Just Investing on NZX and not Elsewhere

[Buffett Jr]

Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?

Due to time constraints, I cannot keep track of the ASX market anymore but still want to pick individual stocks rather than hand my money over to a fund manager. However, my concerns are that the NZX is limited and there are only a small handful of companies I'd ever consider investing in for longer term investments.

Am I spreading my focus too thin?

How have your exploits gone solely investing in NZX related stocks?

[Yeshiva]

Actually, that's me to a tee. I simply don't know enough about overseas companies or overseas economies to deploy larger amounts of capital overseas, and then worry about how to hold the stocks in registries etc. Besides, if I want overseas exposure I can buy into NZ companies that export heavily overseas and earn USD/Euro/whatever. Fisher and Paykel Healthcare, Diligent, Sanford, and even emerging minnows like Pushpay spring to mind.

If I really wanted to get some diversification from owning overseas stocks, I'd probably just buy an ETF held in AUD. There seems to be quite a variety of internationally focused ETFs listed on the ASX.

[Buffett Jr]

Actually, that's me to a tee. I simply don't know enough about overseas companies or overseas economies to deploy larger amounts of capital overseas, and then worry about how to hold the stocks in registries etc. Besides, if I want overseas exposure I can buy into NZ companies that export heavily overseas and earn USD/Euro/whatever. Fisher and Paykel Healthcare, Diligent, Sanford, and even emerging minnows like Pushpay spring to mind.

If I really wanted to get some diversification from owning overseas stocks, I'd probably just buy an ETF held in AUD. There seems to be quite a variety of internationally focused ETFs listed on the ASX.

How many companies on the NZX do you feel is enough to diversify/reduce risk or on the other side too much companies to be able to follow closely enough?

[fungus pudding]

Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?

Me. I'm even more limited. I only invest in listed property trusts and know absolutely nothing about anything else.

[Buffett Jr]

Me. I'm even more limited. I only invest in listed property trusts and no absolutely nothing about anything else.

No other index funds, ETF's, etc either?

[trader_jackson]

I am very NZX based, MRP, ARV, GNE and HNZ make up a very large portion of my portfolio. I have a few other 'plays' like PEB and AFT with a total of 11 investments, 2 in the ASX. (Most of these are all very small by share trader standards - small enough that brokerage has a sizable impact)

I am also continuously investing (via a savings plan) in ASF (Australia Financial Sector EFT) which you could also consider if you like the banks, and a reasonable yield of about 4%

Being young, I am a very long term holder of the above stocks, with the first 4 paying very good dividends (5%-10% net)

(Please note that the above is NOT financial advice and you should always do your own research)

[Mickey]

I'm pretty much the same as others here with similar reasons to Yeshiva for not entering into the foreign equities. However, with the AUD looking favourable - I'm thinking of buying into an ASX Index. I like the fact that the NZX has a reasonable degree of separation from global markets and can operate without being too heavily influenced by what is happening (the past 2-3 weeks is a good example of that but I know that can change too). With the NZD trading lower against the USD - and another possible OCR change - then I see further revenue opportunities for NZ companies trading overseas and another plus for investing into our market. I'm currently holding AIR, GNE, CEN, SKL & SPK and a small investment in Devon Dividend Yield Fund. I may look at buying into one or two property shares such as GMT or PCT - but still doing my research on these.

[mfd]

Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?

Personally I mostly have individual NZ stocks, and try to cover my overseas with low cost (for New Zealand) ETFs/funds through smartshares/superlife. Unfortunately, it's much more exciting to buy a single stock rather than an index fund, so I'm a bit unbalanced at the moment. Once I get my Kiwisaver up and running I'll be setting it to invest mostly in overseas shares to try and improve the balance.

I've also just started playing with sector funds, I've picked up some smartshares Australian Resources as with the amount of money I'm dealing with I think it's cheaper and easier than investing directly overseas (and I don't have to spend too much time researching individual companies)

[percy]

How many companies on the NZX do you feel is enough to diversify/reduce risk or on the other side too much companies to be able to follow closely enough?

Well lets look at a basket of fine Aussie companies and see how they performed over the past year.
ARI.-78.54%,BHP.-44.42%,CCV.-48.11%WOW.-24.28%,SUN-20.78%,ANZ.-27.48%,NWS.-11.05%,IAG.-17.36%,STO.-58.19%,GXL.-22.67%,BPT.-61.26%,and DSE.-100%.
Now a basket of NZ stocks;AIA.+27.27%,AIR.+24.90%.AWK.+30.16%.CVT.+12 4%,EBO.+43.01%.FPH.+41.48%,HBL.+11.6%,SCL.+47.40%, SUM,+27.80%.TIL.+285.33%
But wait there's more!!!,the NZ stocks pay fully imputated divies.
That CVT is + 124%.

[fungus pudding]

No other index funds, ETF's, etc either?

