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GR8DAY
22-08-2009, 02:36 PM
Can anyone clarify for me why I have money sitting in the bank earning a miserable 3.6% when I cud so easy transfer into shares in listed property co's and be earning 11 or even 12%??? ...esp when these same cos (GFT, ING, PFI, KIP etc etc) are generally trading for well less than their NTA.?? Am I missing something important here or just completely thick? On the surface it seems like no contest ( 3.6% v 12%).....there's gotta be a catch?
Of course there is downside risk (but also upside risk)....but even then the returns to investors shud surely remain constant......or close to it?

Any advice and thoughts welcome.

Gr8day

Billy Boy
22-08-2009, 03:06 PM
It takes a long time for some folks to see the trees through the woods.
I have about 70% of my entire portfolio in LPT's coz all other investments
are crap at the moment, percentage wise.
Its not too late to get in, But you have missed the big dip.
Although having said that, we could see another dip come October.
IMO:- ING, GMT, KPF. are the better picks at the moment.
APT are too much into office space for my liking and could well
be the last to come right
KIP only pay a divvy every six months (4 cents) and this is a
disadvantage for them.
PFI do not pay a very good div, Percentage wise for the cost
of each unit but are solid
Nap will be interesting if St Lawrance gets the big heave hoe but
a lot of debt.
All in all the only reason for lpt's being overlooked ???
Bugger all people know about them, let alone how they work !.
I see Chris Lee is warming to them..... and about bloody time.
Do you own research.....
One of my great questions when I buy into something is
What can I do better with the money.
At the moment, not much. And I will have a problem.
Coz I am averaging 12.7% (PIE) paid quarterly, I cant find
myself ditching them coz of the cash flow.
What a bugger, hate that when it happens :D
Cheers & Beers BB:)

fungus pudding
22-08-2009, 04:43 PM
It takes a long time for some folks to see the trees through the woods.
I have about 70% of my entire portfolio in LPT's coz all other investments
are crap at the moment, percentage wise.
Its not too late to get in, But you have missed the big dip.
Although having said that, we could see another dip come October.
IMO:- ING, GMT, KPF. are the better picks at the moment.
APT are too much into office space for my liking and could well
be the last to come right
KIP only pay a divvy every six months (4 cents) and this is a
disadvantage for them.
PFI do not pay a very good div, Percentage wise for the cost
of each unit but are solid
Nap will be interesting if St Lawrance gets the big heave hoe but
a lot of debt.
All in all the only reason for lpt's being overlooked ???
Bugger all people know about them, let alone how they work !.
I see Chris Lee is warming to them..... and about bloody time.
Do you own research.....
One of my great questions when I buy into something is
What can I do better with the money.
At the moment, not much. And I will have a problem.
Coz I am averaging 12.7% (PIE) paid quarterly, I cant find
myself ditching them coz of the cash flow.
What a bugger, hate that when it happens :D
Cheers & Beers BB:)

I agree with you. Have a good look at DNZ as well - unlisted..

Mensa
23-08-2009, 07:50 AM
The following article has some useful information ...

http://www.nbr.co.nz/article/which-property-trust-will-be-next-visit-well-102153

Billy Boy
23-08-2009, 08:39 AM
I agree with you. Have a good look at DNZ as well - unlisted..
DNZ worry me with all their debt.....
The old rule.... Got 10k what better can you buy ???
BB

fungus pudding
23-08-2009, 08:53 AM
DNZ worry me with all their debt.....
The old rule.... Got 10k what better can you buy ???
BB

Yes. I have referred to their debt level before. Still they have some excellent properties and good WALT etc. I hold 300,000 shares in DTZ and find them good for income. At current proce of 45cents they are paying approx 10.4% net of tax as a PIE which is over 16.5% equivalent to a 38% tax payer. Mind you I know absolutely nothing about the share market. I'm simply a burnt out old commercial property investor :D who just dumps surplus cash into property shares because I've got no mortgages left to pay off can't be bothered buying anymore properties, and never sells anything.

loofa
23-08-2009, 03:07 PM
These have been good earners for me since 2004.
A little bit of selling at close to highs and buying back recently has been the way to go.
Currently I have both ING and GMT plus CFDs on both entered at 15%+ below the current prices.
Because CMC charge only 5% interest on the margin brrowed and these yield 12%+ it is "money for jam" if you keep an eye on moves.

