Australian (ASX) Stock Market Forum

Is it a good time to invest in ETF index funds?

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bondog said:
Hi all

looking to invest some of my super In vanguard vas and vgs and was wondering if it’s a good time now to invest?
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now i know it is cherry-picking figures .. but

i notice VAS has fallen 2%

and VGS has fallen about 3% since bondog's post

will they fall more before the middle of February , i don't know

but that two or three percent saving is a nice help to the novice

either a couple of more units or a little extra cash left in the war-chest
 
now i know this is water under the bridge , but in 2011 VAS dropped nearly $7 between March and December ( $59.45 to $52.70 ) well over 10%

a similar situation could happen in the future ( just don't ask me when ) , what choices will you make ( rush for the exit during the tumble , hold solid , and perhaps buy some more as the price slides )
 
On the other hand, the downside of passive like Tesla in the US bourse, if you believe it's a fraud your passive portfolio has to buy a big chunk of it even if you don't want to.

If the APT deal goes ahead and Block (aka Square) lists on the ASX, I will definitely be trading out of VAS and into AFI. I would prefer the index which QOZ tracks but I *hate* BetaShares.
 
i have very little ( maybe none ) exposure to Tesla ( as i have mostly avoided the US market feeling it is over-priced , yes i have missed out on massive gains , but that is what i chose )

i almost certainly have some exposure to APT , exclusively through various ETFs and LICs , that will probably not change much , going forward no matter what it re-lists as .

now VAS into AFI ( i am exiting Vanguard eventually , anyway ) that is an intriguing play , i hadn't decided whether to pick replacement ETFs ( i have recently bought some ZYAU , but probably don't want a truckload of them ) LICs ( new or bulking up existing holdings ) or individual stocks ( a couple i still consider hovering around 'fair value ) , i guess timing and prices will influence that , when it happens

'conservative LICs ' ( i include there , ARG , AFI , AUI , BKI , and don't ignore CIN and WHF , and sadly MLT is no longer an option ) my sticking point there is entry price , but a market downturn could squash that objection , quickly

my sticking point with Tesla is i don't see div. returns in the near future ( there will be another new product to invest in )
 
Smurf1976 said:
Just wondering why that is?

What's the issue?
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some like HVST ( i hold ) have been a little disappointing and the fees often not so competitive , i don't HATE them , but they sometimes get overlooked when there is a close competitor

their saving point for me is they are quirky enough , to fit a niche i was looking to fill at the time ( like QFN when i bought them )

but heck now there is plenty of variety for those who enjoy the extra research

the BEAR , BBUS and BBOZ ( i have held all 3 in the past ) were products i used when i probably shouldn't but came out OK except for the last smallish parcel , GEAR and GGUS i haven't tried yet , and maybe never will

maybe InvestoBoy doesn't need to go that far out on the risk-curve , and that is OK , as well
 
Not heard of HVST before. Holders of it are paying 0.9% for this!?

Do the distributions go anywhere near compensating for torching all the $$?

Although I have glanced at some other ETFs available, I will stay well away from any niche products offered by many as they appear to me to stray from the original concept of index funds (as I understand the concept). In my view, the products are designed to entice those who are attracted to latest hot sector. Of course, I've no problems if people want to place money there. Their funds but just like HVST, it ain't getting mine.

Get's back to this snippet in regard to Bogle and note the qualifiers "broad based" and "don't trade." Sector specific and thematic ETFs can be viewed as outside that remit.

Anybody got a pair of dice handy?

bondog said:
"But let me be clear. There is nothing wrong with investing in those indexed ETFs that track the broad stock market, just so long as you don't trade them. [emphasis his]"
Click to expand...




1642359021311.png
 

BETASHARES AUS DIVIDEND HARVESTER (MANAGED FUND)​

ASX: HVST ETF: Equity Australia Large Value

Total Holdings 2

Distinct Portfolio
Yes

Portfolio Turnover
352.44%

CODECOMPANYASSET
A200BetaShares Australia 200 ETF100.00%
--Spi 200 Futures Mar220.00%

Management Cost 0.65%

as currently according to Comsec

now originally it had an aggressive div. harvesting mandate ( some would call it div. stripping ) swapping the holding bias , between sectors ( say to the banks as div. season came up for the banks ) which was arguably expensive to run

but NOW buying mostly in and out of an in-house ETF , roughly 3 times a year ??

yes paying monthly divs amplifies the paperwork . but ??
 
