Managed funds Plan of attack - Comments please!

Hi

After spending a few weeks researching and reading every post on this forum i've come up with the following and would love some comments on it...

Money to invest via discretionary trust:

AUSBIL Australian Active Equity Fund - 100k (50% LVR)
CFS Global resources wholesale - 100k (No Loan)
Platinum Asia (wholesale) - 66k (50% LVR)
Macquarie Small Companies Growth Trust - 66k (50% LVR)
Challenger China - 50k (No loan)

All of these are wholesale funds, except for Macquarie Small Companies Growth Trust which don't seem to have a wholesale version.

We'll be going direct with Ausbil, Platinum Asia and Challenger. For CFS we are using their wholesale product, and we'll use Comsec for the Macquarie fund.

This move will see $266k of our money tallied with $116k through a Suncorp margin loan (best interest rate we could find) for a total portfolio of $382k.

I would love any comments as to the sanity of this approach and whether my last few weeks of research has been in vain.

Cheers

PS. I've kept LPT and cash out of this portfolio for now as I don't think its the right time for property and we've already got enough cash in the bank to offset the margin loan interest.

You may want to investigate the CFS version of the Ausbil fund: Profile: Colonial First State - Ausbil Wholesale Australian Active Equity (FSF0460AU) (I'm in this fund) ... I'm not sure how the fees compare with going direct - but having multiple funds with CFS makes managing things a bit easier - especially if you decide to switch money between funds. It may well work out to be a lot more expensive than going direct - in which case it's not worth it.

For most wholesale funds, I've found that CFS don't actually charge more than it costs to go direct (or it's very close) ... seems that for their wholesale funds, CFS negotiate lower fees with the 3rd party fund managers, then charge the same MER as you would pay by going direct - taking the difference as their fee. At least that's what I've seen for the few funds I've looked at in this much detail ... not sure if it's the case across all their wholesale funds.

Sim

Direct is 0.9% and through CFS it is 1.04%. I think for the extra 0.1% its worth it for the reasons you stated.

Do you use the CFS wholesale margin loan option for the funds you are invested in through CFS? At 9.15% the only cheaper lender i've found is Suncorp at 8.5%, so i'm wondering if there is any benefit to using the CFS margin loan?

I have a large margin loan, so get good discounts with LevEq.

I'd use the product that best suits your needs - no need to go with CFS unless they are the most suitable.

Damn, I just spoke to LevEq over the phone and they wont budge on interest rates until the laon is $500k+...

Sim, any chance of getting MAQ0091AU up onto comparefunds? I think the website is great and can see myself becoming more and more dependant on it for information

Unfortunately not at the moment - see my comments on CompareFunds about which fund managers I can and can't support. Macquarie does not publish any historic unit price data on their website - so I can't do anything for any of their funds.

I would have to charge for access to premium data before I could support Macq and all the other lazy fund managers who don't provide good info

Hi.. woke up today and realised that if I had actually dumped my $400k into those MFs 6 months ago, i'd be down a huge chunk...

Sometimes waiting to get into the market can be a good move.

Cheers
DT

"Sometimes waiting to get into the market can be a good move.

Cheers
DT"

Standing aside is a position.

Intentionally being out of the market is a position, procrastinating isn't. Only dostortugas knows his intentions.

True enough... while the market has been sliding I've been researching other ways of creating a passive income. I'm still watching the MFs closely to see when is best to get back in. I take a daily approach to new information but make my decisions weekly/monthly.