Looking for some advice on general investment strategies

[quickstraw]

I wouldn't call them buy and hold stocks rather trading stocks.

Exactly my point. That is trading. I/we are talking about standard buy and hold investments for the average punter. Property is better because you can leverage better.

By buying listed stock off market at 20% below market prices and trading is a no brainer. Buying unlisted stocks and taking them to the market normally generates 4 times return but sometime 20 times return.

Then you have special situations stocks that are about to do something that gets the market excited.

One that I had a windfall on recently was cassini

Since 1997, our fund has generated on average ~38% pa with the worst year generating ~32%pa

You're doing well but I wouldn't advocate a beginner doing this unless they were of high intelligence and did all their research and learning.

The average punter is not sophisticated enough to beat the index (in fact I worked at one of Australia's largest brokerage firm and a majority of the brokers invested in real estate as they believed it was damn hard to beat the index). The average punter will fall for a all sorts of trading schemes advertised all over the internet (options, CFDs, forex) but very few will be successful

 

[Power Raid]

20% off market prices ???? What kind of rort is this

standard discount for placements.

The rort is ASIC and the corporations act. These can not be offered to retail investors (normal investors) without disclosure. Given good investments don't come with disclosure, mums and dads don't get a look in as they are already gone.

Thus thanks to the government wanting to protect mums and dads, they get the left overs that the wealthy don't want.

 

[Power Raid]

Exactly my point. That is trading. I/we are talking about standard buy and hold investments for the average punter. Property is better because you can leverage better.

You're doing well but I wouldn't advocate a beginner doing this unless they were of high intelligence and did all their research and learning.

The average punter is not sophisticated enough to beat the index (in fact I worked at one of Australia's largest brokerage firm and a majority of the brokers invested in real estate as they believed it was damn hard to beat the index). The average punter will fall for a all sorts of trading schemes advertised all over the internet (options, CFDs, forex) but very few will be successful

brokers seem to know a lot about the fees they will earn but very little about the companies they invest in


each to their own but I don't like debt. I will lend money but won't borrow even if buying property.

I would find it embarrassing, too restrictive and too risky.

 

[quickstraw]

I would find it embarrassing to borrow money for property

Come again?

 

[Power Raid]

Exactly my point. That is trading. I/we are talking about standard buy and hold investments for the average punter. Property is better because you can leverage better.

You're doing well but I wouldn't advocate a beginner doing this unless they were of high intelligence and did all their research and learning.

The average punter is not sophisticated enough to beat the index (in fact I worked at one of Australia's largest brokerage firm and a majority of the brokers invested in real estate as they believed it was damn hard to beat the index). The average punter will fall for a all sorts of trading schemes advertised all over the internet (options, CFDs, forex) but very few will be successful

It is really just a function of the markets.

From 2002 we started accumulating good long term stocks and by 2005 we held 35% of AGO (in two holdings) and 20% of RIV. Our investment horizon was 3 to 7 years. We cashed out making 40 and 80 times our money respectively.

Today we invest in unlisted stocks with time horizons of 3 to 7 years but only short time frames in listed stocks with the exception of 10 or so stocks which we are accumulating on market.

 

[Power Raid]

Come again?

coming from an eastern european background and married to an asian partner, debt is not something that sits well with our cultures.

- call me old fashion but I buy goods with cash.

- I had a mortgage when I was a teen but I wouldn't borrow money now for any reason. even my credit card has a debit balance.

- I like to take risks on income and creating wealth. By borrowing, I would need to be more cautious with wealth creation and may even need a wage.

- if I took a wage I would have to pay higher taxes and have to lock up funds in super

 

[quickstraw]

Fair enough - can't criticise if you have done well. I'll chalk that one up as "so glad Australians allegedly lack culture" because what it really means is we are free from expectation handed down from previous generations that is often outdated.

 

[Power Raid]

Come again?

oh, each to their own though


I think you will be surprised how many rich people live a lie. They have nice cars, houses and suits but it is all funded by debt.

They end up walking this tight rope that they can't get off and have to work harder and harder to pay for their living. Of course, they are stressed and unhappy given they are tired and want a change in life but can't afford to stop. As a result they buy more crap to keep up the facade and buy happiness only entrenching them in their horrible "rich" lives.

I work with all too many of these types on a daily basis.

Yet the most successful have no debt, are happy with the simple lives and have the greatest wealth.

 

[Power Raid]

Fair enough - can't criticise if you have done well. I'll chalk that one up as "so glad Australians allegedly lack culture" because what it really means is we are free from expectation handed down from previous generations that is often outdated.

No, it is more relevant now than ever

 

[George Washington]

Calling bullshit on 17 years of 38% average returns. You run at that level much longer and your fund will be bigger than the australian economy.

 

[Power Raid]

Calling bullshit on 17 years of 38% average returns. You run at that level much longer and your fund will be bigger than the australian economy.

ok, sure.

you do know you have to distribute returns and to maintain those returns you have to expand and contract to avoid cash drag.

that is the difference between a business designed to generate returns vs a business designed to clip fees (like super).

we also not only invest in assets but we invest in transactions meaning we can have small margin returns like 2% a transaction (per period ie 30 days) which means you have low risk but high annual returns.

 

[Power Raid]

Calling bullshit on 17 years of 38% average returns. You run at that level much longer and your fund will be bigger than the australian economy.

I should add, we became the largest listed resource group on the ASX.

We are now probably number 3 in the unlisted space.

 

[George Washington]

ok, sure.

you do know you have to distribute returns and to maintain those returns you have to expand and contract to avoid cash drag.

that is the difference between a business designed to generate returns vs a business designed to clip fees (like super).

we also not only invest in assets but we invest in transactions meaning we can have small margin returns like 2% a transaction (per period ie 30 days) which means you have low risk but high annual returns.

Fair enough. Though using this strategy is completely unachievable for an at home investor.

 

[Power Raid]

Fair enough. Though using this strategy is completely unachievable for an at home investor.

yep, I am favoured by the corporations act which denies mums and dads from participating.

that said buying the asx portfolio will deliver a long term average of 14% and can be leveraged to the tune of 70% and serviced from dividends.

That is probably 4-6% above property without the headache of insurance, tenants or property managers

 

[benchwarmer5]

You in on Bursons IPO tomorrow ?

 

[RobbieGray17]

Rather than create a new thread.

Lets say we travel 10 years in the future, and Adelaide has an uninteruptable north, south corridor from the Barossa Valley to Reynella, with at least one overpass directly into the city.
If you were to buy a house at Gawler, currently it would take you about 1 hour in peak hour to get to the city. After the upgrades, it would take you less than 25 minutes.

How much would you expect a $350K house in Gawler to change in 10 years time.

1. Given there is 0 Growth in the average housing market.
2. Given a predicted 10 year growth in the average housing market.

I'm trying to put a figure on how much this will improve housing value due to infrastructure. Will this also place downward pressure on fringe suburbs to the city?