sharetrader
Page 6 of 8 FirstFirst ... 2345678 LastLast
Results 76 to 90 of 106
  1. #76
    Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    372

    Default

    Quote Originally Posted by mfd View Post
    13 years is a strange timeline. Here's my source

    https://seekingalpha.com/article/415...vs-s-and-p-500

    Looks like they did well around 2007 which bumps up your quoted 13 year returns. The trend is pretty clearly towards matching the market in the future, as you'd expect as the size of the company increases. Not a terrible place for your money, but don't expect the future returns to look like the past.

    I can fully understand not wanting to be in kiwisaver if it's too inflexible. On a pure financial returns basis, I will take it over Berkshire anyday due to my employer and the tax man more than doubling all my contributions.
    The author's can pick the timeline to suit what every spin they want, also I would question where that SeekingAlpha link gets it's data from as their chart doesn't seem to reflect what I posted.

    The employer matching of contributions is not always double. The minimum is 3% of person's income and the employer doesn't have to match any higher if the employee chooses to contribute more (up to 8% - a far cry from 18% that Canada allows).

    My notion is at the minimum, the 3% matching contributions can easily be eaten up by the fund's mgt fees and this you lose out on compounding returns. More importantly, contributions only come if you're employed. What does that leave to those with disabilities or on the benefit? This is why I wonder if the NZ gov't would of been better to boost their superannuation pension fund by directly buying the S&P500 index so that everyone will see the benefit at retirement. Not just those that are able to work.

  2. #77
    Member
    Join Date
    Jan 2014
    Posts
    269

    Default

    Quote Originally Posted by SBQ View Post
    The author's can pick the timeline to suit what every spin they want, also I would question where that SeekingAlpha link gets it's data from as their chart doesn't seem to reflect what I posted.

    The employer matching of contributions is not always double. The minimum is 3% of person's income and the employer doesn't have to match any higher if the employee chooses to contribute more (up to 8% - a far cry from 18% that Canada allows).

    My notion is at the minimum, the 3% matching contributions can easily be eaten up by the fund's mgt fees and this you lose out on compounding returns. More importantly, contributions only come if you're employed. What does that leave to those with disabilities or on the benefit? This is why I wonder if the NZ gov't would of been better to boost their superannuation pension fund by directly buying the S&P500 index so that everyone will see the benefit at retirement. Not just those that are able to work.
    Technically I agree, high fees could eat up the contributions. However, if I do a back of the envelope calculation of a 7% return without matching, versus a 6% return with employer matching (1% fee, so three times what I pay), the matched scenario wins until you get to 90 years from your first contribution. In reality, the matching far outweighs the cost of the fees. Even a 2% fee wins for 50 years.

    As I said, I only contribute 3% as that is all that is matched. Savings above this go elsewhere. If the matching increased, I would put in more to maximise this

    Fully agree the system is not well setup for those who don't earn much or don't work at all, but that doesn't change my response to the incentives.

  3. #78
    Senior Member Valuegrowth's Avatar
    Join Date
    Jun 2013
    Posts
    1,195

    Default

    My Kiwisaver started in early 2010. 100% cash fund. I feel like I should adjust my kiwisaver now. Is it wise to keep 100% cash? Are there any risks?Thanks in advance.


    Last edited by Valuegrowth; 21-03-2020 at 10:52 PM.

  4. #79
    Permanent Newbie
    Join Date
    Mar 2010
    Posts
    1,127

    Default

    Quote Originally Posted by Valuegrowth View Post
    My Kiwisaver started in early 2010. 100% cash fund. I feel like I should adjust my kiwisaver now. Is it wise to keep 100% cash? Are there any risks?Thanks in advance.
    Are you pulling my leg as your name doesn't suggest someone who would be in cash mr valuegrowth

    With the power of hindsight I would have suggested a growth fund from 2010 to Dec 2019 and then a move to cash.

    Cash right now to me would seem the best option but it will depend on what central banks do. they have been working hard to debase currencies to clear debts but have been unsuccessful so far. I am not wise so take my ramblings with a grain of salt I would suggest a move to growth or balanced fund might be good sometime in the future but not yet as the virus might only be the pin that pricks the debt bubble. I believe the debt bubble is what the financial markets are really scared of.
    https://www.theguardian.com/world/20...ggle-with-debt

    Personally my Kiwisaver will remain ultra conservative unless we go to negative interest rates or suggestions of a currency crisis.
    When to move to growth is impossible to know but personally I don't think it is just yet.

