Letters of the Week

Options for self-managed funds, investing in Templeton, and SMSF tax treatment.

Options for self-managed super funds

I am interested in investing in a number of managed funds for my SMSF and was wondering if it would be possible for Eureka Report to write on the costs and advantages of investing in the following options:

1. Direct with the individual funds

2. Via a wrap account, and

3. Via master trust.

I would be looking to invest between $30,000 and $50,000 per fund. I do not use a financial adviser, so would not want to pay for the service.

I’m sure that many of your subscribers would also be interested in this subject.

Thanks and regards

PV

Editor’s response: Bruce Brammall wrote a timely piece in November last year, (Tapping into super wraps, November 7) that explains the benefits of investing in wrap accounts.

Investing in Templeton

Last week, Robert Gottliebsen mentioned he had invested in international funds management group Templeton. I know and appreciate that Eureka Report is not in the financial advice business but I was hoping Mr Gottliebsen could explain why he made this investment.

What little I can find out about them would indicate that they are nothing special.

Gil Thorncraft

Robert Gottliebsen’s response: Templeton is a value investor.  Its Australian-listed company is a mirror image of the global fund. Normally it sells in Australia at a discount to its asset backing and from time to time Templeton buys back stock if the discount gets too great. I buy in small amounts because it is a low management cost effective way to gain access to global sharemarkets. There is clearly a currency risk but I believe that longer term the Australian dollar is overvalued, so this is a hedge against a fall. In the current environment the dollar could rise, so it’s a long-term risk hedge play.

SMSF tax treatment

I don’t believe Eureka Report has concentrated enough on the very real threat of legislative change to the taxation treatment of the SMSF sector. Could you advise on this?

RH

Editor’s response: Robert Gottliebsen and Bruce Brammall have both written on this hot topic recently (China and super: Big changes afoot, February 8), (Inside Labor’s super wealth tax plans, February 6), while James Kirby interviewed Alan Kohler on the Government’s plans for superannuation in the article (Gillard’s super tax plan, February 5).

For more Letters of the Week, click here.

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