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RTC26: Four questions to ask before investing in a managed fund · The Curve

• 0:00
  Welcome to season two of Raising the Curve, a conversation for women who want to
• 0:06
  learn more about money, via money. For the future they want to have. The pursuit
• 0:11
  for financial confidence and increasing your wealth should be a simple one. So
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  this is a place for you to learn about investing in finance in a non-scary or
• 0:20
  intimidating way. Thank you for being here and for listening. Because together
• 0:25
  we really can raise the curve. So I had a pretty eventful weekend. What did you
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  do? Is this, was I there? Yeah, you were very much there. What did we do? Oh, this is
• 0:37
  breaking me out. Oh, okay, so we went to Hawkes Bay and I had a fool. Like an old lady,
• 0:45
  I had a fool. I think we need to paint the picture a bit more detail. So Vick was
• 0:49
  walking with her suitcase and her stuff. Admittedly a massive suitcase for a
• 0:53
  weekend, like a 30 KG going away to Europe for five weeks. Yeah, it was, but it was
• 0:59
  only time I can pack a large suitcase. And she, did you get your foot caught in your pants?
• 1:03
  I think so. It all happened very quickly. I just turned around and Vick's literally
• 1:08
  face down on the pavement. She didn't even put her hands out. And I'm so
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  bit FYI. It's 10 o'clock in the morning. She's cracked a rib. I've cracked a
• 1:17
  rib. Her tooth fell out. I busted my lip. I have the biggest bruise on my
• 1:23
  hip and grazed my knee and it's been so dramatic. It's been so dramatic. I've got nearly two
• 1:28
  days at Hastings A&E. Thank you to all the doctors and nurses. You're too sucking
• 1:32
  better. Yeah. Yeah. They managed to stick it back on. Was that an accident though? No. Thank
• 1:37
  you ACC. Really? Yes. Well, it was definitely an accident. It actually doesn't really
• 1:44
  go. It's almost straighter than it was before. Well, we were with a friend and he was like,
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  I just don't know how you fall on your face and you don't put your hands out. I was
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  like, I know. It's almost instinctual. It's quite amazing. Yeah. So, yes, very eventful
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  weekend and every time surf makes me laugh, it kind of hurts a little bit. Oh, but that's
• 2:03
  fine. You know, it's the price you pay for your. It's actually hurting. Yeah. Oh my god.
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  But it's fine. I'll try and not be so funny. It's a dead day. Oh my god. Oh,
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  no, it's fine. Okay. No, I actually will tone it down. No, it's fine. So in today's
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  episode, we're talking about fun managers. Yes. Everything you need to know about choosing
• 2:30
  a fun manager, being a fun manager myself. This was a pretty easy episode. But do you
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  know what though? So I guess the difference is because some people will want to invest
• 2:39
  in fun managers. Some people will want to invest at DIY. Some people will want to do both.
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  And it's probably really good just before you start spending or in BC any money to kind
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  of just research both. Talk to a fun manager, see what their minimum is. Can you afford
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  that? Totally. And the number of people that, like, yes, I just want to do a little bit
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  myself on the DIY platforms. You know, I want to own some Microsoft and I want to own
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  some Lulu lemon and all that. But the majority of my money, I'm still not that confident.
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  So I'll give it to a fun manager. And then maybe down the track, they put more and more
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  on the DIY platforms and do it themselves as they get their confidence up. So there's
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  just so many different ways and there's so many different people out there to help you.
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  And then another way is getting an advisor and letting them do it. So there's just, you
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  can pick and choose. You can do all or none. It's completely up to you. It's whatever
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  you feel comfortable with. Some people, I mean, I've got money with a fun manager. And
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  then I've got some that I do myself because I like to have, have the flexibility to buy
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  what I want because you don't have that in a fun manager. You can't put your money
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  with them and go, hang on, can you please actually buy some of this for me in this for me
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  because they, that's not how it works. When you invest in a fun manager, you invest alongside
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  everyone else, you all get, you're all invested in the same. There's no favorite children.
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  No, there's not. You can't pick and choose. It's, yeah, you get, you get what you give
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  and pretty much. And the nicest way. Yeah. So say I was had $10,000 that I, because generally
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  that's about the minimum isn't it? Yeah, they're a bit lower now, but that is, that is
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  usually the minimum for the good fun managers. Yeah. So say I had $10,000 and I was trying
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  to figure out what fun manager I wanted to go with or what fund we'd even start.
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  The best thing to do would be there's actually websites. So there's sort of, there's Morning
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  Star, there's other companies like Invest Now, there's, even she's, even just making
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  more confusing. She's in Hatch actually have fun managers on there that you can invest in.
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  So if you were like, if you didn't quite have $10,000 and you wanted to invest in a fun
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  manager, you can do it through the DIY platforms. So say, buy funds, for example, has a number
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  of funds on the Shazies platform. So if you didn't have enough to meet their minimum,
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  you can go through Shazies where Shazies pulls it together and then we'll send it off to
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  the likes of buy funds, for example. Are your rates or your fees lower because you've
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  gone through DIY? No, you'd still pay the same. Yeah. Yeah. So it's amazing how accessible
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  the DIY platforms are made. Well, I think also because they have got so many investors
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  of the fun managers are going, hang on, we want to get a piece of, piece of the pie in
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  terms of getting access to those investors. So there, they've put their funds onto the
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  platforms. But I guess, do you know how fun works? Okay, let me give a stab in the
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  duct. So a fun. I love this reverse. I ask you the questions. This is great. Now a
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  fund. It basically is, so my name is Sandra. I'm a fund manager. Yes, I have. Hi, everyone.
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  And I have 200 people who have given me money. Yeah. All upwards of $10,000, which we all
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  know I'm terrible at math. So I'm not going to try. But I'm getting, is it 200,000? Anyway,
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  whatever it is. And then I have a big list of the companies that I invest in. So if,
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  say, you came to me and you were like, I want to invest in your fund. I'd be like, cool.
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  This is currently what we're invested in. This is where the fund is worth right now. Yeah.
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  And then from there on, if someone handed their money over, I'm not going to be constantly
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  being like, hi, hi, Denise. Just want to let you know that I've invested in this. You
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  know, if that list changes, it changes. But essentially it's like, so you get a snapshot
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  when you give them money over and then you give your money over and it's sort of like
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  it's up to me. Yes, yeah. And so, yeah, it's really good. Okay. Five to ten hours, pat
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  on the back. I guess to go into a bit more detail because funds in New Zealand are called
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  pie funds. All of them. Yeah. So it's P I E. It's like an acronym. Yeah, I love an
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  acronym. I love a pie. So what is it then portfolio investment entity? So that just
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  means it's it's the way the fund is structured means it's really tax-efficient for investors
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  like you and me. And it's done in a way that you invest in units. So instead of buying
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  shares in the fund, you buy units in the fund, but operates exactly the same way. And
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  that if there's increased demand, then the units increase the units increase. Yeah.
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  Or the under sorry, if the underlying value of the companies at the fund invests in increase
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  than the units increase. Maybe to start with a brand new fund. No investors in it. Say
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  I'm the first investor. But you're very, very first investor. No, no, no, you need
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  to think of a fun new name. That's your game work. No, she always chooses the names that
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  are like 75 plus. Give me like a fun young name. Sasha. Sasha. Okay. What you pick a name
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  for me. Sorry. Your name is Deena. Because I've got a friend called Deena. And you said
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  that Mary was old-fashioned. Deena's not okay. Deena's fun and new. Okay. Well, you know
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  Deena and my name is Sandra because I'm the fund manager. Okay. So no one's in my fund
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  right now. No one's in your fund. We need a third person by the way. Okay. Okay. We'll have
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  with Deena. Do you think I can think of it? Okay. Well, let's just start with the example.
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  We're getting Donna, which also is Donna and Deena and Sasha and Deena. Okay. And then Sandra.
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  Okay. So the fund starts at $1 for one unit. One unit is $1. You're starting at the very
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  at the beginning. Now say that Deena, myself, invested $100. I would get that would buy me
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  a hundred units because that unit is a dollar. And then Sandra invests that $100 into whatever
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  companies. Yeah. So you're a handful of 10, 20 different companies. And then the next day, say,
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  Diana. Deena. Deena. Deena. Deena. Deena. Deena. Deena comes along and she wants to buy
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  $100. She's got $100 in vests as well. So she wants to buy units in the fund. But the shares that
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  Sandra invested in, that you invested in, the those underlying vests actually increase in value
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  overnight. And so now the fund is at $110. So that means she can afford less. Yeah. So she can only
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  buy, she'll only get like 90, 90.9 units. So her $100 goes less because the value has risen.
