Want to see if anyone has held investments averaging 7%+ p.a. that they would like to share?
Do You Have Any Investments Yielding average 7%+ p.a.?
Poor Ass on 10/04/2019 - 23:47
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I’m invested in a number of income structured products that pays 9% coupons on a quarterly basis with maturities of 3 years.
Some of the newer issues are a little lower, around 7.5% to 8% but still a lot higher than anything else on the market.
The great thing is that there is no cap gain at maturity as coupons are considered income.
Sounds awesome! Care to hare the name of the product?
They are offered by a number of international banks here. However most are open to wholesale/ sophisticated investors only, although there is one distributor who is offering it to retail clients at the moment.
@Hydrool: And who is the distributor?
Are you noticing how you aren't really answering the question people are asking you?
Are they secured or unsecured?
Income is guaranteed if that’s what you mean
Capital is not protected. I had multiple MLIs (marked-linked investments) back in Australia. Lost 33% on capital in one case only (due to BHP's performance back at the end of 2015). So risk must be considered. (Please seek professional tax advice if that could be considered capital loss.)
I was fine with the risk and purchased some BHP shares at the time of maturity. Personally, I consider I have completely recovered my loss. I would not have purchased BHP shares otherwise.
Most display houses give that sort of return.
why would you invest in properties that earn less than 7%?
Damn. My bad lol.
Damn Bad post or damn bad buy? 😎
Capital gains > Cash Flow.
Why not sell the ones less than 7% and buy ones that pay more than 7%, if 7% is easy? And don't tell me you like a challenge.
I know nothing and agree that you may own properties that make less than 7%
Yeah, I've seen a few dogbox CBD apartments in Melbourne that were 9%. No capital growth, but very decent cash flow.
ASX Top dividend shares eg Wbc, Nab, Boq are paying about 10 to 12% with franking, or 8 or 9% without.
I gave up on bank interest last October, and property seems worthwhile but I don't want the involvement.In about 5 weeks I'll have earned approx 11% dividends from share purchases made in Oct 2018.
10% cash payout but the share is 10% down…
In my case it's 2% down, but I intend to keep the shares for decades so I don't care, and to add to my collection each year.
It's a fairly lazy strategy, but I think it's going to work out longterm.Actually it's the only strategy that makes sense if you intend on investing in the sharemarket long term because no one can predict the market and outperform it by picking stocks over a long term period based on history.
In fact the average performance for picking stocks is actually slightly worse than randomly selecting stocks. That means a monkey throwing darts at a newspaper to pick stocks performs better than the guy picking stocks.
Therefore investors should be using an index fund tracking a large part of the market.
But the fee problem has to be avoided: even a fraction of a percent in fees has devastating consequences for long term investment. You can lose over half your money like the suckers having their money stolen for superannuation.
So you must be in an index fund where the investors own the fund so there is no incentive to levy fees. An example of this is Vanguard 500 which has a long history to compare to stock picking funds with fees.
@Diji1: Will we improve our portfolio performance if we have a diversified portfolio of monkeys throwing random darts?
If yes, any advice on the best portfolio of monkeys or maybe other primates?
I think this might become the best performing alpha primate fund ever.
Who's in?
In that case you're better off choosing a company with share dividends rather than a payout for tax purposes.
Unless you need the cash payouts
@FIVEDOLLAR: Both share dividends and payout are treated as taxable income for that financial year.
Only advantages with share dividends are that you don't have to pay brokerage fee and you obtain the shares at a slightly cheaper price.
That doesn't compound though
It does if you're on the DRP.
DRP is a nightmare when tax time comes
@od810: It's literally the same tax process as recieving dividends… you just pay tax on the dollar value
@Autonomic: Sale value minus buy value, four times a year, times the number of shares DRP'd. Nothing a spreadsheet can't handle!
@od810: Second this.
