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  1. #1
    Junior Member
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    May 2017
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    Default Investment advise for another rookie

    Hi,

    I am a Australian PP holder living in NZ for the last year.
    I have saved up 20k and looking at investing that into a better deal than the current savings and term deposits on offer.

    I can put away this 20k for as long as I can foresee (5-10 years or even more), this is because I plant to move back to Australia sometime in the near future and therefore plan to keep this for long-very long time until such time I need this bit of money.

    After a bit of reading around forums I have now decided to go towards Smartshares.
    I like this platform because of the useful available information - mainly the annual statements (Although not all the info makes sense).

    Some questions if I get some assistance on?

    1. I am interested in buying just FNZ.
    But I find that the price of this share is currently at its highest level of ~$2.20.
    a. Is this a good time to buy this?
    b. Is there potential to go even higher?
    c. How do I determine the good fund to go at this point (based on what data)?



    2. Is this a better option compared to having it a term deposit for example?
    a. How can I determine this to ascertain from the past info to work out the difference (although, I understand that the past is not a good indicator of future) just to play with numbers that are real rather than futuristic which is yet to occur?
    b. Are the returns after all the fees, taxes better option compared with the term deposits and savings account?
    c. Is there capital growth with these shares?

    Is there any other way I can use this 20k to grow over the next 5-10 years?

    Thanks in advance.



  2. #2
    Member
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    Dec 2014
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    267

    Default

    Well I definitely can't make any recommendations regarding what investments might suit your goals, but I did really enjoy reading this guys blog. Maybe you'll find it a good starting point.. good luck.

    http://jlcollinsnh.com/stock-series/

  3. #3
    Ignorant. Just ignorant.
    Join Date
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    Irresident
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    Default

    Stick half of it in a bank account in Australia with one of the Australian banks.

    Because the Australian government guarantees bank deposits, you have just insulated half of your lump sum from downside risk of capital loss due to a combination of enthusiasm and ignorance.

    Now the other half has to work twice as hard.

    Good luck with that.

  4. #4
    Junior Member
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    May 2017
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    Default

    Quote Originally Posted by GTM 3442 View Post
    Stick half of it in a bank account in Australia with one of the Australian banks.

    Because the Australian government guarantees bank deposits, you have just insulated half of your lump sum from downside risk of capital loss due to a combination of enthusiasm and ignorance.

    Now the other half has to work twice as hard.

    Good luck with that.
    Thanks, it look awhile to get what you meant.. I won't lie...

    I am not sure if you're referring to me being enthusiastic and ignorant or the New Zealand markets..
    If you are referring to me.. I am taking all the bit of opportunity to learn.. after all people learn at every opportunity it presents and no one will be ignorant forever - it may be a costly learning experience.. and I will soon enough be playing around with sharemarket and will be schooling others..

    Thanks for your advise towards getting half of it across to Aus. I have considered it and thinking of moving bit by bit using online services such as Transferwise.

    So, is there no guarantee on bank deposit provided by the government here in NZ?

  5. #5
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    May 2017
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    Quote Originally Posted by huxley View Post
    Well I definitely can't make any recommendations regarding what investments might suit your goals, but I did really enjoy reading this guys blog. Maybe you'll find it a good starting point.. good luck.

    http://jlcollinsnh.com/stock-series/
    Thanks for your time in sharing your experience. I appreciate it.

  6. #6
    Guru peat's Avatar
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    Aug 2004
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    Auckland, , New Zealand.
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    Quote Originally Posted by Vig View Post
    So, is there no guarantee on bank deposit provided by the government here in NZ?
    No guarantee in NZ , in fact the NZ Govt solution to a bank failure includes a potential haircut for depositors.
    For clarity, nothing I say is advice....

  7. #7
    Legend
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    Quote Originally Posted by peat View Post
    No guarantee in NZ , in fact the NZ Govt solution to a bank failure includes a potential haircut for depositors.
    Is there an intention to treat all depositors equally though? I may be wrong. But I seem to remember that any 'haircut' on term deposits, should the NZ banks get into absolute strife, will only happen above a threshhold level. If we are talking about a $10k term deposit, I think that might be exempt from any haircut.

    Even if the government demands a 'haircut' all round, that could lead to rioting from smaller bank customers. There is nothing to stop a local bank paying a small savers 'haircut' to the government out of bank funds to appease irate small saver customers. If they want to stay in business long term, it may be a sacrifice the banks have to make.

    SNOOPY
    Management top tip: Share the responsibility. Change your name by deed-poll to "Someone Else"

  8. #8
    Guru
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    Hamilton New Zealand.
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    Default Paradoxial thinking due to animal herd behaviour (survival instincts)

    Quote Originally Posted by Vig View Post
    Thanks, it look awhile to get what you meant.. I won't lie...

    I am not sure if you're referring to me being enthusiastic and ignorant or the New Zealand markets..
    More likely Mr Market being enthusiastic and ignorant (overvalued?).

    Strange thing about people..when the markets recover from the depths (undervalued + fundamentally less risk) there is no newbie in sight and even normal investors are scared to re-enter the market...when the market is overvalued and has been going up for 8 years with secular fundamentals at very high risk newbies want to enter and the normal investor is all "in" boots n all (100% + as much loans as they can get).......
    Large volume of Buyers seem to buy in at the top and sell at the bottom...Strange don't you think..but there is much evidence to support this...(insects drawn to a UV light zapper)

    Think risk v reward..can the market double in the next 3 years as it normally does after the bear market dies and when everyone to scared to enter...

    This Bull market is over 8 years old (average 3.7 years)..Bear markets follow bull markets...An average Bear Market wipes out 40% of your capital which takes nearly 3 years to recover back to break-even...that if no companies in your portfolio go belly -up

    Sorry to ruin your day
    Hoop

  9. #9
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    [QUOTE=Hoop;667788]More likely Mr Market being enthusiastic and ignorant (overvalued?).

    Strange thing about people..when the markets recover from the depths (undervalued + fundamentally less risk) there is no newbie in sight and even normal investors are scared to re-enter the market...when the market is overvalued and has been going up for 8 years with secular fundamentals at very high risk newbies want to enter and the normal investor is all "in" boots n all (100% + as much loans as they can get).......
    Large volume of Buyers seem to buy in at the top and sell at the bottom...Strange don't you think..but there is much evidence to support this...(insects drawn to a UV light zapper)

    Think risk v reward..can the market double in the next 3 years as it normally does after the bear market dies and when everyone to scared to enter...

    This Bull market is over 8 years old (average 3.7 years)..Bear markets follow bull markets...An average Bear Market wipes out 40% of your capital which takes nearly 3 years to recover back to break-even...that if no companies in your portfolio go belly -up

    Sorry to ruin your day
    Hoop

    [the aussie bank is not a bad idea but you will only get 2% at best less tax for term term funds invested . You'd be better to just use your money buying and selling items off trademe . Worked for me . However a good fund manager like pie funds or some of the other fund managers that you can easily check will proved you with long term returns probably of 5% at a low and a lot higher if you are lucky . If your approach is long term then that's why I would do. ]

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