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  Got it. Does that make sense? Yeah. And then say that those investments actually lost value.
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  Then comes along another another person. And she wants to invest $100 as well. But because the
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  share, the dollar value of the units has gone down, not the units themselves. She can buy more.
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  She can buy more. So she yet she's buying 111 units. So the first person that invested
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  has 100 units. The second person because the value went up, she could afford less.
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  Therefore she's only got, she's got less units. But they're, but they're valued higher. So she's
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  still got the overall same amount. And then the third person comes along. She gets more units
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  because they're now cheaper. They've fallen in value. The fund return has fallen. So she gets more
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  units. So they've all got $100. But the unit balance will be different because of the entry points.
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  And that's the same with stocks. Same with stocks exactly. But you know, I always get asked that,
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  oh, should I, I should wait for, you know, a bad year for a fund manager. I should wait for the
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  unit price to fall. I should, you know, and it's just like you're trying to time the market. It's
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  waiting for PayPal to fall before you buy it or waiting for the NZX 5D to fall before you buy it.
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  You know, it's, you could be waiting a long time. So it doesn't matter when you enter the fund,
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  you're still getting the same value as the money you've got. Exactly. You're still going to
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  get the increase or decrease that everyone else in the fund is getting once you're an investor in
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  their fund. So one thing that the reason that funds are different to ETFs, which is an exchange
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  traded fund. So when we talk about fund managers, we're talking, you can call the managed funds,
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  mutual funds, hedge funds. They're all pretty much the same thing. It's the same price at the end
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  of the day, no matter what. So everybody gets the same price at the end of the day. That's the price
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  of their investment. Whereas in ETF, you can buy and sell because it's traded like a company or
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  traded like a stock and priced throughout the day. You could buy it in the morning, I could buy it
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  in the evening and we could get it from price. Does that make sense? Because it's traded on the
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  exchange like a company. So a company's share price, we'll go up and down all throughout the day.
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  And so will the funds underlying the funds underlying investments, the companies share prices
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  will move off and down. But at the end of the day, the price is struck and say it might be a
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  dollar 10 per unit. That's what everyone's investment is. And that's like an average.
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  So it's an average of all the underlying investments. And then amount is that you've invested in
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  those. So that $100 is invested in, for example, say 10 different companies. And then at the end of
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  the day, five of those might be up, five might be down. But everyone in that fund has a dollar 20
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  per unit or whatever. That makes sense. No. Or whatever the price is.
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  Yeah. Sorry. Whatever the prices at the end of the day, everybody spends on the same
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  period. But it'll just depend. You might have more units than these because of the time that you
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  bought in. But everyone's return, say the return of that day was half a percent up. Everybody will
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  get that return. Whereas if you'd bought an ETF, some exchange traded fund in the morning,
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  you might be up 1% and then I buy it in the evening and it fell throughout the day,
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  I might be down 1%. So because it's traded like a company. So it would be like if you were an
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  DIY platform, essentially. Do you mean if I was buying an ETF through a fund manager,
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  or do you mean if I was, but is this, are they told? No, no. So you buy on the stock exchange.
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  Yeah. So what are some key questions if I decided that I wanted to go through a fund manager?
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  What sort of questions should I be asking? Well, I think, in my opinion, there's kind of four
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  key things that I would ask and that I would look for if I was to put some money with a fund manager.
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  The first one is what's their long-term performance? 10 years plus if you can. I mean,
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  some fund managers haven't been around for that long. So it's what is their longest-term
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  performance is what I'd be looking at. So if they've only been around for seven years,
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  then look at seven-year performance. If they've been around for 20 years, look at 20-year performance.