Im going through this issue currently. I really should have prepared for the it better :(
Im trying to work out CGT for 6 stocks with DRP over 13 years :( FML
can you enlighten me on this 'with/without franking' in layman's term ?
is it something to do with tax ?
thanks
Franking, from the investor's point of view, is kind of like tax withheld or prepaid.
If dividend is $70 with 100% franking, then $30 is prepaid to the ATO.
At the end of the financial year, if your total income is below $18,201, you're exempt from income tax, then you'll get that $30 back.
i see, so when ppl say with/without franking - it's just for comparison purpose , not suggesting there's an option to choose franked or unfranked ?
@dcep: AFAIK, investors cannot choose how much of their dividend is franked. Something to do with
how much tax the company paid to the ATO.further info at ATO but I can't be bothered to read to understand further@dcep: It depends on a few things, if the companies pay tax in other juridictions i.e. CSL pays tax in Us, there will be no franking credit or the companies making loss for many years and have capital loss carried forward, they won't have franking credit until they actually pay corporate tax. Also in some case, they pay corporate tax partially in Australia. That is what i understand
@ phunkydude
Simple way of explaining it is if your annual income tax rate is below the company tax rate of 30%, you will get the companies prepaid tax (franking) back into your hand (all or part of it) by applying for it in your tax return.
So if you earn over $87,000 p/a you will still have to pay some tax on the dividend income, but something like 12% from memory.IE. if you're a poor pensioneer you get the normal advertised dividends, say 8% for NAB, plus if fully franked (ie 30% prepaid by company), you get 8% x 1.3.
That 8% in your example is after the company has paid their 30% tax, right?
So the fully franked amount should be 8% / 7 x 3
and the total you get should be 8% / 7 x 10
@Trung: Yes, so if you pay no tax eg a disability pensioner, you will actually get 11.4% dividend p/a (after your tax return is paid by the government), given the above example 8% franked dividend that is usually advertised.
Note:
You are right Trung I think, my "you get 8% x 1.3" was wrong.
Some ROSCA may give 7% to 15% returns.
I had a term deposit in 2008 that had 8.25% rate, man I should have locked it in for longer.
We had some money in Pyramid at, roughly, 18%; fortunately we got out before it went belly up.
Around 1991 I had a term deposit on approx 22% with NAB
A financial advisor ( and Licensed!) wanting more advice on financial matters?
Check the other posts including AMA
https://www.ozbargain.com.au/node/447589
This has got to be ozbargain clickbait
OR maybe trying to get evidence to prosecute unlicensed financial advisers….
Haha, might need to "top up" his approved product list ;)
lol I don't sell products
You don't sell products? I'm sorry but are you really a Financial Adviser? It baffles me that Financial Adviser wouldn't be familiar with the term approved product list.
@akyeeeahdude: the industry and so broad and not all advisers have to sell products and yes a lot of them do and most of them are scum too
adviser side of work I provide fee for service so I make recommendations and plan strategies. There may be some products recommended but nothing comes back to me.
@Poor Ass: Approved Product List refers to the "products" that you are "approved" to recommend. I'm not referring to making a sale.
No it's for myself
Don't be hating
there is a conflict of interest in him providing financial advice to himself
also he doesn't want to pay his fee's (they are crazy), so better to ask on ozbragain which is freeeeeee
go to the casino, returns are at least 50%
black!
OP had another post drumming up interest in a fraudulent investment scheme a few weeks ago.
OP should be banned for spamming OZBargain with fraudulent and frivolous threads.
One of the great features of OzBargain is that it removes most spam/junk threads/posts. It would be a terrible shame for that benefit to wane.
JMS
*not financial advice
I put mine on black. Or high yield investment car
I got the high yield investment car, worth it but watching my saving rot in the bank is the worst.
What is the frequent reference on Ozb, to a high yield investment car?
Are they joking, or can you give an example.
I thought cars were the most devaluing asset you could get, which I assume is the joke, right?
