# 300k to invest



## Typical (17 Sep 2013)

So I know I will probably need specialist advice, but I am little allergic to so called "experts".

I have a good sum in stocks so don't want to add to that.  I was thinking of maybe commercial property in Ireland?  Does anyone have any better ideas?

Many thanks 

Typical


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## mercman (17 Sep 2013)

It all depends on your level of risk you can afford to take. There are plenty of avenues to read about on this site.

But be aware, *DO YOUR OWN RESEARCH* before basing any investment on others ideas, predictions or past direction to take.


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## Steven Barrett (17 Sep 2013)

Typical said:


> So I know I will probably need specialist advice, but I am little allergic to so called "experts".
> 
> I have a good sum in stocks so don't want to add to that.  I was thinking of maybe commercial property in Ireland?  Does anyone have any better ideas?
> 
> ...



Why would you invest in commercial property? Have you seen the amount of empty units throughout the country?


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## mercman (18 Sep 2013)

SBarrett said:


> Have you seen the amount of empty units throughout the country?



I'm not disagreeing with you but have we all not seen and heard about the non - Irish vultures sniffing around the Irish market. These are well used to buying bargains and flipping them on. 

Yes there are heaps of empty units throughout the country. But the property itself is not to blame. The fact that persons overpaid for property and Banks over lent is the root cause. 

It will just take a good eye and a deep pocket and a hard neck to sniff out potential.


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## Bronte (18 Sep 2013)

Typical said:


> So I know I will probably need specialist advice, but I am little allergic to so called "experts".
> 
> I have a good sum in stocks so don't want to add to that. I was thinking of maybe commercial property in Ireland? Does anyone have any better ideas?
> 
> ...


 
That's a lot of money to expect sound financial advice on in a web forum.  

Do you have any experience in commercial property or any property?


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## Steven Barrett (18 Sep 2013)

mercman said:


> I'm not disagreeing with you but have we all not seen and heard about the non - Irish vultures sniffing around the Irish market. These are well used to buying bargains and flipping them on.
> 
> Yes there are heaps of empty units throughout the country. But the property itself is not to blame. The fact that persons overpaid for property and Banks over lent is the root cause.
> 
> It will just take a good eye and a deep pocket and a hard neck to sniff out potential.



The property is an inanimate object, so I wouldn't be laying personal blame on the property either. 

I'd be careful on flipping properties too. That short term view of a long term investment is where I would lay some blame on the state of the Irish property market. 

I think people really need to think of property for what it is, a very long term investment. You need to do cashflows and include periods of when the property is vacant. What about rates and insurance? What kind of commercial property are you looking at? There is an abundance of industrial and office space out there. So are you going retail then? If so, location is key and you will be paying for that. Much more than €300k.

Personally, I much prefer investments. Invest, collect dividend, sell when you want, no ongoing costs.


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## Jim2007 (18 Sep 2013)

mercman said:


> The fact that persons overpaid for property and Banks over lent is the root cause.



And why did they get involved in property in the first place??? Despite all the evidence to the contrary, for some reason that is beyond me, Irish people persist in loading up on one of the few asset classes that can seriously damage their wealth and even go so far as to borrow to do it....

I just got back an hour ago from a meeting with PostFiance (the Swiss Post bank) where we were discussing one of the funds they offer as part of various pension savings plans.  I think you may be able to see the fact sheet from this [broken link removed].  Like other examples I've shown, this is typical low risk offering aimed at people who are about 8 to 10 years off retiring.  And as usual real estate is kept at about 4% and of course the fund is not leveraged.

Now it is not actually a very well performing fund, but it is worth noting that as you can see from the little diagram, the fund took some hits in 2007 and 2009, but has long since turned around and started to provide positive results  - compare this to people who are still waiting for property to recover.

And since I know you are interested in fees - they charge a once of CHF35 admin fee, the first time you buy into the fund, no custody fees, no other entry or exit charges and the TER of the fund itself is about 0.87%


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## monagt (18 Sep 2013)

Is that product available in Ireland?


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## Jim2007 (18 Sep 2013)

monagt said:


> Is that product available in Ireland?



No, nor would I recommend you try to replicate it using Irish equities, because the Swiss equities used represent some of the largest multinationals around and so in fact give a good exposure to a much broader geographic spread than would any Irish alternatives.

However the most important point to take away is not the product but the asset allocation model being used.  Many people in Ireland seem to believe that hold a large part of their wealth in property is a low risk option, but the numbers as opposed to sentiment show that in fact it is the opposite!

After setting aside your rainy day fund, the next step you should take is to determine the best asset allocation strategy that suits your situation in life and the goal you want to achieve.  Hand it hand with this is looking at the level of risk you are willing to take on and how to reduce that risk through diversification.  

Only after this should you start to examine possible products that might suit your investing strategy and then you can start to do things like look at the fees involved in each option and so on.

The sad reality is that if people had gone through such a exercise back in the day, some of them might at least have realised that you do no borrow to invest and that going beyond single digits went allocating wealth to property means that you are in fact building a high risk portfolio and not the low risk option they thought they were getting...


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## Steven Barrett (19 Sep 2013)

I agree with Jim. Asset allocation accounts for 91% of your growth. Get that right and you're laughing. 

Investing in property offers you very little diversification to equities. Look at when property prices go up and compare it to equities. They follow the same cycles. 

The problem for us Irish is that we never had a property bubble before, prices only went up. Well, now we've experienced one, let's learn from it.


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## monagt (19 Sep 2013)

Is there one fund or 1-3 funds that give you Asset Allocation?
http://en.wikipedia.org/wiki/File:Asset_Allocation.pdf


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## Steven Barrett (19 Sep 2013)

It's not a one size fits all. It depends on what return you want and the level of risk you are willing to take to get it. A portfolio then has to be constructed to get you those returns with the lowest level of risk. There are no guarantees though, it's far from an exact science.


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