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Sunday, 25 October 2020
Recently trending Have the rules of retirement investing changed?One last hurrah for the 60/40 portfolio?YourSuper will save $17.9 billion! Surely you’re joshing18 Aussie names for your watchlistClaiming a tax deduction for super contributions
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The 60/40 diversified portfolio has been the mainstay of the superannuation industry for decades. But it is built on a fundamental principle of defensive bond returns, and its time is nigh.
Fixed income opportunities beyond term deposits and hybrids remain scarce for retail investors, but active bond funds can access other securities where value is still available. Here are examples.
Government bond yields are so close to their lower bounds that they are unlikely to provide the returns of the past, nor act as a counter to falling equity markets. What are the investment choices?
The signs are that bond yields could stay low for a long time. This has important implications for future returns, but are we heading for the Big Bang, the Big Crunch or the Steady State?
Going back to June 2019, investors would have questioned the logic of diversifying away from outperforming growth assets. But when markets feel at their best, it is paramount to keep a perspective on long-term goals.
Citi's clients tap into their own views to find investments that suit their portfolios, often working across global boundaries. It's a search for solutions in a world with no risk-free returns.
Falling dividends and the uncertain outlook deliver challenges for income generation, but a dual approach of short-term income and long-term sustainability should ensure a portfolio continues to perform.
Do you think investors can only lose heavily on bonds if the credit defaults? When bondholders accept 0.88% for 100 years, there is great potential for serious pain somewhere along the journey.
There are heavy clouds on the horizon in the near and medium term, yet risk markets have separated themselves from the economics. Liquidity will not solve the problems of bankrupt companies.
Investors hold non-government bonds for both their income and defensive characteristics, but there must be sufficient diversification and liquidity in quality names to manage the risk.
Market uncertainty, low interest rates and the threat from COVID-19 to global economies have boosted the performance of high quality fixed income assets. Lesser corporates face another story.
For investors able to react quickly when stressed selling hits hybrids, excellent margins are available on quality names. The GFC taught experienced investors lessons that are now repeating.
In retirement, we still want to reduce stock volatility while generating cash flows. The two needs have not changed, but the reward expected in the old days from interest payments has gone. What should we do?
In Budget 2020, Josh Frydenberg announced a performance comparison tool and fund stapling to save Australians $17.9 billion over 10 years. But too many moving parts make results highly cyclical.
A Morningstar stock screener reveals a cross-section of companies with competitive advantages that are trading at material discounts to estimated value. This is a list of 18 highly-rated names worth watching.
The timing of lodging a notice of intent to claim a tax deduction on super contributions and making partial rollovers or withdrawals can make a big difference to the amount allowed to be claimed.
Budgets are forecasts, and more than most, Josh Frydenberg and Treasury waved a wet finger in the air in compiling the 2020 version. How many companies will now employ a new apprentice for $100 a week subsidy? Which back-of-the-envelope showed 3.5 million businesses would use the instant asset write off? And the $17.9 billion for super savings based on the YourSuper proposal is wishful thinking.