Hunter Hall: How can this be?

[NGE]

My super fund has details posted on their website providing information on how my fund is doing which does not coincide with the reality of my specific super fund performance.

The website disclosure and performance reports represent a better picture than what I can see on the figures on my personal fund holdings.

There are quite a few discrepancies for example, I only signed up in August 2005 for this fund rolling over from a previous fund, but the online report shows transactions in my account from 2004 and all through 2005 up to August 2005. How can this be?

I have asked questions about these issues and others to the fund and have received no adequate reply. There are quite a few questions over past few weeks I have put to the fund managers for explanations on my personal superannuation performance, but I only get phone call from the PR person who just says they will answer my questions in writing. The written response I finally received after some weeks is evasive and totally self serving, very cloudy!

I wanted to speak to a fund manager one particular day and I was told he was not in that day. After some weeks of following them up for answers I finally got an email with some responses but they are not satisfactory and do not properly address the questions I asked. It is really hopeless and no one is willing to talk to me there. They cannot explain.

I just get some spin and no real discussion from them to clarify issues I need more information on. I have now decided to self manage my super fund in relation to current and future contributions but am not sure about what to do with the existing portfolio which has been making serious losses.

I could turn to a financial adviser but from my discussions with one or two over past years, I have decided that I would prefer to do my own research as they are not infallible merely seeking commissions.

Hunter Hall's recent letter to me allude to their good performance on a few years of allegedly significant gains before the GFC. Those poor gains in fact amount to less than the regular low bank interest on the amount I had invested for capital growth and yield. Their response is patronising and ignoring my concerns. I cannot get anywhere in getting someone from their office who honestly directly can discuss the matters with expertise.

I think they owe me a respectful honest response targetting my concerns for all the money they have made from management fees I have paid over past six years I've been 'invested' (negatively) with them.

All I get is fudging and being treated as if I am rather stupid and will just go away if they just push the same lines over and over and over.

NGE Member: Shellee

[nswnotill]

Perhaps it is time to cut your losses and transfer your super to another fund. This is allowable under the current legislation, when everyone has a choice of fund.

[Shellee]

I think everyone should re-think their super fund, get out of managed funds completely and learn to DIY saving immense amount of fees. The only people to benefit from superannuation as it is presently set up are the fund managers! I am furious with them.

[manfredh]

Since super is just a tax structure, if you're going to DIY, you need a better understanding of the structures available to you otherwise you stand to do more harm to your financial position.

[Shellee]

super isn't working as a tax structure if the fund is losing my capital. Income tax on that money would cost me less than the capital losses not to mention the lost opportunities of not having invested wiser. I would be going DIY within an investment admin company called netwealth which have been set up to do same for my Hunter Hall holding as it is, they charge admin fees but with HH i would be paying these anyway as well as the HH management fees which have been nothing short of robbery. I have not made a decision yet and have been thinking only for past few months but it is time I did something now.

[manfredh]

Any investment you make can lose your capital, even down to bank accounts - there's a reason the government introduced a bank guarantee.

Most likely, you could have had the same investments outside super. Thus, it's not superannuation that is the issue but your choice of investment.

However, there are no guarantees in life, the market isn't rational and knowledge isn't perfect. Many companies have collapsed even where people thought they were okay, and that's just the extreme cases. But market values of shares go up and down every day - and it doesn't mean that if the price goes down it's because the company has done something badly.

If you switch, you'll still be paying management fees to a fund manager if you select them to manage your investments. Alternatively you could invest in shares directly yourself - but then you're responsible for all share selection yourself and will only have yourself to blame if they also lose capital value. It's not a bad choice if that's what you want to do, but from reading I'm not sure that will resolve the cause of your dissatisfaction.

[Shellee]

manfredh... what are you talking about besides stating the obvious? I am not seeking advice here.

[manfredh]

Just that a number of your statements are incorrect. I'm not sure what you're trying to achieve as some of your expectations are unrealistic.

[Shellee]

Who is happy with their super fund?

It is obvious I am not. HH stated the investment is for returns over 5 to 7 years but I have been with HH that long and there are no reasonable returns at all to speak of only unreasonable losses. The market recovery which has my personal portfolio back way in the black now, has not achieved same for my HH fund.

This is mismanagement by professionals who took fees for this fiasco at my expense. Now they won't even face up to the truth and provide me with answers to my several questions, just flush me away with spin.

Standard & Poor's report on them has indicated that on their analysis my HH fund chose mostly risky speculative small caps to invest the fund units in and not surprisingly the general market recovery is not treating them kindly. However the HH rep makes no admissions on the managers' strategies as if they had nothing to do with the poor performance. Totally innocent bystanders but they are not such at all.

In fact they apparently are so guilty that HH has seen fit to replace some of these fund managers with a new lot with different investment outlooks hoping to revitalise the failing HH super fund/s. Will I wait to see if they can do it? I don't think so. I might have if HH had responded to me respectfully with honest and informative explanations, but nothing like that has occurred. So i am not about to put another cent into their slot machines.

Its felt like gambling and superfund investment should not be that. Too much is at stake.

[manfredh]

What you've said certainly indicates performance issues, but it doesn't mean super itself is bad (actually the opposite is most often true, compared to the same investment outside super). Also, what encouraged you to choose that particular fund? That may be more the issue then the fund itself.

For example if you invest in shares and the sharemarket goes down, it's not the fund managers fault - they've done what they were told to. If they invested in property when you requested to invest in shares they would be in the wrong. Hence my earlier questions; while you are dissatisfied with what you've had so far, if you switch to something else without understanding what and why, you may also be disappointed there.

[Shellee]

Its clear to me you haven't been reading the latest articles on the managed super funds. If you think they are that good and the best option then go ahead, I have no issue with you being delusional.

[manfredh]

I wonder who's delusional given you haven't answered how you're going to do better. DIY literally means what it says, but what you've presented so far shows you misunderstand fundamental concepts.

I also said that super is typically better than the same investment outside super. I don't get how you turned that into saying that managed funds are the best option. I'm starting to understand why you had problems with the staff at Hunter Hall given your interpretation of what's been written.

[Shellee]

yea sure, the tax benefits mean the investment in a super fund is better than the same investment outside. Do you know anything about Hunter Hall?

[computerflyer]

manfredh,

It is sometimes good to consider the object of your posts may not be financially illiterate, even if not a savvy and seasoned investor.

Shelly, FWIW a lot of funds have delayed if not shonky book keeping. My take on the whole super industry is that it is inefficient, bloated, advisors suck fees for little if anything, and the advertising is over the top. For example, lower fees (ref industry fund ads) are meaningless if investment returns are subpar. Total return is all that matters.

If not for the tax benefits and resultant super fund activity the ASX would also likely tank. Just my opinion!

[manfredh]

Computerflyer,

I certainly considered that upfront. However, repeating the same incorrect arguments and misinterpreting what was said doesn't suggest they want to improve their understanding.

The most important next step is to consider your options - it's all well and good being dissatisfied with something but what are you going to do? In this case, DIY was suggested but if you're going to do that, you'll need a better understanding otherwise you stand to lose much, much more.

If you've found a dud and can do better and explain why, great. If you're just unhappy because you lost funds when the whole market did, and the manager just did as they said they were going to e.g. invest in tech stocks and tech stocks went down, you don't have anything to complain about except your own poor choices initially.