Q: If I am in the dead zone, just missing pension, but poor: should my strategy be to switch as much super to international equity from Oz equity?

A: Firstly, Mr Shorten needs to be elected first, and then legislate the change. If elected, it won’t come into effect until the start of the 19/20 financial year;

If you are just missing out, your strategy might be to get access to a part pension by selling some of your shares and investing in the family home (see my article here).

I don’t quite get why you should necessarily switch to international equities. I agree that some Australian shares will be marginally less attractive, but that doesn’t mean you should switch. Further, the market has already/will probably adjust to this change by making those shares that are popular with retirees (such as the Banks and Telstra) cheaper.

Q: I’m keen to add corporate bonds to my portfolio and would appreciate your advice on the different ways to do it.

A: Thanks for the question. I can’t offer an opinion on Australian Bond Exchange – to be honest, I haven’t heard much about them and their website doesn’t really say a lot.

If $250K is above your investment parameters, then options you could consider are:

1. a) Listed hybrids on the ASX;
2. b) A managed fund (there are several that specialize in corporate bonds); or
3. c) An ETF. Both Vanguard and iShares have ETFs that track corporate bond indices (VACF and IHHY).

In regard to (b), if you are looking for a fund with a short duration that maintains investment grade credit, you might like to consider the Halidon Yield Enhanced Fund that we manage.

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 regard to your circumstances.