If you had half a brain when you did your expected P&L you would of 1/2 the return at least just to see what would happen if the next five years don't match the last five of a spectacular bull run.Fund #1 5 year return 38% }
Fund #2 5 year return 28% } average of 25% 5 years
Fund #3 5 year return 19% }
Fund #4 5 year return 17% }
FUND #5 1 year return 8%
All these funds are classed as growth
they have mixed asset allocations with the majority in the domestic market 65%
Can I name funds in this forum ??
Yes, providing that the information you post is correct (obviously).
If you had half a brain when you did your expected P&L you would of 1/2 the return at least just to see what would happen if the next five years don't match the last five of a spectacular bull run.
Do you realize what the Average return of funds are when not in a ripping bull market??
If you think we are in the same environment that lead to an average growth over five years of 25% enjoy your ride.
Doh! - I did a quick review of figures based on info on this site:
http://www.colonialfirststate.com.a...D=65&ProductID=40&Public=1&FundTransfer=false
The resource fund appears to have averaged 25% p.a. (so compounded its done 250% over the whole time). Thus you would have made a good profit if you'd invested 5 years ago. (though the interest costs and initial commision and outlay would have meant your average return was only 19% p.a. vs the 25% p.a. the fund made - though I haven't taken into account any tax implications both on the gain and on the interest).
Nobody can predict with certainty the likelihood of this performance continuing - there has been a strong commodities bull market for several years and the market has changed a lot in the past 6 months - if you believe that the resources run will continue into a new leg it might be worthwhile to put some into it - though I still think you are getting stung way too much on the entry fees and commission and question this.
You should not trust any numbers given to you and verify them all yourself, and should stress test them for things like large interest rate rises (what if rates went to 15% or more) and for much more conservative returns (i.e. work on a figure like 10% p.a.). Funds do often have negative returns in flat or falling markets - they're obliged to invest in stocks via their allocation rules so will be close to fully invested in stocks even if they have a negative market view.
I'd still be waiting for the dust to settle on the current market fallout before taking a first time entry to the market but thats only one opinion.
Funds also always like to show you their 'good' periods when trying to attract you, so have a look at longer term life of the fund etc. - i.e. as the saying goes DYOR.
you only make a paper loss the day you pull out
I'm looking at 30 years + of investment
i believe i'm starting out the correct why under the wing of a managed share fund
If you are in for 30 yrs plus, now is the best time to enter the market, after this 30% correction has happenned. Start with 30% of your fund, if it goes down again, progressively buy more.
No. Wrong cliche for the wrong time.
try "The market can stay irrational longer than you can stay solvent"
As said by John Maynard Keynes when using other peoples money. Said some 70 years ago after he went bust.
Spoken like a true prophet, eh?....
AJ
If the average investor expects their blue chip stock market investment to achieve 25% year on year (as it would seem people do), this implies the ASX200 index by the end of the century to be trading at:
4118046071574
Fund #1 5 year return 38% }
Fund #2 5 year return 28% } average of 25% 5 years
Fund #3 5 year return 19% }
Fund #4 5 year return 17% }
FUND #5 1 year return 8%
All these funds are classed as growth
they have mixed asset allocations with the majority in the domestic market 65%
I under stand the first year I'll make a 4k loss with commission Fund entry fee $2000 Advisor $2000
I will pay intrest on the line of credit loan as interest only
any loss will be partially tax deductable
I will reinvest the divendends
LOL. I'm leveraging up even more now I know that.
Doh as TH has already said we are unlikely to see a Bull Market like the last 5 years any time soon so theres no immediate hurry. Plenty of time to research your idea.
Market trend is currently down. No bottom insight yet.
The fund entry and adviser fee is simply outrageous. If you are determine to go ahead to buy into a fund open a Comsec account and buy your own units no adviser fee and some have no entry fee.
There is some very good advice on this thread, suggest read it several times take some of the blunt replies as market reality not personally.
Good luck
READ the quote 25% average over 5years, Yes in a bull market
There are peaks and troughs this happens to be a trough
How deep, nobody knows. hence my original question
On average the highs out-weigh the losses. True or false
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