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I'm interested in moving some of my savings to either a managed fund or ETFs. Around 50k AUD in total + ongoing additions.

Now I'm trying to decide whether to find a managed fund, or use Vanguard ETFs. With a new trading account I can keep at least the initial move free of transaction charges, but ongoing additions would cost me the standard fee. I may want to move half of those funds into a mortgage deposit in a year. (maybe?)

Some things I already know of:

  • I don't mind trading in full shares
  • I can deal with the occasional distribution myself

Things I'd like to learn:

  • The volume on ETFs I'm looking at seems very low compared to popular stocks - for example, should I be worried about liquidity of VAP if I want a quick exit?
  • Exploring a few higher rated managed funds traded from Australia, I found the high rated ones (by Morningstar) are high risk only - am I just looking in the wrong places? Or is the only choice there to combine multiple higher risk ones?
  • If I'm going for an international shares ETF, choosing something like VGAD (hedged into AUD) seems like an obvious choice if I don't pretend to know what's going to happen to the currency rates. Is there any reason why I may consider VTS/VEU instead?
  • And finally, does investing into VAP+VAS+VGAD (local+intl mix, hedged into local currency, ratio not defined yet) have any obvious issues?
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    If you put each of those "things you'd like to learn" into its own question, you might be able to get a good answer on some of them. As it is, this is too much to handle in a single question. Apr 17, 2017 at 14:45

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Now I'm trying to decide whether to find a managed fund, or use Vanguard ETFs. With a new trading account I can keep at least the initial move free of transaction charges, but ongoing additions would cost me the standard fee. I may want to move half of those funds into a mortgage deposit in a year. (maybe?)

Most ETFs, like the stock market, exhibit significant volatility and, over short periods of time, substantial down-side risk. In other words, there is a significant chance that the value of your investment will be worth substantially less in a year from now.

The likelihood of this being the case in, say, 10 years from now is much lower, and vanishingly small for a diversified portfolio.

If you aren't confident you'll at least have the option of keeping most of your money invested for over a year, consider that the stock market may not be right for you, at least not as an investment vehicle.

Regarding the things you'd like to learn; as the commenter said - that's a huge topic and I think you need to clarify your questions.

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