Fund Investment #5 – Oh Baby! (Bunting)

OK, so Godfreys didn’t quite cut the mustard for our Fully-Franked Fund. What appears to be a potential bargain basement priced business is also a debt-laden company hanging on for dear life by a thread.

Retail is a dangerous environment these days – not so much for the customers, where discounting and bargains abound – but for investors.

We’ve had a number of well-known retail brands go bust recently:

  • Oroton (November 2017)
  • Live Clothing (November 2017)
  • Topshop Australia (May 2017)
  • Payless Shoes (April 2017)
  • Howards Storage World (December 2016)
  • Pumpkin Patch (October 2016)
  • Dick Smith (January 2016)

A few others look to be on the ropes, including the great department store Myer, having been on a downward slide for years.…

Godfreys (GFY) – Great Investment, Garbage, or pure Gamble?

Back in my earlier days of investing, this is exactly the kind of stock I used to be attracted to. A previously successful business that is on the brink, investors having all but given up hope, but with the potential to offer huge returns if it somehow pulls out of its nosedive.

These days, I prefer to lean towards quality companies – and I’m not sure Godfreys fits the bill. However, my ‘value investor’ ears still prick up when I hear a company suffering so much. I can’t help but be curious to investigate whether the market is over-reacting in the short term, and is overlooking the longer-term potential value, as often happens when bad news appears.

A good company and a good investment can be two completely different things. Let’s see whether you think Godfreys has any potential as either

Fund Investment #4: Monash IVF (Invest in Life!)

After the previous post about LIFE, what better investment to be bringing into the Fund than Monash IVF (MVF).

‘Invest in Life’ is the headline of MVF’s 2017 annual report and most recent shareholder presentation in November 2017. And just like our First Fund investment Virtus Health, that’s exactly what they do.

But talk about an industry being out of favour! Virtus and Monash IVF are the two leading ‘Fertility solutions’ businesses in Australia, and the share prices of both have suffered in recent times.

The key numbers from an investment perspective are surprisingly similar to Virtus, so I’ll only highlight those briefly further below. Instead, let’s spend a little time understanding the business itself……

Don’t Waste All Your Precious Potential On Your Job

So Far the Focus has been on those Fully Franked dividend investments in Frankie’s Fund. But all this is meaningless without the universal context that underlies everything we all do – LIFE.

For most of us in this day and age, the journey of life follows a broadly similar path:

As a Child – the Potential of life is boundless

The world is truly a wonder. We are constantly amazed by what is around us, the new things we are always learning about.

We can be and do anything we can dream of. The movies we watch are not fantasies – they are real. You can be that girl that restores the Island of Motonui to its lush, green glory, saving her people. That boy whose joy of music can’t be contained, despite his family fighting against him. That girl with the magic of ice flowing through her. That… fish who finds his family? Sure, even that!

The potential of life is boundless.

Facing your Fear of a Financial Market Free-Fall

As investors, there are two things we absolutely love – appreciating asset prices, and / or greater income from those assets. And boy have the past few years been good to us – especially for our friends in the US!

But all this Fortune brings with it a potentially Frightening downside – the Fear of a Financial Market Fall – or CRASH! Yes, these do happen occasionally, and can really put a dent in your Fund balance.

Yes – this does happen unfortunately…

Given this Fantastic run over the past Few years, the media is Full of speculation around if and when a potential downturn might be coming. Seems like a timely issue to address as we get Frankie’s Fund up and running.…

Introducing… Indexing Ian!

Hi everyone! I’m Ian, or ‘Indexing Ian’ as Frankie likes to call me.

You’ve heard Frankie’s Investment ‘F’hilosophy, so let me tell you a bit about mine. I haven’t always been an ‘Indexer’, in fact, for many, many years, I spent HUGE amounts of time analysing stocks, buying and selling, trying to time my investments perfectly. I’m a pretty smart guy, always thought of myself as ‘above average’ in many ways, and like Frankie, have plenty of experience in the finance industry, so I didn’t want to settle for an ‘average’ index fund – how BORING!…

Frankie’s Investment ‘F’hilosophy

So far I’ve introduced you to the First Few Fully-Franked Dividend Shares in the Fund, and hopefully through those posts on Virtus Health, Telstra and Prime Financial Group, you’re getting a Flavour for the way I invest. But it’s probably worth taking a quick time out to highlight my ‘F’hilosophy of investing a little Further.

Let’s start with a Few key points:…

Fully-Franked Fund Investment #3: Prime Financial Group (PFG)

Our next investment definitely won’t make the ‘Top 10 sexiest companies of 2018’ – accounting and wealth management firm Prime Financial Group.

Prime started life on the ASX around 20 years ago, and has growth through investing in lots of other little accounting firms across the country. As a result it offers integrated accounting, business advisory, wealth management and capital services, focusing on providing highly personalised advice whilst being able to draw on its network of firms to offer broader finance advice and services.

It’s tiny by ASX (Australian Stock Exchange) listed company standards, with a market capitalisation of only $29 million. But that’s not such a bad thing – it’s been ticking along under the radar the past few years without much excitement, and after a little burst towards the end of 2017, it’s dropped back down to a share price of $0.155 today. This follows some recent issues with its auditors, which I’ll talk more about at a later date.

I’m buying around 30,000 shares in this little business, for an initial investment of $4,650. Let me explain why….…

Fully-Franked Fund Investment #2: Telstra (TLS)

Telstra, the big Australian Telecom, and one of the great dividend stalwards of the ASX over the past 10 year. A dividend that was seen as reliable as the sun rising in the morning – until recently…

Poor Telstra shareholders have been suffering over the past few years. The share price was up around $6.50 around 2 ½ years ago, and has been sliding all the way down to around $3.50 in recent times.

It’s not screamingly cheap at the moment, but at this price it definitely deserves a place in a Fully-Franked dividend Fund. I’d love to buy a few more shares at a cheaper price, so I’m starting with a smaller allocation of around 1,000 shares. At a price of $3.61 (closing price 17 January), this is a total cost of $3,610.

Fully-Franked Fund Investment #1: Virtus Health (VRT)

The honour of the First Fully Franked Investment in Frankie’s Fund goes to Virtus Health (VRT), with an investment of around $7,000.

Yesterday its shares closed as a price of $5.12 (11 January 2018). Virtus listed on the ASX around 4 ½ years ago, and only for very brief periods during that time has the price ever been this low.

I’ve bought 1,375 shares based on this price for a total cost of $7,040.

Now, price is one thing, but what we really care about is Value! We’ll take a quick look at a few key figures, including value, but first, some very brief background……