- About Collins House Online
- Getting Started
- Socially Responsible Investing
- Withdrawals & Account Closing
How do I get started with Collins House Online?
- Register online at the Collins House Online Website (www.collinshouse.com)
- You will need to provide information on how much you earn and spend.
- Fill in your age and information about education level.
- Answer a series of questions that will help determine your attitude towards risk.
- Choose if you wish to opt in to socially responsible investments.
- Choose how much money you would like to invest through Collins House Online to begin with, starting from $10,000.
- Choose if you would like to set up optional monthly contributions or not.
- Collins House Online will then show you what your portfolio is likely to be worth over time.
- If you’re happy with this, you will be asked to sign up and confirm your email address.
- You will be asked to provide your personal details.
- Invest your money then sit back and let Collins House Online do the rest.
Can I transfer my initial deposit in multiple payments?
Yes, you can. We understand that banks often impose a daily transfer limit and that some people want to transfer their initial deposit from multiple bank accounts so there is no need to transfer your initial deposit in a single transaction.
Should I invest if I need my money for less than 2 years?
We don’t recommend investing for less than 2 years, and believe you’d be better off leaving your money in a high-interest savings account.
Our investment approach is to grow wealth over the long term.
Who are OpenMarkets?
OpenMarkets are an Australian stockbrokerage firm specialising in online trading. We open an OpenMarkets brokerage account for you so we can trade on your behalf.
When you’re completing the CMA activation form, you’ll see that OpenMarkets has third party authority on your CMA. This authority is necessary so they have permission to withdraw funds to invest in the ETFs for your Collins House Online portfolio.
What are the costs of setting up the Cash Management Account in my name?
There are no costs associated with setting up the Macquarie CMA on your behalf. This is simply part of the Collins House Online service.
What happens once my account is opened and I’ve deposited my initial investment?
Once you’ve deposited your first investment into your Collins House Online linked CMA, we will invest your money in the portfolio of ETFs that we recommended for your personal situation.
What happens if I already have a Macquarie Cash Management Account?
Even if you have an existing Macquarie CMA we need to open a new CMA on your behalf. Having a Collins House Online specific CMA allows us to be an Advisor on the Collins House Online CMA, which is essential for us to monitor your CMA balance, and invest and/or re-balance your portfolio on your behalf.
It also allows for deposits, withdrawals, portfolio distributions and fees to be monitored as well as audited each year as part of our service.
Opening up a new CMA for you is completely free.
What is the minimum investment amount?
Our minimum investment amount is $10,000.
We believe investing less than $10,000 is not in your best interests due to the relatively high investment costs you face when investing small amounts. However you are able to transfer lesser amounts into your Macquarie CMA and we will not deploy the funds until your account balance reaches the amount of $10,000.
Why do you ask for my financial details?
In order to provide personal financial advice and recommend the right investment strategy that is in your best interest we need to know your current financial situation and objectives.
Why do you ask for my Tax File Number?
We ask for your Tax File Number (TFN) so that we don’t have to deduct withholding tax from your investment returns.
Providing your TFN is not compulsory, it just means that without it we have to deduct tax, which you may be able to claim back at a later day. You also have the option to provide a TFN exemption code if one applies to you.
How long does it take for Collins House Online to invest my money?
Once your initial transfer into your account is complete, it will take 1 to 2 business days for you to be invested. We will email you when we have received your initial deposit, and when we’ve invested on your behalf.
I’ve got my CMA details, what do I do now?
If you have not done so already, you will need to activate your CMA. Once this is done you will need to transfer your initial investment from your everyday bank account to your CMA. This is done using your normal online banking tool.
What information do I need to open my Collins House Online account?
Most of the information you need to provide is straightforward such as your name and address.
We’ve found that people struggle most with providing their Tax File Number (TFN) so we suggest digging this up before you start. (FYI: you can find your TFN on your tax statement)
We also ask for your income and expenses - these numbers need only be estimates so don’t worry about putting together a complete yearly budget.
Do I need to be an Australian citizen to invest with Collins House Online?
You do not, but you do need to be an Australian resident for tax purposes.
What types of accounts are available with Collins House Online?
Collins House Online is currently available to Individuals, SMSF’s, Trusts and Children under the age of 18 when held on their behalf by parents/grandparents/others.
How old do I have to be to use Collins House Online?
You must be at least 18 years old to invest with Collins House Online, although parents/ grandparents and others can hold investments on behalf of children/grandchildren and others.
How do I add more money to my investment? And when are these funds deployed?
If you wish to add to your investment portfolio once it is already up and running, you simply log into your normal online bank and transfer the money you want to invest into your CMA. We will invest the monies from your CMA once the balance of your CMA reaches a minimum of $3000.
