Managed Funds

[BAM]

Hi,
I'm new to this forum and would just like to ask everyone their thoughts on managed funds.
1) Has anyone invested in a managed fund?
2) Do you think their fees are reasonable?
3) Would you prefer to trade for yourself and create you own portfolio?
4) Do you find that getting access or investing in these funds is easy?
5) Has anyone got any strong objections to managed funds?

My impression is that people who aren't interested in the "nuts and bolts" of investing but would still like to build wealth use these funds? Just looking for some general info.

 

[Smurf1976]

I think you really need to understand what the fund is invested in before handing over your money.

And seriously do understand that past performance is NO guide to future performance whatsoever.

Suffice to say that I lost plenty through investing in managed funds in the 1990's. Good profits at first and then I took the advice of professionals and borrowed to invest. Massive mistake and I walked away having lost 80% from the peak. Leverage works both ways...

I did learn something though. NEVER get caught up in a bubble and KNOW what you're investing in. Turned out that my well performing managed "share" fund was heavily into dot.com stocks, something I hadn't really paid attention to when the big profits were rolling in. Worked rather well until the first "dip" in early 2000 when I used that "buying opportunity" and borrowed more...

I think a few highly leveraged speculators will be learning the same lessons from a more recent rather large bubble...

 

[Realist]

I think a few highly leveraged speculators will be learning the same lessons from a more recent rather large bubble...

what large bubble?

Resources?

Hmm, look at BHP it has a PER of 10, billions in the bank, pays dividends, is well run, has a great future ahead of it.

There's no bubble in BHP - infact a bleak future is already built into the price.

 

[wayneL]

what large bubble?

Resources?

Hmm, look at BHP it has a PER of 10, billions in the bank, pays dividends, is well run, has a great future ahead of it.

There's no bubble in BHP - infact a bleak future is already built into the price.

No it ain't. It would be $12.00 if so.

 

[Realist]

No it ain't. It would be $12.00 if so.

So a price earnings ratio of 5.

Ridiculous.




A PER of 10 is low!!!!!!!!!!!

 

[wayneL]

So a price earnings ratio of 5.

Ridiculous.




A PER of 10 is low!!!!!!!!!!!

Only if earnings will grow into ther future and not decrease.

That PE of 10 will turn into 30 (if price remains the same)

BHP's oil interests will be the only thing to save its @55

 

[BAM]

Thanks for the feedback guys.
As pertinent as P/E's are when valuing a stock, I think you're getting off the track here.

Any comments about managed funds?

Cheers.

 

[larry123]

Hey, Ive invested in a couple of funds and I have found solid returns when it comes to my funds. I think even though some managed funds are risky you are handing your money over to a professional who generally has a lot of expertise in the sharemarket( tonnes more than what I have). When it comes to fees you can invest through certain banks that don't have any exit fees. The management fee is very small and I don't really worry about it. Some funds even cut the price of fees if you download there Produst Disclosure statement form their website. My opinion is that if you are looking for good returns and are interested in managed funds be prepared to ride the ups and downs of the market and that's how you can produce good earnings (this may take several years). I hope this helped and if you need any info just ask.

 

[JimBob]

When I went about picking a managed fund, i went to this website:

http://www.moneymanager.com.au/tools/compare/findamanagedfund.html

It lists all the top funds and sorts by performance, i picked one of the ones near the top with the lowest entry and exit fees. Ive got one with Australia Unity - very happy with the performance so far.

I always like to have some of my money in a managed fund, if anything, its a good way to help save money to later invest in shares yourself.

 

[chansw]

Hi,
I'm new to this forum and would just like to ask everyone their thoughts on managed funds.
1) Has anyone invested in a managed fund?
2) Do you think their fees are reasonable?
3) Would you prefer to trade for yourself and create you own portfolio?
4) Do you find that getting access or investing in these funds is easy?
5) Has anyone got any strong objections to managed funds?

My impression is that people who aren't interested in the "nuts and bolts" of investing but would still like to build wealth use these funds? Just looking for some general info.

1. Yes, I do. I am currently investing in Global Resources Fund and Global Property Trust Fund.
2. I use an online discount broker which waives the entry fee. For the management fee, I don't think you can avoid. If you want to pay less, index fund is always the choice.
3. I also have my own portfolio and use the managed funds in the areas that I don't think that I can access easily (like overseas shares)
4. With Colonial First State, I can access and manage my managed funds myself easily online.
5. I don't have any objection to managed funds. Like any investment, you need to know why you invest on it, what you are investing on and manage it.

You can always find more information on http://www.morningstar.com.au/

 

[Julia]

1. Yes, I do. I am currently investing in Global Resources Fund and Global Property Trust Fund.
2. I use an online discount broker which waives the entry fee. For the management fee, I don't think you can avoid. If you want to pay less, index fund is always the choice.
3. I also have my own portfolio and use the managed funds in the areas that I don't think that I can access easily (like overseas shares)
4. With Colonial First State, I can access and manage my managed funds myself easily online.
5. I don't have any objection to managed funds. Like any investment, you need to know why you invest on it, what you are investing on and manage it.

You can always find more information on http://www.morningstar.com.au/

You make a lot of sense here, Chansw.

