Maximum Net Yield from a diversified portfolio of NZ Stocks.

[Beagle]

If your task was to invest $100K for an elderly person aged 88 and the sole purpose of the investment was to generate the maximum net yield in a reasonably diversified portfolio of N.Z. stocks what would you do ?

My initial thoughts in no particular order and indicative yield based on current SP's noted are
Spark $3.41 7.3%
HLG $3.36 9.0%
AIR $2.375 8.5%
THL $3.80 5.0%
PGW $0.54 6.8%
HBL $1.64 5.2%
GEN $$2.065 7.9%

Average net yield 7.1%

Assume for the sake of this exercise that the elderly person already has some REIT's (Kiwi, Goodman and Argosey).

What would you do ? ( For the sake of this exercise pretend its your own elderly mother you are investing this for)

[iceman]

I have recently invested half that amount for an elderly person with main focus being on dividend stream. I selected:
THL (25%)
PGW (15%)
AIR. (15%)
HLG (25%)
SPK (20%)

[Beagle]

I have recently invested half that amount for an elderly person with main focus being on dividend stream. I selected:
THL (25%)
PGW (15%)
AIR. (15%)
HLG (25%)
SPK (20%)

Thanks mate...always a good thing to check others idea's especially when you're investing other people's money. Good to see we're thinking along similar lines.

[percy]

If your task was to invest $100K for an elderly person aged 88 and the sole purpose of the investment was to generate the maximum net yield in a reasonably diversified portfolio of N.Z. stocks what would you do ?

My initial thoughts in no particular order are
Spark 7.3%
HLG 9%
AIR 8.5%
THL 5%
PGW 6.8%
HBL 5.2%
GEN 7.9%

Average net yield 7.1%

Assume for the sake of this exercise that the elderly person already has some REIT's (Kiwi, Goodman and Argosey).

What would you do ? ( For the sake of this exercise pretend its your own elderly mother you are investing this for)

Looks excellent to me.
Would you please add current share prices so we can track the portfolio.

[Beagle]

Looks excellent to me.
Would you please add current share prices so we can track the portfolio.

Thanks for your feedback Percy, amended post as suggested :)

My mind is very open to others thoughts folks so please...I am all ears, (hounds have large ears lol) and more than happy to split this 10 ways at $10K per investment if there's another 3 good idea's.
Main thing is I don't want my personal bias towards some of these to shine through so I'm looking for an almost exactly equal split in terms of allocating capital between shares.

I suppose I am open to more diversification, (just thinking out loud here) and even though there is an argument that something like Barramundi which invests in Australian shares and pays a guaranteed 8%, sometimes out of capital...that's probably okay as Mum won't live forever so if there's some capital erosion in a stock like that I'll more than likely make it up in stocks like HBL and THL so I'm probably okay with BRM as it provides some international diversification. Does Fisher funds Marlin fund also pay 8% ?, that would give her some international exposure outside of Australia so I am seen to be doing the prudent thing getting even more diversification. (Fiduciary obligation of upmost good care is VERY strong when you're investing your own mothers money that's for sure !).

Maybe I should also throw a really high growth solid company in there on the basis that growth could be used to derive a return ?
I'm thinking maybe my highest conviction growth stock SUM would be a good choice and I could sell 10% of the stock per year as it grows to give Mum a return out of it that way...perhaps that's not a silly strategy seeing as its average growth rate for the last 5 years has been a whopping 48%. Makes sense ?

[iceman]

Agree Roger one has to be careful and try to avoid excessive bias or preference when investing, particularly when investing other people's money.
I selected a higher percentage of THL, despite lower currrent yield, because of my expected large increase in their dividend in the next few years. So obviously my bias/preference influenced it ! But I also think the person came to me because they wanted my bias/preferences/advice. So a bit of a predicament isn't it !

[percy]

I help out on my late friend's family trust.
I have found the trust's performance has greatly improved, since we have been following my bias and preferences.!!..lol.
Now my view is, I think I would trust both of you to invest wisely, on someone else's behalf.
So back yourselves.

[Beagle]

Agree Roger one has to be careful and try to avoid excessive bias or preference when investing, particularly when investing other people's money.
I selected a higher percentage of THL, despite lower currrent yield, because of my expected large increase in their dividend in the next few years. So obviously my bias/preference influenced it ! But I also think the person came to me because they wanted my bias/preferences/advice. So a bit of a predicament isn't it !

