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Advice on diversifying

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Ben Gordon

Ben Gordon

Joined
3 April 2021
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Hey all,

I have $1000 invested into vanguard ETF VAS

I have nearly accumulated another $500 with weekly deposits and wondered whether i should invest this next $500 into the global ETF and have two that i each week put some money towards.

i am more or less asking with low amounts which i currently have am i best putting it all into VAS until i get a larger amount to place into various funds?

Also it looks like the market has improved, should i wait till it downward trends before i buy more? I originally brought at $89 now is $94.

many thanks
 
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Unfortunately we aren't licensed to give advice, we are just people throwing around our own ideas, so your questions are asking for very specific advice.
All people can do is say what they are doing, not tell you what to do, that is my understanding. I think the forum administrator gets in the poo if people start giving advice.
So regarding your situation, I don't have VAS, I prefer LIC's to ETF's, but having said that I have to live off my investment earnings so LIC's appear more suited to that end.
So a lot of investment decisions depend on what stage of life you are at and what your investment goals are, they are different for everybody.
 
Oh sorry about that.

How does LIC differ to ETF.

I am in my mid 30s
 
Yes he was.

OP: I have a significant amount of money in GGUS and LNAS. These are leveraged into the U.S s&p 500 and nasdaq 100 respectively. In my opinion, both are excellent long term bets, hence why I hold them. I have no intentions of selling either.
 
Ben Gordon said:
Oh sorry about that.

How does LIC differ to ETF.

I am in my mid 30s
Click to expand...
From my understanding the main difference is ETF's have to distribute all their earnings, every year, whereas LIC's can hold back cash reserves which can be used to smooth bumpy dividend years e.g last year.
The other thing with ETF's like VAS, again from my understanding, they hold a cross section of the top 300 asx listed shares, when a share drops out they sell out, when another comes in they buy in, so in a way it is very mechanical which is o.k.
With LIC's they mainly buy shares for their dividend yield, and are more a managed fund, therefore they have a different selection criteria.
As I said it is only my understanding, but as a self funded retiree I have been very happy with my choice, but as they say it is horses for courses.
A huge amount depends on your personal circumstances and objectives.
 
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Ben Gordon said:
How does LIC differ to ETF.
Click to expand...
I don't mean to be obtuse, but in your previous vanguard thread, there was a LIC's explained link from the smart money gov au website.

I remember you said you were time poor, however many people don't utilise their toilet crapper time plopperley, IMO.

5 minutes per bog should see you have an understanding of a LIC & ETF in 2 days.... assuming you are NOT constipated.
If the latter IS the case, 1 trip to the porcelain bus should see you with an understanding of both.

A small time investment...
Sit and stink AND think.... ??

All in good humour, cheers.
 

Dona Ferentes said:
I agree @frugal.rock . Probably from ASIC.
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Thanks for the heads up guys, here it is, I think.

Listed investment companies (LICs) - Moneysmart.gov.au

Listed investment companies (LICs) vary in risk and complexity. Many operate like managed funds, so check the underlying investments.
moneysmart.gov.au
 
Dona Ferentes said:
I agree @frugal.rock . Probably from ASIC.
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Ben Gordon said:
Edited. Not playing childish games.

Consider thread closed.
Click to expand...
So you know what ASIC means but not LIC or ETF....?
The threads closed when the boss @Joe Blow says it is
sptrawler said:
Unfortunately we aren't licensed to give advice, we are just people throwing around our own ideas, so your questions are asking for very specific advice.
Click to expand...

The thread title starts with "Advice"...
You were told clearly in one of your other threads that we don't advise etc etc and apparently you were a time poor professional.

If one was to suggest "things" based around your age, that's taking your specific circumstance into consideration and the suggestions could then, or may be, misconstrued as advice suitable for a 35 year old, or thereabouts.

Your more than welcome to take your bat n ball and go home so as to speak but to suggest we are playing childish games?

ASIC seems to play childish games and they seem to be quite choosy who they try to play with.
Capish?
 
Please be kind everyone. I know it's not OK to be offering personal financial advice to others, so offer a helping hand instead. We need more kindness and love in the world. And no, I haven't been drinking.
 
Well the boss said kindness. None of which you have been. ASIC is on the news. LIC I have not seen in the news.

Do you enjoying tormenting new people or just had a bad up bringing?
 
