| Introduction |
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1 | (1) |
| About This Book |
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1 | (1) |
| Conventions Used in This Book |
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2 | (1) |
| Foolish Assumptions |
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3 | (1) |
| How This Book Is Organised |
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4 | (1) |
| Part I Coming to Grips with the Basics of Managed Funds |
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4 | (1) |
| Part II Doing the Research for Your Peace of Mind |
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4 | (1) |
| Part III Choosing, Buying and Selling Managed Funds |
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4 | (1) |
| Part IV Determining How Funds Are Labelled |
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5 | (1) |
| Part V Following Some Sensible Ideas for Happier Returns |
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5 | (1) |
| Part VI The Part of Tens |
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5 | (1) |
| Glossary |
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5 | (1) |
| Icons Used in This Book |
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6 | (1) |
| Where to Go from Here |
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6 | (1) |
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Part I Coming to Grips With the Basics of Managed Funds |
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7 | (2) |
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Chapter 1 Getting Started with Managed Funds |
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9 | (1) |
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Making a Start with Managed Funds |
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10 | (2) |
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Considering managed funds beyond the GFC |
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10 | (1) |
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Discovering that you're probably using managed funds already |
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11 | (1) |
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Including managed funds in your portfolio |
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11 | (1) |
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Examining What's Managed in Managed Funds |
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12 | (1) |
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Lifting the lid on fund managers |
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12 | (1) |
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Finding out how fund managers earn a crust |
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12 | (1) |
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Plunging into Managed Funds without Taking a Bath |
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13 | (3) |
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Managing your risk and setting your goals |
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13 | (1) |
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Picking managed funds from the myriad of options |
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14 | (1) |
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Conquering the paperwork and working out the costs |
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15 | (1) |
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Dealing with and Keeping Track of Your Investments |
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16 | (3) |
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Taking advice or going it alone |
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16 | (1) |
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Tracking your fund's performance |
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17 | (1) |
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Adding some spice to your investing |
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17 | (1) |
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Knowing what to look out for and what to do if it all goes wrong |
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18 | (1) |
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Chapter 2 Understanding the Pros and Cons of Managed Funds |
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19 | (20) |
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Accessing All Areas: The Everyday Investor's Backstage Pass |
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20 | (4) |
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Opening up a world of investing opportunities |
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20 | (1) |
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Investing with the professionals |
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21 | (1) |
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Making investing convenient |
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22 | (2) |
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Diversifying Your Portfolio |
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24 | (4) |
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Understanding why diversification can be an investor's friend |
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24 | (2) |
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Getting exposure without the expense |
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26 | (1) |
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Discovering how managed funds diversify |
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26 | (2) |
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28 | (2) |
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Finding the right fund for your money |
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28 | (1) |
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Making the most of what you have |
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28 | (2) |
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Four Reasons Why Managed Funds May Not Be for You |
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30 | (4) |
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30 | (2) |
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32 | (1) |
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Hugging an index might not leave you feeling warm and fuzzy |
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33 | (1) |
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34 | (1) |
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Stacking Up Managed Funds against Other Investments |
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34 | (5) |
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35 | (2) |
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37 | (1) |
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Summarising the differences |
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37 | (2) |
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Chapter 3 Examining the Structures of Managed Funds |
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39 | (18) |
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Easing through the Legalese |
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40 | (5) |
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Defining a managed investment scheme |
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40 | (2) |
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Making sense of managed fund structures |
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42 | (3) |
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Superannuation and Managed Funds |
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45 | (5) |
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Knowing about employer super funds |
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45 | (2) |
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Doing it yourself: Self-managed super funds |
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47 | (1) |
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Understanding industry super funds |
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48 | (2) |
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Working Out Your Retirement Options |
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50 | (2) |
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Learning about market-linked pension accounts and annuities |
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51 | (1) |
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Managing your income with fixed-income pensions and annuities |
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51 | (1) |
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Understanding the Differences between Various Funds |
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52 | (5) |
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Retail and wholesale funds |
