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In a perfect world an investor in Australia would hold a four-box portfolio of investment assets featuring Australian shares, international shares, fixed interest and cash in approximately equal measure. This provides that most important element of investment, diversification. Far too many people don’t pay enough...
The legendary investor Warren Buffett once said that it is only when the tide goes out that it is revealed who has been swimming naked. We think this aphorism is particularly apt when considering the US Federal Reserve’s quantitative tightening (QT) programme. There has been...
Traditionally, when seeking income, investors have turned to fixed income investments such as term deposits or bonds. However, persistently low interest rates have seen investing in higher yielding stocks become an increasingly popular strategy for investors seeking to generate an income stream. For example, according to...
[vc_row css_animation="" row_type="row" use_row_as_full_screen_section="no" type="full_width" angled_section="no" text_align="left" background_image_as_pattern="without_pattern"][vc_column][vc_column_text]ETF stands for Exchange Traded Fund and is shorthand for a parcel of securities (usually shares or bonds) that are traded in the same way as a single stock. In other words, it’s a simple way to own a...
Serious about earning a yield? If retail investors are serious about earning a yield they can hope to live on, one logical option is to look to the ETF (exchange traded fund) market where a number of ETFs have been specifically set up to maximise the...
One of the great misunderstandings among retail and Self Managed Super investors is the belief that infrastructure stocks and property trusts are always good assets to hold if you are seeking a secure income stream. Sometimes, these stocks are even referred to as “bond proxies”, suggesting...
One of the biggest mistakes amateur investors make is to get more concerned with fees than with net returns. They are mesmerised by the prospect of saving money rather than growing their super pie. It’s true, as superannuation expert Jeremy Cooper memorably pointed out not long after...
iNAV. Funny sounding name, right? Well yes, but it is an important part of understanding what ETFs are all about. iNAV stands for ‘indicative net asset value’. What’s the Net Asset Value (NAV) you might ask? Well it’s total net assets under management of a portfolio. The NAV...
In short, lots. Just like there is with any investment that you may have. We all agree, ETFs are easy, accessible and offer you flexibility and liquidity, all for a low cost cost, but yes there are certainly risks. Keeping it simple, let’s look at some of...
A credit spread represents the additional risk (or risk premium) added on to a base interest rate (usually the rate of a government bond) when pricing corporate bonds. Credit spreads are closely related to a company’s estimated likelihood of default. A riskier company’s bond would have...