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  You know, the longer period of performance you can look at, the better indication you can get
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  of how they've performed through market cycles. So we do say that past performance is no
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  indication of future returns. That's like, it's one of the biggest caveats in finance, but
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  that's all we have to go off when we're making these decisions. So we do, we do look at that
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  past performance in terms of what we can expect from that fund manager going forward. If they've
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  delivered 10% per year for the last 20 years on average, then I can get pretty comfortable
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  knowing that because you've had the global financial crisis within the last 20 years,
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  you've had COVID in the last, you know, you've had some significant market falls. So I can be
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  pretty confident that that fund manager knows what they're doing and they're going to manage my
• 14:54
  money through the next big market correction. But is this a fund manager i.e. you specifically,
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  or is it the funds that you manage and everyone that's managed that fund across their 10-20-year
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  period? Because I... So yeah, so the fund manager is the, the Milford's, the fishes, the pie funds,
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  the Devon whatever, that's the fund manager. Then underneath that, they'll have a handful of different
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  funds. So they might have a growth fund, an income fund, a balanced fund, a sustainability fund,
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  you know, they'll have a handful of different funds. So when you're talking about, look at the,
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  you know, historical performance, do you mean Milford as a whole, what has there... Look at the fund.
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  I'd look at the fund that you want to invest in. Okay, so like the high growth fund or the... Yeah,
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  because that's where you're going to put your money. Yeah. With that, my question is,
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  are you looking at the person who is physically managing that fund at that time and what their
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  personal performance has been? Or is it historic? Because there would have been maybe four people in
• 15:53
  that job across 10 years. No, because usually it's a team. Like, yes, there is a portfolio manager
• 15:58
  with a name on the fund. And next, it's the overall responsibility to manage that fund, but usually
• 16:03
  there's a whole team behind it. So if I left in the performance deteriorated substantially,
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  then that would be reflected in the performance and then you'd be like, oh, they're not a good
• 16:12
  fund manager. So it's all about the consistency of the fund performance. Not the person,
• 16:17
  necessarily mentioned. Yeah. I mean, most of the times it does come down to the person and the team,
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  but there's a team behind it. There's not just Victoria Harris on the Trans-Hesmin climate fund.
• 16:27
  I mean, obviously, you're doing a great job, but I just mean it's not as though say that you were
• 16:32
  in that job for three years. And then before that was Bradley Cooper. Oh, that's management.
• 16:39
  We're working on it. I want to work there struggling with the names today. But say, you know,
• 16:44
  someone else had managed that before. You're still able to look at the performance across the time
• 16:49
  when it was a different person managing it. Yeah, yeah. And because it is kind of a team effort,
• 16:54
  it's yes, there's a portfolio manager with the name on it, but it's usually a team effort.
• 16:58
  And they do that to avoid that problem, specifically, because otherwise, there's a key man risk.
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  If you've had someone managing that fund for 10, 12 years, and it's done a fantastic job and
• 17:11
  then they leave. Imagine. Yeah. So they do make sure that there's a team effort so that
• 17:15
  that doesn't happen. The key thing to look at the long term is because it's so easy to outperform
• 17:20
  or do well in one or two years. Yeah. I mean, I've done it. You have good years, you have bad years.
• 17:26
  And so is that what they didn't give you like a, I don't know, some kind of a sheet or a breakdown.
• 17:30
  Yes. And it would say 2017. And this is, and it would be an average. Yeah. So every fund manager
• 17:37
  does a has a standardized fund update team place that they have to include things like performance,
• 17:45
  what the fund invests and the risk associated with the fund. So there's a few key things that they
• 17:52
  have to include in there. And so it's quite easy if you were to sit down and compare, say you did
• 17:57
  you did your research, you went on Morningstar or sorted, you you picked out three or four funds that
• 18:02
  you thought, you know, it looks good either from a performance standpoint, whatever. And then
• 18:07
  you print it off their fund updates. You can you can you can sit down and compare Apple's
• 18:11
  because the regulator has made these documents standardized so that we can compare.
• 18:19
  So you can compare the performance and it has they all have tables that have one year, two years,
• 18:26
  three years, four years. So you can search by if you wanted a high performing fund. If you wanted
• 18:32
  a low risk fund, if you wanted a low fees, you can sort on sorted, surprising. And it's
• 18:40
  fits out all the fund managers, funds that are run by fund managers. And then you go through it,
• 18:45
  you might pick a couple that you think look like they've had high returns and then you print out.
• 18:49
  Some might not have been around for that long. So you're like, Oh, I don't want to be so
• 18:52
  those some might have been around for 10 plus years and they've got really good performance.
• 18:55
  You're like, Oh, cool. Okay. I'm going to look I'm going to go into their website and pull up
• 19:00
  some more information. So it's kind of the that those those places are just places you go,
• 19:06
  it's all aggregators and you can get a good view of of everything that's available.