Steve
23-08-2009, 04:54 PM
Why are the property manager fees for a listed property trust always higher than the fees charged to private property trusts?

fungus pudding
23-08-2009, 05:59 PM
Why are the property manager fees for a listed property trust always higher than the fees charged to private property trusts?


Which private property trusts always have lower fees ?

GR8DAY
23-08-2009, 06:20 PM
......thanks BB & others for info and advice. I will be acting on it this week and pursue my thinking .maybe just " dip my toe" to start with. BB....what makes you think there cud be another correction coming up in October? (gut feeling or more than that?) Also are all LPTs PIEs and does that mean you (as a unit holder) dont have to pay anymore tax on what you receive as a dividend? Also where do I find info etc for DTZ etc (publically unlisted Property Trusts)

Thanks again

GR8DAY
23-08-2009, 06:23 PM
These have been good earners for me since 2004.
A little bit of selling at close to highs and buying back recently has been the way to go.
Currently I have both ING and GMT plus CFDs on both entered at 15%+ below the current prices.
Because CMC charge only 5% interest on the margin brrowed and these yield 12%+ it is "money for jam" if you keep an eye on moves.

What/who is "CMC" charge?

voltage
23-08-2009, 08:22 PM
I am buying 4 LPTs for income. Have rental houses but LPTs are a no brainer, higher income yield no hassle. They will become my retirement income source one day. Suggest you have a spread they all have their own risks.

fungus pudding
24-08-2009, 08:10 AM
I am buying 4 LPTs for income. Have rental houses but LPTs are a no brainer, higher income yield no hassle. They will become my retirement income source one day. Suggest you have a spread they all have their own risks.


What if you evaluate selling off your houses and buying into LPTs? You can retire and live well off between 500,000 and a million in LPTS, depending on your needs. But I know many landlords with more than a dozen houses/flats and things, and still have to maintain a job. It's nonsense to consider residential property an investment. It just isn't anymore.

GR8DAY
24-08-2009, 11:10 AM
......cudnt agree more FP. Ive had commercial/industrial in the past and wud have done very very well ( instead of just very well) if I hadnt sold when I did......but cant be bothered now with the hassels etc. Can you tell me...are all LPTs PIEs???....and does this mean that no further Personal Tax is paid on the net distributions??

Cheers

fungus pudding
24-08-2009, 12:24 PM
......cudnt agree more FP. Ive had commercial/industrial in the past and wud have done very very well ( instead of just very well) if I hadnt sold when I did......but cant be bothered now with the hassels etc. Can you tell me...are all LPTs PIEs???....and does this mean that no further Personal Tax is paid on the net distributions??

Cheers

That's my understanding. Certainly KPF, ING, GMT, KIP, DNZ, APT are PIEs so distribution does not need to be returned as income. I pick up about $40,000 per annum from PIEs - no tax -my accountant doesn't even want to know about it. Just watch where you are reading the dividends though - some reports are all to hell. The higher your personal marginal tax rate - the bigger the advantage is with PIEs. I find not having to give a toss about the paperwork is a big enough bonus on its own.:D

voltage
24-08-2009, 04:43 PM
FP spot on comments, i will eventually sell my properties and convert to LPTs. Only difference is that I have geared into rentals and wish to cement some capital gains first.
I suppose I could gear into LPTs to some extent. What are your thoughts. Thanks.

fungus pudding
24-08-2009, 05:24 PM
FP spot on comments, i will eventually sell my properties and convert to LPTs. Only difference is that I have geared into rentals and wish to cement some capital gains first.
I suppose I could gear into LPTs to some extent. What are your thoughts. Thanks.

