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  1. #31
    Legend minimoke's Avatar
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    Quote Originally Posted by Beagle View Post
    Days like today I am happy that I am of a similar view to you Peat and AMP and sitting on a pretty reasonable cash allocation but most other days this month it hasn't felt so good lol
    Like you I am "well positioned" in cash. But yields on cash are abysmal. Which makes even expensive stocks look more attractive - thus pushing demand.

  2. #32
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by minimoke View Post
    Like you I am "well positioned" in cash. But yields on cash are abysmal. Which makes even expensive stocks look more attractive - thus pushing demand.
    I keep mine with Heartland in their 2.75% on call account so at least it keeps pace with inflation and if the "custard" hits the fan and assets get cheaper then one's purchasing power goes up ! I agree that you are quite right that globally the returns on cash are pitiful, (2.75% is unheard of) which is definitely one factor fuelling the global rally.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  3. #33
    Legend minimoke's Avatar
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    Quote Originally Posted by Beagle View Post
    I keep mine with Heartland in their 2.75% on call account ....
    Hmmm. I wonder if they have a Special Rate for shareholders. Percy?

  4. #34
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    Quote Originally Posted by Beagle View Post
    I keep mine with Heartland in their 2.75% on call account so at least it keeps pace with inflation and if the "custard" hits the fan and assets get cheaper then one's purchasing power goes up ! I agree that you are quite right that globally the returns on cash are pitiful, (2.75% is unheard of) which is definitely one factor fuelling the global rally.
    That is a great on-call rate. I guess Heartland's lending rates are higher as well. Does this mean they have riskier customers or are the main banks screwing over savers?
    https://www.heartland.co.nz/savings-...avings-account

    I am using Rabodirect rolling over three monthly term deposits at roughly 3%. Banks ratings as follows.
    https://www.rbnz.govt.nz/regulation-...credit-ratings
    ratings explanation
    https://www.rbnz.govt.nz/-/media/Res...8179.pdf?la=en
    At least part of my money is tied up for three months. In Heartland you can transfer it out at the first signs of trouble. I suppose it is unlikely any bank will go under. Are the NZ taxpayers still underwriting/gauranteeing the bank business in NZ?
    Last edited by Aaron; 31-01-2018 at 12:46 PM.

  5. #35
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    Just read the thread heading. I hope nz equities are too expensive I have been waiting for them to get cheaper for a while now. Good to see heartland providing interest rate competition. Interest rates go up asset prices come down. Maybe the world is normalising

  6. #36
    percy
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    Quote Originally Posted by minimoke View Post
    Hmmm. I wonder if they have a Special Rate for shareholders. Percy?
    HBL usually send special rate cards through with reports,however, mention you are a shareholder and would prefer the shareholders' rate.

  7. #37
    percy
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    Quote Originally Posted by Aaron View Post
    Just read the thread heading. I hope nz equities are too expensive I have been waiting for them to get cheaper for a while now. Good to see heartland providing interest rate competition. Interest rates go up asset prices come down. Maybe the world is normalising
    For those of us who loaded up in the market a few years ago,as well as enjoying the market being too expensive, we are very relaxed with the increasing dividends.

  8. #38
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by Aaron View Post
    That is a great on-call rate. I guess Heartland's lending rates are higher as well. Does this mean they have riskier customers or are the main banks screwing over savers?
    https://www.heartland.co.nz/savings-...avings-account

    I am using Rabodirect rolling over three monthly term deposits at roughly 3%. Banks ratings as follows.
    https://www.rbnz.govt.nz/regulation-...credit-ratings
    ratings explanation
    https://www.rbnz.govt.nz/-/media/Res...8179.pdf?la=en
    At least part of my money is tied up for three months. In Heartland you can transfer it out at the first signs of trouble. I suppose it is unlikely any bank will go under. Are the NZ taxpayers still underwriting/gauranteeing the bank business in NZ?
    The move by the main trading banks to either pay no interest or so little interest on call accounts its laughable is a fairly recent phenomenon. Really at the rates the main banks are paying they're saying they don't want people to have their money on call. No there's no deposit guarantee scheme that I'm aware of unlike in some other countries. Some of Heartland's lending is at the riskier end of the scale but the main trading banks also have a fair slice of risky lending on their balance sheet's too.

    I have ~ 38% of my portfolio allocated to cash at this point which demonstrates the degree of caution I have to where the markets are at present. I confess this sized cash allocation has felt a little too conservative at times this summer with the market roaring away like the bit fat fairly mature Bull it is some days...I guess after a stellar 2017 I am content to rest on my laurels a little this quarter and see how things unfold through to 31 March and go from there. This feels about right to me and passes the "sleep test" so I'll just follow my gut instinct and stick with that cash allocation in the short term. The key risk I find with sitting on a sizeable cash allocation is resisting the temptation to spend it
    Last edited by Beagle; 31-01-2018 at 02:40 PM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  9. #39
    Legend peat's Avatar
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    Quote Originally Posted by Aaron View Post
    That is a great on-call rate. I guess Heartland's lending rates are higher as well. Does this mean they have riskier customers or are the main banks screwing over savers?
    https://www.heartland.co.nz/savings-...avings-account

    I am using Rabodirect rolling over three monthly term deposits at roughly 3%. Banks ratings as follows.
    https://www.rbnz.govt.nz/regulation-...credit-ratings
    ratings explanation
    https://www.rbnz.govt.nz/-/media/Res...8179.pdf?la=en
    At least part of my money is tied up for three months. In Heartland you can transfer it out at the first signs of trouble. I suppose it is unlikely any bank will go under. Are the NZ taxpayers still underwriting/gauranteeing the bank business in NZ?
    No the banks in NZ are not govt guaranteed.
    Yes I use the Rabo 60 day notice account for 3% that strikes me as useful, and stops me from acting on a whim. I keep enough aside (at a much lower rate) for trading settlements
    I have no concern with Rabo as an institution so dont need to take into account any 'signs of trouble' with them.

  10. #40
    Legend minimoke's Avatar
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    Quote Originally Posted by peat View Post
    No the banks in NZ are not govt guaranteed.
    Agreed - but they are all probably too big to be allowed to fail. I have seen no change in appetite from government to intervene in the same way they did with South Canterbury Finance should an event occur.

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