fund. I have a 100K in the Equity Enhanced fund that was heavily promoted by Peter Spann a couple of years ago. Similarly it is also 100% in cash I believe and Freeman Fox is currently in negotiations with Macquarie to provide some sort of alternative product which will allow investors to somehow partake in the recovery. Not sure at this stage of the details, apparently Peter Spann wil be given details in upcoming updates and a new PDS will be produced.

    cheers
    Gazza
     
  3. jabba_jones

    jabba_jones Well-Known Member

    Joined:
    2nd Dec, 2007
    Posts:
    60
    Location:
    Sydney
    Received my letter on Friday (same day as the letter of extension)

    After an initial look seems to be risking another 1% in interest to allow exposure back into the underlying investments. However the catch is you can only get a maximum of 25% gain based on some creative averaging of unit prices at specific dates over the next 5 years.

    I will research it a bit more and hopefully post what I plan to do, on face value seems a 1% premium to allow upto 4%? PA return. Should you be holding to maturity basically means coughing up a bit more for the hope of making some return, should you want to sell before means you can potentially be liable for your entire investment as there is no longer any threshold management!

    On the tax changes anything is possible, as another thread mentioned you shouldn't invest just for the taxation advantages. For a bit of good news, recently they held off changing MIS's to be on a revenue only basis after alot of opposition from a working party of Fund managers. So there is some hope for sensible decision making...
     
  4. Bigspender

    Bigspender New Member

    Joined:
    19th May, 2009
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    Location:
    Adelaide, SA
    I have $100K in BRIC and China (Dec 07) and have decided to cut my losses and bail. The indicative caps (35% and 25% respectively) negate the potential for any real gains as far as I can see.

    I'm also unclear about the potential for those caps to be realised before maturity. Our losses to date don't automatically disappear so does it mean that (best case scenario) a 25% gain on $100K in say 3 years would need to deduct the current level of loss to determine a payout? I presume so but not surprisingly I haven't been able to get a clear answer from Macquarie on that one.

    Taking a hit now means I can redirect the interest savings over the next 6 years elsewhere. $8800 a year over 6 years equals more than $50K. Even taking into account the tax offset of the investment, I'll still be miles in front of a max 30% (average) investment return ($30k) after 6 years of ongoing interest payments.

    I'm no financial supremo, just a small time naive investor but wanted to share my experience and thoughts. Will keep an eye on this to hear alternative views.
     
  5. jabba_jones

    jabba_jones Well-Known Member

    Joined:
    2nd Dec, 2007
    Posts:
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    Location:
    Sydney
    Hi All,

    Done up a simple spreadsheet showing the outcomes for a range of options with the reFleXions variation offer.

    Would appreciate any feedback / fixes in regards to formula mistakes or other things I have overlooked.

    "If" the formulas are correct then the offer doesn't look too appealing to me, unfortunately I can't fund the 22%+ shortfall to cut and run on my China investment...

    Anyone know off hand the impact of the AUD:USD movement since 2007 would be on the redemption price?
     

    Attached Files:

  6. Bigspender

    Bigspender New Member

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    19th May, 2009
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    Location:
    Adelaide, SA
    I have been told (by Macquarie but never quite know what to believe) that the rising Aussie dollar shd lower the redemption cost. However, this does not seem to translate to reality because an AUD improvement from March to April is not reflected in a lower % redemption figure for China.

    I've applied for a redemption on China but will be unclear about the payout I'm facing until sometime in mid June (and then it will still be an approximate amount). I'm told there will be no certainty on the actual amount until the money is withdrawan from my account on 30 June. How I'm meant to know how much money to have in my account is beyond me :confused:

    Does anyone know how a personal loss of this magnitude will affect personal tax? I presume there's no real tax benefit until sometime in the future when I make a capital gain?
     
  7. MikeH

    MikeH New Member

    Joined:
    22nd Nov, 2009
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    Location:
    Adelaide
    The Variation 6months on

    Hi fellow investors.
    I have 300k in Brics, China and Asia, and have been pretty worried about the wisdom of buying into the variation (which I did on the advice of Macquarie advisors)

    In short, taking October’s performance, I could bail out now at a loss of about $45k. At variation option time it would have cost me $57k to bail out. So this leaves me about $12 better off apart from interest ($21k) so about $9k worse off at this point, despite a brilliantly performing market.

    Okay I have paid interest in advance for 12 months, and if the markets continue its spectacular growth rate it looks like I might be a little better off next July (next opportunity to bail out).