No. Don't even know what they are.

[mfd]

Well lets look at a basket of fine Aussie companies and see how they performed over the past year.
ARI.-78.54%,BHP.-44.42%,CCV.-48.11%WOW.-24.28%,SUN-20.78%,ANZ.-27.48%,NWS.-11.05%,IAG.-17.36%,STO.-58.19%,GXL.-22.67%,BPT.-61.26%,and DSE.-100%.
Now a basket of NZ stocks;AIA.+27.27%,AIR.+24.90%.AWK.+30.16%.CVT.+12 4%,EBO.+43.01%.FPH.+41.48%,HBL.+11.6%,SCL.+47.40%, SUM,+27.80%.TIL.+285.33%
But wait there's more!!!,the NZ stocks pay fully imputated divies.
That CVT is + 124%.

So...a good time to be re-balancing some of that NZ profit to cheap Aussie shares then?

[percy]

So...a good time to be re-balancing some of that NZ profit to cheap Aussie shares then?

NO.!!!
Let profits run.
Why sell winners to buy losers?
Add to your winners and sell your losers, and you will end up with a portfolio of just winners.

[mfd]

NO.!!!
Let profits run.
Why sell winners to buy losers?
Add to your winners and sell your losers, and you will end up with a portfolio of just winners.

I'm not selling winners unless they take up too big a chunk of my portfolio (I took the top off of ATM), this is fresh money I'm putting in. I tend to assume these things are cyclical, and as I'm not likely to need the cash for a long time I'm happy to buy into things that are temporarily out of favour rather than sticking more into companies currently on a good run of luck.

More than one way to skin a cat, I guess.

[Buffett Jr]

I am very NZX based, MRP, ARV, GNE and HNZ make up a very large portion of my portfolio. I have a few other 'plays' like PEB and AFT with a total of 11 investments, 2 in the ASX. (Most of these are all very small by share trader standards - small enough that brokerage has a sizable impact)

I am also continuously investing (via a savings plan) in ASF (Australia Financial Sector EFT) which you could also consider if you like the banks, and a reasonable yield of about 4%

Being young, I am a very long term holder of the above stocks, with the first 4 paying very good dividends (5%-10% net)

(Please note that the above is NOT financial advice and you should always do your own research)

Couple of questions...

Where is your kiwisaver invested? Mine is 100% overseas shares through superlife, this therefore has large exposure to USA and European markets.

Secondly, why the financials ETF in Australia as opposed to the AUS dividend or AUS top 20 ETF's?

[Yeshiva]

How many companies on the NZX do you feel is enough to diversify/reduce risk or on the other side too much companies to be able to follow closely enough?

About a dozen or 15 feels good to me, and no more than two in any sector, so I own Contact Energy, am looking closely at Genesis, but wouldn't bother with another Gentailer since it would hurt diversification.

[drcjp]

Only invest on NZX but always have a tranche of shares in companies that dual list on ASX, eg. KMD, A2M. That way can also take advantage of greater liquidity and investor insanity as recently demonstrated with A2M. Also has flipside of greater risk too.

[Nasi Goreng]

I'm quite the opposite of most on this thread. I have more invested overseas than here.

As far as research goes, I often think it's easier to research overseas companies because they are bigger, we sometimes use there products ourselves and there is a whole lot of info to be found all over the media as well as quarterly telecons with CEOs etc.

[LAC]

I am now on 100% NZX, I did previously have a few Aust banks on my portfolio but sold them off and invested in better NZ stocks. I just spend most of my free time researching NZ stocks and if I had more time I guess I would invest elsewhere but I started to follow a similar strategy in the past year....pick a portfolio of winners and just accumulate the winners. Once that strategy starts to go flat then I might look outside the NZX but we do have companies that export outside nz and we also have companies that are building property outside nz so I think I indirectly invest outside nz:)

[warthog]

Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?

Due to time constraints, I cannot keep track of the ASX market anymore but still want to pick individual stocks rather than hand my money over to a fund manager. However, my concerns are that the NZX is limited and there are only a small handful of companies I'd ever consider investing in for longer term investments.

Am I spreading my focus too thin?

How have your exploits gone solely investing in NZX related stocks?

Do you wish your investments to have a hedge against a lower Kiwi dollar (which flows through to higher pricing for some goods/products, such as technology for example) or are you indifferent as to whether the Kiwi is under- or over-valued against other major traded currencies?

If you either wish to hedge against or even benefit from a lower Kiwi, you will need to do some careful homework to get this on the NZX.

[trader_jackson]

Couple of questions...

Where is your kiwisaver invested? Mine is 100% overseas shares through superlife, this therefore has large exposure to USA and European markets.

Secondly, why the financials ETF in Australia as opposed to the AUS dividend or AUS top 20 ETF's?

