Navrainvest Fund Performance (Calender Year)

[Garry K]

Hi all,

1/ NONE of the indexes are a true reflection of the market over the longer term.

Good points Bill.

For example, the actual companies that make up the ASX 200 index constantly change.
The poorer performing ones, whose share price falls, could drop out of the index, to be replaced by one that's growing it's share price. This skews the results. If you picked the ASX 200 index on a day, and followed those companies for 10 years, you would get a different result to the index over that 10 years.

GarryK

 

[Steve Navra]

Top 25 Oz Equity Fund Performance (5 Years)

Hi all,

I thought it might be useful to view the TOP 25 Australian Equity Managed Funds performance over 5 years:

The point I wish to emphasise is that in the medium to longer term all funds tend towards the average.

As can be seen, the best of the funds has been Tyndall at 15.78%

This begs the following questions:

1) Why invest in managed Funds??
2) Why invest in shares at all??
3) What are the alternatives??

Mainly though:

What is an acceptable investment return??

Regards,

Steve


Top 25 Australian Equity Funds - 5 years Return (Ref: Comsec)
Tyndall Australian Share Value Fund Australian Equity - Diverse Equities 15.78
Tyndall Australian Share Portfolio Australian Equity - Diverse Equities 14.56
Perpetual Investor Choice Australian Share Australian Equity - Diverse Equities 14.02
BT Imputation Fund Australian Equity - Diverse Equities 12.42
Glebe Large Cap Equities Trust Australian Equity - Diverse Equities 10.6
Advance Imputation Fund Australian Equity - Diverse Equities 10.55
Challenger Socially Responsive Fund Australian Equity - Diverse Equities 10.13
INVESCO Australian Share Fund Australian Equity - Diverse Equities 9.84
Australian Unity Leaders Imputation Trust Australian Equity - Diverse Equities 9.29
Colonial First State Imputation Fund Australian Equity - Diverse Equities 9.11
Challenger Select Australian Share Fund Australian Equity - Diverse Equities 9.07
ING OneAnswer Investment Portfolio Australian Share Trust Australian Equity - Diverse Equities 9.06
Dresdner RCM Global Investors Australian Equities Trust Australian Equity - Diverse Equities 9
Australian Ethical Equities Trust Australian Equity - Diverse Equities 8.92
Advance Australian Shares Multi Blend Fund Australian Equity - Diverse Equities 8.79
MLC MasterKey Unit Trust Australian Share Fund Australian Equity - Diverse Equities 8.34
Macquarie Leaders Imputation Trust Australian Equity - Diverse Equities 8.28
Portfolio Partners Personal Choice Shares Trust Australian Equity - Diverse Equities 7.97
Merrill Lynch Growth Fund Australian Equity - Diverse Equities 7.93
AMP FLI AMP Equity Fund Australian Equity - Diverse Equities 7.72
Colonial First State Australian Share Fund Australian Equity - Diverse Equities 7.71

 

[NigelW]

Hi all,

I thought it might be useful to view the TOP 25 Australian Equity Managed Funds performance over 5 years:

The point I wish to emphasise is that in the medium to longer term all funds tend towards the average.

As can be seen, the best of the funds has been Tyndall at 15.78%

This begs the following questions:

1) Why invest in managed Funds??
2) Why invest in shares at all??
3) What are the alternatives??

Mainly though:

What is an acceptable investment return??

Regards,

Steve


Top 25 Australian Equity Funds - 5 years Return (Ref: Comsec)
Tyndall Australian Share Value Fund Australian Equity - Diverse Equities 15.78
Tyndall Australian Share Portfolio Australian Equity - Diverse Equities 14.56
Perpetual Investor Choice Australian Share Australian Equity - Diverse Equities 14.02
BT Imputation Fund Australian Equity - Diverse Equities 12.42
Glebe Large Cap Equities Trust Australian Equity - Diverse Equities 10.6
Advance Imputation Fund Australian Equity - Diverse Equities 10.55
Challenger Socially Responsive Fund Australian Equity - Diverse Equities 10.13
INVESCO Australian Share Fund Australian Equity - Diverse Equities 9.84
Australian Unity Leaders Imputation Trust Australian Equity - Diverse Equities 9.29
Colonial First State Imputation Fund Australian Equity - Diverse Equities 9.11
Challenger Select Australian Share Fund Australian Equity - Diverse Equities 9.07
ING OneAnswer Investment Portfolio Australian Share Trust Australian Equity - Diverse Equities 9.06
Dresdner RCM Global Investors Australian Equities Trust Australian Equity - Diverse Equities 9
Australian Ethical Equities Trust Australian Equity - Diverse Equities 8.92
Advance Australian Shares Multi Blend Fund Australian Equity - Diverse Equities 8.79
MLC MasterKey Unit Trust Australian Share Fund Australian Equity - Diverse Equities 8.34
Macquarie Leaders Imputation Trust Australian Equity - Diverse Equities 8.28
Portfolio Partners Personal Choice Shares Trust Australian Equity - Diverse Equities 7.97
Merrill Lynch Growth Fund Australian Equity - Diverse Equities 7.93
AMP FLI AMP Equity Fund Australian Equity - Diverse Equities 7.72
Colonial First State Australian Share Fund Australian Equity - Diverse Equities 7.71

