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Thursday, 13 May 2021
Recently trending The risk-return tradeoff: What’s the right asset mix for a 5% return?How long will my retirement savings last?Buffett's favourite indicator versus all-in equitiesIn fact, most people have no super when they dieFive timeless lessons from a life in investing
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Bank hybrids produced excellent returns in the last year and the biggest lesson from March 2020 is that many investors don’t understand the structures, and in a crisis, they panic first and think later.
Hybrids deliver returns comparable with equities over the long term with less volatility, which makes the risk-adjusted return and lack of correlation to equities an attractive characteristic in a diversified portfolio.
Most fund managers had a strong year in FY2018, but past bumper years when MTAA invested heavily in so called 'low risk' illiquid assets provide a warning in less fortuitous markets.
Many retail investors have turned to unrated or high-yield corporate bonds in recent years, but conditions have been favourable. Watch for the once-a-decade spikes in default rates.
The implications for hybrids, bank margins and bank fees from the increase in the risk-weighting of residential mortgages and learning our banks are not top quartile among the capital levels of global banks.
Until recently, institutional investors did not buy many bank hybrids, leaving issue size and margins subject to retail demand. But retail investors, including SMSFs, no longer have the market to themselves.
All new apartment buildings have defects, and inexperienced owners assume someone else will fix them. But developers and builders will not volunteer to spend time and money unless someone fights them. Part 1
Josh Frydenberg's third budget contained changes to superannuation and other rules but their effective date is expected to be 1 July 2022. Take care not to confuse them with changes due on 1 July 2021.
Why are prices rising but not the CPI? When we measure inflation, we aren’t measuring raw price changes, we’re measuring the pleasure-adjusted or utility-adjusted price changes, and we use it incorrectly.
The global recession came quickly and deeply but it has given way to a strong rebound. What are the lessons for investors, how should a portfolio change and what role will inflation play?
We are publishing this anonymously knowing it comes from an impeccable source. Bernie Madoff’s fund was almost distributed to retail Australian investors a year before the largest-ever hedge fund fraud was exposed.
Some LICs have recently paid out more in dividends than their net profit as they have the ability to tap their retained profits and reserves. Others reduced dividends to ease the burden on cashflow and balance sheets.
With the increase in the concessional cap to $27,500 on 1 July 2021, a contribution reserving strategy could allow a member to make and claim deductions for personal contributions of up to $52,500 this year.