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Topic # 31600 23-Mar-2009 22:42
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Has anyone had any previous experience with rabobank and their managed fund service? I have some spare cash I would like to invest and around now is a prime opportunity but I do not have the time / skills to be looking at my own investments.

Any other reccomendations?

Cheers
Chris

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  Reply # 202928 23-Mar-2009 23:25
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I have my Kiwisaver contributions invested with Gareth Morgan Kiwisaver and have been really impressed by the amount of detail provided each month, as well as the transparency of what fees they are charging.

So far as other investments are concerned, I manage that myself, but if you don't have the time or inclination, I suggest you have a look at what Gareth Morgan can offer here:

http://www.garethmorgan.com/Pages/Content.aspx?pid=47

There are also some very informative Portfolio Tips here:

http://www.garethmorgan.com/portfoliotips/

Many of the funds on Rabobank's web site have very high fees and they probably also pay Trail Commissions to Rabobank.  This is common practice in the Financial Advice Industry and is something Gareth Morgan is determined to expose.

Many years ago I set up an investment with a Financial Advisor.  Then for the next few years I wondered why the returns were so poor.  Nowhere near the advertised returns in the glossy brochure we were given when we made the investment.  It turned out that the Financial Advisor not only received hefty commissions on our entry to the fund; he also received Trail Commissions every year we remained in the fund.  For this reason, it was in his interest to keep our money in the fund, even though it was not performing well.

That experience has put me off Financial Advisors for life and I resolved to learn the ropes for myself.  For that reason, I have never invested in Hanover, Nathans Finance and the like which went spectacularly bust last year.  The only place I use Managed Funds is for overseas investments, where it is difficult if not impossible to know enough about the various companies who list their shares on NYSE, LSE etc.  In order to get some of our funds outside NZ, it makes sense to use Managed Funds there.  But for local companies on NZX, it is easy enough to access their web sites because there aren't that many which are safe enough bets in the current market conditions.  In fact, I would say you could count them on 2 hands, if not less!

The DIY approach is not for everybody though.  If you would rather hand it over to someone, Gareth Morgan is somebody I would recommend without hesitation.  Have a good look around their web site, and see what you think.

HTH,
Grant.

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  Reply # 202937 24-Mar-2009 00:20
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On the Kiwisaver note...I've been researching which kiwisaver fund/provider to go with and just recently saw these guys generated some of the higest returns (to march 2009).

http://www.huljich.co.nz/

However yes you need to be aware they have higher fees than say an asb kiwisaver fund.  It's a toss up whether the higher returns out weigh the higher fees.

Links:

Morningstar Research shows that of 376 New Zealand superannuation funds on its database, 275 or 73.13 per cent had negative returns over the year to 30 June 2008
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10559165

Huljich Wealth Management manages the Huljich, Mike Pero and NZF funds and managing director Peter Huljich said their success was due to the fund manager's cautious investment strategy.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10562197

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