LPTs are already geared, albeit conservatively. It all really depends on your situation and outlook. A lot of residential investors are propping up properties to the extent they are actually buying the capital gain (and that's just compulsory saving) Are you showing a profit? If so - is it an acceptable return on current value or just on historical cost? Is the higher return you will get from LPTs going to make up for possible capital gain? Is there more of a chance of capital gain in the listed trusts given that they are currently being given away (well below assett value)?
I know what I would do, but my philosophy has always been to just keep stacking up income, never sell anything, and regard any capital gain as a very welcome bonus.
So I suppose a lot depends if you want to build up an income to become financially independent - which is relatively easy; or do you want to try and do it through capital gain including the necessary selling to realise profit?
Good luck.

voltage
24-08-2009, 05:27 PM
FP do you include LPts like westfield?

fungus pudding
24-08-2009, 05:42 PM
FP do you include LPts like westfield?


No, but only because I know nothing about Westfield. I presume they are still Aussie based. Generally the Aussie property companies are very highly geared, and gearing works both ways. When values fall - you get hammered. Also they are subject to CGT and of course are not PIEs. I have a heap of Centro managed MCS syndicate stuff. They are great - but Centro listed property has been disastrous, simply because of high leverage.

POSSUM THE CAT
24-08-2009, 06:05 PM
Voltage Westfield Has the lowest gearing to the best of my knowledge but still a lot higher than most NZ LPTs

777
24-08-2009, 06:16 PM
Does anyone follow

http://www.directproperty.co.nz/

fungus pudding
24-08-2009, 06:38 PM
Does anyone follow

http://www.directproperty.co.nz/

First I've heard of them. Shares are 14,500 each by looks of things, but I have no idea of returns etc. Web site is vague. Like to know more.

loofa
24-08-2009, 07:01 PM
What/who is "CMC" charge?

CMC Markets charge 5.5% (rate today) for the 90% they are loaning against.
So if the yield is 12% and there is no change in price of the CFD, you make a margin of 6.5% on a day to day basis.

voltage
24-08-2009, 07:43 PM
loofa, i am ignorant of CFD. Obviously these are leveraged products. Could you expand further. thanks. If I borrow to invest is this the same thing

GR8DAY
24-08-2009, 07:57 PM
....ok cheers loofa. just started looking into CFDs today after your comments so still trying to get my head around them also. I guess it would be just as easy to mortgage the house and throw it at LPTs to make the same gain...as you say money for jam?? do you have any prefered LPTs and for what reason?

Gr8day

voltage
24-08-2009, 08:00 PM
FP i suppose an LPT is just like any other share but focused on income. Does this mean you should include other income shares inNZ that pay a high dividend

fungus pudding
24-08-2009, 08:11 PM
FP i suppose an LPT is just like any other share but focused on income. Does this mean you should include other income shares inNZ that pay a high dividend

If you want to. I don't because I have huge confidence in bricks and mortar, and no confidence in run of the mill widget manufacturers, retailers etc. Also I know a large number of people who make a damn good living from real estate and many are including the listed trusts now because they represent better buying than the direct market. But I have never met anyone who lives off the sharemarket through general shares. Which is not to say they don't exist - just that they seem to be well hidden.:D

voltage
24-08-2009, 08:14 PM
thanks FP I do welcome your comments, you certainly know what you are doing. Do you buy all the LPTS available on the NZX?

fungus pudding
24-08-2009, 08:37 PM
thanks FP I do welcome your comments, you certainly know what you are doing. Do you buy all the LPTS available on the NZX?

No. I have 25,000 Apt. 50,000 GMT. 150,000 ING. 50,000 KIP, 100,000 KPF. 315,000 DNZ (unlisted) and a few bits and pieces in some Australian syndicates, one American, and some NZ proportional titles. My main income is from a couple of commercial buildings. I am really interested in that Direct property fund mentioned a couple of posts back so will follow it up. I got to the stage in life where I have no mortgages so just intend to keep dumping my surplus into LPTs and the like. I'm not suggesting that being mortgage free is a great thing - it carries the risk of losing out in times of high inflation and capital gain. But it suits me these days because buying has become too competitive, i.e. returns don't excite me. As I said, I just keep concentrating on stacking up income and that has meant repaying mortgages which has given me a better income than buying more property. Personally I see little point in becoming better off on paper all the time, while being stretched for cash. It's necessary when you start - but there comes a time when you think 'enough is enough'. As I've often said 'the funny thing about real estate is it will keep you poor while you're getting rich'. Amen :D

beacon
25-08-2009, 08:34 AM
As I've often said 'the funny thing about real estate is it will keep you poor while you're getting rich'. Amen :D