Mine is with ANZ Growth Fund, which I believe is 80% shares, 20% cash and invests mostly offshore shares, although I have only just joined kiwi saver and only work part time (Auckland uni student...) so it isn't massive in comparison to my share portfolio. I may switch funds in the future to a more niche provider, but happy with ANZ for now.

AUS dividend (ASD) absolute no for me... It has almost 22% invested in Rio, BHP and Woodside... all mining/oil companies which are expected to slash there dividends, some by 50% or more... and AUS Top 20 (OZY) also has over 6% invested in BHP, and both ASD and OZY probably has more previously good dividend paying mining stocks which arent in the top 10 I can easily see on the smart shares website... yes, maybe some ASF stocks might cut there dividend a fraction, but it won't be nearly as much as the AUS mining sector will

[Vaygor1]

Do you wish your investments to have a hedge against a lower Kiwi dollar (which flows through to higher pricing for some goods/products, such as technology for example) or are you indifferent as to whether the Kiwi is under- or over-valued against other major traded currencies?

If you either wish to hedge against or even benefit from a lower Kiwi, you will need to do some careful homework to get this on the NZX.

My view is sometimes you win on the cross-rate, and sometimes you lose. ie there is a risk, possibly a controllable one, but not for me. I eliminate this risk by buying NZX only.

Being a long term holder (ie not a trader), I think I would begrudge an excellent cross-rate compelling me to sell an excellent overseas share (assuming I owned any overseas shares) earlier than I would perhaps want to.

[Lewylewylewy]

Something people often forget is that when they buy shares, they're not buying shares, they're buying part of a company. Imagine if you are buying the whole company to own for yourself. Would you buy a failing company? Maybe you would, if you thought you had the expertise to turn it around or could get it at a bargain and sell of the assets... But you can't do that with shares. They rarely sell for less than the cake of their assets and you can't change anything about the way it's run.

Sure you could buy a company whose success is cyclical and currently on a low, but why not just buy a winning company managed by a bunch of people who are doing a great job?

Especially in NZ, you can even buy into a monopoly and take advantage of the unique economy we have here.

Listen to Percy, I say.

[mfd]

Something people often forget is that when they buy shares, they're not buying shares, they're buying part of a company. Imagine if you are buying the whole company to own for yourself. Would you buy a failing company? Maybe you would, if you thought you had the expertise to turn it around or could get it at a bargain and sell of the assets... But you can't do that with shares. They rarely sell for less than the cake of their assets and you can't change anything about the way it's run.

Sure you could buy a company whose success is cyclical and currently on a low, but why not just buy a winning company managed by a bunch of people who are doing a great job?

Especially in NZ, you can even buy into a monopoly and take advantage of the unique economy we have here.

Listen to Percy, I say.

Must be a psychological difference, when I see a graph that's been heading steadily upwards for a while (say, FPH) some people would call it a winner and buy, my first assumption is they've had a good run but they look ripe for a fall, especially if the PE has increased in anticipation of things continuing to go their way. In most things in life (especially business and investing) I think we have a habit of attributing too much to skill and too little to luck, when things are going well.

It's not a case of either or anyway, I have a core of solid companies and index funds, with smaller parts of my portfolio on more speculative stuff. I've only really been investing a couple of years and certainly don't know everything yet, so happy to hear other's opinions. Incidentally, the first share I bought on arriving in New Zealand was Chorus straight after the first comcom decision, even monopolies have their risks here. It won't always be the case, but this time buying on bad news has worked out alright.

[percy]

Must be a psychological difference, when I see a graph that's been heading steadily upwards for a while (say, FPH) some people would call it a winner and buy, my first assumption is they've had a good run but they look ripe for a fall, especially if the PE has increased in anticipation of things continuing to go their way. In most things in life (especially business and investing) I think we have a habit of attributing too much to skill and too little to luck, when things are going well.

It's not a case of either or anyway, I have a core of solid companies and index funds, with smaller parts of my portfolio on more speculative stuff. I've only really been investing a couple of years and certainly don't know everything yet, so happy to hear other's opinions. Incidentally, the first share I bought on arriving in New Zealand was Chorus straight after the first comcom decision, even monopolies have their risks here. It won't always be the case, but this time buying on bad news has worked out alright.

The better you understand a company the more chances you have of making sound investment decisions.
FPH.Why has the sp risen 41.45% in the past year,112.87% in the past 2 years and 171.29% in the past 5 years,and why have Craig's got a $9.63 target price?
The answers can be found by going to www.fphcare.com then NZ ,then investors,then presentations.The 30th November presentation is the one you want.
PS.Warren Buffett said "You are better to pay a fair price for a good company,rather than a good price for a fair company."I concur.

