‘Investing’ Category

Don’t look back – what drives potential returns?

Don’t look back – what drives potential returns?

A medium term view…

AMP Capital’s Dr Shane Oliver discusses the thinking behind their investment projections, and offer some interesting insights for the medium term.

This is an excellent read for retirees and investors – a little technical in parts, but worth persevering. In the end, I think the most important takeaway is that we should have reasonable return expectations going forward, and watch your asset allocation more than usual. Please call me if you have any questions.

Read more here

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

EOFY strategies to consider, right now…

EOFY strategies to consider, right now…

A checklist

With just over a month to go, and the Federal Budget behind us, now is the time to prepare for the end of the financial year. Created by AMP, this is an excellent link for those clients needing a checklist. As you would expect, it’s AMP-centric, but the fundamentals are universal. As always, feel free to call me personally if you’d like to take a closer look at your personal situation. Read EOFY checklist

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

Correction time?

Correction time?

Or something worse?

The last few weeks have seen the investment scene hit another rough patch. So is this just a seasonal glitch or something more sinister in the making? Read more here

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

Words of wisdom from two old pros

Words of wisdom from two old pros

Quotes to invest by…

With interest rates at an all time low, many cash investors are now, somewhat reluctantly, being forced to consider alternatives. But with this comes some danger and discomfort.

At 81 and 94, Warren Buffett and Charlie Munger have earned the market’s respect through performance, but they’ve also earned the appreciation of the broader investment community through their willingness to share what they’ve learned and how they’ve been so successful.

So it seems timely to revisit some of their more famous quotes and advice…

Warren Buffett:

“Time is the enemy of the poor business and the friend of the great business.”

“Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.”

“I don’t look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.”

“Price is what you pay; value is what you get.”

Charlie Munger:

“When any guy offers you a chance to earn lots of money without risk, don’t listen to the rest of his sentence. Follow this, and you’ll save yourself a lot of misery.”

“People have always had this craving to have someone tell them the future. Long ago, kings would hire people to read sheep guts. There’s always been a market for people who pretend to know the future. Listening to today’s forecasters is just as crazy as when the king hired the guy to look at the sheep guts.”

I’m not sure that I entirely agree with Charlie’s last point, but I’m happy to give him due deference.

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

Interest rates cut

Interest rates cut

A record low…

Today the Reserve Bank of Australia (RBA) finally decided to take the plunge and reduce the cash rate by 25 basis points to 2.00%, a record low.

This wasn’t a huge surprise as economists this morning were factoring in a 78% chance of a rate cut today. Interestingly, the RBA provided no outlook statement for interest rates going forward, so unless the Australian economy deteriorates significantly from here, this could be the last of the rate cuts. We’ll see.

At the time of writing, the Australian share market was initially up 1.1%, however has since fallen into negative territory as the Australian dollar, surprisingly, went up in defiance of the interest rate cut.

While this is welcome news for borrowers, the decision will put more pressure on investors, particularly retirees, with significant cash/term deposit holdings – interest rates are low and will stay low for some time to come. If you need income, it’s time to consider your options.

On a different matter, the Federal Budget will be announced next Tuesday night (12 May) and, as usual, the rumours have been flying fast and furious, from superannuation to negative gearing to pensions.

Our advice is to ignore the background noise. Typically, the lead up to every Federal Budget is a showcase of worse case scenarios and general fear mongering, coming from both side of politics, usually leading to fairly unspectacular, watered-down announcements on the night.

We’ll distill the budget details into a simple, easy to understand report for our clients soon after budget night, once we’ve had a chance to thoroughly weigh-up the proposals on the table. More importantly, we’ll contact you individually should there be anything important to discuss.

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

Australian home prices and interest rates

Australian home prices and interest rates

Where are we headed?

The interplay between falling interest rates, the Australian dollar and housing demand is a complex one. While the RBA would dearly love to see our dollar fall, rising house prices, particularly in Sydney and Melbourne, isn’t part of the script. So what happens if, as widely expected, interest rates are cut again in the coming months? Another interesting read from AMP’s Dr Shane Oliver.Read more here

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

What is risk in investing?

What is risk in investing?

Comments from Dr Shane Oliver…

An interesting, common sense article about investment risk from AMP’s Dr Shane Oliver. An easy read. Click here

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.

$20 oil could be a reality

$20 oil could be a reality

…if this happens…

Watch video here

Rick Maggi
Westmount Financial
Clear Focus. Better Solutions.