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52 | (2) |
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Open-ended and closed-end funds |
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54 | (1) |
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Unlisted and listed funds |
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55 | (2) |
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Chapter 4 Identifying Asset Classes and Investment Styles |
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57 | (20) |
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Learning about Asset Class |
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58 | (3) |
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Highlighting the importance of class |
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58 | (3) |
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61 | (1) |
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Setting Out the Types of Asset Class |
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61 | (6) |
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Being conservative in cash |
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61 | (1) |
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Fixing your interest with fixed interest |
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62 | (2) |
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Building your wealth in property funds |
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64 | (2) |
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Raising the stakes with shares |
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66 | (1) |
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How Stylish Is Your Fund Manager? |
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67 | (10) |
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Passive or active management |
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68 | (4) |
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Finding out about growth and value |
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72 | (3) |
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75 | (2) |
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Chapter 5 Revealing the Cost of Investing: Fees and Commissions |
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77 | (14) |
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Examining the Costs of Investing |
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78 | (2) |
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Understanding what you can expect to pay |
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78 | (1) |
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Different funds attract different fees |
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79 | (1) |
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Uncovering Management Costs through the Indirect Cost Ratio |
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80 | (1) |
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Managing Tax in Managed Funds |
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81 | (4) |
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Existing tax in managed funds |
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82 | (1) |
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Paying tax: Who pays what? |
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82 | (3) |
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85 | (2) |
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Understanding upfront fees |
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85 | (1) |
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86 | (1) |
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Paying Ongoing Commissions |
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87 | (2) |
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Understanding why ongoing commissions are paid |
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87 | (1) |
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Avoiding ongoing commissions |
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88 | (1) |
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89 | (2) |
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Working out performance fees |
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89 | (1) |
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Watching out for exit fees |
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90 | (1) |
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Part II Doing the Research for your Peace of Mind |
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91 | (60) |
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Chapter 6 Assessing Your Appetite for Risk and Avoiding Indigestion |
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93 | (18) |
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Understanding the Risk-and-Reward Trade-Off |
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94 | (4) |
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Working out how much you can afford to lose |
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94 | (1) |
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Weighing up the risks with managed funds |
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95 | (1) |
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96 | (2) |
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Discovering What Type of Investor You Are |
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98 | (2) |
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99 | (1) |
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100 | (1) |
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Understanding Your Investor Type |
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100 | (8) |
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Leaving nothing to chance: Defensive |
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103 | (1) |
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Adopting a measured approach: Conservative |
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104 | (1) |
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Keeping an even keel: Balanced |
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105 | (1) |
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Growing your wealth: Growth |
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106 | (1) |
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Betting the farm on red: Aggressive growth |
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107 | (1) |
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Matching the Results to Your Goals |
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108 | (3) |
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108 | (1) |
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109 | (2) |
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Chapter 7 Setting Your Goals and Making a Plan |
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111 | (12) |
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112 | (4) |
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Setting your course to financial freedom |
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112 | (2) |
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Considering other factors when setting goals |
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114 | (1) |
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Being flexible as circumstances change |
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115 | (1) |
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Working Out What You Want from Your Investments |
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116 | (1) |
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116 | (1) |
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Working out how much income is enough |
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116 | (1) |
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Setting Your Investment Timeframe |
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117 | (1) |
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Understanding life's investing phases |
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118 | (1) |
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Sitting tight for better returns |
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118 | (1) |
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118 | (5) |
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120 | (1) |
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121 | (2) |
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Chapter 8 Understanding Research and Ratings Agencies |
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123 | (14) |
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Discovering How Ratings Agencies Can Help |
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124 | (5) |
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Learning who provides the ratings |
