Where to invest?

[Onion]

Bought a wee few FPH today for long term hold. As you said it may still go down...

I took advantage of the dip at this time last year (dip started in Aug '16), having regarded them as perennially expensive, and didn't need to stay nervous about the trend for long. The 5 year SP graph is pretty impressive and the fluctuations haven't lasted for long. SP hasn't been under to 200 MA since 2013.

[Sgt Pepper]

Rubicon will be the star performer. Probably will have an IPO of Arborgen in the USA.

[morphs]

Interesting to see that the Vanguard US Total Market Shares Index ETF on the ASX (VTS) and the Vanguard All-World ex-US Shares Index ETF (ASX code VEU) both list US estate tax as potentially being applicable even though the prospectus for each states "For the avoidance of doubt, Vanguard US Total Market Shares Index ETF securities are not intended to be sold to US Persons as defined under Regulation S of the US federal securities laws."

Just out of interest, in which document did you find the reference to US estate tax for these securities (VTS/VEU)?

[kiwico]

Just out of interest, in which document did you find the reference to US estate tax for these securities (VTS/VEU)?

It came from the prospectus listed on the Vanguard Australia site - for example the ASX listed VEU ETF is still shown as US domiciled with the prospectus referring to the tax issues raised above.

My concern is that buying Vanguard ETFs on the ASX may have no effect on US estate tax given they appear to simply be an ASX listing of a US 'company'.

[Jonboyz]

It came from the prospectus listed on the Vanguard Australia site - for example the ASX listed VEU ETF is still shown as US domiciled with the prospectus referring to the tax issues raised above.

My concern is that buying Vanguard ETFs on the ASX may have no effect on US estate tax given they appear to simply be an ASX listing of a US 'company'.

And the same could then apply to Smartshares that invest in Vanguard ETFs.

[kiwico]

If it's Smartshares doing the investing rather than an individual than as a company there wouldn't be a death of a natural person and therefore presumably no US estate tax. The issue appears to exist only if purchased directly by an individual.

[morphs]

It came from the prospectus listed on the Vanguard Australia site - for example the ASX listed VEU ETF is still shown as US domiciled with the prospectus referring to the tax issues raised above.

My concern is that buying Vanguard ETFs on the ASX may have no effect on US estate tax given they appear to simply be an ASX listing of a US 'company'.

I think you are correct. From a US estate tax perspective there is no difference buying a US domiciled ETF on the ASX as opposed to its home exchange. I notice though that there appears to be an Estate Tax treaty between Australia and the US that would eliminate the tax in most cases: http://www.ustaxes.com.au/credential...te-tax-treaty/ However, that would not apply to a New Zealander who owned the ETF via the ASX! My guess is that in practice, the ASX registrar is unlikely to care about this in the event of a transfer on the death of an individual. It would be up to the individual to comply with the tax laws.

In any case, it is probably best to stay away from any US domiciled investment (ETF or otherwise) if investing individually and you are concerned about the estate tax. Alternatively, use a trust or company as your investment vehicle and then it won't matter.

[voltage]

You are quite right, do not hold in own name, with and online broker or full broker these shares are usually held in custodial and that I think is fine.

[Lewylewylewy]

Fph looking good buying at the moment 😊

[Jonboyz]

I'm looking at getting into some energy company shares. Looks like Mercury is the favourite at the moment here, but any thoughts about it's value vs meridian, contact, genesis etc?