Diversification Opportunity?

Just wondering how many of us predominantly property (assumption)investors are using this time to diversify their portfolio by going into equities, managed funds, Index Funds or ETF's? I work in Financial Services industry and the volume of Margin Loans was well down to forecast (which had already been downwardly revised) for this Year End - even on Pre-paids which is usually a massive hit this time of year. One of the suggested reasons is that people are using equity in their homes to buy shares instead of taking out dedicated loans. The All Ordinaries is hovering around 4230 at present - pretty damn low...any takers?
 
Howdy Henry,

I've started buying shares recently (im newb).
Purchase Some index trackers, LIC's, some individual shares.

I've used a mix of Cash, Equity, Margin loan. But not really big amounts.
I don't use much on the margin loan because the banks rules are hardcore, they can drop the lending ratio on a stock and if ur stock price drops and then goes ex div and drops even further its like the perfect storm of getting owned.

This process for me happened naturally as i decided against purchasing another resi IP for now as NSW land tax to high and the return when i was looking in QLD was really really low and i couldn't stomach it.

I didn't have enuff funds for direct commercial property, well enuff to consider anything that i think would be worth while purchasing.

Started looking at the actual income shares can generate over time and thought i should add these to my portfolio as something to live off in the future.

The share people on this forum have been very helpful in answering questions and their are plently of opinions

Regards,

RH
 
I feel a little safer with covered calls- protects if the market is flat or trends lower (generating 15%+ pa), these sort of returns are not realistic in equities. I'm not that bullish ATM.
 
I feel a little safer with covered calls- protects if the market is flat or trends lower

They really do not protect a portfolio from capital loss. When writing CCs you sell the upside for a couple of pieces of silver, but wear all the downside risk.

CCs are an income generating strategy with no value as a hedge.
 
I work in Financial Services industry and the volume of Margin Loans was well down to forecast (which had already been downwardly revised) for this Year End - even on Pre-paids which is usually a massive hit this time of year. One of the suggested reasons is that people are using equity in their homes to buy shares instead of taking out dedicated loans. The All Ordinaries is hovering around 4230 at present - pretty damn low...any takers?
The DOW is still tracking downwards,and some think the "ASX"will go down the same curve,, one would think those that got blown of of the water in late 08 on the advice of their FP,would not be stupid enough too go down the same bumpey"opm" road again..willair..
 
They really do not protect a portfolio from capital loss. When writing CCs you sell the upside for a couple of pieces of silver, but wear all the downside risk.

CCs are an income generating strategy with no value as a hedge.

Remind me to give the $350k I have made over the last two years back, given that it is only silver...... Yes you are right, it was awful earning that income.....

We will wait patiently to see how your strategy will help make us dollars? Although I find those that quick to knock people down, well you know the rest.....
 
Remind me to give the $350k I have made over the last two years back, given that it is only silver...... Yes you are right, it was awful earning that income.....

We will wait patiently to see how your strategy will help make us dollars? Although I find those that quick to knock people down, well you know the rest.....

Yes: you made money out of an income producing strategy. You were not hedging against the downside!!!

Would you care to enlighten us on what the market value of the stocks you hold that you write CCs over is? To achieve that return, my guess is that you would need about 5 mil face value of stock.

I would also like to know how you did in '07 - '08. I hope you aren't using "carefully selected" time periods.
 
Yes: you made money out of an income producing strategy. You were not hedging against the downside!!!

Would you care to enlighten us on what the market value of the stocks you hold that you write CCs over is? To achieve that return, my guess is that you would need about 5 mil face value of stock.

I would also like to know how you did in '07 - '08. I hope you aren't using "carefully selected" time periods.

I took a look at many of your past posts......umm, rather negative. I can just see you smiling if property and stocks crash ..... that is not what I am about..... Forgive my rudeness, but I will not be responding to any of your further comments/questions.

To close this segment, The two years mentioned above was 07/08 and the last financial year( I had a year off in between to do an Ironman triathlon- you could look this up as well). Face value of stock was $2.3M (bad guess). No I do not trade derivatives for clients, Yes I was full time, Yes it was the top 50 ASX listed stocks, Yes I did receive dividends, No I would not encourage people do this for a living. No I have not lost any clients money in any shape or form, Yes I have made a majority of my money in property, Yes I started with no dollars- in fact I grew up in one of the hardest areas in Sydney. Yes I did retire at 34 years of age, I hope this answers all your questions...
 
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