    It would be great to hear what other Dec07ers think about the variation? And what you think the best course of action to take at this stage?
     
  8. gemudford

    gemudford Member

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    26th Jan, 2010
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    Location:
    Sydney, NSW
    Has anyone happened to have any distributions paid out from any of the Macqurie Reflexion 2007 Trusts?
     
  9. lukesal

    lukesal New Member

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    28th Feb, 2010
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    Location:
    Perth, WA
    I too took out the 2009 variation offer, as advised by macquarie. As I saw it, not taking it exposed oneself to too much risk.
     
  10. Amc1808

    Amc1808 New Member

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    8th Mar, 2010
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    Location:
    Perth wa
    I am in the same boat - anyone had any news on when or if this variation is worth hanging in for... I am still at a loss to find easily accessible info that can keep me up to date and informed as I bought direct without an advisor ... kinda regretting that now...
     
  11. lukesal

    lukesal New Member

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    Perth, WA
    Get onto Macquarie. There are reports available monthly, and should paint a better picture.
     
  12. Amc1808

    Amc1808 New Member

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    8th Mar, 2010
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    Location:
    Perth wa

    Found it ... thanks Lukesal .... Macquarie ReFleXion DEC 07

    Well you know what they say about paintings.. one man's art is another man's crap.... but seriously ... if anyone cna tell me the good news here I would be happy to be enlightened coz even though it is growing ...it is still way behind and there is gearing loan payment due in June of $10k and whilst I am a "stayer" it is not looking great... (PS Check out the statement in red)

    December 2007 Variation
    Japan Trust Japan Focus Trust Best of Japan and Australia Trust Asia Property Trust BRIC and Emerging Markets Trust China Trust Europe Trust Renewable Energy Trust Commodity Trust
    Varied Underlying Investment S&P / ASX200 S&P / ASX200 S&P / ASX200 S&P / ASX200 MSCI Emerging Markets Index Merrill Lynch China Dragon Index Dow Jones EURO STOXX 50® Index S&P / ASX200 S&P GSCI Commodities Basket
    Reset Level 3924.5 3924.5 3924.5 3924.5 766.05 4129.36 2451.02 3924.5 100
    Initial Investment Level^ TBA TBA TBA TBA TBA TBA TBA TBA TBA
    Underlying Investment Value 4569.6 4569.6 4569.6 4569.6 933.59 4489.46 2776.83 4569.6 112.3976185
    Underlying Investment Return* from Variation Start Date 16.44% 16.44% 16.44% 16.44% 21.87% 8.72% 13.29% 16.44% 12.40%
    Variation Cap 62% 35% 130% 35% 30% 25% 42% 35% 32%
    Unit Value 1.0408 0.9647 0.9884 0.8669 0.8803 0.8192 0.9019 0.8995 0.8674
    Loan Value for Floating Rate Investors -1.1182 -1.1182 -1.1182 -0.9921 -0.9921 -0.9921 -1.0117 -1.0117 -1.0117
    Net Return for Floating Rate Investors** -7.74% -15.34% -12.98% -12.51% -11.17% -17.28% -10.98% -11.21% -14.42%
    Current FX Rate 80.4 80.4 80.4 0.89 0.89 0.89 0.64 0.64 0.64

    Loan Value for Semi-Fixed Rate Investors -1.2089 -1.2089 -1.2089 -1.1212 -1.1212 -1.1212 -1.1277 -1.1277 -1.1277
    Net Return for Semi-Fixed Rate Investors** -16.81% -24.41% -22.05% -25.43% -24.08% -30.20% -22.58% -22.81% -26.03%
    ^ This is the average of the closing level varied Underlying Investment on the 15 July 2009, 30 September 2009, 31 December 2009 and 31 March 2010. This will be notified on the reFleXion website.

    * The performance of the varied Underlying Investment may not match the performance of the Variation Units in the Macquarie reFleXion Trusts investment before or at Maturity. See the relevant PDS and Variation invitation for details on why each of the Trusts will not match the performance of the particular varied Underlying Investment.

    ** The Net Return figure represents the indicative value that an investor could receive from a Macquarie reFleXion Trust, assuming the investor was able to redeem the investment on the valuation date above at the Unit Value indicated, less the indicative amount the client would be required to repay on their Investment Loan. If the investor has funded their first years interest payment with an Interest Loan the Net Return may be higher or lower than reported. The Net Return takes into account movements in Foreign Exchange rates since the relevant Unit Issue Date. The Net Return does not include distributions paid. (DID ANYONE GET ANY DISTRIBUTIONS?)

