Generate Newsletters
MEMBER NEWSLETTER OCTOBER 2016
Performance of Our FundsReturns to 30 September 2016 (after fees and before tax).
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The month that was…September was another quiet month as far as returns in global financial markets were concerned. This translated into subdued movements for our Funds’ unit prices. More on this later. |
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Warren Buffett WisdomsAfter 50 years at the helm of Berkshire Hathaway (which is typically one of our largest investments for both of our growth funds) Warren Buffett has become widely regarded as the world’s greatest investor. In his annual letters to shareholders, and in various interviews he has given, he has shared many of the lessons he has learned during his career. This month:“The smartest side to take in a bidding war is the losing side.” Here Buffett makes it clear that he has a strong preference for being the only bidder when he is considering buying a company. Fortunately for him, Buffett’s reputation is such that this is usually the case as companies often come to him when they get into financial trouble (for both capital and the prestige of having Buffett on the share register). There are also other reasons why company vendors seek out Buffett when they are wanting to sell up. Chiefly amongst these is they know Buffett won’t try to cut costs aggressively and sack large amounts of staff. Plus they know that if they continue to do a good job he will be largely leave them to their own devices to run the company. |
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What’s New in KiwiSaver?The KiwiSaver Annual Market Report has recently been released. The report notes that Generate was the fastest growing scheme both in terms of funds under management and membership numbers – an achievement we are very proud of. You can read the report here. |
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“Investing 101”Be prepared to walk awayIf an investor has spent considerable time (or money) researching a potential opportunity it can become difficult to walk away even if the investment doesn’t quite stack up. The investor must be prepared to set the opportunity aside if the due diligence does not support an investment case. In addition, people’s natural aversion to losses can lead to poor and irrational investment decisions whereby investors refuse to sell loss making investments in the hope of making their money back at some later point in time. We believe that astute investors pay little or no attention to the purchase price of an existing investment in deciding the rational course of action regarding whether or not to hold, sell or buy more. The rational investor will estimate the likely return on the investment on a forward-looking basis and compare that return to other attractive investment opportunities and decide on the course of action from there. |
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Top Holdings as at 30 September 2016
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International Equities Manager SpotlightPlatinum International Fund |
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Contact usIf you have any questions after reading your newsletter, give us a call on 0800 855 322 or email us at info@generatekiwisaver.co.nz and we would be more than happy to help.We thank you for your support. Kind regards, The Generate Team |
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