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124 | (1) |
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Understanding what the agencies do |
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125 | (1) |
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126 | (3) |
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Understanding the Ratings |
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129 | (4) |
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129 | (2) |
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Morningstar recommendations |
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131 | (2) |
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Standard & Poor's ratings |
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133 | (1) |
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Digging into the Research |
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133 | (4) |
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Reading the research reports |
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134 | (2) |
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136 | (1) |
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Chapter 9 Making Sense of Performance |
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137 | (14) |
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Understanding That Past Performance Is No Guide to the Future |
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138 | (2) |
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138 | (1) |
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Buying into past performance |
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139 | (1) |
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Looking at the Many Ways to Measure Performance |
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140 | (5) |
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140 | (3) |
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143 | (1) |
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Splitting performance into income and growth |
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143 | (1) |
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Allowing for tax and expenses |
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144 | (1) |
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Applying Performance Results to Investment Choices |
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145 | (4) |
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Avoiding the chase for returns |
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146 | (1) |
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Warning: Last year's standout, this year's disaster |
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147 | (1) |
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Looking for consistent performance |
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148 | (1) |
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149 | (2) |
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Polishing your crystal ball |
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149 | (1) |
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Learning what history shows about timing the market |
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149 | (2) |
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Part III Choosing, Buying and Setting Managed Funds |
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151 | (70) |
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Chapter 10 Discovering Who's Who in the Managed Funds Zoo |
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153 | (24) |
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Uncovering Australia's Key Players |
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154 | (7) |
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The biggest and the best: Getting to know Australia's top fund managers |
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154 | (4) |
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Slicing through the advertising |
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158 | (3) |
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The Big Names versus Boutiques |
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161 | (4) |
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161 | (1) |
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Boutique managers may be better |
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162 | (3) |
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165 | (3) |
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165 | (3) |
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168 | (1) |
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Going for CLASS When Choosing a Manager |
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168 | (3) |
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168 | (2) |
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Length of time in the industry |
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170 | (1) |
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170 | (1) |
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170 | (1) |
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Style can impact performance |
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171 | (1) |
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Getting to Know the Person Looking After Your Money |
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171 | (6) |
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172 | (1) |
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173 | (1) |
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174 | (1) |
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Following the leader who makes money |
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175 | (2) |
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Chapter 11 Looking At Your Options: Taking Advice or Going It Alone |
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177 | (10) |
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Examining the Best Route for You |
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178 | (2) |
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178 | (1) |
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179 | (1) |
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Dealing Directly with Your Fund Manager |
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180 | (2) |
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Dealing direct can work well |
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180 | (1) |
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Making sure you understand the costs |
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181 | (1) |
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Investing through a Managed Fund Broker |
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182 | (3) |
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Finding out what services are offered |
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182 | (1) |
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183 | (1) |
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183 | (2) |
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Using Financial Planners and Other Advisers |
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185 | (2) |
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Making the decision to seek advice |
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185 | (1) |
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Working out what service you need |
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185 | (1) |
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Finding a financial planner |
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186 | (1) |
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Chapter 12 Filling In the Forms |
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187 | (20) |
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Getting Your Head around the Product Disclosure Statement |
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187 | (11) |
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You shouldn't need a PhD to read a PDS |
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188 | (1) |
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188 | (2) |
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190 | (1) |
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Too much information! A typical PDS layout |
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191 | (1) |
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Discovering the main parts of a PDS |
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192 | (6) |
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198 | (3) |
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198 | (1) |
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199 | (2) |