I used managed funds for a couple of years because I lacked the confidence to invest myself. Soon got fed up with the amount I was paying in fees, regardless of performance which wasn't that great.

If you're just starting out, have you considered just buying some good blue chip shares yourself, e.g. the big banks, Woolworths, etc to "get a feel of the market". Unless there's a total market downturn, you're not going to lose money, will see reasonable growth under present conditions, plus decent dividends and 100% franking. By using an online broker, your only fees will be the minimal brokerage charged which is a fraction of what you'd be paying a professional fund manager.

I'd never again allow anyone else to manage my money. Much better to keep control yourself.

Julia

 

[reece55]

BAM
Don't forget the endless amount of LIC's (Listed Investment Company's) listed on the ASX as an alternative from that of managed funds. AFI (Australian Foundation Investment Company) for instance has a MER of around about .1 - .15% of FUM, which is a far cry from that of say a Perpetual fund. They may not be the most interesting investment, but they will give you the flexibility of being able to invest when you want with only brok. in the way, and most are fairly liquid.

AFI and ARG are probably the best of these, with the longest track record.

 

[niknah]

I'd never again allow anyone else to manage my money. Much better to keep control yourself.

I feel the same way too. Used to be with a financial planner who put my moneys into a master fund that invested into other funds that invested into real stocks and things. All those people took a slice and I was left with the left overs.

Read somewhere that there're so many funds out there that they out number stocks.

Read an article on fool.com hat said the funds with the least fees usually return best over the long run. If you really have to, index funds are pretty easy to do and understand, no hidden surprises about where they put your moneys.

 

[Kipp]

I'd never again allow anyone else to manage my money. Much better to keep control yourself.

Julia

I've got about 70% of my funds managed by my borther in his own fund (he is an analyst Full-Time.. very successful) and the rest I've got in my own portfolio. I suppose like Jules previously I don't quite have the confidence to run it all myself. And ultimately- no matter how bad you think the returns might be they are (usaully) better than the bank, plus I find I can sleep a bit easier at night...<p>
Hunter Hall are pretty good and have a solid record over the past 10 years. And pretty rasonable fees. Not sure that I agree with Smurf. I reckon track record is pretty imp't when investigating fund managers or companies. You might also want to look outside of the sharemarket (into Property Trusts/ 1st Mortgages etc) the company I work for "MAB" have a few property trusts (retail- supermarkets actaully) though I'm not sure I'd recommend them... (but their management fees are SUPER low 0.5% pa!!!) but there are plenty of others out there.

 

[clowboy]

Looking to invest in some O/S managed funds,

what countries do people think are worth investing in ATM?

and does anyone have any decent O/S funds?


cheers

 

[hardcoremike]

theres some exchanged traded funds like the amp china growth fund(cant remember the code) and india equity which is INES.

i'm fairly interested in the vanguard asx 300 index fund cos it's so simple and the fees are low, anyone have that?

 

[Judd]

I've stayed away from mainstream unlisted international funds as they simply charge too much for poor performance - despite their claims as "stock pickers."

International index funds seem to do better than most active managers. There are some low cost index funds such as Vanguard. Check out this site

http://www.vanguard.com.au/Personal_Investors/Our_products/Investment_funds/index.aspx

For high conviction funds, you may wish to consider Platinum International provided you have the $25,000 up front - we don't. However, be aware of the charges and fees.

http://www.platinum.com.au/

Another possibility is Hunter Hall but again be aware of fees and charges. Alternatively take a position in the management company itself!

http://www.hunterhall.com.au/

Then there are the EFTs listed on the ASX. Low cost if held rather than traded as brokerage applies. Also pay quarterly distributions.

http://www.asx.com.au/investor/lmi/ishares.htm

 

[The Barbarian Investor]

Compare Funds Australian Site worth a look, reasonably new site

 

[Sean K]

For high conviction funds, you may wish to consider Platinum International provided you have the $25,000 up front - we don't. However, be aware of the charges and fees.

http://www.platinum.com.au/

Another possibility is Hunter Hall but again be aware of fees and charges. Alternatively take a position in the management company itself!

http://www.hunterhall.com.au/

I have held Platinum and HH for some time. Some Platinum funds have lagged the past year because of their weighting to Japan, but the Asia fund seems to have done OK. HH has been a pretty consistant performer. I use the funds to diversify into other markets and it releases me from needing to put Australian blue chips in the portfolio. Well, that is the theory anyway. I would have done much better the past year if I had controlled the entire portfolio but it would have been much more demanding to manage I think. Not sure if I am up to it. Next year will be interesting....

 

[TERRAIN]

I wouldn't discount MF totally. I used them intially. And am reconsidering...

I hold 15 stocks, 12 stocks are long termers, and the rest are specs I trade.

At the moment I considering Int'l Shares, Emerging Markets - Asia and India etc. For further diversification to these markets.

AGF is an option for exposure to China - listed EFT. There are many Exchange Trade Funds listed on the ASX which are good options expecially ishares http://www.ishares.com.au/index.do, Streetracks http://www.streettracks.com.au/....

The point is consider ETF's as well, and it depends how active you want to be as to weather you want to manage a portfolio of shares.
Good Luck