Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 242

Cuffelinks Newsletter Edition 242

  •   2 March 2018
  •      
  •   

Six months ago, I injured my hamstring on a long bike ride, and eager for a fix, I have seen three physiotherapists for treatment. One arranged steroid injections, another gave rigorous massage and acupuncture, while the third was all exercise. One wanted me back every few days, another after two weeks.

Should I think less of the profession because the solutions differ? Should I simply accept they have different experience, training and preferences for what works? Was the treatment in my best interests or to encourage further visits? Did I need expensive ultrasounds and injections? It's the same with many professions. Most of us don't know if we are overserviced or need the in-house tests.

Financial advice is being scrutinised and regulated far more intensely due to its conflicts. ASIC recently released a report on vertically-integrated financial advice firms which found:

"In 75% of the customer files we reviewed, the adviser has not demonstrated compliance with the best interests duty and related obligations." 

The files were 'non-compliant' because advisers were not considering all relevant circumstances and the customer's existing products.

Our first two articles shed light on some problems the advice industry faces. In the second part of the interview with Michael Kitces (pictured in Sydney), he says the industry caused such regulatory overview, and he suggests a better way forward.
   
Then Peter Thornhill takes an opposite view to the article written last week by Don Ezra. Both men have long backgrounds in asset allocation, and the fact that they can't agree on whether bonds or equities are riskier illustrates part of the advice dilemma. Warren Buffett weighed into the risk debate in his annual letter this week, and we also draw out his argument.

Please comment on any of these articles. There are no definitive answers, which is why investors should educate themselves about the choices available. 

Progress seems more promising on post-retirement investment products, but David Belloutlines five immediate hurdles. Given the Government has just appointed nine prominent experts to an advisory panel, David's caution is important. Then Sean Henaghan wants us to move on from the passive versus active debate and focus more on outcomes. 

On a cheerier note, Adrian Harrington shows which non-residential real estate sectors have performed best and the outlook for 2018, while Julia Stanistreet gives some pointers for selecting Listed Investment Companies trading at a discount to their NTA. Nigel Stewart offers tips to prepare for a market setback before it actually happens.

This week's Sponsor White Paper from BetaShares looks at how to use a 'bear' ETF in various ways, plus a video and background on the new hybrid ETF.  

Graham Hand, Managing Editor

Edition 242 | 2 Mar 2018 | Editorial | Newsletter

 

  •   2 March 2018
  •      
  •   

 

Leave a Comment:

banner

Most viewed in recent weeks

2 billion reasons to fix retirement income

A proposal to address Australia's 'stranded balances' in retirement by requiring super funds to transition members to pension phase at 65, boosting retirement income and reframing super as a source of income.

The ultimate superannuation EOFY checklist 2026

Here is a checklist of 28 important issues you should address before June 30 to ensure your SMSF or other super fund is in order and that you are making the most of the strategies available.

Do super funds need a massive wake up call?

UK retirement expert, Guy Opperman, believes super funds are failing at supporting members in deaccumulation. Here is what Australia should do about it. 

Two months into retirement

A retirement researcher's take on retirement and her focus on each of her six resource buckets to stay engaged during the transition and beyond.

Reforming the taxation of wealth and wealth transfers

As the budget approaches debate continues about the need and method for addressing wealth inequality. Could reinstating wealth transfer taxes be the answer?

Welcome to Firstlinks Edition 662 with weekend update

The debate over the budget is increasingly shaped by frustration and perceptions of unfairness, rather than clear-eyed assessment of policy outcomes.

Latest Updates

Back to the future - Why indexing CGT is a good idea

A return to indexation of capital gains would be a fairer way to compensate households for the effects of inflation than the current discount. Importantly, it opens the door to future, broader reforms to stop the taxation of inflation.

Australia has no death duties. Technically.

Australia may not levy formal death duties, but a growing web of tax measures is quietly shaping what wealth passes between generations. Now, the 2026 budget adds another layer.

Strategy

The folly of the Iran war

From oil shocks to fractured alliances, the Iran war carries the hallmarks of a historic policy misstep - one that could tip an already fragile global economy into crisis.

Taxation

Noel Whittaker’s take on the budget

Marketed as a fix for inequality and housing affordability, the latest budget instead delivers a tangle of tax changes that leave everyday Australians worse off.

Investment strategies

The red metal's long game

Copper has had a rough few weeks but investors should not ignore the potential for future price increases as supply increasingly falls behind demand.

Taxation

The lesser-known effects of changed property taxes

The budget’s property tax reforms are being framed as fairness measures, but they risk splitting the housing market, penalising lower‑income investors and introducing distortions that may prove costly.

Latest from Morningstar

Why stocks sometimes fall for no obvious reason

The vast and opaque world of private assets is a powerful gravitational force - and when trouble hits, it's the more liquid public equities that often the feel it first.

Sponsors

Alliances

© 2026 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.