[mfd]

The better you understand a company the more chances you have of making sound investment decisions.
FPH.Why has the sp risen 41.45% in the past year,112.87% in the past 2 years and 171.29% in the past 5 years,and why have Craig's got a $9.63 target price?
The answers can be found by going to www.fphcare.com (http://www.fphcare.com) then NZ ,then investors,then presentations.The 30th November presentation is the one you want.
PS.Warren Buffett said "You are better to pay a fair price for a good company,rather than a good price for a fair company."I concur.

I've got nothing against FPH in particular, it's just the kind of graph that scares me. Having spent a short amount of time working in a respiratory health clinic, I was always surprised how many people went for the 'wear a mask at night forever' option rather than the 'try losing a bit of weight' option. I guess even a literal wake-up call isn't enough. I expect the company will do well, but it's not for me at this stage. If we're doing Buffet quotes, how about "be fearful when others are greedy and greedy only when others are fearful"?

[bohemian]

I totally agree Percy. Add to that Tony Carter as chairman of FPH.NZ and AIR.NZ, and that will do me as an endorsement of both companies.

[Hoop]

NO.!!!
Let profits run.
Why sell winners to buy losers?
Add to your winners and sell your losers, and you will end up with a portfolio of just winners.

:t_up::t_up:Your post deserves a reputation click


I'm not selling winners unless they take up too big a chunk of my portfolio (I took the top off of ATM), this is fresh money I'm putting in. I tend to assume these things are cyclical, and as I'm not likely to need the cash for a long time I'm happy to buy into things that are temporarily out of favour rather than sticking more into companies currently on a good run of luck.

More than one way to skin a cat, I guess.

:t_down::t_down: Your post doesn't

[percy]

I've got nothing against FPH in particular, it's just the kind of graph that scares me. Having spent a short amount of time working in a respiratory health clinic, I was always surprised how many people went for the 'wear a mask at night forever' option rather than the 'try losing a bit of weight' option. I guess even a literal wake-up call isn't enough. I expect the company will do well, but it's not for me at this stage. If we're doing Buffet quotes, how about "be fearful when others are greedy and greedy only when others are fearful"?

One we all should remember is another Buffett quote;
"Risk comes from not knowing what you're doing."
I take that to mean to; the better you understand a company,the more chances you have of making sound investment decisions.

[winner69]

Must be a psychological difference, when I see a graph that's been heading steadily upwards for a while (say, FPH) some people would call it a winner and buy, my first assumption is they've had a good run but they look ripe for a fall, especially if the PE has increased in anticipation of things continuing to go their way. In most things in life (especially business and investing) I think we have a habit of attributing too much to skill and too little to luck, when things are going well.

.

mfd, you have some cause to wonder if the FPH returns of the last few years can be maintained

Percy asked why has the FPH share price gone up so much % over the the last few years - its not all due to earnings growth. The PE has gone from 15 to 32 odd at the moment - forecast eps this year is 25 cents so if PE had been maintained at 15 share price would be $3.75. The difference to $8 odd is the impact of a significant re-rating of FPH

Yes, some of that re-rating is deserved but all of it?

Doesn't take much for sentiment to change as you point out - like FPH share price performance wasn't that flash from 2007 to 2013 was it .... even though the company was doing all the good things its doing today

Comments only about market sentiment, not beriding the company at all. A company I much admire but the market can do funny things at times

[mfd]

One we all should remember is another Buffett quote;
"Risk comes from not knowing what you're doing."
I take that to mean to; the better you understand a company,the more chances you have of making sound investment decisions.

Here's a genuine question. If we assume the market is generally efficient, and prices are set by a whole bunch of people and institutions who also understand what they're investing in, where does your edge come in? Do you believe other participants don't do enough research, or do you just make sure you do more? Do you think your judgement on the research is more correct? Or perhaps New Zealand is a sufficiently sleepy market at the edge of the world that it escapes proper scrutiny?

Before I got into investing I was quite heavily into advantage gambling and although I was never into straight betting, there were plenty of tipsters around who were convinced they knew more than the market and came unstuck pretty quickly. It was extremely rare to find someone who actually seemed to have an edge (and of course very difficult to prove anything more than luck).

Edit: I'm in no way claiming that I know more than the market or have any kind of edge, but I enjoy giving it a go.

[Stranger_Danger]

This thread is making me want to sell - even more than I have been - NZ equity holdings.

Not only do we have a "unique" property market that has nothing to do with the rest of the world, now our sharemarket is heading to the same level of uniqueness?

Oh paleeeese.

[percy]

Here's a genuine question. If we assume the market is generally efficient, and prices are set by a whole bunch of people and institutions who also understand what they're investing in, where does your edge come in? Do you believe other participants don't do enough research, or do you just make sure you do more? Do you think your judgement on the research is more correct? Or perhaps New Zealand is a sufficiently sleepy market at the edge of the world that it escapes proper scrutiny?

Before I got into investing I was quite heavily into advantage gambling and although I was never into straight betting, there were plenty of tipsters around who were convinced they knew more than the market and came unstuck pretty quickly. It was extremely rare to find someone who actually seemed to have an edge (and of course very difficult to prove anything more than luck).