According to Vanguard, the 5 year average annual return for Australian Shares (to 30 June 04) is 7.4% [maybe with the bull market we've had a figure to December 04 would be a few basis points higher]. Looking at the data above it seems that the VERY best fund managers have added between 0.31 and 8.38% value...and if you were outside the top 4 you at best received 3.2% outperformance... Not good!

What are the odds of picking the right manager...? Aren't there something like 600-700 managed funds available in Australia that focus on Australian equities???

Remembering that these are the best of the fund managers it seems to me that as a whole the funds management industry in Australia destroys value for investors...and they get paid to do it.

getting off the soapbox now...

 

[Francesco]

Thanks, GaryK and Dee

The performance of Perpetual and Vanguard seems acceptable. I have Perpetual in my portfolio, including its small companies fund (closed). It has withstood the test of durability in my portfolio! Laggards not encouraged in my portfolio!

I have checked Vanguard before and did not invest in it because its performance was not really on fire! Maybe its 2004 performance was an aberration! I will keep an eye on it. I cannot believe my portfolio performance is just 27%. It may be skewed downwards by including the losses of TLS second offer (big and poor performing!)

 

[AdamN]

Hi Adam,

Sorry, I haven't been ignoring you!!
All your questions have been previously answered in this forum . . . please do a search and all will become clear.

I will send you a detailed (because your specific questions do require the detail) e-mail
. . . answering these questions in full.

You might then like to post a response to that; giving your understanding to other members.

regards,

Steve

Hi Steve,

I had a hunt through the archives but didn't really find what I was looking for. Perhaps I was searching in the wrong places ?
Regardless, I look forward to your explanation via email.

Thanks,
Adam.

 

[Mr. Fabulous]

Steve,
I wouldn't bother with explanations for detractors - there are always going to be people who knock others' successes, no matter how great those successes may be. Warren Buffett even has his critics. Personally, I'm waiting for a little more volatility in the marketplace - that is when Steve's system is going to truly shine.

 

[AdamN]

Steve,
I wouldn't bother with explanations for detractors

Not sure I agree.
For me personally, the fact that Steve has gone to such lengths for his rebuttles has made me more comfortable with the product, and for that I appreciate his efforts in replying (when he could have easily decided to distance himself from the discussion had he possessed less patience).

I'm not totally sold yet (still waiting for a couple of questions to be addressed) but I'm certainly better informed about it than what I previously was.
In all likelihood I will probably invest with NI in the near future, but even if I don't then at least I have a better understanding of the product, and could possibly recommend it to others who may be interested in earning more than 5.25% pa with ING.

So keep replying please Steve

Ad(ios).

 

[likewow]

Steve,
I wouldn't bother with explanations for detractors - there are always going to be people who knock others' successes, no matter how great those successes may be. Warren Buffett even has his critics. Personally, I'm waiting for a little more volatility in the marketplace - that is when Steve's system is going to truly shine.

Mark,

You make it sound personal when it isnt. It was questions and disagreement (from me at least) on Steve making comparisons with huge super funds and also using performance relative to an index when for sophisticated investors (not necessarily myself) consider that stuff very average performance.

Steve has left some important questions unanswered, such as:

Where did he source his data for index performance calender 2004?

With the dollar cost trading style (black box ?) using so many buy/sell transactions surely it impacts on the performance of the fund especially with increased volatility(beta).

If potential HNW investors want to invest in the Navra fund they need things answered.

 

[Steve Navra]

Steve,
I wouldn't bother with explanations for detractors

Hi Mark,

I agree with Adam . . .

The very purpose of this forum is that it is a medium for asking and questioning various aspects of investing.

We are all on the same journey . . . exploring the possibilities and discovering what constitutes a 'good' investment.

I don't get too fussed, even when I sometimes think the questioning is a bit cynical. Personally I find the honest scepticism to be challenging and will always try my best to give an accurate assessment in response.

Mainly though, I sincerely hope there is educational value in the various posts that I offer.

I have always loved what I do:

My personal asset base doubles every 5 years (at least) with the use of Optimised Investment Structure.

Clients who are following the method are achieving the same result and I find this more than rewarding.

Others might debate and draw their own conclusions; I learn from and value their opinions and hopefully they likewise gain from the insights I give.

There is NO RIGHT or NO WRONG in investing, only REALITY.

And in reality we all get our just rewards.