Brilliant elucidation. kudos

GR8DAY
25-08-2009, 12:37 PM
FP......as a "mature" holder in these co's do you have any concerns with any of them to offer to an "immature" investor trying to make an informed decision?? Are you comfortable with all their current financial positions?

fungus pudding
25-08-2009, 12:54 PM
FP......as a "mature" holder in these co's do you have any concerns with any of them to offer to an "immature" investor trying to make an informed decision?? Are you comfortable with all their current financial positions?

I'm no expert but overall I'm quite happy. They've been knocked around because of the credit crunch and banks requiring vhem to repay some borrowings to lower there LVRs, which has meant some have sold buildings - which is the last thing a property investor should do. I don't like their divdend reinvestment schemes because they dilute the shares a little. Although the take-up hasn't been high enough to worry about. APT is one I don't like and hold only 25,000 shares. That's cos I don't like office buildings - they date, cost a fortune to refurbish, and always need large expenditure for new tenant. A grubby old warehouse or similar usually makes a better investment. Anyway, have a look at the share prices compared to the assett backing, and there's a fair margin there to reduce any worries. The commercial property market is hot with buyers prepared to accept quite low yields, while listed property is getting ignored, and that to me is why it looks like bargain buying. Just don't expect to buy in one day - and be out the next.

Billy Boy
26-08-2009, 11:14 AM
......thanks BB & others for info and advice. I will be acting on it this week and pursue my thinking .maybe just " dip my toe" to start with. BB....what makes you think there cud be another correction coming up in October? (gut feeling or more than that?) Also are all LPTs PIEs and does that mean you (as a unit holder) dont have to pay anymore tax on what you receive as a dividend? Also where do I find info etc for DTZ etc (publically unlisted Property Trusts)

Thanks again

GR8DAY.
SORRY I missed your post...
How ever F/Pud has answered most of your Q's
Dip in October......
There always seams to be one. First Qtr for most Coy's after
F/Year reporting. Lpt's will not be afected too much but usually
suffer along with the rest of the market. (herd mentality).
I agree with F/Pud in his saying. "the private rental market is
under performing & too much hassel"

I hold ING GMT KPF DTZ
Dont like APT warm on KIP & PFI..
Cheers BB:)

GR8DAY
26-08-2009, 06:38 PM
.....cheers BB. No one seems to be mentioning NAP National Property Trust.....do you know if there's any reason for that? I picked up a few yesterday. Their gearing is low ( around 25%) and yield seems ok. Any thoughts anyone?

fungus pudding
26-08-2009, 07:02 PM
.....cheers BB. No one seems to be mentioning NAP National Property Trust.....do you know if there's any reason for that? I picked up a few yesterday. Their gearing is low ( around 25%) and yield seems ok. Any thoughts anyone?

Some of their properties are less than wonderful, e.g. a couple of shopping centres in Ch-ch; and apparantely the management is a bit hefty on shareholders, but there's a big discount to intrinsic value, along with more than 10% return after tax - can't be too bad.

fungus pudding
26-08-2009, 07:05 PM
.....cheers BB. No one seems to be mentioning NAP National Property Trust.....do you know if there's any reason for that? I picked up a few yesterday. Their gearing is low ( around 25%) and yield seems ok. Any thoughts anyone?


I think there's a few references in this thread.

http://sharetrader.co.nz/showthread.php?t=2157

voltage
26-08-2009, 07:22 PM
abamrocraigs recommend Kiwi, Goodman, ING Medical and hold on AMP Office

loofa
21-09-2009, 07:47 PM
Holding ING GMT with both shares and small CFDs to utilise the high yield.
Very profitable over the last two months.
Whre to now?

