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Investment Portfolio; Against Melbourne/National Property prices.
Topic Started: 16 Dec 2012, 08:34 AM (25,673 Views)
Poontang
Member Avatar


Poontang
16 Dec 2012, 08:34 AM
Share Code

SBM

MTS

NST

EPX

FML

IMF

AYN

ABY

BKP

MXR

RAU

OPP

$1.68

$3.19

$1.415

$1.855

$0.031

$1.665

$0.037

$0.48

$0.006

$0.005

$0.012
Quantity

20000

10000

20000

15000

806451

15000

500000

20000

830000

1000000

416666
Purchase Value

$33600

$31900

$28300

$27825

$25000

$24975

$18500

$9600

$5000

$5000

$5000
Current Price

$1.425

$3.35

$1.21

$1.83

$0.030

$1.61

$0.035

$0.48

$0.006

$0.005

$0.009
Current Value

$28500

$33500

$24200

$27450

$24193

$24150

$17500

$9600

$5000

$5000

$3750



20Kg Silver Bullion @ $966.06Kg $19321
Cash $ 5432
Cash 2 $0


Portfolio Value at Start $240000
Portfolio Current Value $226696

There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
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Bowral trash trader
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It was brave of you to start this.

Down $13,304 or 5.5% in the first week.

Hope it's only hypothetical.
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Poontang
Member Avatar


Poontang
16 Dec 2012, 08:34 AM
Share Code

SBM

MTS

NST

EPX

FML

IMF

AYN

ABY

BKP

MXR

RAU

OPP

$1.68

$3.19

$1.415

$1.855

$0.031

$1.665

$0.037

$0.48

$0.006

$0.005

$0.012
Quantity

20000

10000

20000

15000

806451

15000

500000

20000

830000

1000000

416666
Purchase Value

$33600

$31900

$28300

$27825

$25000

$24975

$18500

$9600

$5000

$5000

$5000
Current Price

$1.46

$3.38

$1.27

$1.82

$0.031

$1.63

$0.037

$0.48

$0.006

$0.005

$0.008
Current Value

$29200

$33800

$25400

$27300

$25000

$24450

$18500

$9600

$5000

$5000

$3333



20Kg Silver Bullion @ $977.95Kg $19559
Cash $ 5432
Cash 2 $0


Portfolio Value at Start $240000
Portfolio Current Value $231574

(Edit: Forgot to add in Cash balance to total)




I am not a licensed financial advisor. These are not recommendations, and always seek professional advice before investing.
Edited by Poontang, 31 Dec 2012, 11:29 AM.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Profile "REPLY WITH QUOTE" Go to top
 
Poontang
Member Avatar


SBM

MTS

NST

EPX

FML

IMF

AYN

ABY

BKP

MXR

RAU
20000

10000

20000

15000

806451

15000

500000

20000

830000

1000000

416666
$1.53

$3.39

$1.27

$1.765

$0.033

$1.77

$0.037

$0.50

$0.006

$0.005

$0.008
$30600

$33900

$25400

$26475

$26613

$26550

$18500

$10000

$4980

$5000

$3333



Cash $5941 ($9 Interest + $500 Monthly Deposit)

Silver 20Kg @ $951.91 = $19038

Total Portfolio Balance $236390.


I am not a licensed financial advisor. These are not recommendations, and always seek professional advice before investing.
Edited by Poontang, 6 Jan 2013, 09:04 PM.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Profile "REPLY WITH QUOTE" Go to top
 
Poontang
Member Avatar


Poontang
6 Jan 2013, 06:24 PM
SBM

MTS

NST

EPX

FML

IMF

AYN

ABY

BKP

MXR

RAU

GOR
20000

10000

20000

15000

806451

15000

500000

20000

830000

1000000

416666

34154
$1.53

$3.39

$1.27

$1.765

$0.033

$1.77

$0.037

$0.50

$0.006

$0.005

$0.008

$.013
$30600

$33900

$25400

$26475

$26613

$26550

$18500

$10000

$4980

$5000

$3333

$4460



Cash $1481 ($9 Interest + $500 Monthly Deposit)

Silver 20Kg @ $951.91 = $19038

Total Portfolio Balance $236390.


I am not a licensed financial advisor. These are not recommendations, and always seek professional advice before investing.
34154 GOR @ $0.13 Added to portfolio.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Profile "REPLY WITH QUOTE" Go to top
 
Trojan
Default APF Avatar


Poontang
16 Dec 2012, 08:34 AM
Portfolio Value at Start $240000
Portfolio Current Value $240000


Will update portfolio after close of trade Fridays or before trading opens Monday morning (excluding public holidays)
Any trades made will be updated when a trade is made.
Any Dividends will be added to Cash amount on ex date. No dividend reinvestment unless stated.
Cash 2 Account will be approximation of CGT/Income Tax liability
$500 per month will be "saved" into Cash account.
I noticed you are adding the dividends to your cash (eg your portfolio performance will be capital gains + yield). Yet you say you are comparing it to Melbourne/National property prices which is capital gains only.
Will you be adding rental yields to the Melbourne/National property prices?