Edit: I'm in no way claiming that I know more than the market or have any kind of edge, but I enjoy giving it a go.

I have followed the share market for 49 years.
For many years I had no capital invest,but it was still my hobbie.Still is,but now I have the capital.[Thanks to the market].
I have made every mistake possible.
I am still learning, yet over the past few years have made very few mistakes,and a lot of good decisions.
The amount of luck I have is governed by the research I do.This wealth of research enables me to react immediately to company announcements.
I back myself.If I don't understand a company I don't invest in it.
If I make a mistake I act straight away.
I like companies with good cashflow,little debt,growing eps and paying an increasing dividend,and who do what they say they will do.
You will note there is no magic to my investing, just the enjoyment of successfully following the market.

[mfd]

I have followed the share market for 49 years.
For many years I had no capital invest,but it was still my hobbie.Still is,but now I have the capital.[Thanks to the market].
I have made every mistake possible.
I am still learning, yet over the past few years have made very few mistakes,and a lot of good decisions.
The amount of luck I have is governed by the research I do.This wealth of research enables me to react immediately to company announcements.
I back myself.If I don't understand a company I don't invest in it.
If I make a mistake I act straight away.
I like companies with good cashflow,little debt,growing eps and paying an increasing dividend,and who do what they say they will do.
You will note there is no magic to my investing, just the enjoyment of successfully following the market.

Fair enough. One thing I saw in the gambling world was the old hats who'd been doing it so long they could smell a price move as soon as it kicked off and move fast. I'm sure that experience is valuable but I guess there's no short cuts to obtain it.

[Jinx]

Fair enough. One thing I saw in the gambling world was the old hats who'd been doing it so long they could smell a price move as soon as it kicked off and move fast. I'm sure that experience is valuable but I guess there's no short cuts to obtain it.

Follow the old hats, is a decent start as a short cut.

[h2so4]

Fair enough. One thing I saw in the gambling world was the old hats who'd been doing it so long they could smell a price move as soon as it kicked off and move fast. I'm sure that experience is valuable but I guess there's no short cuts to obtain it.

What was the game?

[h2so4]

.......I'm not sure a good nose is a prerequisite.

[Beagle]

Some on here have done very well by investing offshore and many trade and invest in smaller companies on the ASX, some with great success but the main issue I have with Australian investing in particular is that its iniquitous and unreasonable that N.Z. investors are not able to claim Australian franking credits. This bizarre situation has remained despite so called closer economic relations.
In effect N.Z. investors pay tax twice on most dividends received from Australian companies so in effect you are investing with one had tied behind your back...not a level playing field.

[thestg]

The Aussies have to pay 50% Capital gains tax if selling within 12 months. Do NZ investors in the aussie market have to pay this as well?

[fungus pudding]

The Aussies have to pay 50% Capital gains tax if selling within 12 months. Do NZ investors in the aussie market have to pay this as well?

I don't think Australian CGT is limited to 12 months. It applies whenever an asset is sold.

[Jay]

True FP - as far as I can tell, rates are different depending on when you bought and then sold

https://www.ato.gov.au/General/Capital-gains-tax/Working-out-your-capital-gain-or-loss/Working-out-your-capital-gain/

You don't pay 50% CGT thesg, my interpretation of the below means, that if you have held the asset for more than 12 months you only pay tax on 50% of the gain.
"Companies will pay 30% tax on their capital gains (the current company tax rate). For individuals the rate will be your income tax rate for that year.
If you’ve acquired a capital gains tax (CGT) asset after 21 September 1999 and held it for over 12 months before selling it, you should be able to obtain a 50% discount on the capital gain. If you sell an asset less than 12 months after buying it you don’t get the 50% discount and should pay tax on the full capital gain"

[Snow Leopard]

The Aussies have to pay 50% Capital gains tax if selling within 12 months. Do NZ investors in the aussie market have to pay this as well?


I don't think Australian CGT is limited to 12 months. It applies whenever an asset is sold.

If you are NOT Australian Tax Resident you DO NOT usually pay any Australian CGT on the sale of Australian shares.

If you are Australian Tax Resident then you DO usually pay Australian CGT on the sale of Australian shares. The rate of CGT is your tax rate if the shares sold are held for less than 12 months and 50% of your tax rate if held for more than 12 months.

You may or may not have to pay taxes on your net gains of selling Australian shares in the country/countries in which you are tax resident.

Disc: Do not rely on the above in composing your tax affairs or [not] filling in your tax returns.

Best Wishes
Paper Tiger

[thestg]

Thanks Jay & Paper Tiger. Makes good sense to me now.

[Major von Tempsky]

"Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?"

That's me too. Item 1, Bang, no more overseas exchange exposure worries.