Skol
11-10-2009, 12:05 PM
Been buying a few MGR. Done pretty well recently and lots of exposure in the Aussie papers who reckon it's a sitting duck for a takeover because of its low gearing (18%).
I'm a bit like fungus, paid off the mortgages, still have a job, one commercial property and excess cash goes into shares, LPTs etc. I've spent most of my working life cash poor and asset rich, I like having a few grand to splash every now and then.
Looks like the Govt. one way or another is going to stick the knife into residential rentals.

Also property ownership isn't liquid and I'm sick of paying Councils, Insurance Companies, Solicitors, accountants, Regional Council, real estate agents, repairs, maintenance, etc. etc.

Not to mention dealing with the occasional scumbag tenant.

Billy Boy
23-10-2009, 10:17 AM
Hi Skol
Seams a few of us have been in your boat(so to speak) asset rich, cash poor. I now have no comercial properties, and have invested in LPT's
mainly. It,s the best move I've made so far. As you say no worries,
Rates, tennants, etc.... and the reterns are Tax Free.
Have been watching NAP lately and picked up a few. They appear
to be getting the house in order. Managing things well. KPF is
clipping along nicely.
APT welllll..... go some housework to do. I use to hold but got out
some time ago.
I would have though ING could have moved SP wise but there again
with the ANZ takeover things need to settle.
GMT now trading around NTA.... Hmmmmm I hold a lot.
Your thoughts welcome
Cheers BB:)

fungus pudding
23-10-2009, 01:26 PM
Hi Skol
Seams a few of us have been in your boat(so to speak) asset rich, cash poor. I now have no comercial properties, and have invested in LPT's
mainly. It,s the best move I've made so far. As you say no worries,
Rates, tennants, etc.... and the reterns are Tax Free.
Have been watching NAP lately and picked up a few. They appear
to be getting the house in order. Managing things well. KPF is
clipping along nicely.
APT welllll..... go some housework to do. I use to hold but got out
some time ago.
I would have though ING could have moved SP wise but there again
with the ANZ takeover things need to settle.
GMT now trading around NTA.... Hmmmmm I hold a lot.
Your thoughts welcome
Cheers BB:)



All good stuff. Not a bad idea thought to keep enough commercial to give you at least the first 70,000 of income, and use the LPTs from there on to avoid the 38% tax rate.

CJ
02-02-2010, 04:15 PM
Does any one know about tax deductions for PIE income. For example if you had interest costs from a loan to purchase shares in a LPT would that be deductible against your taxable income.I think so.

At one point I worked out the benefit of borrowing $1m from kiwibank secured against $1m deposited into their 1 year TD pie. Currently a $3k loss but when I originally did it was about $1k positive. Not enough to make it worthwhile and I didn't think they would lend me $100m to do it.. [edit - I just remembered - I was on a PIR of 19.5% but marginal rate of 39% at the time (due to specific circumstances) so it wasn't a scheme that could be rolled out to the masses so didn't pursue - so would be up $1500 on a $1m loan/investment based on current rates (my PIR has now chagned though)]

777
02-02-2010, 04:25 PM
I have heard the LPT's pay dividends under the PIE regime.

Under the PIE regime if you nominate the correct PIE rate for your income level PIE income is not included in your tax return. Very nice for people in high tax brackets.

Does any one know about tax deductions for PIE income. For example if you had interest costs from a loan to purchase shares in a LPT would that be deductible against your taxable income.

I don't think you can nominate a PIE rate for listed funds. They work on the 30c rate although some of the income may be imputed in which case you can include that and claim the imputation credits. No gain to 30c payers but of use to the lower rates.

This may be of use to regarding changes to rates on 1/4/10.

http://www.ird.govt.nz/news-updates/like-to-know-changes-tax-rates.html

fungus pudding
02-02-2010, 06:32 PM
I don't think you can nominate a PIE rate for listed funds. They work on the 30c rate although some of the income may be imputed in which case you can include that and claim the imputation credits. No gain to 30c payers but of use to the lower rates.

