It was an uneventful month for the Australian share market. Aussie shares were relatively flat in March, gaining 0.7% to close at 4,420.0 points. Global markets were mixed with the Dow Jones Index gaining 2.0%, the FTSE falling 3.3%, the Nikkei 225 gaining 3.7% and the Hang Seng falling 5.2% for the month.
The Australian share market had a positive month in February despite unprecedented political events and a shock decision by the Reserve Bank to keep rates on hold.
The All Ordinaries Index gained 1.4% to close February at 4,388.1 points. Aussie shares underperformed major global markets with the Dow Jones Index gaining 2.5%, the FTSE gaining 3.3%, the Nikkei 225 gaining 10.5% and the Hang Seng gaining 6.3% for the month.
The Australian share market had its best start to any year since 1994, with the All Ordinaries Index gaining 5.2% for the month of January (closing the month at 4,325.7 points).
Aussie shares outperformed most major global markets in January – a trend I expect to see continue throughout 2012. Global shares performed well with the Dow Jones Index gaining 3.4%, the FTSE gaining 2.0%, the Nikkei 225 gaining 4.2% and the Hang Seng gaining a staggering 10.6% for the month.
December capped off a very poor year for investors. 2011 started badly with natural disasters (severe floods in Queensland and nuclear disaster at the Fukushima power plant) however this was only a teaser for what was to follow with a European sovereign debt crisis and issues never before encountered (i.e. a common monetary policy with differing government fiscal policies).
Each month I seem to be writing the same thing.... more volatility due to European sovereign debt issues! Again the political posturing in Europe weighed on the performance of the Australian share market.
The share market has snapped a six month losing streak to post near record monthly gains in October. The All Ordinaries Index gained 7.1% to close the month at 4,360.50 points.
Global share markets were all significant stronger in October with the Dow Jones Index gaining 9.5%, the FTSE gaining 8.1%, the Nikkei 225 gaining 3.3% and the Hang Seng gaining 12.9%.
Last month I wrote about the cause of decline in share prices over the first half of 2011, and how we had ‘priced-in’ a significant financial crisis in Europe.
September was another poor month for the share market.
The All Ordinaries Index fell 6.9% to close the month at 4,070.10 points. The Australian share market has now fallen over 16% for the 2011 calendar year.
Global share markets were all significant weaker with the Dow Jones Index falling 6.0%, the FTSE falling 4.9%, the Nikkei 225 falling 2.8% and the Hang Seng falling 14.3%.
There are three key themes that have triggered such extreme market movements over recent months:
With the recent poor sharemarket performance it is only natural for investors to be fearful and think about switching assets away from shares into cash.
However, by moving now from shares into cash is shortsighted and doesn’t take into account the big picture and long-term benefits of investing in shares.
On a long-term basis, notwithstanding the recent poor performance, shares have proven to provide a growing income stream. Cash deposits only hold their value; therefore cash investors face a significant risk of inflation eroding their returns.
In general, there are two choices as to how to appoint a trustee to your super fund: Individual trustees; or Company trustee (with members acting as directors).
I am often asked by clients to outline the main differences between these two choices. There are benefits of both, and I have outlined below some issues you should consider when making a decision.
The ATO have released a draft ruling which addresses some major concerns surrounding the use of limited recourse borrowings by SMSFs. Essentially the following changes have been proposed to commence from 7th July 2010;