• 19:11
  Layered a land. Yeah. A bird's eye view. Yes. Exactly. Like a bird's eye view.
• 19:19
  So okay. So once you've done that and you've found a fund that you think has delivered
• 19:25
  really good long term returns. What other stuff do you need to ask? I think it's also a key
• 19:31
  thing to ask is how much risk of they're taking to get those returns. These fund updates also have
• 19:36
  risk parameters. So they'll have that literally little is like the fire meter or it's a high
• 19:42
  day. It is red yellow green. But it goes from one to seven and it ranks the funds as high risk
• 19:50
  as seven or low risk is one. So if your if this fund is at green green really seven and it's
• 20:01
  only producing a low low return. It's like, okay, were you taking all this risk and you're only
• 20:06
  delivering that return? You know, we just can't look at performance and isolation. You need to look
• 20:11
  at risk associated with that and just make sure you know what the fund isn't besting in whether it
• 20:17
  is 80% in bonds and 10% in shares or if it's 100% in shares. If it's only invested in Bitcoin
• 20:26
  or Bitcoin companies, you just gotta be just be careful. Just look under the hood effectively.
• 20:31
  What's what's it actually investing in to get those returns? But so how do I know what it
• 20:36
  should or shouldn't be? Like what's an alarm bell? I don't get what you mean. So say it's producing
• 20:41
  50% returns and it's low risk then what does it actually make up? I guess it's like how much risk do
• 20:48
  you, how much risk do you want to take? Say you've got you want to get the money out in five years
• 20:51
  and you want to go into a low risk fund and you're like, oh, well, this fund's delivered two years
• 20:55
  of 50% returns. Awesome. But it's saying it's low risk. It's like, well, obviously it's not. It's
• 21:00
  because you can't have higher returns than low risk. So it's looking under the hood and going,
• 21:04
  okay, what have you actually invested in to get that 50%? Why is that concerning? Wouldn't that just
• 21:10
  be a really good thing? If you're like, amazing, it's low risk and it's got all these returns,
• 21:13
  isn't it good? No, because you can't have, you can't you need it too. Maybe a better way to explain
• 21:19
  is that it's like, look, we are a low risk bond fund and you look at it at 100% of recent years.
• 21:27
  It's like, hang on, you said you're a low risk bond fund and you invested 100% in shares.
• 21:32
  But isn't that illegal? I'm just saying like, make sure if you're after a low
• 21:39
  risk fund. They are the returns are high. Maybe that's a concern that in the future,
• 21:46
  you can't sustain those high returns if you're having low risk. Just make, I guess, just how much
• 21:53
  risk they're taking to achieve those returns. And is that you're saying that because if you're
• 21:59
  looking for low risk and you don't want to risk your money being lost over three years because
• 22:03
  you've got a shorter time horizon. That if the returns are super high, but they're claiming to be
• 22:09
  low risk, they might actually not be and therefore the next year you might actually be down.
• 22:14
  Exactly. And they might be, they're trying to overcompensate by investing in riskier assets
• 22:20
  that the fund shouldn't be investing in. Because if you're investing in a fund, you might want to
• 22:25
  like I do, 80% in growth and 20% in income or more bonds, more low risk. But if under the hood
• 22:35
  I'm looking at it and it's actually hang on, I've invested 100% in growth. That wasn't what I
• 22:40
  wanted. Do you know what I mean? It's like, if you're trying to balance your portfolio investments
• 22:46
  in the diversification of where you are. But you're actually not diversifying, but you think you are.
• 22:52
  You know, it's just kind of, yeah, I guess it's just look at the long-term performance, but then
• 22:56
  you can't look at performance on its own. You have to look at the risk associated with that performance.
• 23:02
  Yeah, look at the long-term performance, but also look at the risk that they're taking to get that
• 23:05
  performance. I'm so trusting. I just, I want a low, I want low risk, but oh my god,
• 23:13
  they do. I mean, there's a lot more rules. Starting that's where all my money goes. You know,
• 23:16
  I just wouldn't even have... There's a lot more like so many rules now in the industry that
• 23:23
  just try and get rid of those cowboys. I'm just saying there's still ones out there and there
• 23:27
  will be companies out there. Like, there was a lot of fund managers that got a slap on the rest
• 23:33
  because 2020 was a was a terrible year for a lot of fund managers. It's the beginning of the
• 23:39
  market's fell. And then if you, and then they grew off such a low base, so that some funds were
• 23:46
  having 140% returns. And they were advertising that on like billboards and newspapers and magazines.
• 23:54
  And you're effectively false advertising because it's like hang on a sec. If you just included
• 24:01
  the second year before that and average that you're not generating 140% return, you're generating
• 24:08
  like maybe 50% return. You know, so you're, they're being picking and choosing what they want to
• 24:13
  advertise. It's like radio, it's like radio statistics. And every station is number one. Yeah.
• 24:20
  When number one is like in 10 to 12 year olds. When number one. It's like the local
• 24:24
  fishing shop. It's like the first fish and chips. From 2007. I drove past one in
• 24:32
  and they did that. And I was like, oh, mate, you should be taking that down like nobody cares about
• 24:36
  you winning in 2020, 2000 in the season. It's appropriate labeling. Yeah. Okay. So it's
• 24:42
  it's a realising that you can't just trust what you read as gospel and you have to dig below it.
• 24:46
  Don't trust the figures as they are. If something sounds too good to be true, it probably is.
• 24:51
  God, I sound like my father. So did you when you said I got a slap on the wrist?
• 24:57
  Oh, he always told me that when I was buying a car. I'm like,
• 25:02
  Dad, look at this one. It's so cheap. And it's like, he'd be like, if it sounds too good to be true,
• 25:06
  it probably is. I was like, no, this guy is genuine. Dad and cars are so annoying. Dad was just like,
• 25:13
  it's my money. I'm a 30 year old woman. And he was still like almost banning me from buying a
• 25:17
  European car. I'm like, but they're way cooler than I should eat Japanese. I don't want them poor.
• 25:23
  One day. I still haven't told my parents. And I don't know why. If you want one, you don't
• 25:27
  tell me. No, sorry. I bought a car. What one? I just upgraded. What is it? What kind?
• 25:34
  A black one? Can you show me a photo? No, I don't even. But I'm not as good as you know.
• 25:38
  I haven't told my parents. And I feel I'm really like nervous to tell my my mum and dead
• 25:42
  that I bought a car without that. You're 33. I know. Anyway, okay. Okay.
• 25:46
  What's number three? Number three is are their fees appropriate? Now, I think we've
• 25:52
  talked about before how important fees are when it comes to investing because they're effectively
• 25:57
  a negative return, if that's a way to think about it. So they are subtractions from your return
• 26:04
  or from your performance. If you're looking at a fun manager and you're looking at performance,
• 26:10
  make sure you're looking at after fees performance because then you're comparing apples with apples.
• 26:15
  So if two fun managers have delivered 10% return per year on average, but one has one percent fee
• 26:23
  and one has a five percent fee, then what you're getting in the hand versus nine percent versus
• 26:29
  five percent is a lot different. So make sure you're looking at after fees. Where do you find
• 26:35
  after fees? They will state that, but just make sure in the fine print. Most of them will.
• 26:42
  So it will just be checking. I'm just checking that this is your after fees. And feel free to
• 26:47
  ask them if you can't find it anywhere just as this after fees performance and they'll be able to
• 26:51
  tell you and it just gives you a better indication of what you can expect to get in the hand rather
• 26:57
  than just on a screen. And if you're compounding over the long term, fees can make a huge difference.
• 27:03
  If you're in a low fee, but high returning fund, that's the best outcome and that's what you
• 27:09
  want to be at. But I mean, the benchmark I kind of give myself is about 1%. If I'm paying over
• 27:16
  1% fee, I want you're doing a bloody good job because I'm paying them higher than the average really.
• 27:24
  If they're doing lower than that, that's great, but you don't want your performance to suffer
• 27:28
  because of that. And you need to pay fees because everyone hates fees, but I think I'd rather pay
• 27:34
  a higher fee and get good performance because over the long term, it's going to make a difference.
• 27:41
  What's number four? What's number four? This is probably the most important and it is,
• 27:45
  do they have skin in the game? Oh my god, yeah. Are you interested in that?