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201 | (2) |
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Information you need before you start |
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201 | (2) |
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203 | (1) |
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Knowing What Else to Look Out For |
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203 | (2) |
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Anti-Money Laundering: How It Affects You |
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205 | (2) |
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What does it mean for the fund manager? |
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205 | (1) |
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What does it mean for the investor? |
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206 | (1) |
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Chapter 13 Buying, Selling and Monitoring Your Investments |
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207 | (14) |
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Calculating the Price You Pay |
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208 | (4) |
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Understanding how units are priced |
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208 | (2) |
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Learning how dividends can affect price |
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210 | (1) |
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Making sense of management expenses |
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210 | (1) |
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Taking a look at price spreads |
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211 | (1) |
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212 | (2) |
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Instructing your adviser or going direct |
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212 | (1) |
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What happens when you buy? |
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212 | (2) |
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Paperwork you can expect from your fund manager |
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214 | (1) |
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Monitoring Your Investments |
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214 | (3) |
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215 | (1) |
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Reading fund manager updates |
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216 | (1) |
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217 | (4) |
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How do you sell managed funds? |
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217 | (1) |
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What happens when you sell? |
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218 | (3) |
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Part IV Determining How Funds Are Labelled |
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221 | (64) |
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Chapter 14 Understanding Standard Fund Types |
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223 | (18) |
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Considering Types of Managed Funds |
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224 | (2) |
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Ensuring you know what's in the box |
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224 | (1) |
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Making it easier to compare |
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225 | (1) |
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Looking at Eight Ways Australian Funds Are Labelled |
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226 | (7) |
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227 | (1) |
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228 | (1) |
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228 | (1) |
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Mid- and small-cap equities |
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229 | (1) |
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230 | (1) |
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Single-sector and single-asset funds |
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230 | (2) |
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232 | (1) |
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233 | (1) |
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Following a Well-Travelled Path: International Equities |
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233 | (4) |
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Going overseas? Fasten your seatbelt |
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234 | (2) |
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Finding your way around the currency hedging maze |
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236 | (1) |
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Weighing Up Concentrated Funds |
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237 | (2) |
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Like your funds neat? High conviction may be your tipple |
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237 | (1) |
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Higher risk can pack a punch |
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238 | (1) |
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Understanding Index Funds |
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239 | (2) |
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Taking the stress out of decision-making |
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239 | (1) |
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So what's the catch with index funds? |
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240 | (1) |
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Chapter 15 Examining More Ways of Classifying Managed Investments |
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241 | (18) |
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Listed Investment Companies |
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242 | (4) |
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Understanding Listed Investment Companies |
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242 | (4) |
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246 | (1) |
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246 | (5) |
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Investing in the next big thing |
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247 | (2) |
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From stocks to commodities and international shares |
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249 | (1) |
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Typical investing strategies |
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250 | (1) |
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Ethical, or Values-Based, Investments |
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251 | (5) |
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Ethics and investing can go together |
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252 | (2) |
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Make money from ethical investments, really! |
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254 | (2) |
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256 | (3) |
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Growing your returns, literally |
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256 | (1) |
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Understanding the difference between tax-advantaged and tax-driven |
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257 | (2) |
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Chapter 16 Lifting the Veil on Hedge Funds and Structured Products |
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259 | (14) |
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Understanding What's Meant by Hedging |
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260 | (1) |
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Hedging: A simple explanation |
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260 | (1) |
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Finding a place in your portfolio for hedge funds |
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261 | (1) |
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Examining Types of Hedge Funds |
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261 | (4) |
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As many types as there are funds |
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262 | (2) |