And the $500 per month you are adding to your investment portfolio - will you be adding $500 per month to the property prices as well?
Just for fair comparison sake.
Edited by Trojan, 10 Jan 2013, 03:54 PM.
I put trolls and time wasters on my ignore list so if I don't respond to you, you are probably on it ....
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Poontang
Member Avatar


Trojan
10 Jan 2013, 03:52 PM
I noticed you are adding the dividends to your cash (eg your portfolio performance will be capital gains + yield). Yet you say you are comparing it to Melbourne/National property prices which is capital gains only.
Will you be adding rental yields to the Melbourne/National property prices?

And the $500 per month you are adding to your investment portfolio - will you be adding $500 per month to the property prices as well?
Just for fair comparison sake.
The $500 is what I considered to be a fair discount a renter would have over a purchaser and so as argued in discussions before the "renter" is saving the difference.

It is a comparison to continue renting and not purchase a house as against purchasing a PPoR not an investment property.

Even then, if we were to comapre against an investment property situation, how do we come to an agreed yeild figure when some would argue their is no yeild as property investors lose money and claim the difference as negative gearing and some positive gear. How could we establish a base line for comparison.


The argument that started this thread was that a person had sufficient funds to purchase a house but decides to rent instead and invest because they think they can outperform the property market.


It does not take into account what the home buyer has paid out in interest either.
It does not take account rent paid. My personal position, rent is just under $700per month Some elses might be $2000per month.

Round figures house now $500k in 5 years MIGHT be $535k and the portfolio in 5 years MIGHT $500k earning $30k a year in dividends meaning that even despite the supposed dead rent money the investor will clearly be in front.
Counter to this the house might be now $650k and the portfolio still only $240k (or less) clearly putting the home buyer in front.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Profile "REPLY WITH QUOTE" Go to top
 
Strindberg
Member Avatar


Poontang
10 Jan 2013, 05:21 PM

The argument that started this thread was that a person had sufficient funds to purchase a house but decides to rent instead and invest because they think they can outperform the property market.
Er...if a person has enough funds to purchase a house he will not have to pay rent or mortgage interest. The person who decides to invest elsewhere will have rent outgoings exceeding the outgoings of the house purchaser.

Where then is the logic behind assuming that the renter has an excess of $500 a month compared to the person who uses the funds to buy a PPOR?

Edit add:
It seems you are assuming the people have $240k cash. If that is used to buy a house the above situation applies. If say the cash is used as a deposit on a $480k place then the buyer will be paying mortgage interest on the remaining $240k. In that case it is unlikely that his mortgage interest costs will exceed the renters rent on a $480k place. Adding $500 a month to the renters account is therefore not appropriate.
Edited by Strindberg, 10 Jan 2013, 07:07 PM.
Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
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Shadow
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Evil Mouzealot Specufestor

Poontang
10 Jan 2013, 05:21 PM
It does not take into account what the home buyer has paid out in interest either.
For a proper like-for-like comparison you need to assume the same leverage for both investment options. If you're assuming the homebuyer must take out a loan and pay interest in order to invest in property, then you must assume that a loan is also required to invest in the alternative investment portfolio.

Or, if you assume that the investment portfolio can be purchased without leverage, you must apply the same assumption to the property investment, in which case it will be providing a positive rental yield that you must include in your comparison.
Edited by Shadow, 10 Jan 2013, 07:20 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Poontang
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Shadow
10 Jan 2013, 07:10 PM
For a proper like-for-like comparison you need to assume the same leverage for both investment options. If you're assuming the homebuyer must take out a loan and pay interest in order to invest in property, then you must assume that a loan is also required to invest in the alternative investment portfolio.

Or, if you assume that the investment portfolio can be purchased without leverage, you must apply the same assumption to the property investment, in which case it will be providing a positive rental yield that you must include in your comparison.
I disagree, mainly in removing the rent/interest aspects of the "project" I think makes it a fairer like for like.


A person has $240k Deposit and chooses to rent rather than buy at this point in time as they think they can get better returns investing.

Interest payments on a $240k loan would be similiar to the persons rent. Allowing for Council Rates, Water Rates, Building Insurance and a little aside for maintenance issues.

Happy enough to remove the $500 a month aspect of the portfolio. Other than that I think it is quite a fair comparison.

The other only 2 alternatives are just leave it as an investment portfolio to be tracked here, or the investor borrows $240k and gears the portfolio up with the applicable tax deductions on the investment loan a buyer of a PPoR does not receive.

I am extremely confident that if the investment portfolio take the 2nd approach it will monster the housing option as far as returns go.
There are some people who seem angry and continuously look for conflict.
Walk away, the battle they are fighting isn't with you, it's with themselves.

The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it.
The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.

Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Profile "REPLY WITH QUOTE" Go to top
 
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