Item 2, Bang, no more overseas tax worries.

Item 3, Bang I can easily keep track of what's happening.

I operate a ANZ sharetrading account and do my own tax returns. I never buy and sell the same share in the same tax year. I totally reject charting and try to follow Buffett principles.

My first objective has been to invest in shares with a good tax free dividend flow big enough to render me moderately financially independent. Next I have made another investment which concentrates on capital growth, to diversify. When it finally declares a dividend I'll probably sell (tax free because of that) and very sizeably add to my dividend yield investments. I have also been enabled to pay off children's student loans, cars and for some of their housing. My next objective is to beat the estate of the second richest man in my Family Tree and then to beat the richest one in the family tree. After that I could die happy, knowing I had also provided good retirements to our 4 children. Yes I follow the KISS principle.

[Yeshiva]

"Does anyone here solely invest in NZX listed stocks and has no stockmarket investments elsewhere?"

That's me too. Item 1, Bang, no more overseas exchange exposure worries.

Item 2, Bang, no more overseas tax worries.

Item 3, Bang I can easily keep track of what's happening.

I operate a ANZ sharetrading account and do my own tax returns. I never buy and sell the same share in the same tax year. I totally reject charting and try to follow Buffett principles.

My first objective has been to invest in shares with a good tax free dividend flow big enough to render me moderately financially independent. Next I have made another investment which concentrates on capital growth, to diversify. When it finally declares a dividend I'll probably sell (tax free because of that) and very sizeably add to my dividend yield investments. I have also been enabled to pay off children's student loans, cars and for some of their housing. My next objective is to beat the estate of the second richest man in my Family Tree and then to beat the richest one in the family tree. After that I could die happy, knowing I had also provided good retirements to our 4 children. Yes I follow the KISS principle.

Good on you. I love reading this kind of story!

[mfd]

What was the game?

Used to make pretty good money in the UK through bonus abuse and arbitrage, mostly soccer and horse racing, also some casino stuff. People are still making money, but the bookies are sharper now, the bonuses are worse, and I've had my stakes limited or been banned at a few dozen bookies now so it's a lot quieter for me. Pretty off-topic for this thread, but feel free to message me.

[Raz]

Used to make pretty good money in the UK through bonus abuse and arbitrage, mostly soccer and horse racing, also some casino stuff. People are still making money, but the bookies are sharper now, the bonuses are worse, and I've had my stakes limited or been banned at a few dozen bookies now so it's a lot quieter for me. Pretty off-topic for this thread, but feel free to message me.

Bookies in UK still provide opportunities. Personally invested heavy overseas in three businesses and property..best ROR of any any investment in my portfolio. Shares in the US ,Netherlands & Germany, have all performed well over twenty years.

[stevevai1983]

NZX is a great market. The average company payout ratio and stock dividend yield is very good. (that's why it's more resilience to volatility)
Also NZX has some good ETFs to invest if you want to diversify your portfolio.
So basically you can have a very solid portfolio with a basket of NZ companies + ETFs like OZY,ASF,ASR,USF,USG etc

There is only 1 problem: transaction fee is wayyyyy too high here...

[percy]

It appears as though "the fat lady is not about to sing".
BNZ economists revised their 2016 forecast for GDP growth to 2.4% from 1.9%,while Fitch's lowered their's to 2.4%.

[Toulouse - Luzern]

So basically you can have a very solid portfolio with a basket of NZ companies + ETFs like OZY,ASF,ASR,USF,USG etc

There is only 1 problem: transaction fee is wayyyyy too high here...

Agree.

The fees are far too high.

No change in years despite lower costs for market providers ...

[Arbroath]

You can transact online with decent brokerages for 0.3% brokerage, I remember when it was a closed shop and brokerage was 2.5%!

[bull....]

You can transact online with decent brokerages for 0.3% brokerage, I remember when it was a closed shop and brokerage was 2.5%!

commission rates in nz for anything are outragous

[777]

I have no problem with current share brokerage fees(.2% with ANZ Sec) but real estate fee's are well over the top. $30000-$40000 on a million dollar house is totally unacceptable especially when they also want you to front for advertising costs.

[LAC]

I have no problem with current share brokerage fees(.2% with ANZ Sec) but real estate fee's are well over the top. $30000-$40000 on a million dollar house is totally unacceptable especially when they also want you to front for advertising costs.

Tell me about it.....I used to think Lawyers n Car dealers where the ppl to watch out for, until I came to NZ and seen the rules/process that real-estate follow. Sellers/homeowners take all the risk in buying and owning a property and then when they sell.....there's someone waiting to clip the ticket for a few hours work

[nextbigthing]

I have no problem with current share brokerage fees(.2% with ANZ Sec) but real estate fee's are well over the top. $30000-$40000 on a million dollar house is totally unacceptable especially when they also want you to front for advertising costs.