This trading strategy ensures that we maintain some cash in your portfolio (to pay fees etc.) and that all trades are placed in sizes, which adhere to the ASX, recommended minimum trade sizes.
Will I get a confirmation when you receive my initial investment or subsequent investments?
Absolutely. We keep you up-to-date with email confirmations at all stages of the investment process, including when you make a deposit into your CMA.
Can I open multiple Collins House Online Online accounts?
You can indeed. You will need to use a different email address for each account and go through the normal account opening process including activating a new CMA for each Collins House Online account you create.
We will shortly be introducing the ability to have multiple separate portfolios within the one Collins House Online account.
How many portfolios does Collins House Online offer?
When you join, Collins House Online will ask you a series of questions, which we use to construct your personal portfolio based on your risk tolerance, financial goals and investment timeline.
Collins House offers 5 individually tailored investment portfolios.
- Conservative. 20% growth, 80% defensive
- Moderate. 40% growth, 60% defensive
- Balanced. 60% growth, 40% defensive
- Growth. 75% growth, 25% defensive
- Aggressive. 90% growth, 10% defensive
What asset classes can I invest in?
Your portfolio is constructed from a list of Exchange Traded funds that provide exposure to different asset classes so you have a diversified portfolio.
- Australian Shares: Collins House Online offers access to nearly 200 Australian listed companies.
- International Shares: Collins House Online can access shares in over 1,500 of the world’s largest companies listed across the U.S, Europe and Japan.
- Emerging Markets: Collins House Online can access over 3,500 of the largest companies in emerging economies such as Brazil, China and India.
- Property: Collins House Online provides access to Australian property such as shopping centers, office buildings and residential.
- Enhanced Cash: Collins House Online can give you a mix of bank deposits, term deposits and short term money market securities.
- Bonds: Collins House Online has access to bonds issued by high-quality companies and the Australian government.
What if my portfolio goes down in value?
When we built and recommended your portfolio, we knew there would be bad days. Your portfolio has been built to withstand changing market conditions.
A few things to keep in mind:
- Volatility is a normal part of investing in the sharemarket and also applies to Government Bonds and Fixed Interest Investments
- Sharemarkets have historically delivered higher long-term returns than cash because their short-term returns are so unpredictable.
- Over the past century, there have been some large dips, but the market has always recovered and risen to new highs.
- In order to make money from your investments, you need to hold through times of increased volatility.
When you invest, you are compensated for bearing risk. If share returns were predictable they wouldn’t be risky and if they weren’t risky there would be no reason why they should generate a higher long-term rate of return than safer investments like cash.
Remember, if you’re invested with Collins House Online, the sharemarket is only one component of your portfolio. Your shares are also spread across not only the US and Australia, but also many sharemarkets throughout the world.
Depending on your portfolio, you may also have exposure to Australian bonds, property and cash. These other components help to create the benefit of diversification, an investment approach that is at the core of all-intelligent investing.
You cannot control what markets will do from day to day, but you can control your actions and exhibit discipline in sticking to your investment strategy.
As Warren Buffett says, “We don’t have to be smarter than the rest. We have to be more disciplined than the rest”.
How often does my portfolio get rebalanced?
We compare the asset allocation of your portfolio against your target asset allocation on a daily basis but rebalance only when required. By running the comparison daily we can incorporate cashflows, such as contributions and investment distributions, into the rebalancing decision.
We've set thresholds so if your asset allocation moves far enough from the target allocation we will rebalance for you, even in the absence of any contributions or investment distributions. The thresholds are different for each portfolio and asset class depending upon characteristics such as total portfolio risk and asset class volatility.
Broadly speaking, the rebalancing thresholds are set so that the portfolios do not materially deviate from their expected long term risk/return profile and yet shouldn’t be so restrictive so as to generate excessive rebalancing. Too frequent rebalancing risks generating poorer tax outcomes and excessive transaction costs. Additionally, the thresholds are set wide enough so that they can take advantage of the expected momentum exhibited by asset returns over the short term but not too wide to deviate materially from the expected long term risk/return profile.
In the absence of contributions, we expect that the rebalancing transactions will occur once or twice over a 12 – 18 month period.
Will I receive franking credits from my investments?
Yes. If you hold an Australian ETF in your Collins House Online portfolio and the companies within that ETF pay franked dividends, you will be entitled to those dividends and any franking credits attached to them.
Will I receive dividends from my investments?
Yes. Dividends (also called distributions) are paid directly into your Cash Management Account (CMA) and are automatically reinvested once your CMA reaches the minimum investment balance of $5000. Dividends will appear in your activity feed.
How is my Collins House Online portfolio constructed?
Your Collins House Online portfolio is constructed from a list of Exchange-Traded Funds (ETFs) approved by the Collins House Online Investment Committee which includes Dominic Alafaci. Collins House Online portfolios are comprised of several ETFs that provide exposure to different asset class, which results in an overall diversified portfolio.
The specific combination of ETFs in your portfolio is dependent on your own financial situation and capacity for risk.
What is an Exchange Traded Fund?
An Exchange Traded Fund (ETF) is a type of investment fund listed on the stock exchange and traded like shares. Each ETF holds a collection of securities, the composition of which mirrors a particular index, such as the S&P/ASX 200 index of Australian shares.
ETFs allow individual investors to gain all the diversification benefits of owning a large number of securities while only having to hold one investment. In so doing, ETFs significantly lower the investment amount needed to diversify appropriately. Since each ETF is designed to track a particular index, ETF fees also tend to be lower than for equivalent funds trying to beat indices.
Whose name are my investments held under?
All ETFs that are purchased as part of your Collins House Online portfolio are held in your name under your own personal Holder Identification Number.
Why does my account have a cash balance?
When you invest with Collins House Online we will open a Macquarie Cash Management Account (CMA) on your behalf. Money deposited by you, into this account, is used by Collins House Online to purchase ETFs on your behalf. In addition to ensuring that your CMA contains sufficient funds to pay for all ETF purchases, we maintain a sufficient balance in your CMA to ensure the successful payment of fees and charges.
What is rebalancing?
The recommended weightings of assets in a new investment portfolio is termed the Strategic Asset Allocation. Initially, the composition of the portfolio will reflect the Strategic Asset Allocation, however with time the weighting of assets in the portfolio will change either as some assets outperform others, or because of the impact of additional cash contributions into the portfolio.
Rebalancing is the process by which a portfolio that has materially changed from the original asset allocation is re-adjusted toward the Strategic Asset Allocation.
How do you determine my risk score?
Your risk score is determined by an algorithm based on your responses to the risk questionnaire that you complete when opening your Collins House Online account. The algorithm generates a score ranging between 1 and 10.
A Collins House Online risk score of 1 is suggestive of a person who is highly investment risk averse while a score of 10 is indicative of a person who has a high tolerance to investment risk. We use your Collins House Online risk score as one of the factors (though not the only factor) in determining what Collins House Online portfolio to recommended to you.
Who makes my investment decisions?
Collins House Online portfolios are approved and maintained by the Collins House Online Investment Committee in conjunction with the Clover Investment Committee
Dominic Alafaci who has over 30 years’ experience in tailoring investment portfolios, heads the Collins House Online Investment Committee. Alongside him is the General Manager of Collins House Online David Varlamos and Director of Collins House Private Wealth Kate Nicol. Between them, they have over 60 years experience in portfolio construction and financial markets.
Kate Nicol A Dip FP Director Collins House Pty Ltd Senior Advisor Collins House Private Wealth
Kate has over 15 years experience in financial services. She holds an Advanced Diploma of Financial Planning, and is currently completing her Bachelor of Business in Financial Planning as well as the Certified Financial Planner certification through the FPA.
Before joining Collins House in 2011 she commenced her career in financial services in 2001 in the United Kingdom before returning to Australia to join the Commonwealth Bank in Melbourne.
Between 2004 and 2010 she was employed as an Indepenedent Financial Advisor with UK Chartered Firm, Firth & Scott Financial Services Ltd where she was responsible for over 100 retiree client portfolios. Kate provides high quality ongoing advisory services to clients of Collins House, and assists them achieve their lifestyle and financial objectives in a professional, yet personalized and ethical manner.
David Varlamos B.A., SIA (AFF) Director/General Manager Collins House Online Investment Services Pty Ltd
David joined Collins House in 2018 as a Portfolio Advisor. He has extensive experience in constructing and managing High Net Worth Portfolios comprised of listed equities, derivatives and managed funds as well as providing corporate advice on Initial Public Offerings and capital raisings.
David’s previous positions included as a Director at Baillieu Holst from 1995 to 2010 and as a Senior Investment Advisor at Macquarie Bank from 2010 to 2014.
David holds a Bachelor of Arts from Monash University and a Certificate in Financial Markets from the Securities Institute of Australia.
Can I customise my portfolio?
No, Collins House Online does not offer the capability for customisation of the portfolio, however for significant sums ($10 Million or more), we will consider creating standalone portfolios.
Does Collins House Online accept in-specie transfers?
At this stage, Collins House Online is unable to offer a facility to accept ETFs that you already hold and would like to form part of your Collins House Online investment portfolio, via an ‘in-specie’ transfer.
Are Collins House Online portfolios available via WRAP or SMA platforms?
Collins House Online portfolios can only be accessed via the Collins House Online website and are not available via WRAP and SMA platforms at this stage.
What is Socially Responsible Investing?
Socially Responsible Investing is a method of investing that takes into account the impact of a company on the world. Companies are evaluated on their triple bottom line, which takes into account not just the potential financial return, but also their environmental and social impact. It’s a way for investors to put their personal values into action, and help shape society.
The three main factors companies are screened on are Environmental, Social and Governance (or ESG for short) considerations.
What percent of my portfolio will be composed of the Socially Responsible Investments?
The percentage of Socially Responsibly Investments varies depending on your portfolio personalisation. If you opt in for Socially Responsible Investments, they will comprise between 20% and 75% of your portfolio.
SRI portfolios are made up of the same mix of asset classes as standard Collins House Online portfolios; Australian Shares, International Shares, Emerging Markets, Property, Enhanced Cash and Bonds.
However for SRI portfolios, we have selected different Australian & International Shares ETFs which are Socially Responsible Investments.
As the market demand for ethical investment products grows, we hope to see more products introduced to the market and to evolve our SRI offering as that happens.
How do Socially Responsible Investments perform?
A common concern is that socially responsible investing means having to sacrifice investment returns. There is a robust, and growing, body of evidence that this is simply not the case.
An analysis of 2,200 individual studies of ESG and corporate financial performance found that “the large majority of studies report positive findings”. This is likely the largest empirical study on the matter, and presents a solid business case for ESG biased investing.
Another study, by Morgan Stanley found that “investing in sustainability has usually met, and often exceeded, the performance of comparable traditional investments. This is on both an absolute and a risk-adjusted basis, across asset classes and over time.”
Does Collins House Online charge more for Socially Responsible portfolios?
No, we charge the same low fee regardless of whether you choose to add the Socially Responsible Investment option or not.
However, the inbuilt fees charged by the firms that manage the ETFs for Socially Responsible Investment are slightly higher. This is because there is significantly more work involved in managing the screening process, for example investigating and evaluating the companies. Core Collins House Online portfolios have an average ETF fee ranging between 0.17% - 0.20% per year, whereas our Socially Responsible Investment option portfolios have an average ETF fee ranging between 0.23% - 0.40% per year.
Will Collins House Online’s Socially Responsible Investment options change over time?
We anticipate that in the next few years the number of Socially Responsible Investment ETFs listed in Australia will expand greatly. We constantly monitor and review all available ETF options, and should our Investment Committee decide a better investment option is available, we will inform our members and make the switch.
Which Socially Responsible Investments does Collins House Online use?
For Australian shares, we’ve chosen the Russell Australian Responsible Investment ETF which screens out companies heavily involved in alcohol, tobacco, gambling, pornography, controversial weapons (like cluster bombs), and high-polluting fossil fuels. It also gives a positive weighting to companies that display positive environmental, social and governance practices (such as diversity and management). The entity managing this ETF, Russell Investments, has been a signatory to the United Nations’ Principles for Responsible Investment (UNPRI) since 2009.
For International shares, we’ve chosen the UBS IQ MSCI World Ethical ETF, which screens out companies with significant involvement in tobacco, production of cluster bombs, landmines, chemical and biological weapons and depleted uranium weapons.
How much can I withdraw at any one time?
You can withdraw as much or as little as you would like at any time. However, if your withdrawal causes your Collins House Online portfolio to fall below the $10,000 investment minimum we will need to close your account.
How do I withdraw money from Collins House Online?
You can withdraw your money from Collins House Online at any time using the withdrawal feature in the Settings section of your dashboard.
In order to withdraw your funds, Collins House Online will sell some or all of your portfolio assets. This normally takes 3-5 business days, and we will get in touch when the sale has been executed.
How do I close my account?
You can close your Collins House Online account at any time, using the Account Closure feature in the Settings section of your dashboard.
To close your account Collins House Online will sell your portfolio of assets. This normally takes 3-5 business days, and we will get in touch when the sale has been completed.
What do I do if I forget my password?
Simply click on the Forgot your password? link and enter the email you use for your Collins House Online account. We’ll send you an email with instructions on how to reset your password.
What do I do if I think my account has been compromised?
Please let us know ASAP so that we can ensure your account is secured.
You can email us at email@example.com or 03 8080 7838
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FINANCIAL SERVICES GUIDE
COLLINS HOUSE PTY LTD, ACN 109 236 722, ABN 62 091 913 093, TRADING AS COLLINS HOUSE PRIVATE WEALTH, AND COLLINS HOUSE ONLINE INVESTMENT SERVICES PTY LTD, ACN 620 936 567, ABN 30 492 640 027 TRADING AS COLLINS HOUSE ONLINE, ARE CORPORATE AUTHORISED REPRESENTATIVES OF COLLINS HOUSE PRIVATE WEALTH PTY LTD ACN 166 528 758 AUSTRALIAN FINANCIAL SERVICES LICENCE NUMBER 449 146