Spreads – Why they’re fair
Spreads – Why they’re fair
When shopping around for funds to invest in. You’ll likely get to a point where progressing with a fund choice might come down to fees.
A common mistake we see investors making, when comparing Managed Funds side-by-side, is assuming that funds with buy and sell spreads (fees) are more expensive than funds without them. In this article we explain why this isn’t true, and in fact, why buy and sell spreads help to stop investors experiencing hidden costs, and create transparency around […]
Above benchmark: how indexing has grown up
Above the benchmark:
How indexing has grown up
Vanguard Group founder John C. Bogle in 2014
Passive products are on track to break another benchmark record this year in a move that could see indexers take majority control of the US equities fund market.
According to a late 2018 Bloomberg report, data from research house Morningstar shows passive US share funds grew market share from 45.7 per cent in November 2017 to 48.1 per cent 12 months later.
“They’ll top 50 percent in 2019 […]
Swimming lessons from McDuck: why custody shouldn’t be a mystery
Swimming lessons from McDuck – Why custody shouldn’t be a mystery
Scrooge McDuck loved to splash with cash, swimming solo in the deep, impregnable bank vault that housed his money.
The famous image of McDuck diving into his millions is typically interpreted as greed cartoonified.
But the loaded old duck had his reasons.
As the second-richest fictional character of all time – worth US$33.5 billion, according to Forbes magazine – McDuck clearly put a high value on two of the most important features of money: liquidity and […]
Sober investing tips: how to handle volatility
Sober investing tips – How to handle volatility
Sober investing tips: how to handle volatility
InvestNow members are generally glass half-full types.
Looking back at the last quarter of 2018, over 90 per cent of investors didn’t spill a drop as share markets served up another round of volatility; about a third of InvestNow members even took the opportunity to top up their portfolios as equities staggered downwards.
But if October left investors stirred, not shaken, the final two months of 2018 threatened to tip them off-balance. The last month of the […]
Going global – Tax tips and traps for local investors
Going global – Tax tips and traps for local investors
Kiwis like their offshore travel.
According to the latest data from Statistics NZ, almost 264,000 New Zealanders jetted overseas during October 2017 – up about 33,000 compared to the previous October and close to 100,000 above the figure for the same month in 2007.
Perhaps that familiarity with the foreign is why Kiwis are also happy enough to ship their money to global destinations, unaccompanied. Figures from the Reserve Bank of NZ (RBNZ) show the wholesale managed funds market consisted of […]
What’s on the income menu in a yield-hungry world
People invest for all manner of reasons but their goals can be boiled down to just two: income or growth.
In practice, of course, most investors will want a mix of both income and growth in proportions according to their risk appetite and specific life situation.
Growth assets tend to be ‘riskier’ investments such as shares while NZ investors have historically derived much of their income from the ‘safe’ haven of bank term deposits (TDs).
But the division between ‘income’ and ‘growth’ assets is […]
Always blow on the PIE: how to avoid fund tax burn
Before 2007 fund investors in NZ were served up the financial equivalent of meatloaf: returns and tax were baked together into one unappetising lump according to the antiquated legislative recipe of the day.
Unsurprisingly, in those dark days many retail investors preferred home-made direct portfolios of shares and fixed interest assets over the uniform concoction of meat and sawdust dished up by the tax-challenged managed fund industry.
But in 2007 the Labour government rewrote the fund tax recipe […]
Investment vehicle checklist: your ride is here
As InvestNow founder, Anthony Edmonds, explained last month, mapping out your destination by working out your strategic asset allocation (SAA) is the first – and most important – step in planning an investment journey.
While an investor’s SAA helps describe the route, end-point and comfort levels of the proposed trip, an investor has to ultimately choose between different investment vehicles to translate their plan into action.
“Many investors are happy enough taking the bus; others might prefer to drive a car themselves,” Edmonds says. “Or for the thrill-seekers there’s always a motorbike.”
For […]
PIEs and PIE tax – your questions answered
PIEs and PIE tax – your questions answered
Article by InvestNow
The disclaimer
The following are a few of the more common questions our customers ask us about PIE funds and PIE tax. This post does not constitute a warranty or advice. You should seek independent professional advice on investments, tax, legal and accounting matters.
What is a PIE?
A portfolio investment entity (PIE) fund is a type of New Zealand managed fund that invests the contributions from investors in […]