No money pits. Mine is no different.
That said im looking at classic cars to flip. Wouldn't recommend it
@Bid Sniper: Yeah, how could you have picked old VW buses or Monaros decades later would become worth $50k+, and so many other classics get crushed.
I made some money by buying about 30 vehicle that looked like trash (paint and rust) and patching them to presentable, or had one problem like a head blown or gearbox or brakes gone, and got them sometimes for thousands under price.
The profit aint worth the effort, but it was fun.
@[Deactivated]: Yeah lot of work! Saw some recent VW buses, prices on those rusted out lunch boxes are insane.
I know Subarus so will stick to those, more for fun than anything. Not an investment thats for sure!
@username02
Its an ongoing OzB gag about a dude who posted here that he got a job as a financial adviser and bought a luxury car as "a high yield investment" to impress his clients and colleagues, or some such nonsense.Naturally the joke was that this is ridiculously bad financial advice. As you say, most cars are a clear waste of money investment-wise.
Meme origins here (click "show" on the hidden comment) https://www.ozbargain.com.au/comment/4128667/redir
Casino
APT ASX. It was about $6 last year, now it's $25. Is that more than 7%? ;)
Sad thing is, I don't know when to sell it. Or any stock.
I have the same problem. Easy to buy, hard to know when to take a profit.
LOL. Same problem here. It's near impossible to time the market.
Tell me about it.
I'm a few dollars away from APT being a 10 bagger. Been a long time since 10 bagger drinks for me
Not sure when to offload some
Definitely not my Bitcoin!
lol yeah I went in when it was 5 digits
HODL
Very interesting trace on Wiki Leak BTC's wallet https://www.youtube.com/watch?v=Ot3Wp3fAJbk&ab_channel=ThatM…
I get 35% on my FLT shares but I bought them for <$10.00 during the GFC. One of the biggest financial risks I ever took. A lot of the shares I bought during the GFC return 20%+ now. OTOH, quite a few companies I bought during the GFC died an ugly and expensive death.
NAB, WBC and CBA are doing 7%+ gross.
Recently bought Shaver Shop, Capral and Boral for their yield.
Harvey Norman, WAM Capital, Wesfarmers, Platinum Asset Management are all grossing 7%+
Ratesetter P2P lending will get you 7%+ on the 5 year loan. Just under for renewable power lending.
Salary Sacrifice into Superannuation gives an immediate 15% return but you can't access until you are an old fart.
I haven't bought in yet but Alumina is grossing 15%+. I don't understand the business yet and can't understand why the yield is so high…
NB: high yields may indicate that the company is on the way down with a strong likelihood that the yield may decrease. (past performance not an indicator of future returns).
Hell why does Warren Buffett waste his time, he should just get your mobile number…..
I don't think Warren Buffet has a mobile phone. He doesn't even use a computer.
Warren Buffett's annual RoI averaged over something like 40 years is 20.9%.
So yeah, don't think he is going to call him anytime soon.
I don't think there's anything special in my capital gains or dividend yields. It's time in the market (I've been buying shares for ~25 years) and trying to buy quality stocks, preferably where the CEO has some major skin in the game.
This doesn't always work. eg: Platinum Asset management where the owner & his (ex) wife owned ~46% of PTM. He sold 10% recently (to pursue philanthropic activities - LOL) and the company has taken a dive (it was already struggling). I'm about 10% down on them and have a few other stinkers in the portfolio.
I bought FLT in a downward spiral purchasing another $5k every time it dropped 20% desperately hoping it would recover. It wasn't investing, it was gambling and I got lucky.
I'm pretty sure my superannuation is earning much more than 10%pa - not that I can access it or anything.
For the last few years, maybe. But I doubt it'll get close to that this FY! Unless you have an SMSF?
Just checked my retail super and it has grown 10.4% in last 12 months despite Oct 18 stock crash.
