Hi all,
Firstly, I would also like to thank Steve for putting forward all the information he has. By doing so he has naturally left himself open to all the different comments and/or critisisms that may come along. This is out of the ordinary compared to other plans/systems put up by various gurus who do not give the detail.
So despite my constant questioning/critisisms of parts of the overall "Navra method", I am very thankful that Steve gives the opportunity with his detail.
My opinion is that his method outlined in his "book"
is more than likely to work most of the time.
My questioning is still related to risk, not the risk/risk averse nature of the individual investors that is included so far, but market risk.
If the Navra fund is fully invested 100% shares, and the market continues to fall, and then trades around a level 10-20% below where it is fully invested, it cannot continue to trade. It has no more money to buy the stocks that are now cheaper, and then when the price rises off the lows to where it would have sold some to make the profits, it can't do it, because it was unable to buy at the lows.(unless the fund then borrows, but I did not see this in the PDS). At what % decline of the u-beaut 25 stocks (it could be only 10 according to the PDS) would the fund be 100% invested??
If the fund had 2 bad years of 20% falls, then 3 years of 15% gains, the 5 year average is still below 0. Unlikely to happen? sure is, but the posibilities still need to be included.
This is not end of the world, doom and gloom stuff, but normal market behavior, for instance some of the major banks fell 60% in value between 89-91.
There is not the acknowledgement of the potential for such possibilities in the grand plan, everyone wants to be positive and think of nothing but the rosy future. If Steve could show how the plan would work given that there was a 5 year period when not only did property growth go backwards, but the fund also did not perform well due to "unforseen circumstances", I'm sure it would be greatly received.
For those planning/looking into LOE, it is not the good times, nor the average times, they wish to see. It is how something performs in the bad times, that influences them the most.
bye