Completely agree. However it's a free market, why doesn't the market sort it out and naturally reduce commissions? This doesn't make sense.

[snobilo]

Completely agree. However it's a free market, why doesn't the market sort it out and naturally reduce commissions? This doesn't make sense.

Because us kiwis have a lot of discretionary income and when selling a home that price tag isn't enough to go through the hassle of doing it yourself for most. From the conversations I've had with a "few" other investors.

[Lewylewylewy]

It's a cartel.

[fungus pudding]

Because us kiwis have a lot of discretionary income and when selling a home that price tag isn't enough to go through the hassle of doing it yourself for most. From the conversations I've had with a "few" other investors.

There have been several R.E. firms who have promoted themselves as low fee agencies. Most. if not all, have gone broke. The Joneses comes to mind but many others whose names I can't recall also failed. (Green door? or something like that was another) There was another nationwide organisation owned by members of the law society, which any law firm could opt to join. Big failure. The RE business is not as easy as it looks by any stretch of the imagination. Selling privately is very very difficult. Purchasers have no qualms about making offers through a 3rd party, but most will walk away if they feel the price is too high rather than insult the owner. Fact. A good agent will get a good price. Yes yes, I know there will be exceptions, but it's difficult to find an agent who will try and sell their own property.

[minimoke]

Selling privately is very very difficult.
Absolute rubbish! I've sold all my properties privately. Which is proof positive anyone with half a brain can do it and why there is no barrier for entry into RE.

[mfd]

There have been several R.E. firms who have promoted themselves as low fee agencies. Most. if not all, have gone broke. The Joneses comes to mind but many others whose names I can't recall also failed. (Green door? or something like that was another) There was another nationwide organisation owned by members of the law society, which any law firm could opt to join. Big failure. The RE business is not as easy as it looks by any stretch of the imagination. Selling privately is very very difficult. Purchasers have no qualms about making offers through a 3rd party, but most will walk away if they feel the price is too high rather than insult the owner. Fact. A good agent will get a good price. Yes yes, I know there will be exceptions, but it's difficult to find an agent who will try and sell their own property.

In the UK I think the average fee is ~1.5% and it's pretty straight forward to get 1%, which normally includes all advertising costs. What makes the process so much more complex over here to justify the higher fees? It's not quite as outrageous as the index fund fees (for example SmartShares adds a 0.3% annual fee to invest in Vanguard VOO which itself costs 0.05%), but I can at least understand the economy of scale argument there. Not sure that applies to real estate.

[Jay]

The selling prices of most properties have gone up a lot more than inflation over the last how many years, so selling on a % basis means returns go up (and you have pay for your advertising, which you never use to) , however expenses have only risen a little.
In any of the bigger cities an agent would only have sell 5 or less properties in a year and they have earned over the average wage.

This from Nov 2015 "... Some Auckland estate agents are enjoying million dollar salaries thanks to a 44 per cent pay rise in five years.The wage hike has been achieved without them having to do any extra work, official figures reveal..."
and the article goes on to say "... Vendors also pay marketing fees, auctioneer's fees, and usually a fixed administration fee on top.
When a sale happens, the real estate franchise takes a cut of up to 10 per cent.
Commission is split between the salesperson and the agency. For new agents, the split is close to 50/50 but top real estate salespeople can command up to 75 per cent of the commission..."

[Raz]

Easy to sell in a boom market private, when sentiment changes in a market a good RE makes a difference with their network.

[minimoke]

Easy to sell in a boom market private, when sentiment changes in a market a good RE makes a difference with their network.
Again more rubbish. If their networks were so good there would be no need for client paid advertising. Its not hard to sell: you just need a property that meets the market. Sellers often have unrealstic expectations of the value of their property when the market falls - especially so when their gearing is challenging

[NZSilver]

Well the NZX has been a fine place to invest over the last 6 months - seems the majority of companies are growing or paying great divs. Gains of 50-100% on companies that are considered boring.

[macduffy]

Well the NZX has been a fine place to invest over the last 6 months - seems the majority of companies are growing or paying great divs. Gains of 50-100% on companies that are considered boring.

Yes, but it's a bit worrying now, to me at least.

While there will be individual winners and short term bursts, the market at a whole can only grow at the rate of economic growth generally. These growth rates seem to be moving further and further out of kilter as the market advances against a backdrop of aenemic economic growth. Of course, low interest rates encourage investment in higher return divvy - paying stocks and other sharemarkets don't look very attractive. It's no wonder that rental properties continue to be popular. What to do?

Disc: Continuing to hold NZ shares!

[NZSilver]

Yes, but it's a bit worrying now, to me at least.

While there will be individual winners and short term bursts, the market at a whole can only grow at the rate of economic growth generally. These growth rates seem to be moving further and further out of kilter as the market advances against a backdrop of aenemic economic growth. Of course, low interest rates encourage investment in higher return divvy - paying stocks and other sharemarkets don't look very attractive. It's no wonder that rental properties continue to be popular. What to do?