Regards,

Steve

 

[Steve Navra]

Steve has left some important questions unanswered, such as:

Hi likewow,

Sorry I didn't realise these were unanswered:

Where did he source his data for index performance calender 2004?

I source my data from the actual S&P 200 index figures, as presented on each days close.

31/12/03 S&P 200: 3299.800
31/12/04 S&P 200: 4050.600

A gain of 750.80 which represents a gain of 22.75%
(Yes OOPS a typo with the previous figure and the spreadsheet came up with 19.75%)
likewow . . . I assume this is what you are referring to?

With the dollar cost trading style using so many buy/sell transactions surely it impacts on the performance of the fund especially with increased volatility.

The returns achieved are net of the expenses of trading. Yes there are heaps of trades, but as the FUM increases so the cost per trade decreases. There is negligible impact on the returns, as the more volatile the market (Yes more trades) the greater the trade margins are . . . which many times over makes up for the tiny trade cost.


Hope that answers these questions

More questions are welcome,

Steve

PS: It's NEVER personal

 

[likewow]

OK Thanks Steve.

 

[dee]

what returns are you getting if income distributions are reinvested

 

[Steve Navra]

what returns are you getting if income distributions are reinvested

Same return, but compounded !!
I will post a schedule of the compounded effect tomorrow. (2nd Feb)

Regards,

Steve

 

[<KS>]

Same return, but compounded !!
I will post a schedule of the compounded effect tomorrow. (2nd Feb)

Regards,

Steve

/me waits for the schedule with baited breath

<KS>

 

[Steve Navra]

/me waits for the schedule with baited breath

Me too

Sorry, will havta be tomorrow . . . the day kinda got away from me.

Aaah the anticipation

regards,

Steve

 

[<KS>]

Me too

Sorry, will havta be tomorrow . . . the day kinda got away from me.

Aaah the anticipation

regards,

Steve

YOUR A MEAN MAN!!

I read this in your FAQ on the Web:

In a falling market the system can produce positive returns if there is sufficient volatility.

What would sufficient volatility be defined as? I am sorry if this is a bit basic but this is a steep learning curve for me as until about 4 days ago I was a strict RE only kind of investor - and now I am slowly warming to the idea of placing up to $60,000 from my LOC into a fund, albeit in a small 'test' amount initially.

(grumbles about high entry requirements to get into the wholesale fund)

Either way - funds etc in general are becoming less scary the more I look into them, probably because ignorance results in fear of the unknown/misunderstood.

<KS>

 

[Steve Navra]

What would sufficient volatility be defined as?

Hi KS,

You will probably find the answer here: http://www.navrainvest.com.au/index.asp?content=navtrade
Suffice to say in the example: Falling Share Price
LEIGHTON
When the share price regained the $10 level (back to it's start price) we were reflecting a 17% gain.
Currently LEI is at $12.24 reflecting a 33.50% return since that date. (01/09/03)

The short answer regarding your question is that there must be sufficient movement in the pricing to allow margin gains (both above and below), sufficient to exceed the decline in the share price.

Regards,

Steve

 

[<KS>]

Hi KS,

You will probably find the answer here: http://www.navrainvest.com.au/index.asp?content=navtrade
Suffice to say in the example: Falling Share Price
LEIGHTON
When the share price regained the $10 level (back to it's start price) we were reflecting a 17% gain.
Currently LEI is at $12.24 reflecting a 33.50% return since that date. (01/09/03)

The short answer regarding your question is that there must be sufficient movement in the pricing to allow margin gains (both above and below), sufficient to exceed the decline in the share price.

Regards,

Steve

AAAH

Nice examples, I can relate to that since I work for Boral

I had the chance to buy shares a few weeks ago for like $5.66 - the catch was I had to hold on to them for 3 years, so I decided against it. At least with a fund that uses Boral as a temporary vehicle I am not tied down, I like that idea.

Thanks Steve

 

[Steve Navra]

Same return, but compounded !!
I will post a schedule of the compounded effect tomorrow. (2nd Feb)

Schedule of compounding return:

Initial Investment 29/04/2003 500,000.00 units $500,000.00
Distribution reinvested 01/07/2003 5,387.07 units
Distribution reinvested 01/10/2003 16,086.82 units
Distribution reinvested 02/01/2004 15,862.28 units
Distribution reinvested 01/04/2004 11,957.77 units
Distribution reinvested 01/07/2004 8,388.15 units
Distribution reinvested 01/10/2004 19,741.17 units
Distribution reinvested 04/01/2004 21,178.32 units
Closing Balance 598,601.58 units @ $1.137 $680,430.42

Absolute Return
Gain of $180,430.42 / Initial Investment $500,000.00 X 12/21 months = 20.62% per annum. (Since inception)

 

[qaz]

Absolute Return
Gain of $180,430.42 / Initial Investment $500,000.00 X 12/21 months = 20.62% per annum. (Since inception)

Not suprised your smiling there Steve, I would be too.....