Joe Blow said:
Please be kind everyone. I know it's not OK to be offering personal financial advice to others, so offer a helping hand instead. We need more kindness and love in the world. And no, I haven't been drinking.
Click to expand...
Thank you Joe. I feel attacked.
 
Ben Gordon said:
Thank you Joe. I feel attacked.
Click to expand...

Don't be. I think the lads were just having a lighthearted moment. I wouldn't take it personally. Please understand that it's not appropriate for anyone here to offer personal financial advice, so always be sure to talk in hypotheticals rather than asking for specific advice. Talk about the issue you wish to discuss in general terms, rather than as it applies to you specifically.
 
Ben Gordon said:
Do you enjoying tormenting new people or just had a bad up bringing?
Click to expand...
Firstly, I won't retort to that and would suggest you revisit what has been said from an unemotional perspective.

Secondly, let's forget that the thread title starts with "advice" as long as you now understand the mere mention of it ruffles a few feathers.
Maybe the boss @Joe Blow can change it to Suggestions or Ideas if you @Ben Gordon were for that idea.

Thirdly, I suggest you revisit your previous threads, as the information you seek is there already and from your posts in this thread it would seem you haven't taken in the information previously provided?

I know that I have been blissfully ignorant on information provided myself on occasion, usually just missed it though.
I remind myself that legally "ignorance is not a defence" although as I slowly head into the abyss of dimentia, I guess I'll forget that too.


FWIW
I have spent nearly as many years as you are old, on construction sites, Surveying.
A rough n tumble Professional.
I was brought up without a silver spoon... and travelled through life being schooled by hard knocks.


The only advice I wish to give is;

If you are time poor, do a time and motion study of an average day.
I am sure that you could identify/ find time to learn a little about investing, considering it's your children you are investing for.

Finally, I apologise for anything that I have said that challenged you to the point of feeling "attacked".
It was totally unintentional.
 
Hey kids ?

Two things re: OP

- for a start I’d suggest doing the calcs to see if, long term, it’s going to be better in a managed fund with a planned savings set up vs ETF. I think Vanguard have a page addressing it but do some research.

- that’s why I suggested researching the diversified funds to begin with. Because your aim seemed to be diversification in an easy manner. If you want to go broader you’ll have to add, or change. Which is best depends again on what you want to achieve.
 
Ben Gordon said:
Well the boss said kindness. None of which you have been. ASIC is on the news. LIC I have not seen in the news.
Click to expand...
So now we are back on court, second serve, like I said IMO any choices have to be with an end game in play.
For example, if I was 25 and investing to hopefully make a lot of money, for a deposit on a house in Sydney. I might be looking for the next crypto or afterpay.
If I am investing to follow the asx, as I think it will rise appreciably, I would probably just buy ETF's , but if I had chosen that in 2009 before the GFC, I have gone nowhere in 10 years.
If I am investing to give up work, I would try and learn how to trade successfully, or buy more lottery tickets.
If I am investing to replace my current income stream when I retire, I would chose a combination of a cash reserve in super that isn't touched, a blue chip share portfolio outside super with dividend reinvestment and an active share portfolio in super that gives growth and income.
So like I said it really depends on what your end game is, get a plan, make it a realistic plan and stick to the plan then it will be fine IMO.
The main reason I have found that people don't get anywhere, is they don't have a plan and by the time they realise they need a plan, time is too short for a plan to work.
Another thing some have mentioned you want to invest for your kids, I wonder with all the tax implications of putting money in children's names, if there is any advantage.
If you invest in the partner who has the least tax obligation, it would seem to me to be a better option, you can help your kids at any time, if you are in a financial position to do so.
Nothing would be worse in my opinion, than setting your kids up, at your expense and then becoming a financial burden on them.

To add a bit of frivolity I knew a sparky a lot older than I was, working in the bush in a crappy mining Town, 60+ years old struggling with the physical side of hauling cables underground.
He won a lot of money in lotto, so he could finally pull up stumps, I said to him jeez mate how good is that I mean what an absolute stroke of luck. He said not really I knew I was going to win someday, that was his plan and it worked. I was speachless. ? ? ?
 
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I personally enjoy owning some of the global ETF, it does diversify you into a lot of industry sectors that aren’t covered by the Aussie index, for example technology.

But it’s kind of up to you, there is some additional currency risk vs reward based on what the Aussie dollar does, but I can’t offer any insights on which way that will play out.
 
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