Smurf1976 said:
Just wondering why that is?

What's the issue?
Click to expand...

I am done with BetaShares

I had ~30% of my total equity position with BetaShares in QUS, which formed the US portion of my equity allocation. BetaShares has changed their QUS product benchmark from FTSE RAFI US 1000 to Equal Weight S&P 500. So they went from an extremely well thought out benchmark which is supposed to...
www.aussiestockforums.com www.aussiestockforums.com
 
Belli said:
Not heard of HVST before. Holders of it are paying 0.9% for this!?

Do the distributions go anywhere near compensating for torching all the $$?
Click to expand...
MAYBE if you include the franking

however they did have to markedly change how they worked the portfolio/mandate

now of course this might have been partly my fault , for not buying them cheaper ( at the start ) and averaging down more aggressively

will be watching these if the market melts down
 
Smurf1976 said:
To be fair it is a bear fund and a leveraged one at that. It's not intended to be a buy and hold investment and it did go up significantly during the March 2020 crash as it should have.
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yes you need to remember when to let it go quickly ( unlike the last batch i had and then they consolidated 10 into one )

so in hindsight be prepared to take a loss earlier rather than later
 
Smurf1976 said:
To be fair it is a bear fund and a leveraged one at that. It's not intended to be a buy and hold investment and it did go up significantly during the March 2020 crash as it should have.
Click to expand...

I fully agree with your statement and, yes, it did go up in March 2020 but that's about all it has done from what I observe.

I still hold the view the particular structure of some ETFs entices people to trade which, again my view only, is contrary to the original intention of index funds -

"But let me be clear. There is nothing wrong with investing in those indexed ETFs that track the broad stock market, just so long as you don't trade them." - Jack Bogle.

There are many ETFs available which don't fit that criteria and seem to pander to people's inner need to second guess, predict and speculate. However, unlike many others, I am not of a trading mindset but despite that I'll see the VGS & VAS distributions* hit the account today. It required no effort from me apart from placing funds and waiting.

* PS: Out of curiosity I checked the SMSF accounts (yes, I retain electronically all records) for the annual amount it recieved when it first invested in an ETF in 2002 - which was STW which was then swapped for VAS when it listed. The amount it received last FY (a five figure sum starting with a number greater than 1) was 24 times that when it first invested in an ETF.
 
Last edited:
Dona Ferentes said:
View attachment 136194

www.firstlinks.com.au

Three ways index investing masks extra risk

There are thousands of different indexes, and they are not all diversified and broadly-based. Watch for concentration risk in sectors and companies, and know the underlying assets in case liquidity is needed.
www.firstlinks.com.au www.firstlinks.com.au
Click to expand...
yes , and while i do not ignore index investing completely , i see it creating extra opportunity for those who venture outside the platitudes ( one reason i have persisted with active manager LICs .. there will be moments they will shine , and the others won't )
 
... so did any newer members take advantage of the recent market volatility , to put in a toehold ??

it might only be a tiny discount to recent highs , but you are caught between ' timing the market ' and 'time in the market ' missing out on div. payments/DRP generated increases

but take care ( don't over-commit )
 
Looking at vanguard etf’s since Vanguard has a fairly unique structure in terms of investment management companies. The company is owned by its funds. The company’s different funds are then owned by the shareholders. Thus, the shareholders are the true owners of Vanguard. The company has no outside investors other than its shareholders. Most of the major investment firms are publicly traded.

Having the above in mind and the uncertainty of the market and looking at the medium to long term, I see Vdco as a good diversified conservative fund to invest in . It is at a low price at the moment and a good 3 to 5 year or longer investment. It is made up of other vanguard funds, bonds stocks and cash. Investors will be looking closely at this fund now.
other low priced Vanguard funds Veth , great spread of efficient businesses. If they follow sustainable programs they will themselves be great long term investments. Vmin looking at min volatility.
now is a good time to jump in.
 

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