# Which of Rabodirects funds for highest capital growth?



## tonster01 (23 Oct 2007)

Can anyone suggest a particular fund of Rabodirects that may be worth reading up on more myself...

Due to the sheer mass of volume I think I have just been overwhelmed which has in turn stalled me from investing.

This will be my first big investment so to speak and do not want to make a complete b@%ls of it...

Thanks


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## mercedes1 (23 Oct 2007)

The growth graph shown for each particular fund is of great benefit in deciding which one is right for you. The risk factor shown is also helpful, as is the aa recommendation. Like yourself I found the sheer number of them a little confusing. However the graph shows the growth in years, months and weeks. I invested some in a high risk fund ML India, this one has performed really well up around 30 per cent in five months, but I believe it is volatile and could go the other way. The graph shows this clearly, I also invested in Ml energy fund , this one has a more even graph and is less likely to reap high returns but is also less likely to drop sharply.
Hope this helps.


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## ClubMan (23 Oct 2007)

mercedes1 said:


> The growth graph shown for each particular fund is of great benefit in deciding which one is right for you.


Why? Past performance is no guide to future returns.

Choosing a fund based on risk/reward profiling is another matter - in the long run the returns should be higher with a higher risk/reward profile albeit most likely with a higher level of volatility along the way.


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## Godfather (24 Oct 2007)

ClubMan said:


> Why? Past performance is no guide to future returns.


 
Totally agree. Past is dust. And I experienced it myself when I did a wrong investment that tought me quite a lot...


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## mercedes1 (24 Oct 2007)

I mentioned the graph as a quick view to the trend of the share. I believe that taking that together with the risk/reward information improves my chances of picking the best fund. 
Like the stockmarket , people use all different systems and this one has worked well for me.
So far my investment in these funds has performed exceptionally well.


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## Sunny (24 Oct 2007)

mercedes1 said:


> I mentioned the graph as a quick view to the trend of the share. I believe that taking that together with the risk/reward information improves my chances of picking the best fund.
> Like the stockmarket , people use all different systems and this one has worked well for me.
> So far my investment in these funds has performed exceptionally well.


 
Do you look at the price graph by itself? That really doesn't tell you much. No point seeing a fund with a nice upward sloping price graph showing 30% returns over 6 months if its benchmark and other similar funds are showing 50% returns over the same period.


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## ClubMan (24 Oct 2007)

mercedes1 said:


> I mentioned the graph as a quick view to the trend of the share. I believe that taking that together with the risk/reward information improves my chances of picking the best fund.


I disagree - past performance is no guide to future returns.


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## shanegl (24 Oct 2007)

Indeed. And investing in managed funds in the long run is a mugs game.


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## tonster01 (24 Oct 2007)

ClubMan said:


> Why? Past performance is no guide to future returns.



Thanks for the replies..but I am trying to get down to the nitty gritty as to how I differentiate why I should go for one fund/share over the other...

Should be be looking at balance sheets of companys..reading up on the respective countries GDP etc.believing the hype thats fueling the markets.?

Or is this knowledge you accumulate over time with your own study etc.

Hope I am not asking the impossible here

Thanks


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## ClubMan (24 Oct 2007)

shanegl said:


> Indeed. And investing in managed funds in the long run is a mugs game.


Why? Costs and tax issues compared to direct shareholdings or something?


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## room305 (24 Oct 2007)

ClubMan said:


> Why? Costs and tax issues compared to direct shareholdings or something?



Even a 1% pa charge will drastically reduce your return over the longterm. I think Rabo's charges are well in excess of this.

Also actively managed funds, on average, underperform the market once fees are taken into account.


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## Sunny (24 Oct 2007)

tonster01 said:


> Thanks for the replies..but I am trying to get down to the nitty gritty as to how I differentiate why I should go for one fund/share over the other...
> 
> Should be be looking at balance sheets of companys..reading up on the respective countries GDP etc.believing the hype thats fueling the markets.?
> 
> ...


 
I would advise that the first step you take is to decide what type of investor you are i.e. your risk profile. If memory serves me right Rabo has some info and tools that might help with some of the questions that you need to ask yourself. After that it becomes easier to differentiate between the funds according to the risk you want to take. There is no point puting all your money into Chineese equities for example because it has the highest returns if you can't afford volatility or loss of investment. Also there are other fund providers such as Quinn (cheaper) that might be worth checking out as well.


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## Sunny (24 Oct 2007)

room305 said:


> Even a 1% pa charge will drastically reduce your return over the longterm. I think Rabo's charges are well in excess of this.
> 
> Also actively managed funds, on average, underperform the market once fees are taken into account.


 
Had a feeling this thread was going to go down this road!! Been a while since this debate has surfaced!


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## stir crazy (24 Oct 2007)

so many questions but no answers .

which sort of investment is not a mugs game ?


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## shanegl (24 Oct 2007)

ClubMan said:


> Why? Costs and tax issues compared to direct shareholdings or something?


 
I'm referring to the fact that they're actively managed as opposed to passive index tracking. This will mean higher management fees, and you're more likely to pick a fund that will underperform the index than beat the market. When you see some ETFs charging as little as 0.35% its a little hard to swallow.


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## ClubMan (24 Oct 2007)

shanegl said:


> I'm referring to the fact that they're actively managed as opposed to passive index tracking. This will mean higher management fees, and you're more likely to pick a fund that will underperform the index than beat the market. When you see some ETFs charging as little as 0.35% its a little hard to swallow.


Sorry - I misread the following as referring to all unit linked funds no matter what the approach to how they are run (e.g. actively managegd versus index trackers):


shanegl said:


> Indeed. And investing in managed funds in the long run is a mugs game.


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## shanegl (24 Oct 2007)

My mistake, it did look like I was slating funds in general, rather than a type of fund.


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## mercedes1 (24 Oct 2007)

Sunny said:


> Do you look at the price graph by itself? That really doesn't tell you much. No point seeing a fund with a nice upward sloping price graph showing 30% returns over 6 months if its benchmark and other similar funds are showing 50% returns over the same period.



If you read what you quoted ! You will see that you are even contradicting yourself !


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## Sunny (25 Oct 2007)

mercedes1 said:


> If you read what you quoted ! You will see that you are even contradicting yourself !


 
How am I contradicting myself? You said you look at the price graph of the fund by itself. What exactly does that tell you if you don't compare it to anything? As far as I remember Rabo doesn't allow you to compare their price graphs against anything so what exactly does it tell you that you find so helpful.


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## RaboDirect (25 Oct 2007)

The graphs on each fund show the price history. See this example [broken link removed]

However, when you look at each fund's fact sheet you will see how the fund has performed against a relevant index - see here for the example [broken link removed]

The Fund Selector tool shows the annual growth for 1, 2, 3, 4, 5 years and since launch. [broken link removed]

Hope this helps to clarify some queries. 

RaboDirect


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## Sunny (25 Oct 2007)

Thanks Rabo. Wasn't criticising what you offer. Actually think it is very good and I know you publish all the investor reports.

I just take issue with a poster advising someone to base a large part of their investment decision based on what a historic price graph shows.


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## minion (25 Oct 2007)

There are many methods.
1 - looking at the graph that is trending upwards.
2 - Looking at the info on the fund and analysing it.
3 - Both
4 - Take pot luck.

None of these is foolproof and im willing to bet good money  that all are as good as each other when it comes to picking funds


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