Yes absolutely it is mate, quite a conundrum but your circumstances in terms of your brief is no doubt a little different to mine in that this represents quite a significant proportion of my Mum's capital, other than her retirement unit. Whatever I do I have to be able to put my hand on my heart and say I did a very good job of diversification...so I suppose just thinking out loud as I type, (which is always dangerous lol), I have to have some international and Australian investment that gives a decent yield so Barramundi and Marlin look like a good idea and I also have to justify the decision making to my brothers when Mum eventually dies so I probably have to show I invested in at least one high growth share like SUM but also in other growth shares like THL, HBL so I think maybe the seven I mentioned above plus Barramundi, Marlin and SUM, $10K each.

Still open to other idea's folks.

[RTM]

I think you have about the right number of stocks for a 100 k investment. Personally I wouldn't invest in HLG as I think we still have big changes to come in that area in NZ with respect to more on-line shopping, other competition. You could add FSF instead of HLG to further access NZ's major industry...agriculture.

And of course I have been wrong with respect to HLG for years.

[Beagle]

I think you have about the right number of stocks for a 100 k investment. Personally I wouldn't invest in HLG as I think we still have big changes to come in that area in NZ with respect to more on-line shopping, other competition. You could add FSF instead of HLG to further access NZ's major industry...agriculture.

And of course I have been wring with respect to HLG for years!

Thank you, FSF 6.5% net yield, excellent idea...My Mum comes from a farming background originally, I think she would approve :)

[Jantar]

...
My initial thoughts in no particular order and indicative yield based on current SP's noted are
Spark $3.41 7.3%
HLG $3.36 9.0%
AIR $2.375 8.5%
THL $3.80 5.0%
PGW $0.54 6.8%
HBL $1.64 5.2%
GEN $$2.065 7.9%

Average net yield 7.1%

....
This is very similar to my own holding. Although I have replaced SPK with STU.
STU is paying a very good return, and although they are facing a legal challenge I do not believe it will impact their earnings greatly.
SPK are facing a huge upset in the near future as Electricity retailers start installing fibre directly to customers and offering high speed internet packages bundled in with their power supply. Trustpower are already doing this and Contact is well on the way, but only in some areas at present.

[RGR367]

On the assumption that it's my mother's money, I would be more speculative as I know for sure it will be part of my inheritance later on :)

[Beagle]

Thank you Jantar, I appreciate you sharing your thoughts.

[Bilbo]

Hi Roger, how about Milford's Diversified Income Fund as an alternative to direct stocks? It's returned 10.5% to 11.5% (depending on PIR rate) over the last 5 years. They have a quarterly distribution which I think is cents per unit rather than a percentage.

[bull....]

I have some air of your list roger also spk in NZ also ddr (au) great company paying over 7% , grossed over 9% for aussies as part of my div portfolio and couple others round the place. currently yields me over 8% net per annum.

[Beagle]

On the assumption that it's my mother's money, I would be more speculative as I know for sure it will be part of my inheritance later on :)

LOL I shall put everything into Pushpay then :lol:

[Beagle]

Hi Roger, how about Milford's Diversified Income Fund as an alternative to direct stocks? It's returned 10.5% to 11.5% (depending on PIR rate) over the last 5 years. They have a quarterly distribution which I think is cents per unit rather than a percentage.

Hmmm..well worth looking into, thanks... maybe as an alternative to Barramundi or Marlin as having had a look at their 3 year SP graphs this morning they don't inspire much confidence.


I have some air of your list roger also spk in NZ also ddr (au) great company paying over 7% , grossed over 9% for aussies as part of my div portfolio and couple others round the place. currently yields me over 8% net per annum.

Thanks for the suggestion mate but I don't want the risk of individually stock picking in Aussie, don't have the time or expertise.

[Harvey Specter]

Have you looked at this, either for inspiration, plagiarism, or as a cop-out to mitigate your fiduciary obligations?

http://smartshares.co.nz/types-of-funds/smartdividend/nz-dividend

[Beagle]

Have you looked at this, either for inspiration, plagiarism, or as a cop-out to mitigate your fiduciary obligations?

http://smartshares.co.nz/types-of-funds/smartdividend/nz-dividend

Thanks for the link. Three good reasons to have a look :)

[Biscuit]

Have you looked at this, either for inspiration, plagiarism, or as a cop-out to mitigate your fiduciary obligations?

http://smartshares.co.nz/types-of-funds/smartdividend/nz-dividend

They have SKC for the tourism sector in their top ten picks. Maybe an alternative to THL Roger? Bigger moat, do better than THL from increased Chinese tourism, more recession proof?

[couta1]

They have SKC for the tourism sector in their top ten picks. Maybe an alternative to THL Roger? Bigger moat, do better than THL from increased Chinese tourism, more recession proof? I think you'll find that SKC is off limits for Roger as it is for me, on moral grounds.

[Beagle]

They have SKC for the tourism sector in their top ten picks. Maybe an alternative to THL Roger? Bigger moat, do better than THL from increased Chinese tourism, more recession proof?

Thanks for your suggestion Biscuit and its not without merits but its a SIN stock, my late father, (formerly a minister of religion), used to say those places are nothing but a den of iniquity...I can still hear his voice ringing in my ears years after he passed away so I couldn't live with myself investing Mum's money in there. Thanks for your post Couta1, yes its off limits for my personal portfolio too for the same reason.

[Snoopy]

If your task was to invest $100K for an elderly person aged 88 and the sole purpose of the investment was to generate the maximum net yield in a reasonably diversified portfolio of N.Z. stocks what would you do ?

My initial thoughts in no particular order and indicative yield based on current SP's noted are
Spark $3.41 7.3%
HLG $3.36 9.0%
AIR $2.375 8.5%
THL $3.80 5.0%
PGW $0.54 6.8%
HBL $1.64 5.2%
GEN $$2.065 7.9%

Average net yield 7.1%

Assume for the sake of this exercise that the elderly person already has some REIT's (Kiwi, Goodman and Argosey).

What would you do ? (For the sake of this exercise pretend its your own elderly mother you are investing this for)


I would throw in my own entry to the Stocktastic competition. The basis for my entry was looking for income. But at the same time if you look for just income when at the bottom of the interest rate cycle, the capital value is likely to be hit as interest rates rise. So as a defence against this happening, I look for 'income shares'' with a bit of a growth plan behind them. I looked up the price of the varous components of my entry mid morning and my yield calculations are based on the last twelve months of historical dividend yield. The yield I quote is a gross yield, because CEN and SKC have not been paying fully imputed divdends over the last twelve months. So a gross yield comparison seemed fairer.



CompanyQuoted Share PriceGross Dividend per ShareGross YieldGrowth Plan


Contact Energy$4.9714.1c + 16.0c6.1%Recovery to fully imputed dividend paying status


Restaurant Brands$5.4017.4c + 13.2c5.7%Development of KFC in Australia and Carl's Junior in NZ


Skellerup$1.497.6c + 4.9c8.4%Recovery of dairy consumables, Driveshaft couplings in China (Mercedes)


Sky City$3.9512.5c + 10.0c5.7%Recovery to fully imputed dividend paying status, Lions tour


Spark$3.4117.4c + 17.4c10.2%Cost cutting


Average7.2%



All are the kind of shares that should do well in good times and bad. A similar kind of industry spread to what you are proposing Roger. However although I hold it myself, I believe that Skellerup is a lower risk bet on supporting the rural sector: lower debt than PGW and has a growth plan where PGW is all about doing the same but doing it better. Also I have gone cold on GNE at current prices, becasue it is turning into a bet on the direction of oil prices that are notoriously hard to predict. I think CEN offers better long term value in the energy sector.

I note your comment on 'sin stocks'. But SKC hosts the only gambling areas available with an active plan to monitor problem gamblers. Best to have them in there rather than down at the pub pokies, or even down at the TAB. And of course with the hotels and conference venues SKC is so much more than 'just gambling'.

SNOOPY

[RTM]

LOL I shall put everything into Pushpay then :lol:

Don't be silly Roger. Go for PEB.

[Joshuatree]

Vector is also a go to yield play re 6.8% and the s/p is the same as it was 2 years ago; a bit bond like.

[Beagle]

Thanks Snoopy I appreciate your input. I really have to chase a net yield of 5% as a minimum unless I'm doing a SUM and taking a small bet on their growth. SKL meets that criteria although I have had serious issues with their previous forecasting I take your point about PGW...might split the $10K between them.

Thanks Joshuatree, CEN meets the 5% minimum net yield criteria, just. GNE is a superior yield but its not a personal conviction stock I hold for the reasons Snoopy pointed out so maybe a 15K allocation to the gentailer sector between CEN, GNE and VCT makes sense. Their might be ~ $110K to invest, need to talk to my Mum soon about how much she feels she needs to hold back in a general slush (savings) fund for everyday type emergencies.

Thanks RTM - I enjoyed the humor :)

[ziggy415]

go figure.....i,m getting made redundant this monday (for the second time in 14 years) and each time they throw money at me then rehire me back and i was just thinking what would constitute a good income portfolio and lo and behold Roger helps me out...thanks guys...will look and learn

[Beagle]

Really pleased this thread and the contributions of many has helped you out mate. All the best and I hope they hire you back yet again :)

[traineeinvestor]

This thread was very timely for me because I am going through a similar exercise for an elderly family member and came up with many of the same names which have been mentioned on this thread already. The slight twist is that the portfolio has to generate a reasonably high level of sustainable income not the maximum possible yield.

Some additional companies on my list are:

1. ANZ or WBC - these are listed in NZ and pay decent dividends, although only carrying partial imputation credits. Depending on the marginal tax bracket partial imputation may not be that big an issue;

2. NZX – the company gets slammed (rightly IMHO) for various and extensive management failings, but still manages to churn out a steady 6cps fully imputed dividend every year;

3. CMO – the dividend has risen steadily over the last few years. I expect a degree of volatility given the nature of the industry and note the relative illiquidity of the shares, but it's been a nice dividend stream;

4. FBU – a serial disappointment but, at around the $8.00 level, offers a decent and, hopefully, safe dividend yield.

Disclosure: I hold all of the above (either directly or indirectly)

There are a couple of industry groups I am (probably too) cautious about putting much into at the moment – retailers (given the disruptive effect of internet businesses etc), electricity companies (potential over supply) and CNU (government interference). Depending on poll numbers as the election gets closer, there may be some better buying opportunities on some of these stocks.

[Subway]

Is the family member relying on divvie income to pay the bills?

[Joshuatree]

Not forgetting BB'S site as a great reference library

www.dividendyield.co.nz (http://www.dividendyield.co.nz/)

[Food4Thought]

Would you consider a small portion of bonus bonds... nothing guaranteed, how ever also potential there and the money stays valued at the same for how ever long you have them... and it's like lotto in some ways yet you retain your ticket numbers for ever... Always think it's a better idea than actual 'lotto' which I am rather biased against after seeing some terrible outcomes for people I knew.

THL seems to me really expensive right now, even with their return. I remember them at 68cents... if only I kept them... Should have stuck with my gut feeling after working in the industry for a short period and studying tourism on the side. Only about 10 years ago now. I much prefer the outlook for SUM (and would love to see some information about how many people above age 50 invest, and are considering investing in order to have more than bank rates...). Also the younger generations who are unable to afford houses in over priced markets and what they do with their spare cash (if they have any).

I made a good win on GXH and their return wasn't terrible either... somehow aligned with SUM in the sense ageing population... everyone gets a script these days with a mentality that this is "normal". They dropped back a bit and potentially still a little exy for me to buy back in. Was a very good return for me and wish I had more spare cash when I looked into them.

HBL - yet I imagine you are in favour here.

Anyway, best wishes and glad I found this post, good information for sure.

Goodluck :)

[Lewylewylewy]

I would put some in squirrel moneys 5 year plan with an auto payment weekly set up. By then end of the 5 years she will have all that money paid back (plus 9%pa), giving her a big return and enjoying errosion of her savings.

[Beagle]

This thread was very timely for me because I am going through a similar exercise for an elderly family member and came up with many of the same names which have been mentioned on this thread already. The slight twist is that the portfolio has to generate a reasonably high level of sustainable income not the maximum possible yield.

Some additional companies on my list are:

1. ANZ or WBC - these are listed in NZ and pay decent dividends, although only carrying partial imputation credits. Depending on the marginal tax bracket partial imputation may not be that big an issue;Prefer HBL's growth profile and full imputation credits. I excpect HBL's dividend stream to steadily increase over the years ahead.

2. NZX – the company gets slammed (rightly IMHO) for various and extensive management failings, but still manages to churn out a steady 6cps fully imputed dividend every year;Choppy history at best, doesn't impress

3. CMO – the dividend has risen steadily over the last few years. I expect a degree of volatility given the nature of the industry and note the relative illiquidity of the shares, but it's been a nice dividend stream;Agree, Ford and Mazda going places and are very solid brands, thanks for reminding me of this opportunity.

4. FBU – a serial disappointment but, at around the $8.00 level, offers a decent and, hopefully, safe dividend yield.Where there's smoke there's fire. There will be ongoing problems earning a satisfactory6 commercial return on many jobs previously tendered for currently backlogged. The previous tendering processes appear to have been systemically flawed and this has serious implications for the company going forward in my opinion for at least the next two years.

Disclosure: I hold all of the above (either directly or indirectly)

There are a couple of industry groups I am (probably too) cautious about putting much into at the moment – retailers (given the disruptive effect of internet businesses etc), electricity companies (potential over supply) and CNU (government interference). Depending on poll numbers as the election gets closer, there may be some better buying opportunities on some of these stocks.

HLG a superbly managed company trading on undemanding multiples. Some retailers are a definite avoid, such as WHS, in my opinion. Thanks for sharing your thoughts


Is the family member relying on divvie income to pay the bills?
Yes which is why I am diversifying far and wide and only investing in solid well managed companies with a good well tested business model.


Not forgetting BB'S site as a great reference library

www.dividendyield.co.nz (http://www.dividendyield.co.nz/)
Thanks for the timely reminder.


Would you consider a small portion of bonus bonds... nothing guaranteed, how ever also potential there and the money stays valued at the same for how ever long you have them... and it's like lotto in some ways yet you retain your ticket numbers for ever... Always think it's a better idea than actual 'lotto' which I am rather biased against after seeing some terrible outcomes for people I knew.Mum's not a gambler and the effective return from Bonus bonds is commensurate with the current extremely low interest rates

THL seems to me really expensive right now, even with their return. I remember them at 68cents... if only I kept them... Should have stuck with my gut feeling after working in the industry for a short period and studying tourism on the side. Only about 10 years ago now. I much prefer the outlook for SUM (and would love to see some information about how many people above age 50 invest, and are considering investing in order to have more than bank rates...). Also the younger generations who are unable to afford houses in over priced markets and what they do with their spare cash (if they have any). I have a pretty strong preference for SUM as well but THL is also a good well managed company, same Chairman and appears to be executing very well. Forward PE is not unreasonable in my opinion.

I made a good win on GXH and their return wasn't terrible either... somehow aligned with SUM in the sense ageing population... everyone gets a script these days with a mentality that this is "normal". They dropped back a bit and potentially still a little exy for me to buy back in. Was a very good return for me and wish I had more spare cash when I looked into them. Sorry not one I follow.

HBL - yet I imagine you are in favour here. Very popular stoick for sound reasons and still inexpensive compared to its peers with a better EPS growth profile, will definitely be including this in M um's portfolio

Anyway, best wishes and glad I found this post, good information for sure.

Goodluck :)

Thank you.


I would put some in squirrel moneys 5 year plan with an auto payment weekly set up. By then end of the 5 years she will have all that money paid back (plus 9%pa), giving her a big return and enjoying errosion of her savings.
Does that involve any work whatsoever on my part like the intensive work required to monitor one's investment in Harmoney's loans ?

[Mickey]

Hi Roger,

I've enjoyed reading this post as my focus is on setting up a predominately dividend portfolio. For dividends - I have investments in AIR, GNE, SKL, SPK, PCT, GMT, & THL. To get some exposure to Oz - I've also invested in Devon Dividend Yield Fund & Harbour Australasian Equity Income Fund - both of which pay quarterly dividends. For growth - I've invested in SUM and AMP Global Shares Fund. I have an on-call cash reserve that I'm building to allow me to top up on any of the above on the dips. I'm also watching PGW & HLG and will look to enter these at some point.

Best regards and good luck
M

[hamish]

Hi Roger,

Not sure if you or others have seen this site/tool. You can use the 'snowflake' tool to slice and dice fundamentals for stocks as you like. If you move the slider for dividends outwards, along with perhaps health..you'll get a good sense of which Co's pay a good dividend and have a strong balance sheet - for example HLG.

Personally, for income (and some growth to a degree) - through a 5 year lens view, I hold :

AIR - Domestically monopoly, inbound growth due population+tourism = sustainable dividends
HLG - On the turnaround, strong balance sheet - well managed Co.
ZEL - this is my speculative. Growth + improving yield (per their policy reset) = driven by their 49% NZ retail strength. Some regulation risk
HBL - growing eps, particularly through diversified and targeted high NIM product portfolio
STU - Track record in yield. Steel prices bottomed out? Diversified products. Managed good bundle at < $2. Construction to continue tailwinds / steadying next 5 years
IFT - I view this as the 'steady as she goes'. Bondlike. Their core portfolios are social infrastructure related.

I hold all above

[voltage]

Hamish,
simplywall.st, this a great site, thanks.

[Blondie]

Have you considered KFL?. PIE entity taxed at 28%. Dividend paid quarterly @ 2% of the average NTA's of the previous quarter. 49% of the portfolio consists of shares in RYM, MFT, FRE, FPH and IFT.
While the dividend comprises a mixture of Income/Capital return, for an INDIVIDUAL tax payer on a marginal tax rate of 17.5% (up to ? $48K) there could be a tax refund effect if the person chose to include the dividend in their tax return. Under the PIE regime they wouldn't have to include the dividend if their marginal tax rate was 33%.
The KFL NTA's are posted every Thursday plus at the end of the month.
They also have a DRP with the price set at a 3% discount to the average of the share price experienced in the 5 days after the shares trade ex dividend. This can sometimes also be a discount to the current of the share NTA at that time.

[Beagle]

Hi Roger,

I've enjoyed reading this post as my focus is on setting up a predominately dividend portfolio. For dividends - I have investments in AIR, GNE, SKL, SPK, PCT, GMT, & THL. To get some exposure to Oz - I've also invested in Devon Dividend Yield Fund & Harbour Australasian Equity Income Fund - both of which pay quarterly dividends. For growth - I've invested in SUM and AMP Global Shares Fund. I have an on-call cash reserve that I'm building to allow me to top up on any of the above on the dips. I'm also watching PGW & HLG and will look to enter these at some point.

Best regards and good luck
M

Hi Mickey,

Many thanks for your post. I'm especially pleased you brought up the subject of those managed funds as I have a client who has done well with the Devon fund you mentioned and have been thinking about Harbour Asset Managements Australiasian equity fund for some of my own funds. Both those fund managers are very highly regarded in the industry so this is definitely food for thought.


Hi Roger,

Not sure if you or others have seen this site/tool. You can use the 'snowflake' tool to slice and dice fundamentals for stocks as you like. If you move the slider for dividends outwards, along with perhaps health..you'll get a good sense of which Co's pay a good dividend and have a strong balance sheet - for example HLG.

Personally, for income (and some growth to a degree) - through a 5 year lens view, I hold :

AIR - Domestically monopoly, inbound growth due population+tourism = sustainable dividends
HLG - On the turnaround, strong balance sheet - well managed Co.
ZEL - this is my speculative. Growth + improving yield (per their policy reset) = driven by their 49% NZ retail strength. Some regulation risk
HBL - growing eps, particularly through diversified and targeted high NIM product portfolio
STU - Track record in yield. Steel prices bottomed out? Diversified products. Managed good bundle at < $2. Construction to continue tailwinds / steadying next 5 years
IFT - I view this as the 'steady as she goes'. Bondlike. Their core portfolios are social infrastructure related.

I hold all above


Hamish,
simplywall.st, this a great site, thanks.

Hi Hamish, thanks for your post, I'll definitely look into that site when I get some spare time.


Have you considered KFL?. PIE entity taxed at 28%. Dividend paid quarterly @ 2% of the average NTA's of the previous quarter. 49% of the portfolio consists of shares in RYM, MFT, FRE, FPH and IFT.
While the dividend comprises a mixture of Income/Capital return, for an INDIVIDUAL tax payer on a marginal tax rate of 17.5% (up to ? $48K) there could be a tax refund effect if the person chose to include the dividend in their tax return. Under the PIE regime they wouldn't have to include the dividend if their marginal tax rate was 33%.
The KFL NTA's are posted every Thursday plus at the end of the month.
They also have a DRP with the price set at a 3% discount to the average of the share price experienced in the 5 days after the shares trade ex dividend. This can sometimes also be a discount to the current of the share NTA at that time.