  5. #80
    Senior Member Valuegrowth's Avatar
    Join Date
    Jun 2013
    Posts
    1,195

    Default

    Thank you so much Aaron for your great Advise. Now I feel I am going to get opportunity to re-adjust my kiwisaver. I have few options. One is high growth. Other one is balanced. I am also thinking about kiwisaver funds which allow us to pick individual companies to invest or a very aggressive fund. As it is kind of retirement fund, I would think about margin of safety as well. As you suggest, balanced or growth seems to be good option.
    Last edited by Valuegrowth; 22-03-2020 at 04:11 PM.

  6. #81
    Permanent Newbie
    Join Date
    Mar 2010
    Posts
    1,127

    Default

    Quote Originally Posted by Valuegrowth View Post
    As you suggest, balanced or growth seems to be good option.
    I was suggesting cash is a good option right now. Balanced or Growth sometime in the future.

  7. #82
    Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    372

    Default

    Quote Originally Posted by Aaron View Post
    I was suggesting cash is a good option right now. Balanced or Growth sometime in the future.
    Cash is a horrible option if you intend to invest / lock it in for 1 or 2 years. As Warren Buffet said, 'why would anyone lend cash ; such as buying gov't bonds, that return only 1 - 2 % when annual inflation is more than 2%?

    We're going to see a lot of 'quantitative easing' meaning, the NZ reserve bank is going to print money like hell (no different to other gov'ts abroad). The unfortunate problem with NZ is we can't print our way out of debt. Our NZ currency exchange rate will take a massive hit over the coming years and this leads to higher prices on imported goods.

    The NZ tax system is a joke. Consider the negative returns of this financial year and if the funds are invested abroad, they're are wacked with FIF / FDR on the entire managed fund balance. Don't forget, management fee takes a cut.

    Why pay RWT on interest income ? It's a for sure way of not beating inflation.

  8. #83
    Permanent Newbie
    Join Date
    Mar 2010
    Posts
    1,127

    Default

    Quote Originally Posted by SBQ View Post
    Cash is a horrible option if you intend to invest / lock it in for 1 or 2 years. As Warren Buffet said, 'why would anyone lend cash ; such as buying gov't bonds, that return only 1 - 2 % when annual inflation is more than 2%?
    If you lock it in for one or two years wouldn't that be fixed interest rather than cash which is available at a moments notice. Agreed most of what is being done QE etc is to destroy cash and make debt affordable. I would hazard a guess that possibly we are in for a brief period of deflation in asset prices, if the market went down a further 5% this week while you got 0% in cash you would be better off in cash. Time will tell.

    The big question would be when is the best time to switch out of cash which we all agree is a good idea.

  9. #84
    Veteran novice
    Join Date
    Jun 2007
    Location
    , , .
    Posts
    7,152

    Default

    Quote Originally Posted by Aaron View Post
    I was suggesting cash is a good option right now. Balanced or Growth sometime in the future.
    I won't comment on the pros and cons thereof but I would suggest that this is one of the factors contributing to the wild swings, mainly down, in the current market, ie, the pressure on Kiwisaver providers to sell stock on behalf of account holders who decide to move to cash.

  10. #85
    Permanent Newbie
    Join Date
    Mar 2010
    Posts
    1,127

    Default

    Quote Originally Posted by macduffy View Post
    I won't comment on the pros and cons thereof but I would suggest that this is one of the factors contributing to the wild swings, mainly down, in the current market, ie, the pressure on Kiwisaver providers to sell stock on behalf of account holders who decide to move to cash.
    My understanding was Mr valuegrowth had been in a cashfund since 2010 (and would have missed out on the bull run) and was considering moving to a balanced or growth fund. Sometimes being a contrarian can work so if he waited until the other Kiwisavers, have moved to cash it might provide a better entry point. I am hopeless at market timing but it doesn't stop me from trying. I am not suggesting a jump from a growth or balanced portfolio to conservative as he is already in cash, but a bit more patience to see if shares continue down before switching from cash to balanced or growth.

    The original question was "My Kiwisaver started in early 2010. 100% cash fund. I feel like I should adjust my kiwisaver now. Is it wise to keep 100% cash? Are there any risks?Thanks in advance."

    The biggest risk in cash to me is a debt or currency crisis as company defaults could bring down the banks and the banks give depositors a haircut to get themselves out of the s**t. Or central bank money printing leads to a loss of faith in currencies.
    Last edited by Aaron; 23-03-2020 at 10:14 AM.

  11. #86
    Permanent Newbie
    Join Date
    Mar 2010
    Posts
    1,127

    Default

    If I am reading my watchlist correctly so far today cash seems like the best option. Not sure what tomorrow will bring.