Disc: Continuing to hold NZ shares!

I Agree with you Macduffy

Yes worrying but then as you say - low interest rates that are likely to go lower. anything paying a 5%+ div and has a solid balance sheet will continue to do well. There are plenty of companies on the NZX that fit this description.

[Leftfield]

Yes, but it's a bit worrying now, to me at least.

While there will be individual winners and short term bursts, the market at a whole can only grow at the rate of economic growth generally. These growth rates seem to be moving further and further out of kilter as the market advances against a backdrop of aenemic economic growth. Of course, low interest rates encourage investment in higher return divvy - paying stocks and other sharemarkets don't look very attractive. It's no wonder that rental properties continue to be popular. What to do?

Disc: Continuing to hold NZ shares!

The difference i see in many leading NZ companies these days is that they are more International in their outlook and less effected by local NZ economic growth or lack of it e.g. FPH, CVT, MHI, MFT, XRO, ATM, MVN, PEB, BLT etc etc

Such companies target the countries with the best growth prospects.

Back in the 1980's few NZ companies survived outside of NZ.

[macduffy]

Good point, Left field. The problem remains though that growth worldwide isn't much above stalling speed, even the USA threatening to dip into recession. And of course NZ's better than average performance and relatively "high" interest rates keeping the NZD strong isn't helping our exporting companies.

"A bull market climbs a wall of worry." There, I've talked myself out of my mood!

:)

[NZSilver]

Yeh there is no arguing the markets and therefore stocks are priced at what are high multiples cf historic data. But these super low interest rates/inflation - what is a man to do. I thought printing money (qe) would cause inflation req interest rate rises. Turns out all that extra money has been piled into mainly property and partly into other assets suck as stocks. It's all a bit over my head but I just can't see stocks (esp div payers) loosing favour until interest rates rise significantly or that housing market implodes - which I see as highly likely.

[Lewylewylewy]

I agree with everything being said here. It's something that's been rattling around my head for a while. I've been making myself feel better by justifying my investments as permanent holdings that I'll never sell, and use as a base to grow on with my trading find...

But I can help thinking, why not just be a full trader and get a higher rate, rather than invest in slower, steady shares?

Also, if I'm working the slow and steady, why not fully jump out and kill off a chunk of the mortgage, then jump back in when things are better?

One big problem I have is a lack of experience. My shares are going up and doing well amid all the worry... Is this negativity just how a bull market can look? I don't know... All the variables are right for the companies I best in to do well, but those variables are also omens for the economy.

Whatever price my shares are, if I retain them I'll always own that same percentage of those companies. Is that a less intelligent way to think?

[Bjauck]

The difference i see in many leading NZ companies these days is that they are more International in their outlook and less effected by local NZ economic growth or lack of it e.g. FPH, CVT, MHI, MFT, XRO, ATM, MVN, PEB, BLT etc etc

Such companies target the countries with the best growth prospects.

Back in the 1980's few NZ companies survived outside of NZ. MHI is in the process of changing its prime listing to Australia, to access a greater number of investors, so its days of being a "NZ company" are limited. The comparative small NZ stock market capitalisation for the size of our GDP seems to indicate that (with exceptions of course) many NZ companies do not survive by remaining NZ companies. The reasons are many for that, but the comparative appeal of NZ investor real estate is probably one of them, resulting in less investor capital for NZ listed companies.

[BIRMANBOY]

Growth in the NZ share market is not just reliant on economic growth and success its also fuelled by new entrants coming into the market. Low interest rates, risky housing market, overseas investors looking for higher yield all should drive the NZ market higher.

[kiora]

One of my Murphy's Constants!
If everything seems to be going well,you have obviously overlooked something, and it will when you least expect it! :mellow:

[macduffy]

Growth in the NZ share market is not just reliant on economic growth and success its also fuelled by new entrants coming into the market

Which is, of course, contributing to economic growth! - for now.

;)

[Leftfield]

Growth in the NZ share market is not just reliant on economic growth and success its also fuelled by new entrants coming into the market. Low interest rates, risky housing market, overseas investors looking for higher yield all should drive the NZ market higher.

Another major influence on the NZX that was not around in the 1980's is the current strength and investing power of organisations such as the Superannuation Fund, ACC and of course Kiwi Saver.

It used to be the case that if the USA market sneezed, then the NZ market caught a cold. IMHO the NZX is stronger these days.

[BIRMANBOY]

Hah ..sort of like your post...overlooking completing your sentence ...so what will it do? Bite you? reward you? confound you? Entertain you? Maybe Mr. Murphy has gone to a self help seminar and is now espousing a better attitude?
One of my Murphy's Constants!
If everything seems to be going well,you have obviously overlooked something, and it will when you least expect it! :mellow: