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Re: [sharechat] hype, property, interest rates, and shares


From: mixtrader <mixtrader@clear.net.nz>
Date: Thu, 29 Jan 2004 20:44:19 +1300


Hi Callum
 
I am a believer in a fully diversified portfolio so will put my hand up as being an investor in property (both residential and commercial - not industrial)
 
For what it is worth, equities are currently approx 30% of portfolio, property approx 45%, the balance is spread across bonds/deposits and other more liquid assets along with family assets such as personal residence etc.
 
Of all investments in my portfolio, real property gives the greatest headaches but is second best in returns at about 6.5% net of tax (not including capital gains (losses) if any).  It seems that, because the largest portion of income producing assets are property, IRD doesn't classify me as a trader (despite earning more from shares than property).
 
Property (like some shares) is a long-term investment if you operate as I do.  As such the debate as to which is the better investment over longer time horizons is always of interest.  Some of the reason for this type of diversification of investments portfolio has a bit to do with risk aversion.  Having been well bitten by equities once before (1987), I am now averse to placing the entire tray of eggs in the one basket.
 
From an excitement perspective - shares win hands down, property tends to be as exciting as watching paint dry (I'm not talking about body paint here)
 
Regards

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