Managed Funds – Listed Equities

In Australia there is a saying: “You work hard for your money, so make your money work hard for you”. And with the Australian Stock Market consistently among the world’s best performers, the equities market is currently positioned to provide very solid returns.

Underpinning the substantial levels of private investment in listed companies are the broad and consistent forecasts of continuing strength for the Australian economy. The overseas demand for materials, goods and services, particularly from the surging economies of India and China, are expected to sustain local business levels for several decades to come, creating the ideal environment for investment.

Growth Equities, a fund manager that for the past four years has consistently produced annual returns of over 35% for its clients by investing in Australian equities, believes the current strength in the market will be sustained in the long term, confirming managed equity funds one of the most attractive investment options.

Why choose equities in preference to other forms of investment? Leading economic forecasters like BIS Shrapnel agree that business investment will continue at high levels for the next five years. This view is shared by the Reserve Bank of Australia, who point to strong and sustained growth in key global economies as a powerful driver for Australian resource and industrial stocks. And, on the back of strong industrial growth, other sectors like housing and infrastructure are also thriving, creating an attractive range of choices for investors.

          
Listed equity fund managers like Growth Equities bring together the critical factors of sustained wealth creation:

<            A strong local market knowledge and sound research facilities guide their stock selections.

<          A diversified portfolio provides access to the growing Australian economy whilst minimizing the risks.

<             Immediate access to quality investments without the worry of selecting and managing a diversified portfolio.

<            Portfolio management to suit your new tax environment.

It is recommend that an investor seeking a fund manager should look for five key features:

<          A consistent record of producing high returns after all costs and charges (be aware that some fund managers quote gross returns from which a number of costs have to be deducted, which can significantly reduce the final return to investors).

<          A relatively small spread of stocks. Research shows that a portfolio of 20-30 stocks provides the optimum balance between spreading the risk and containing research and management costs. A larger portfolio attracts higher costs without a commensurate increase in the spread of risk.

<          A heavy emphasis on Australian stocks. The strong performance of local stocks means it is unnecessary to risk investments in global markets that can often be more volatile.

<          A very limited – if any – exposure to start-up ventures and traditionally volatile areas of the market like bio-tech companies.

<         The directors and management invest their own money in their funds.

Given the almost universally-forecast long term strength of the Australian equities market, a sound investment program set up now with the help of a fund manager specializing in listed investments will show handsome returns in the years ahead.