sharetrader
Page 5 of 23 FirstFirst 12345678915 ... LastLast
Results 41 to 50 of 225
  1. #41
    Senior Member
    Join Date
    Dec 2014
    Posts
    581

    Default

    Quote Originally Posted by blackcap View Post
    That is the question I have too. Rising interest rates could decimate a bond fund. Or do these funds just buy at par when a bond is issued and hold till maturity and take the interest along the way, ignoring the rise and fall in the actual value of the underlying securities?

    Isn't the unit price of the fund still marked to the current market clearing price of the assets under management? So if you hold a fund with a high exposure to vanilla fixed interest bonds you'll get a capital gain when rates fall and a loss if the rates rise.

  2. #42
    Ignorant. Just ignorant.
    Join Date
    Jan 2005
    Location
    Wrong Side of the Tracks
    Posts
    1,587

    Default

    Quote Originally Posted by blackcap View Post
    That is the question I have too. Rising interest rates could decimate a bond fund. Or do these funds just buy at par when a bond is issued and hold till maturity and take the interest along the way, ignoring the rise and fall in the actual value of the underlying securities?
    AFAIK, because they have money coming in all the time, they have no option but to buy on the secondary market.
    Last edited by GTM 3442; 15-10-2018 at 04:39 AM. Reason: Add important preposition

  3. #43
    Guru
    Join Date
    Apr 2003
    Location
    Wellington, New Zealand
    Posts
    4,876

    Default

    Quote Originally Posted by GTM 3442 View Post
    AFAIK, because they have money coming in all the time, they have no option but to buy on the secondary market.
    Thanks for thee replies. Ok that makes sense. So a conservative "bond" fund can then quite easily suffer capital losses in a time when the discount rate is rising. Interesting.

  4. #44
    Member
    Join Date
    Oct 2013
    Posts
    153

    Default

    Quote Originally Posted by Baa_Baa View Post
    Personally I used to think Kiwisaver was something I should actively manage, by changing portfolio spreads, but I've come around to thinking it's better to just choose the portfolio spread/balance that suits me overall and forget about it, and let time do it's magic thing.
    I agree in part, however I will adjust portfolio when major changes in market cycles seem apparent, like right now. In saying this I have opted to move funds to defensive positions, but have continued my regular contributions to continue to purchase international equities throughout any downturn.

  5. #45
    Member
    Join Date
    Nov 2015
    Location
    Geraldine
    Posts
    133

    Default

    Quote Originally Posted by Baa_Baa View Post
    Even in a downturn however severe, it's easy to forget that there is a constant stream of income flowing into the Kiwisaver providers, which has to go into their investment portfolios, including stocks. So when one stops exposure to stocks in whatever parts of their portfolio, to avoid the paper losses, they also forego the fact that the Kiwisaver provider continues investing in lower priced shares during a downturn.
    I have read a lot of this on kiwi saver providers websites. So how much of an opportunity do you loose if your not IN during the downturn?

    My kiwi saver started in early 2008, 100% growth so it's a reasonable ballance. Looking at the new $$$$$ going in for 1 year it's 5% of the current account ballance (excluding fees & tax). That 5% additional buying opportunity does not excite me compared to the potential reduction in my account ballance.

    A switch to conservative looks appealing if you can time the switch, thats the hard bit.

  6. #46
    Guru
    Join Date
    Feb 2005
    Location
    Auckland, , New Zealand.
    Posts
    3,227

    Default

    Quote Originally Posted by mshierlaw View Post
    I have read a lot of this on kiwi saver providers websites. So how much of an opportunity do you loose if your not IN during the downturn?

    My kiwi saver started in early 2008, 100% growth so it's a reasonable ballance. Looking at the new $$$$$ going in for 1 year it's 5% of the current account ballance (excluding fees & tax). That 5% additional buying opportunity does not excite me compared to the potential reduction in my account ballance.

    A switch to conservative looks appealing if you can time the switch, thats the hard bit.
    Actually the switch back is probably harder to time.

  7. #47
    Senior Member Lego_Man's Avatar
    Join Date
    Feb 2009
    Posts
    556

    Default

    Quote Originally Posted by Baa_Baa View Post
    Even in a downturn however severe, it's easy to forget that there is a constant stream of income flowing into the Kiwisaver providers, which has to go into their investment portfolios, including stocks. So when one stops exposure to stocks in whatever parts of their portfolio, to avoid the paper losses, they also forego the fact that the Kiwisaver provider continues investing in lower priced shares during a downturn.

    Personally I used to think Kiwisaver was something I should actively manage, by changing portfolio spreads, but I've come around to thinking it's better to just choose the portfolio spread/balance that suits me overall and forget about it, and let time do it's magic thing.

    Not necessarily true. In times of panic, people will be switching out of growth funds and into cash/conservative. If this is the case, a shrinking fund needs to realise assets to pay out redemptions. No cheap shares will be bought at the bottom, as all that cash will be required to fund the redemptions. In fact it's more likely that the fund manager will have to sell at the bottom.

    One of the pitfalls of unitised structures is that your are beholden to the behaviour of other investors.

  8. #48
    Senior Member Toulouse - Luzern's Avatar
    Join Date
    Feb 2002
    Location
    Wellington, , .
    Posts
    519

    Smile Interesting Strategy and a couple of questions

    [QUOTE=heisenberg;731518]OP is a good example of momentum investment. I do a similar thing with my investment in the AMP Global Shares Index Fund. That fund mirrors the MSCI World Index, so each month I check the 200 DMA and if it sits below the price, I remain in the fund. If the price is below the DMA then I move to cash/bonds. As we’ve been in a bull market I’ve only had to swap out a few times, but I get the feeling this may become more frequent with the current economic climate.

    Hi Helsenberg

    Time for us to think about what's next for portfolio protection ...


    1 What is OP please?


    2 Can you give a URL link for either AMP Global shares Index Fund with 200 DMA or MSCI World Index with 200 DMA.

    I have google searched for these a few times without success.


    Did you consider 100 or 30 DMA?


    Thanks and regards
    Last edited by Toulouse - Luzern; 19-10-2018 at 08:38 AM. Reason: punctuation

  9. #49
    Advanced Member Valuegrowth's Avatar
    Join Date
    Jun 2013
    Posts
    1,934

    Default

    Where did you invest your kiwi saver and retirement money?

    Individual stocks
    Different types of funds
    100% cash fund
    Others

    I am in 100% cash fund as I didn’t want to take extra risk from my retirement funds. I found in some situation even cash fund could become risky. Therefore, I am hoping to put entire money into individual stocks and looking for a quality retirement funds provider. Is it a risky decision? Thanks.
    Last edited by Valuegrowth; 07-01-2019 at 04:54 PM.

  10. #50
    Senior Member
    Join Date
    Jun 2014
    Location
    Mid of Middle_earth
    Posts
    1,024

    Default

    Quote Originally Posted by Valuegrowth View Post
    Where did you invest your kiwi saver and retirement money?

    Individual stocks
    Different types of funds
    100% cash fund
    Others

    I am in 100% cash fund as I didn’t want to take extra risk from my retirement funds. I found in some situation even cash fund could become risky. Therefore, I am hoping to put entire money into individual stocks and looking for a quality retirement funds provider. Is it a risky decision? Thanks.
    On Kiwisaver, 100% on All Growth funds ever since.
    Retirement money, 85% on TD, the rest on P2P.
    And still fully invested on the Market too. Wouldn't change a thing to this strategy. I retired late last year too.

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •