My investment plan, incl MF and IPs. Comments pls!

Discussion in 'Share Investing Strategies, Theories & Education' started by bonkerrs, 31st Jul, 2007.

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  1. crc_error

    crc_error The Rule of 72

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    Sim,

    I didn't think you can invest into the other Platinum funds other than their main international fund via CFS?

    The Geared Colliers is the same as the ungeared one but magnified! So you could use the data from the ungeared one.

    Looks like we have some interesting times ahead! Dow was down over 100 pts again overnight...

    Tom.
     
    crc_error, 1st Aug, 2007
    #21
  2. Simon Hampel

    Simon Hampel Founder Staff Member

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    Yup, Platinum International is the Platinum fund offered by CFS - I was talking in the plural because of the other fund managers you can buy via CFS if you wanted to.

    BTW - I just checked the fees for the retail vs wholesale CFS options ... the retail is VERY expensive for Platinum !!! Although you get around the problem of needing a minimum $25K to invest via the retail option, you get slugged a 2.46% management fee, as opposed to 1.83% for the CFS Wholesale option and 1.54% for investing directly.

    It may be similar (it won't ever be exactly the same), but the biggest difference (and risk) is how they manage their gearing, and in particular how this affects the return in various types of market movement - which we haven't seen yet. I don't think it is wise to base your analysis of the performance of a geared fund on that of an ungeared fund!
     
    Simon Hampel, 1st Aug, 2007
    #22
  3. crc_error

    crc_error The Rule of 72

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    I actually invest directly with Platinum, and any other funds I open.

    I don't need to pay someone a extra 0.5% for them to print out a nice combined tax statement!

    But I do use CFS for my and family's super.
     
    crc_error, 1st Aug, 2007
    #23
  4. bonkerrs

    bonkerrs Active Member

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    Righto. So I should also borrow the sum of money I want to invest in a MF (35,000) plus set up a ML on top of that? That way, all the interest that I'll be paying will be tax deductible.

    If I did it the way I said in the OP. I would be missing the sum of money (35,000) from the offset therefore in effect paying a interst rate of 7.47% (HL rate) for it.
     
    bonkerrs, 1st Aug, 2007
    #24
  5. Redwing

    Redwing Well-Known Member

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    Out of curiosity which Funds are they CRC ?

    I'm holding Direct Shares and NAVRA in my Super, but some geared funds would probably be a good idea so I'm looking around at the moment

    ...any thoughts welcomed ;)

    PS: Sorry to drop in on the threads direction
     
    Redwing, 1st Aug, 2007
    #25
  6. tailcat

    tailcat Well-Known Member

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    If you take the $35000 out of the offset, you will be `exposing' $35000 of bad debt to the 7.47% interest rate. This interest will be non-deductable.

    What you should do is pay the $35000 into the actual loan (pay-off part of the bad debt) then this $35000 becomes `equity'. You then open a new account (probably LOC) to the value of $35000. You then buy your investments out of this new account. This is a fresh borrowing for the purposes of investing so becomes good debt that is now tax deductable.

    Tailcat
     
    tailcat, 1st Aug, 2007
    #26
  7. bonkerrs

    bonkerrs Active Member

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    That makes sense, put the 35,000 in the loan to 'turn' it into equity then take out a 'for investing' loan which will be 100% tax deductible. Also by opening an account for investing only, easier to keep track of activities for simplified bookkeeping.

    Who would be the best professional to see about doing this... an accountant, a financial planner, a loans (mortgage) broker or go direct to the lending institute (bank)? Also, I will be buying an IP soon (within about 6 months) should I go for an amount that includes money for the MF & IP or worry about the IP later on?

    BTW, the MF I'm thinking about is Navrainvest (because of the income component). Which other income producing MFs are worth looking into?
     
    bonkerrs, 1st Aug, 2007
    #27
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