I'm new to investing, but with my savings now less and less each month, and with the sharemarket having fallen so much in the past year, i've decided to convert most of my savings and take the plunge into the stock market.
Now, i'm not expert, but i've investigated these different fund managers (notably that of Comm Bank and its Colonial products). I however dont feel its high fees can be justified.
Therefore i think i want to put my money into a index tracking fund. That way i can just leave the money to do its own thing for the next few years, without having to worry so much as to whether or not my fund manager is 'doing the right thing' and also not incur the higher fees. So, firstly do you think this is a wise decision to be choosing an index fund over say a more active fund manager?
Secondly, i went to see a broker a few days ago. He pointed me in the direction of the SPDR S&P / ASX 200 Fund which is apparently one of the very few funds that i have available to choose from (in terms of index funds). However, he quoted me a cost of 1% fee (of my total investment) for an amount of around $75,000.
He was keen to point out that they would not charge any other yearly fee, but would only charge when i come to sell. So the second main question i have is, does this fee sound reasonable for such an investment. I am quite young and obviously he acknowledged i don't really have much of a grasp of stocks and i really don't want to be taken for a ride.
Any comments or advice would be much appreciated. Cheers, James