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Unravelling black-box investing |
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264 | (1) |
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Finding out about hedge funds in Australia |
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264 | (1) |
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Fees to Make Your Eyes Water |
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265 | (2) |
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Understanding the 2-and-20 rule |
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266 | (1) |
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Floating above high-water marks |
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266 | (1) |
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267 | (1) |
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Structured Product Investments |
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267 | (6) |
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Watching out for the guarantees |
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268 | (2) |
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Why invest in a structured product? |
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270 | (2) |
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Fees, more fees and the fees you're not told about |
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272 | (1) |
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Chapter 17 Looking at Administration Services and Managed Accounts |
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273 | (12) |
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Understanding Administration Services |
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274 | (2) |
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Uncovering how administration providers and financial planners work together |
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274 | (1) |
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What do administration services do? |
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274 | (1) |
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Making sure you need the services |
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275 | (1) |
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Exploring Wraps and Master Trusts |
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276 | (4) |
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276 | (1) |
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Wraps with a choice of filling |
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277 | (2) |
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Using wraps and master trusts |
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279 | (1) |
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Understanding Managed Accounts |
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280 | (4) |
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Different types of managed accounts |
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280 | (2) |
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282 | (2) |
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284 | (1) |
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Part V Following Some Sensible Ideas for Happier Returns |
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285 | (36) |
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Chapter 18 Borrowing to Invest |
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287 | (16) |
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Gearing Up Your Portfolio |
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288 | (4) |
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Understanding what gearing means |
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288 | (2) |
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Finding a loan to suit you |
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290 | (2) |
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292 | (2) |
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Working out how much you can borrow: LVRs and loan limits |
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292 | (1) |
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Increasing your returns with tax deductions |
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293 | (1) |
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294 | (4) |
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Looking out for the downside |
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294 | (1) |
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Understanding margin calls |
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295 | (3) |
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Finding Funds That Gear for You |
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298 | (5) |
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299 | (1) |
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Advantages of using geared share funds |
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300 | (1) |
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Disadvantages of using geared funds |
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300 | (2) |
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Working out when to use a geared share fund |
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302 | (1) |
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Chapter 19 Investigating Other Investment Strategies |
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303 | (8) |
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Benefits of a Regular Savings Plan |
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304 | (1) |
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Setting up a regular savings plan |
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304 | (1) |
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Benefiting through dollar-cost averaging |
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305 | (1) |
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Examining the Difference between Savings Plans and Dollar-Cost Averaging |
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305 | (4) |
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An example of a regular savings plan |
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305 | (2) |
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307 | (2) |
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Compounding Your Investment Growth |
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309 | (2) |
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Reinvesting your distributions |
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309 | (1) |
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Figuring out the effect of compounding |
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310 | (1) |
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Chapter 20 Understanding What Can Go Wrong and What to Do If It Does |
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311 | (10) |
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Policing the Fund Managers |
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312 | (2) |
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Industry watchdogs and organisations |
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312 | (1) |
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Australian Securities and Investments Commission |
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313 | (1) |
|
Identifying the Crooks and Conmen |
|
|
314 | (3) |
|
Making sure you don't get conned |
|
|
314 | (1) |
|
Too good to be true: No such thing as a guaranteed return |
|
|
315 | (2) |
|
Finding Out Where to Complain |
|
|
317 | (2) |
|
|
|
317 | (1) |
|
Figuring out compensation and claims |
|
|
318 | (1) |
|
|
|
319 | (2) |
|
Finding out why funds may be frozen |
|
|
319 | (1) |
|
Getting out of a frozen fund |
|
|
319 | (2) |
|
|
|
321 | (14) |
|
Chapter 21 Ten Tips for Managed Fund Investing |
|
|
323 | (6) |
|
|
|
324 | (1) |
|
|
|
324 | (1) |
|
Being Patient Is a Virtue |
|
|
325 | (1) |
|
Mixing It Up with Asset Allocation |
|
|
325 | (1) |
|
|
|
326 | (1) |
|
Looking for Income? Distribution History Is Key |
|
|
326 | (1) |
|
Choosing Fund Managers That Perform |
|
|
327 | (1) |
|
Managing Risk, Not Avoiding It |
|
|
327 | (1) |
|
Adding Fuel to the Fire: Dollar-Cost Averaging |
|
|
328 | (1) |
|
|
|
328 | (1) |
|
Chapter 22 Ten Traps and Pitfalls: What the Managers Don't Tell You |
|
|
329 | (6) |
|
Not Knowing What You're Buying |
|
|
330 | (1) |
|
Not Figuring Out the Costs |
|
|
330 | (1) |
|
Not Appreciating Inflation |
|
|
331 | (1) |
|
Believing in Guaranteed Returns |
|
|
331 | (1) |
|
|
|
332 | (1) |
|
|
|
332 | (1) |
|
Believing the Marketing Hype |
|
|
333 | (1) |
|
|
|
333 | (1) |
|
Funds Growing Too Big, Too Fast |
|
|
334 | (1) |
|
|
|
334 | (1) |
| Glossary |
|
335 | (8) |
| Index |
|
343 | |