Not the same every year, but certainly more years above 7% than below since GFC
You can use it if you’re a first home buyer
https://www.ato.gov.au/Individuals/Super/Withdrawing-and-usi…
Just so people understand, "yield" means the income divided by capital value.
Don't include your capital gains (increase in capital value eg share/property price rise) in yield.
You're not going to get a 7%+ yield in any cash, bonds, term deposits or property investments at the moment.
However, there are quite a few Aussie shares yielding over 7% when you include franking (which you should).
Another trap for young players is the "yield trap".
There is a saying in the finance world that "more people have lost money reaching for yield than at the point of a gun".
Yield is just a photo snapshot in any one moment of time. It doesn't give a very good long term picture of the investment's future income stream.
Many investors are lured into buying "high yield" investments which pay a high short term income but these same investments may pay a very poor long term income or receive no capital gain. Worse still the investment may be paying a high yield because they have to and could be at risk of losing 100% of the capital value.
The GFC is now 11 years in the rear view mirror but the memories and lessons are still very fresh for me. If you don't know the history then Google Westpoint, Australian Capital Reserve, Bridgecorp, Fincorp and the freezing of every mortgage trust in Australia.
The GFC is now 11 years in the rear view mirror
I think there's one right in front of windscreen
What do you see as warning signs?
share market peaking out
cooling of overheated housing market
interest rates bottomed out
debt level at peaksglobally
You bugger. You just reminded me of my investment in CityPacific. :-(
Ratesetter. 5 year market is yielding 8.2% at the moment. Not capital guaranteed, RateSetter lends money out to regular people who may refuse to pay up. But it yields 8%+
people who may refuse to pay up
what happens after that ? no recourse ?
RateSetter has a provision fund to cover deadbeat borrowers. Most of the time the provision fund is about 1.7x the size of the estimated deadbeat pool, but if more borrowers default on loans then the investors have to wear the loss. Apparently this has never happened before, but that doesn't mean it won't happen.
Basically, it's probably safe against occasional defaults, but if there's a big event (recession or run on the product) then you could lose it.
Not capital guaranteed, RateSetter lends money out to regular people who may refuse to pay up. But it yields 8%+
Maybe that's why it yields 8%+. You might not get some of your capital back.
That is true, and RateSetter doesn't try to hide that fact. However in 3 years of using RS to lend money none of my loans have encountered a bad borrower.
SNES Classic Mini's ;)
Seriously though, NASDAQ:AMD, ASX:Z1P.
Shares in Google however the Aus dollar is balls atm so that might affect your earnings - but Google is the only company that has so much money and power it has monopolized the world wide web search engine market.
Essentially anything Firefox, safari, Internet Explorer etc try to get over google is replicated and done more efficiently by Google because they have so much money they can essential out muscle anyone in that market. If a company rises up with a new technology that google cannot compete with they just BUY that company outright…
Disney is probably another one they are riding on the big Political Correctness movement and pushing feminist shit which democratic American cant seem to get enough of thus sooner or later everyone else will start to follow if they havent already ie Australia, UK etc. Pretty much have the biggest franchise for kids and adults in Star Wars and Marvel - though Star wars has been done poorly they will likely bring out a 'good' movie in the next year or 3 and it will blow up profits….
Do you own research!
surely google is a big company and still a favorable stock for multiple investors , but, it is struggling with its exploitation such us live streaming/offensive contents/and so on.
i would rather put my money on those startups which will be bought out by google/apple and so forth.
i would rather put my money on those startups which will be bought out by google/apple and so forth.
Do you have experience in this?
How do you predict which 'start-ups' will be bought by google/apple? How many start-ups are publicly listed for you to put your money into?
if i could pick the start ups Google/apple where going to buy i dare say i wouldnt need Ozbargin…. id have so much much that paying RRP wouldnt phase me and i'd be posting from my giant yacht…
Eh?
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how about you share something which is 6%+ ?