    Important information

    This information has been prepared by Macquarie Financial Products Management Limited (MFPML) ABN 38 095 135 694, AFS Licence 237847 and is current as at 31 August 2009.
     
  13. wassie

    wassie New Member

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    Perth, WA

    Spoke to a Macquarie Advisor today who confirmed that today marks the final date for the avergaing of the underlying investment. Fingers crossed!

    As per normal process, notification of performance normally occurs about 3 weeks later, so expect notification to be published in late April (which makes allowance for the Easter break).

    Whilst quietly confident of a good result given the stellar performance of the ASX200, any anticipation is tempered by the major disappointments (and major losses to match) suffered to date with these investments.
    :(
     
  14. lukesal

    lukesal New Member

    Joined:
    28th Feb, 2010
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    3
    Location:
    Perth, WA
    I am currently looking into redemption. I find putting out some $800/mo into what appears a black hole is annoying me. I find it such a non-transparent investment. When I look at the unit trust results, they are all -ve, which I find it that hard to believe, based upon the global economy performance (in general) over the past 12 months.
     
  15. step_1

    step_1 New Member

    Joined:
    30th Oct, 2010
    Posts:
    1
    Location:
    Sydney NSW
    DEcember 2007 Offer

    I bought around 270000 units and have been paying monthly for a sinking fund.
    My frinancial planner has suggested me I get out of it now with a loss of 38K by getting into another managed fund by Bank of Scotland funded by NAB who will also pay the 38K to help me get out of one mess to (another).

    have a look at this link: www.rbs.com.au/_.../GMR0310100_NAB_restrike_Brochure_FINAL.pdf

    Fund review by Lonsec: www.fundsfocus.com.au/managed-funds/pdfs/NAB/restrike-lonsec.pdf

    I am in a fix now as I do not have cash to bail out and if I stay on I will lose up to 72K.
     
  16. Simmo76

    Simmo76 New Member

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    22nd Jun, 2013
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    Location:
    Canberr
    Reflexion 2008

    I'm an unfortunate 2008 reflexion trust investor. Have been paying interest on a fund that just plain sucks. Maturity is in 2015, Ive been waiting for it to "come good" I'm guessing with great confidence that even with the capital protection I'll have to pay for the shortfall on the loan. Anyone else in the same hopeless position still?
     
  17. gemudford

    gemudford Member

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    26th Jan, 2010
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    Location:
    Sydney, NSW
    2007 Mac relexion

    yeah im the same, i invested in the 2007 release.
    japan and aust, china and bric.

    so thankfully im paying my last interest in advance payment in a couple of weeks.

    no distributions and certainly no capital growth........
     
  18. Pinvest

    Pinvest New Member

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    7th Aug, 2013
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    Location:
    Perth, WA
    Frustrated Macquarie client (not for much longer)

    I'm in the same boat with 150 k "invested" in the 2007 china release. Macquarie was full of promise and advice at the time of investment and ever since then, have done a very good job of providing as little information and help as they can get away with. Due to the poor performance of the fund (compared to international share markets and the index they are meant to track), I was encouraged to research if there has been any class actions against macquarie relating to this investment. That is when I found this forum (which has allowed me to vent a little). I wish I had of found it in 2007.
    In May this year, the indicative interest rate was 8.05%, however one month later, the actual interest rate jumped to 8.65%! How can they get it so wrong? I'm still waiting on a legitimate answer to this?
    I have however paid my last prepaid interest and can now look forward to investing in something with some transparency and where I can have some control, such as property. I hope to find some good advice on this forum.
     
  19. Simmo76

    Simmo76 New Member

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    22nd Jun, 2013
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    Canberr
    Funny how the tax statements always take so long as well. I just don't understand how performance can be so bad even when markets are up
     
  20. happinessisinfectious

    happinessisinfectious New Member

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    18th Sep, 2014
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    Location:
    Melbourne, Vic
    Has anyone else reached their maturity of their Reflexion trust and realised there were 0 gains to be had after all those annual interest repayments?

    We invested in the 2006 Reflexion trust and when the fund matured - we realised we had paid all that interest for nothing. Macquarie got richer by $100k because of us and we got nothing back in return.

    We are calling Maurice Blackburn Lawyers as this is wrong.