Looking for advice

[Locky]

Hi there guys.

First time poster here, so please be gentle.

Am looking to start buying into the sharemarket (already have properties), and was thinking of starting with a managed fund or a LIC.

As far as LIC's go I was leaning towards AFI or ARG as they have both been around a long time and from my limited research both look stable.

Basically I want to start small and buy shares as finances permit. I was thinking of it as a second super fund, so obviously I am looking long term.

Any suggestions would be welcomed.

Locky

 

[Fleeta]

Most LICs are trading at a good discount to their NTA at the moment, so I think your timing could be good. The 2 LICs you mentioned are very large ones which have low costs. Some of the smaller LICs have been criticised for their high cost structure which is why they are trading at a steep discount.

I hold BKI and WLS...have a look at these and compare the discount to NTA compared with the others. Of course you should consider more than discount to NTA when making the investment decision. Some LICs have some interesting stock selection which may give them returns that are very different to the market.

 

[bruham]

locky,
I can't understand anyone buying managed funds. To me only losers buy these products.
I "invested" into three of these funds three years ago. None have done anything, just lost me, my time, earned interest and of course my money.I would rather bank my money with ING and earn 5.5% interest. Dead boring but safe.
You'll never learn a thing in shares or share trading with managed funds. You have to be in it to learn.
Just my thoughts.
bruham.

 

[money tree]

Now is not the time to be entering the market. wait for a new war, an economic collapse or a terrorist attack. Nothing is cheap right now. Patience will be rewarded. I feel the market is overpriced and will only fall from here.

 

[Knobby22]

I think pricing is fair.
Certainly, no danger of a crash at these levels though there may be a 10%correction.

 

[Milk Man]

I think pricing is fair.
Certainly, no danger of a crash at these levels though there may be a 10%correction.

Quick Knobby, TOUCH WOOD!

 

[Julia]

Locky,

Regarding bruham's comment that "only losers use managed funds", that's probably somewhat of a harsh generalisation.

What I don't like about managed funds is that you always pay a percentage of your invested capital to the Fund Manager. If the fund does brilliantly well (not often) then you probably won't mind, but bear in mind that if the market experiences a downturn and your capital invested sees a fall, you continue paying that percentage to the Fund Manager (even though to all intents and purposes his management is losing your money!) That said, I know a couple of people who have done well out of property trusts with about 20% pa capital growth and annual yield of around 7 or 8%, though there is not usually any franking attached to that yield.

I can't offer any advice, but have you considered buying a few blue chip companies with well established track records, and importantly, good dividend yield with 100% franking, so that even if the market drops you have the consolation of the income still coming. I always keep my long term investment funds in mostly this kind of stock and therefore get less concerned when the inevitable market falls occur.

Although I would imagine most of the members of this forum would be against this suggestion, you could also consider putting one small trade through via a full service broker, paying their minimum brokerage, usually about $95 (yes, far too much!). However, becoming a client will then entitle you to unlimited discussion with your advisor whose advice you can accept or reject and also access to all their research and their website.

You have probably also already had a look at the ASX website. If not, do. It contains a lot of useful information when you are starting out.

Whatever you decide, good luck, and don't be put off by disparaging comments.

Julia

 

[money tree]

some good advice Julia

QAN and TLS are about the only two stocks I would say qualify....the banks are overpriced (well maybe not NAB)

 

[Aden_1]

Julia,

Can you recomend a good Broker!!??
I think thats a great idea, its something ive wanted to so for god knows how long! Talk to a broker to get some advice!

Can i then transfer that stock, into my holding on COMSEC?

Regards
Aden.

 

[Julia]

Hello Aden,

I wouldn't want to recommend a broker - you could get bad advice and I'd feel responsible. My suggestion would be to make an appointment with as many as you wish, talk to all of them, and then you will feel able to decide in which you feel the most confidence. Ask them what percentage of their analysts' recommendations prove to be correct over a sustained period.
I have had some excellent tips from the broker I use for some of my holdings, but also some total dogs, so don't take everything they tell you as gospel. As anyone on this forum will tell you, you need to do your own research. Full service brokers can, however, help in this as they usually have quite extensive research reports on those companies they research. Not all brokers will be able to offer advice on everything on the ASX.

Yes, you can transfer your holding to Comsec. It probably wouldn't be too courteous to do this too quickly if you are wanting to get ongoing info from the full service broker. If it were me, I'd keep a couple of small holdings with the fsb so you continue to have access to their website etc. Up to you whether you disclose your existing Comsec account.

Let us know how you get on. Good luck.

Julia