Question 1: What five EFTs (exchange traded funds) would you include in a trust fund set up to support a disabled 20-year-old. Capital protection and franking credits sought.
Answer: When you talk about ETFs, I am going to assume that you mean low cost, passively managed index tracking ETFs. There are also actively managed ETFs.
Rather than ‘5’, I suggest that you have a look at Vanguard’s range of pre-mixed ETFs. They have an ETF for a ‘conservative’ portfolio (VDCO), an ETF for a ‘balanced’ portfolio (VDBA), an ETF for a ‘growth’ portfolio (VDGR) and an ETF for a ‘high growth’ portfolio (VDHG).
Each of the ETFs invests in other Vanguard ETFs. You can see the mix on Vanguard’s website (which might provide some insights if you decide not to take the pre-mixed option).
Given the age of the person, I would probably go for the ‘growth’ or ‘high growth’ options. However, they won’t provide capital protection in the short term, and franking credits will depend on the exposure to Australian equities.
Question 2: Ramsay Health Care (RHC) reported poorly and was sold off. Do you think it is a buy?
Answer: It is not that long ago that KKR were trying to buy Ramsay by paying $88 per share.
Ramsay’s FY23 financial result was a miss and the FY24 outlook disappointed analysts. While revenue seems to be on the rise, higher costs are impacting margin.
The analysts are largely neutral on the stock. According to FN Arena, the consensus target price is $57.57, about 10.2% higher than the last ASX price. The range is a low of $48.60 from Morgan Stanley through to a high of $68.00 from Ord Minnett.
As a Ramsay fan, I think it is reasonable buying at the moment. That said, I can’t see an immediate catalyst for a ‘re-rating’ so you can probably afford to be patient. Maybe around $50.
Question 3: I read an article in The Australian about the private credit market in the USA. How can I participate in Australia?
Answer: It is not that easy for retail investors to access the private credit market. You can access it indirectly through some of the units trusts that trade on the ASX such as MXT (Metrics Master Income Trust). You can potentially access it directly through some of the commercial mortgage brokers like Balmain ( https://www.balmainprivate.com.au/ [1] ) or fixed interest brokers such as FIIG Securities.
Question 4: When does Woolworths pay its dividend?
Answer: Woolworths is due to pay its final dividend of 58c per share (fully franked) on 27 September. It trades ex that dividend today (31 August).
If you want to participate in the DRP (dividend re-investment plan), you must notify the share registry by COB on Monday 4 September.
Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances.