Managed Share Funds

[GRETZKY427]

What are peoples thoughts on those managed share funds, i know ANZ and other banks have a managed share fund account were you can start up and account for as little as $2k and make regular deposits (weekly or monthly) this fund gives you exposure to the top 200 ASX companies a certainly percentage in each one ?

Are these another great way of building up your wealth or the years as opposed to say a high interest account only paying 2% ???

Cheers, HAPPY STACKING

 

[phrenzy]

There are other funds that are traded on the ASX that own shares in all the top dividend paying shares or best growth stocks. Buying into several of these offers targeted and diverse investments while still investing you in lots of different sectors and doesn't limit you to the risk of owning just a few specific stocks. Because the shares of these funds are traded in the asx you can just save up a few hundred dollars and buy a little more whenever you have the money and you can buy ones that focus on different areas every time you have enough to make a trade. You can buy some that focus on dividend paying small cap companies or agricultural investments or consumer companies (like wesfarmers or Walmart). You also have some that do direct investment into projects that aren't publicly listed companies, there's one you can buy on the ASX that invests in medical property like GP clinics or radiologists offices. Some use simple rules, like owning the 50 largest Australian or American companies or, like you mentioned, all the shares in the asx200. Others are more complex and others still are actively managed by people who look at opportunities and invest as they think best.

Here's a list of them, make sure you look through the tabs at the top:

http://www.asx.com.au/products/etf/managed-funds-etp-product-list.htm

*edit* some of these have been returning 6% or better and are down as much as 10% because of the recent volatility. The ones that have diverse investments in pretty stable industries will probably do pretty well. I wouldn't go whole hog into them in this enviroment they are getting cheaper and cheaper and it night be an idea to find some that have dropped a bit that you like and put a little into them every time they drop 5%. You'll want to get a cheap online broker so you aren't losing too much to fees if your going to buy regularly but that's not hard. Even if the capital value dips in the short term they should continue to pay out solid dividends which make up for it and offer potential future price increases.

 

[potala]

Like Phrenzy says....
I like the ETF road as a single brokerage account allows you to buy, sell and manage (nearly) all your shares and fund requirements. The alternative is often multiple accounts with different providers... all with different mechanisms for applying, paying etc, not to mention even more online accounts and passwords etc.
Managed funds generally have (usually extortionate) entry costs. The ASX listed ETF road just has your brokerage.

The current ASX ETF offerings are pretty wide ranging. You can go down the international diversification or even the forex, PM or commodity trading road from the comfort of the ASX.

 

[Chubbsng]

Timing and time in the market will always be the ultimate factors. Ive never been keen on managed funds having one 10 years ago and didnt have much luck.

For interest I started 2 funds (both small sums under 5k) around Easter this year and this is my results:

1 managed shares fund via Vanguard and is down approx 2% . The other fund via Schroders which objective is CPI + 5% is down just over 6%. (Incase they didnt know cpi is not -13%)

Obviously if I had to pull the money now both would suck. Both fund pds have 3-5 years cycle expectancies though and I'm sure given such time they will come good. I contribute to both monthly and the cost average will hep it in the end....if i dont get the shits with them beforehand.

I reckon no matter what you invest in there will always be someone telling you its good or bad. More to do with how much time you can buy yourselr: