Tuesday, February 16, 2010

Yap Yap, Yappity Yap, Yap Yap

Well might Mr Morgan regret his intemperate outburst this morning.

Adolf has spent a couple of hours wandering around a few websites to see what really has been going on with Kiwisaver. Who is ripping off clients and who is providing decent results?

Well, here's the go for a selected number of balanced funds. Morgan's fund is listed as GMK.

Fund Manager Fund Size 1 Yr to Jan 10 Annualised
(Balanced) $mil
since inception

AMP 69.1 9.7 -5.7
ANZ 33.1 11.9 -0.5
ASB Tracker 8.3 12.6 -3.7
ASB 91.0 12.9 -3.2
AXA 39.9 19.3 n/a
Fidelity 26.6 6.3 3.2
GMK 297.1 -1.5 -1.6
Huljich 16.7 12.0 12.3
ING SIL 77.8 12.3 n/a
Nat Bank 47.7 11.9 -0.5
Tower 69.9 10.5 0.1
Westpac 89.5 11.1 n/a

It's quite easy to see Mr Morgan is catering for the dumbarse, whinging, green with envy, lower decile, gullible demographic whose inhabitants are quite happy to forgo profits just so long as they are paying low fees.

His website boasts some 45,000 members with an average account size of $6,500.

The poor bastards.

Update: Here's the flash graph from the yapper's website, showing the momentary flutter of profitability, a very long time ago - just six weeks out of 28 months.

Further Update: The link from Gomango's comment provides some perspective.

Some $60k cash was injected by the fund manager to enhance returns when the fund was small. The fund now stands at $16.7 mil and has delivered an annualised return of 12.3%.

12.3% of $16.7mil is a cool $2.05mil.

Fellers, you need to learn something about wood and trees.


Anonymous said...

How has he not done better in the last 12 mths? That's a completely shitty performance if those stats are accurate Adolf.

Adolf Fiinkensein said...

Go see for yourself. Here's the link.


See also Morning Star to Jan 2009 where he doesn't appear to be deem worthy of passing reference, unless I'm blind which always is possible.

Adolf Fiinkensein said...

Do you get the feeling that when things aren't going too well, you invent a mysterious red 'bench mark' line to make your lousy performance somehow look real good by comparison?

Johnboy said...

Perhaps it would be better to look at this graph AF showing GMK performance since Kiwisaver inception in 2007 against the default schemes. Paints a somewhat brighter picture than your graph for Morgans Kiwisavers.


Adolf Fiinkensein said...

Johnboy, that is a separate issue again and a false comparison. Default providers are almost mandated by gummint to provide a lousy return. Their prime requisite is to be able to handle vast numbers of piddly transactions.

No, I have the correct comparison. The prick rises or falls on his performance versus his peers within the industry.

Anonymous said...

Maybe he's going for the U curve dollar cost averaged type result.

adamsmith1922 said...

Morgan is a loud mouth self publicist who is given far too much attention by the media

Johnboy said...

Yes AF but you are showing a 1yr to jan2010 rise in your graph and I admit GMK have not done well in the last year by being very conservative but conversely they did not lose as much in the previous years by the same conservatism.

I still suggest that it is the overall result that matters for a long term Kiwisaver such as myself not what happened in the last 12months.
Lets face it it is a long term savings scheme.

When looking at the default schemes which are "conservative" again GMK at 9.1% return is only outdone by Tower at 9.7% return.

With respect it is obvious you don't like Morgan much and that may be colouring your rhetoric somewhat.

Obviously I have plumped for him as my provider and while disappointed with the last years performance still like the fact I can log on anytime to GMK and see where I am.

Many years ago I had a term investment with AMP that had a life insurance component and was a unit type investment. I was shafted but in the end it turned out alright because I cashed in on the de-mutualisation share issue and sold them quickly at $29/share.
It put me off the big outfits so I went with Gareth's line in bullshit. So far I am happy.

Johnboy said...

Here is GMK's graph of their conservative fund which equates to the their version of the default schemes and shows them at second behind Tower in returns since the begining of Kiwisaver.


Adolf Fiinkensein said...

Clarly Johnboy, you are one of these:

"It's quite easy to see Mr Morgan is catering for the dumbarse, whinging, green with envy, lower decile, gullible demographic whose inhabitants are quite happy to forgo profits just so long as they are paying low fees."

For every $100 invested with this charlatan at the scheme's inception you would have to day, nearly two and a half years later, a lousy $96.

And you figure somehow this is GOOD?

Johnboy said...

No Adolph but what would I have if I had invested the $100 with say ASB at -9%.

At this very moment I have around $12,000 in my account and am $80 dollars poorer than what went in. So yes I have made a minor loss but bear in mind I have only donated around %60 odd percent of that total and the Govt./employer the rest.
When you look at it that way a man is an idiot not to be in it.

pdm said...

Johnboy - if you are going to use Conservative funds then do what Adolf did and list them all - then see how Morgan shapes up.

Adolf - I see even Wetspac beat him in the Balanced area and they were notoriously bad maanagers of other peoples money in the Managed Fund area for years.

Kevin said...

Let's have a look at GMK in 12 months time. The last year is hardly a benchmark setter for any of these funds. My pick would be for a complete reversal of company results.

gomango said...

I'd be cautious about the Huljich results. See here:


In a nutshell - when the fundsize was very small, the fund bought some assets from a related party at below cost. When re-valued this created a one off boost to performance which was not due to the managers skill.

Adolf Fiinkensein said...

Kevin. I'm not looking at 'last year.' I'm looking at the last 28 months.

Gomango. Your logic is flawed. The fund is no longer 'small' and continues to outperform the rest.

BTW, I well remember then NZI LIfe making massive additions to clients' individual accounts from its cash reserves during the early nineties because 'it was the right thing to do' while other companies sat back and said 'tough' as they raked in huge fees set when inflation was running at 15%. I don't remember anyone complaining at the time. Like Don Brash, the then DEO was a man of considerable integrity (and a larrikin.)

Adolf Fiinkensein said...

It has taken the herald itself to 'out' this idiot whose fund management shills appear to be inversely proportionate to his ability to write trash.

Laarrrf my arse off.


pdm said...

Kevin the real proof will be when there are 10 years plus returns to look at.

Morgan will probably have given up by then.

sagenz said...

Adolf - I am not at all sure I agree with your assessment. Morgan points out what even Brash admits is dodgy practice. In his position it must seem as if the dodgy finance companies were back as competitors. Misselling and pumping their performance.
You are wrong that the pumping had no influence. It is disclosed as a material impact in notes to Huljich accounts. On the back of that performance Huljich have gained a large number of subscriptions. Which just proves that New Zealand investors are still fools.
The graphs on Morgans own site do not show the same comparative underperformance. I think the jury will remain out until Huljich performance without pumping is shown. In the meantime I would not touch that fund with someone else's barge pole. It would not surprise me if that kind of behaviour had him banned from offering Kiwisaver funds.

I agree with everything in Morgans article even if his fund has underperformed.

Anonymous said...

Morgan's performance AFTER FEES and TAX since inception is actually one of the better ones. do your research.


gomango said...

Adolf - I beg to differ. Huljich performance over the last year has been the same as most other funds - their real outperformance comes from inception which is exactly when they received the artificial boost. If they published a money weighted return as required in the UK the performance since inception would be significantly lower.

And lets not get carried by a 12% performance in 2009 - global equity markets were up between 30 and 40%.

And re NZI - you really need to be more cynical. Where do you think the reserves came from in the first place? By under allocating income and over reserving in previous years. It was the investors money to start with!

I'm no fan of Morgan - as I've said before on blogs he is a self promoter and clearly taken a leaf from the book of Bill Gross in terms of public pronouncements that are self serving, equally I'm not a fan of Huljich, there has now been a litany of stories around the way they do business.

I'm not sure why you feel the need to promote HWM so heavily, the numbers actually don't support your case.

I'm very happy to go to head to head with you on matters of investment management having worked directly in the business as a portfolio manager, marketer and quantitative analyst here and overseas for more than 20 years..........

Adolf Fiinkensein said...

gomango, not sure where you were twenty years ago but your description of cash reserves is naive and biased. They are NOT the investor's money, they are the companies money which is required, among other things, to fund withdrawals, death and other claims and in the case of endowment and whole of life policies, continuing policy bonuses and cash mandatory cash loans in years when investment performance is negative.

You seem to be singing the same off key song Morgan himself was squawking a year ago.

For what it's worth, I have no bag to carry for Huljich. I simply detest people who grandstand, peddling innuendo and insinuation with no facts in order to gain an unfair commercial advantage.

I notice you have avoided the question I asked of you to please explain exactly how Huljich's declared investment performance since March 2009 in any way is misstated.

gomango said...

Adolf - I replied to your question in the later post re Huljich on your blog. Interested to see your resoponse to my explanation as to how the $60,000 actually can make an extremely significant difference to since inception performance.

In the US, doing this was banned back in the 60's, for obvious reasons.

Any thoughts?

Danyl said...

You've still got it.


Leigh said...

Very interesting...
I was totally thrown of by GMK's current return since inception. But a quick visit to his site's performance shows me that (yes the link these 'random' people keep posting) actually show's during the bad time Mr Morgan's scheme stayed afloat when the others sank and now that the others have risen up again and ofcorse raised above GMK they are boasting about it.

What has totally thrown me off huljich kiwisaver is the fact that on their graphs on their site they do not give you an option to go back and view the data from the initial recession and have only started it fromw when times are good! THAT IS SO DODGY BRO - fully unkiwi

I will be going with GMK because I know I can't withdraw my fund for another 30-40 years so I want it to be able to withstand the shit storm I can see ahead.

To Adolf Fiinkensein it is obvious you speaking on behalf of Huljich because you have all the time in the world to spend talking about this bull* on a blog or you are just some idiot that has bought it all hook line and sinker without doing your research - if you are a real investor which I highly doubt - what are you going to do if it's bad times ahead? I also see in your profile you are a salesman (no suprises there) and you are 63 so while good return's now might be beneficial to you - I think GMK are concerned about people who are in for the long haul like me.

And to Mr Morgan/associates who I am sure are also posting on here hang in there, I know it's hard to convince people who don't take the time to do the research and look at the big picture but there's always got to be someone going down for others to go up and it might as well be those guys.