Hi Blondie,

Welcome to the forum and thanks for your post. I'm familiar with what Carmel Fisher and her team have done at Fisher Funds management and even though she's how sold / scaled back ? her investment I'm thinking the culture will remain for now. I have some reservations about their performance over the years, both that fund, the Barramundi fund and the Marlin fund I previously referenced in this thread.
I've undertaken a brief review of their relative performance over the years and I think my sense is some of my Mum's funds would would be better off with one / both of the fund managers mentioned above.

Thank you to all for your contributions to this thread which are very much appreciated. There's a lot for me to mull over.

[Beagle]

$60K coming in this coming week ex an ANZ "serious" saver account paying 2.35%, $10K in late June 2017 from term deposit 3.5%, and another circa $40K from super scheme being wound up in circa Nov 2017, all up will be circa $110K. Mum has another $70K in REIT's already...might reallocate some of that but I'll leave that for now and work on the rest.
Thinking is to choose my highest 3 convictions this week and immediately invest $10K in each. Invest another $10K per month $40K in my second tier conviction list, (spreading out the timing a bit over a few months to help avoid mistiming the market by investing all at one). That deals with the initial $70K. In November 2017 or whatever month the super scheme is finally wound up over the following 4 months I'll invest $10K per month to spread the timing and diversification even further.

[Cricketfan]

$60K coming in this coming week ex an ANZ "serious" saver account paying 2.35%, $10K in late June 2017 from term deposit 3.5%, and another circa $40K from super scheme being wound up in circa Nov 2017, all up will be circa $110K.

For a second there I thought those amounts were the interest that your mum was earning! I was thinking if that's how much money she has, it probably doesn't matter where you invest the $110k :)

[couta1]

Hey Roger, just chuck half the money into Air and the other half into Spark, good returns and nice and simple. All this overdiversification stuff can give you a headache.:cool:

[Beagle]

For a second there I thought those amounts were the interest that your mum was earning! I was thinking if that's how much money she has, it probably doesn't matter where you invest the $110k :)


Hey Roger, just chuck half the money into Air and the other half into Spark, good returns and nice and simple.:cool:

LOL if only life was that simple :) If I remember correctly, classic investment theory suggests that you need a portfolio of at least 13 different stocks in 13 different sectors to obtain a reasonably diversified portfolio, not an easy task on the NZX when one has a focus on high dividend yield.

[noodles]

NZM are cum a 6c final dividend. This is partially imputed
Their interim dividend was 3.5c

So their net yield > 10%

The CEO was a recent buyer of the stock. If it is good enough for the CEO, is it good enough for your mother?

[couta1]

LOL if only life was that simple :) If I remember correctly, classic investment theory suggests that you need a portfolio of at least 13 different stocks in 13 different sectors to obtain a reasonably diversified portfolio, not an easy task on the NZX when one has a focus on high dividend yield. 15-20 stocks was the figure used under Classic theory. Classic investment theory should always be challenged just like the overuse of Personal protective equipment is now being challenged and found wanting(Healthcare workers used to think wearing gloves for everything was the way to go but now further research indicates less is best) There are only about 6 stocks on the NZX I would now invest in, full stop, let alone 13 in 13 different sectors. PS-I was kinda lateral thinking with the protective equipment example.:D

[winner69]

I prefer this chart rather than the one peat posted on another thread. ....even though they go hand in hand to some extent

[Beagle]

NZM are cum a 6c final dividend. This is partially imputed
Their interim dividend was 3.5c

So their net yield > 10%

The CEO was a recent buyer of the stock. If it is good enough for the CEO, is it good enough for your mother?

Hi Noodles,

Nice to hear from you. Hmmmmm, good question. I know our mutual friend Crackity likes them a lot too. Print media dying a very slow death by 1000 cuts, an awful thing to say but maybe it'll outlive my dear old Mum so perhaps you have a point, a good cash cow while it lasts ?


15-20 stocks was the figure used under Classic theory. Classic investment theory should always be challenged just like the overuse of Personal protective equipment is now being challenged and found wanting(Healthcare workers used to think wearing gloves for everything was the way to go but now further research indicates less is best) There are only about 6 stocks on the NZX I would now invest in, full stop, let alone 13 in 13 different sectors. PS-I was kinda lateral thinking with the protective equipment example.:D

I know where you're coming from mate and don't necessarily disagree all that much because as you suggest there is a real shortage of high quality well managed and well directed companies on the NZX but I have to take a diversified approach in this case, I(t's different when you're responsible for investing others money).