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Defining Adviser Alpha
Read more: Defining Adviser AlphaAlpha. In an investment sense it means how much better your returns were against a specific benchmark. If you were holding an ASX small cap fund and it returned 12% while the ASX small cap index returned 10%, your alpha is 2%. This can also work in reverse. Your fund returns 8% while the index returned 10%, well you’ve got negative alpha of 2%. The financial industry has long been attempting to get to the bottom of what alpha is within financial advice. Someone pays a financial adviser X amount, does that person derive more in value from that advice…
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Super Insurance Opt-In
Read more: Super Insurance Opt-InOn 1 July 2019, the government’s Protecting Your Super package introduces new laws designed to protect members from paying unnecessary fees and insurance premiums. If you have multiple superannuation accounts or superannuation accounts which are deemed to be inactive, you may have received a super insurance election form from your fund recently. Inactive super accounts are those which have not received super contributions for at least 16 months. From 1 July 2019, under the new “Protecting your Super” reforms, super funds will cancel insurance on inactive account. If you have an affected account your super fund would have contacted you.…
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The Bad News of Doing Something
Read more: The Bad News of Doing Something“Why do you include so many bad news stories?” It’s a question we’ve been asked, not regularly, but maybe it needs addressing. First off here’s a good news story. This is the growth of $10,000 over the past 25 years in five different asset classes. If you’ve been invested inside and outside of superannuation, you’ve had a decent bite of that. Even better news, all you had to do was open your mouth and the market spooned the returns right in. What’s better than that? That’s 25 years and despite the fact everyone should think in those timeframes, very few…
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We’re Interested in Superannuation Again, Are We?
Read more: We’re Interested in Superannuation Again, Are We?Last week the Productivity Commission released a report into superannuation. No surprise, it didn’t paint the best picture. Suggesting the super industry was lacking competition and accountability, while many funds were still acting in their own best interests and not their members. It came with a few recommendations from the productivity commission to address the problems and the always helpful media couldn’t miss their opportunity to fill a few pages with advice. The recommendations were good and bad. The report identified the issue of a super account being tied to an employer, meaning quite often a new job means starting…
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Ignoring Advice Has Consequences
Read more: Ignoring Advice Has ConsequencesRead a survey on financial advice and it’s estimated anywhere from 70% to 85% of people will never seek it. Yet from the small pool of people who have sought financial advice, 80-90% of those (depending on the survey) will acknowledge the advice they received was worthwhile and provided value. One of the more curious areas of financial advice is when someone among that small group of Australians who’ve gone out of their way to seek financial advice, ends up ignoring it. They remain engaged with their adviser, they continue to pay fees for their service, but when it comes…
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