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Mutual fund investment

Discussion in 'Managed Funds & Index Funds' started by Punter, 28th May, 2007.

  1. Punter

    Punter Punter

    29th Jun, 2006

    I am back to forum after a long break. Feeling a little guilty about coming here only when I want an advice. Hope the forum will excuse me; I will try to be regular here in future.

    • OK, so have a PPOR, one investment property and one more is getting built.
    • In 30% income tax rate and have balanced the cash flow for the above investments
    • Now have 150K cash!
    • Want to go to mutual funds (no time and expertise to go to share market)
    • Plan to have medium term, medium risk investment
    • Looking for growth (Ausy shares, property and foreign market sector)
    There are so many funds there, so was wondering if some one could give some advise. Or direct me any old posts on the subject.

    Thanks and Regards
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    9th Jun, 2005
    Sydney, Australia
    Depends on your timeframe a bit ... if you are prepared to sit on a fund through short term fluctuations, or even downtrends ... I think you can afford to be fairly aggressive.

    For growth, a geared share fund like CFS Geared Australian share fund is a good choice.

    Property is difficult at the moment ... the LPT sector has been struggling in recent months (it was quite overvalued after a strong run last year) ... although long term, I think there is still good potential there. Perhaps consider international property too - there are some funds around now which invest in the growing foreign LPT sector (which generally isn't as mature as ours in Australia). CFS Property Securities and CFS Colliers Global Property Securities are two that I watch.

    I also think that some degree of exposure to Asia (China and India) is a good thing at the moment too ... I like Platinum's Asia fund because of their focus on quality and they don't invest so much directly in China as in markets that benefit from China's growth (most of the benefits with much less risk).

    You'd probably want some exposure to the Australian mid-market or small-caps ... although if you are concerned about whether we are near the peak of the current market, then small caps are possibly a more risky proposition as they tend to get hammered in a market drop.

    You'd also want to think about resources ... there's already been a lot of growth, and there is a lot of volatility, but with many commentators suggesting there's quite a long way to go in the current resources cycle, there's possibly quite a bit more to me made there.

    Perhaps have a look at some of the CFS Wholesale funds ... you can get in for a minimum of $100K, which can be split across several funds, so you can get some diversification and lower fees.

    Also, with the current market volatility (which I expect will continue for a while), I think funds like NavraInvest will continue to generate good income ... but you did say you were looking for growth.

    This is not advice - just some suggestions on some things you might like to do some more research on.