  12. #87
    Senior Member Valuegrowth's Avatar
    Join Date
    Jun 2013
    Posts
    1,195

    Default

    The biggest risk in cash to me is a debt or currency crisis as company defaults could bring down the banks and the banks give depositors a haircut to get themselves out of the s**t. Or central bank money printing leads to a loss of faith in currencies.
    If banks give depositors a haircut, will if affect my kiwi saver too?

    If it is so,I would go for balance fund/growth fund where I can have both cash and shares. Second option is I would put all my eggs in stocks after doing some research. My period for keeping stocks would be about 7 years.

  13. #88
    Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    372

    Default

    Quote Originally Posted by Aaron View Post
    If you lock it in for one or two years wouldn't that be fixed interest rather than cash which is available at a moments notice. Agreed most of what is being done QE etc is to destroy cash and make debt affordable. I would hazard a guess that possibly we are in for a brief period of deflation in asset prices, if the market went down a further 5% this week while you got 0% in cash you would be better off in cash. Time will tell.

    The big question would be when is the best time to switch out of cash which we all agree is a good idea.
    People that hold cash typically lock it into interest bearing deposits or bonds. This is no different to the silly Kiwi Saver fund options between Conservative to Aggressive where the amount of return on the fund (and risk level) is based on the proportion of the investment held in equities and the rest held in interest bearing bonds or cash. (ie. 60/40 80/20 ratios). and I tell you, these fund managers don't have a plan on investing, they take the income streams day after day and just buy an ETF and the rest to some cash/bond fixed interest return. They won't operate a managed fund like hedge funds do or like Berkshire Hathaway would where the cash says in liquid form and buy in times of crisis. As I mentioned before, what point is earning 1 or 2% a year when the gains are far more by buying at the right time.

  14. #89
    Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    372

    Default

    Quote Originally Posted by Aaron View Post
    My understanding was Mr valuegrowth had been in a cashfund since 2010 (and would have missed out on the bull run) and was considering moving to a balanced or growth fund. Sometimes being a contrarian can work so if he waited until the other Kiwisavers, have moved to cash it might provide a better entry point. I am hopeless at market timing but it doesn't stop me from trying. I am not suggesting a jump from a growth or balanced portfolio to conservative as he is already in cash, but a bit more patience to see if shares continue down before switching from cash to balanced or growth.

    The original question was "My Kiwisaver started in early 2010. 100% cash fund. I feel like I should adjust my kiwisaver now. Is it wise to keep 100% cash? Are there any risks?Thanks in advance."

    The biggest risk in cash to me is a debt or currency crisis as company defaults could bring down the banks and the banks give depositors a haircut to get themselves out of the s**t. Or central bank money printing leads to a loss of faith in currencies.
    If you're going to hold cash, hold it in USD currency because it will provide the best option to invest into shares. I don't have confidence that the NZX will rebound as fast as US listings as over there, it's the bigger fish that eats the little fish. In NZ, the fish just die and no one would come along to eat it.

    If Valuegrowth is asking what to do with the cash, it may not be to his discretion on how it's invested at the Kiwi Fund mgt level. If he chooses to change the ratio from moving more of the cash into holding more equities, that would all entirely depend on what shares are they investing in? Do you choose NZX listings or overseas ones?

    Don't forget, cash is ONLY king when you're planning to seize opportunties and as what I said before, Kiwi Saver funds don't know how to allocate cash to take advantage of a stock market crash; they simply let the individual to DECIDE where to put the funds to in the form of 3 basic risk levels.

  15. #90
    Member
    Join Date
    Oct 2013
    Posts
    130

    Default

    Quote Originally Posted by lou View Post
    Can you have a kiwisaver strategy?

    My Idea is to sign up with the growth "smartkiwi" kiwisaver fund. Their aggressive fund invests in the smartFONZ and smartMOZY; these funds invest into the companies listed in the NZX 50 Index and the S&P Australian 50 MidCap Index.

    I will then track the 200 day moving average for the two indices. Once the index price for the crosses the 200 day MA and starts trending down I ring up smartshares and get them to switch me to the conservative fund. The conservative fund is 80% fixed interest and 20% equity.

    Once the indices cross back over the 200 day MA and starts trending back up I ring up smartshares and get them to switch me back to the growth fund.

    What do you guys think of this strategy?
    Is it a worth while strategy?
    Would you guys suggest anything different?
    One thing I am unsure of is the split that smartkiwi invests in the NZX50 & ASXMC50? Does anyone know this?
    Any ideas to improve this strategy or something similar?
    Very interested to know if OP ever went through with his KS strategy. This is a form of momentum investment which I have wondered about myself recently.

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
  •