• 27:52
  It's a little bit excited, you've been all nice. Well, because it makes sense. I don't know why
• 27:55
  I didn't think of that myself. Yeah. Like, can you ask someone that? Yeah, definitely. Like with
• 28:00
  a company, you want the CEO or to have a lot of shares in the company as well. So you're
• 28:05
  interested or aligned or you want it to be led by the founder who's who's who's got to be stood
• 28:10
  interest. The same thing happens with fund managers. You want the person or the company managing
• 28:18
  your money. So the milk fed or the fish funds or all the portfolio management that fund to have
• 28:24
  money in that fund. So is it the company as well as potentially the individual? It can it can
• 28:28
  depend. Sometimes it's sometimes the portfolio manager themselves will have money in it.
• 28:34
  And other times the company will say our staff have a hundred million dollars of money in the funds.
• 28:42
  They'll either disclose it at a fund level or they'll disclose it at a company level. Either way,
• 28:46
  it's really good. So ideally you would have both the person that's personally made. And you can
• 28:50
  ask. I mean, you could totally call them up and go, Hey, does job logs have money in? Can you ask
• 28:59
  how much? I mean, they might not tell you they might. Because if someone has a hundred dollars,
• 29:04
  I'm not interested. No, exactly. But most fund managers will advertise it because it is a good
• 29:09
  thing to have. But it's really good because if the fund falls, they're going to feel the pain
• 29:15
  just as much as you feel the pain. So they're just way more incentivized. If I had all my savings
• 29:20
  in my funds that I was managing, then I would be way, way more incentivized to grow that fund.
• 29:27
  Because I'm growing my own wealth as I'm growing your wealth. You would not be taking a holiday
• 29:31
  to Fiji or anything like that. No, well, I'm not. Well, I'm not. I'm very close-y on the
• 29:35
  on what's happening in the market. So so so hyper didically would it be a call or to be an email? Is
• 29:41
  that like say it's not and you can't see it anywhere? Could you just call up? You can call them,
• 29:45
  you can email them. Sometimes they might put it in there. I know it's you're saying it's not,
• 29:49
  but it feels weird. No, but they're trying to sell you something. I don't know if I told you this,
• 29:52
  but when I used to sit in front of companies, like the management teams, and they'd be like,
• 29:56
  oh, we're going to do this, this, this, this. And we're going to we're going to double in five years.
• 30:01
  And you're saying they're going, shit, that sounds good. And then you ask the CEO,
• 30:06
  oh, so do you have any shares in the company? And they go, oh, no, no, no, no, yeah. And it's like,
• 30:11
  okay, well, but it's like you can figure it out. You can see it's all publicly disclosed. But
• 30:18
  I just asked them to save myself the time of looking. And also make them feel embarrassed.
• 30:24
  Yeah, totally. So no, they're not going to be able to. Yeah, well, it's just like, okay,
• 30:27
  well, then why should I believe you when you, if it's such a good story, and you think this
• 30:32
  investment is going to do so well, don't you want to be in from it too? You know, just kind of,
• 30:36
  it just it makes sense. So, okay, so doing a summary of the four key things. So number one is
• 30:43
  look at the long-term performance of a fund. Number two, I forgot. How much risk are they
• 30:50
  taking to achieve that? Yep. Number three is... You know, the microphones keep thing up quite
• 31:01
  quiet with spring. These are just infixes because of the phase. Thank you so much. Really trying to
• 31:08
  look intelligent and I love it. So fees, what are the fees? Look at the after-phase performance,
• 31:14
  not before, because that can make a huge difference to your return. Yes. Number four,
• 31:20
  just spoke about idea of skin in the game. Yeah. Yeah. That's a really helpful episode. Yeah.
• 31:27
  Because I think there's people who listen to this podcast who want to invest themselves,
• 31:31
  there's people who want to invest through fund managers, there's people who want to do a bit
• 31:33
  of both. Yeah. And it's good just to have a layer of the land. Yeah. No, definitely. It's, yeah.
• 31:39
  Cool. Okay, awesome. Thank you, Vic. What are we talking about next time?
• 31:43
  Surprise. Are you have no idea, dude?
• 31:48
  Yes. That stays great. Thank you so much for joining us for today's episode of Raising the Curve.
• 31:54
  Please subscribe and leave a review on whatever platform you're listening on. We would also
• 31:58
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• 32:03
  about the curve and how you can learn more, head to the curve.co.nz or find us on socials at the
• 32:09
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