This may be of use to regarding changes to rates on 1/4/10.

http://www.ird.govt.nz/news-updates/like-to-know-changes-tax-rates.html

Interest costs are deductible. Income from pies does not need to be icluded in return. You can nominate your PIR - prescibed investor rate - which is your marginal tax rate. If you don't the default rate is 30%. From memory there is a difference in the way low income earners are treated, but sorts itself out because they claim imputation. Ages since I sussed it all out and can't remember, but it will be on IRD site.

777
03-02-2010, 02:15 PM
Fungus there is no choice of nominating a PIR for "listed" funds. ie those traded on the NZX. Any sorting out of tax paid has to be done at tax return time. That is where the IRD wins because so many people don't bother to fill one out.

fungus pudding
03-02-2010, 02:47 PM
Fungus there is no choice of nominating a PIR for "listed" funds. ie those traded on the NZX. Any sorting out of tax paid has to be done at tax return time. That is where the IRD wins because so many people don't bother to fill one out.

Oops! Sorry - you're quite right of course when it comes to NZX stuff. I'll crwl back under my rock.:o

777
03-02-2010, 10:01 PM
No problem Fungus. I use the PIE system to my advantage but it has a complexity in it self. Things would be a lot simpler if with the restructuring of the tax system they simply came up with one tax rate for investment income. Full and final like PIE. Not part of income tax. Something in the 10-20 cent range.

beacon
04-02-2010, 07:15 AM
Something in the 10-20 cent range.

There might be a long wait before that is seen, if ever ...

fungus pudding
04-02-2010, 07:36 AM
No problem Fungus. I use the PIE system to my advantage but it has a complexity in it self. Things would be a lot simpler if with the restructuring of the tax system they simply came up with one tax rate for investment income. Full and final like PIE. Not part of income tax. Something in the 10-20 cent range.

I'd be a starter for that - having no other income. Bring it on .......

beacon
04-02-2010, 09:57 AM
APT reckons a 10% hit to bottomline if depreciation is removed and land tax introduced.
That is an understatement in my opinion. Also, big research houses talking about vacancy rates remaining high well into 2010-11.

With the interest rate expected to harden, LPT are sitting ducks in the short term if the proposed Tax legislation comes to fruition. If depreciation rules include other businesses as well, then I would expect on impact on all stocks by at least 10% ...

loofa
04-03-2010, 01:33 PM
While I have most of our listed property trusts as directly held I also have been using CFDs to add to the mix.
Below is the position starting in October 2008 (rounded to hundred dollars)
Underlying value of shares purchased using CFDs.............................................. ........... $30,000
CFD margin............................................ .........................$3000 (later $4500)
Maximum drawdown.......................................... ..............$4200
Current value............................................. .................................................. ............ $38,500
Financing cost.............................................. .................................................. ...........($2,900)
Dividends received.......................................... .................................................. ..........$4,700

Current net gain.............................................. .................................................. .........$10,300
Return on investment ($7200 maximum).......................................... ................................143%
OK drawdown could have been greater but period includes the market collapse of 2008/9 which was unusually demanding on many share values.

beacon
04-03-2010, 07:55 PM
You must have either iron guts or deep pockets or great discipline to have held your CFDs right through GFC. But then LPTs were near the bottom in October 2008, so not a fair risk return example. Try having held them from jan 08 to date, you might see a different picture. Worse, if you held TEL/FBU/AIA/NZR/NPX/PGW etc from their peaks...

CJ
05-03-2010, 07:55 AM
Dividends received.......................................... ....................$4,700I thought CFD's were inefficient for income shares because of the way dividends are treated. You only get the net dividend (not the IC's) but end up paying tax on it - essentially double taxation.

ie.
Directly held:
Dividend of $67 with 33IC's. Taxable income of $100 but IC's of 33 so no tax to pay for a 33% taxpayer
CFD's
Dividend of $67 but no IC's. Taxable income of $67 so additional tax to pay of 22 for a 33% taxpayer.

Of the top of my head, excluding capital gains, that means you lose 2% compared with holding directly??

Therefore a margin account (borrowing but own the underlying share) rather than a derivative is better. Or has it changed since I looked at it.

beacon
05-03-2010, 10:09 AM
Or has it changed since I looked at it.

Nothing's changed since you last looked. Also interest cost is on roughly 115% of your holding (100% interest paid + interest lost on 15% margin) = much greater than normal margin account. And no, their bulky disclosure statement does not tell you this simple fact.

loofa
06-03-2010, 09:32 AM
You must have either iron guts or deep pockets or great discipline to have held your CFDs right through GFC. But then LPTs were near the bottom in October 2008, so not a fair risk return example. Try having held them from jan 08 to date, you might see a different picture. Worse, if you held TEL/FBU/AIA/NZR/NPX/PGW etc from their peaks...

No one would hold "long" in a falling market. If available eg GMT it would have been a useful short but bearing in mind the cost of paying dividends back.
In fact the maximum drawdown was because I did not pick the bottom. Not shown above is the fact that the CFDs taken up were an average between Oct 08 and June 09 and the dividends accordingly.
Tax wise I accept gross on everything including claiming the carrying cost interest. :)

No iron guts here just logic!

loofa
06-03-2010, 09:33 AM
I thought CFD's were inefficient for income shares because of the way dividends are treated. You only get the net dividend (not the IC's) but end up paying tax on it - essentially double taxation.

ie.
Directly held:
Dividend of $67 with 33IC's. Taxable income of $100 but IC's of 33 so no tax to pay for a 33% taxpayer
CFD's
Dividend of $67 but no IC's. Taxable income of $67 so additional tax to pay of 22 for a 33% taxpayer.

Of the top of my head, excluding capital gains, that means you lose 2% compared with holding directly??

Therefore a margin account (borrowing but own the underlying share) rather than a derivative is better. Or has it changed since I looked at it.

Not if the CFD interest is 5.5% and the dividend income is 10%+
You also need a lot more capital to hold directly.

loofa
06-03-2010, 09:57 AM
CFD basics
1. Require enough capital to meet the margin and the extra safety level demanded by the provider
2. Shorting allowed where provided
3. Very low commission on transactions but watch the spread
4. Quick execution to trade
5. International scope so do not require currency conversion and remittance
6. Coverage shares, sectors, indices, forex, commodities

I am not involved in any way with the CFD providers and I am not against direct investment (in fact I have a portfolio of international shares and hedge funds)
However I do have a very acute mathematical ability

Brian
26-03-2010, 09:33 AM
Yes they are mostly good news have been in this market since APT took over the old capital property trust. And yes there could be an adjustment dowmwards in october because of govt moves . Another golden opportunity. good luck and get in.

buxlo12
27-03-2010, 07:41 AM
There are quite a few listed property trusts available for example KPF, ING, GMT, KIP, APT
I was wanting to know if any body some more details on the property trusts so we can make some comparisons

Debt ratios?
Dividend yields?
Overall size?
How often they make distributions?
Where is the majority of their properties?
Type of properties they have?

loofa
27-03-2010, 01:32 PM
There are quite a few listed property trusts available for example KPF, ING, GMT, KIP, APT
I was wanting to know if any body some more details on the property trusts so we can make some comparisons

Debt ratios?
Dividend yields?
Overall size?
How often they make distributions?
Where is the majority of their properties?
Type of properties they have?

To much to answer here so get their latest reports.
Briefly GMT is very strong in the industrial and design and build to order.
ING has a legacy of lower value building which are more easily sold on.
APT appears out of favourwith too many office buildings which are under pressure.
KIP has Sylvia Park flagship

ENP
31-03-2010, 03:59 PM
I've looked into these the last few days. There is 7 property trusts that I've found. They all seem to be about the same. Some invest in hospitals, small warehouses, shopping malls and sky scrapers.

Are they all pretty much the same?

POSSUM THE CAT
31-03-2010, 06:07 PM
ENP No read the whole thread

AMR
19-05-2010, 08:51 PM
Have been looking for some LPTs to park my father's savings into - any further news from KIP on their new developments in Mt Wgtn?

Also what are the implications from an employment standpoint if they "force" workers to use buses? It sounds like the developers are grasping at straws to pass the council's TIA.