People have begun talking about how brokers cannot get it right...

People have begun talking about how brokers cannot get it right on HFA valutaion, partly because they are not very transparent. Well lets look at a company like Wesfarmers, recently Aegis had a valuation of $18, with still reasonably high assumption used for the coal price, while simultaneously JBWere had a valuation of around $30 per share with a lower assumed coal price.

What I am saying is that historically you have had many brokers get it very wrong and in this current market it is incredibly easy to get it very wrong.

Also there has been discussion about HFA's fees and revenue generated. The fact is that HFA's Diversified Investment Fund has an MER on its Wholesale product of 1.28%, which is reasonably high, plus administration cost fee of 0.07%. Then, there is the performance fee, which in the current market place, based on their recent returns will be zero.

Another thing to note about the 1.28% MER, is that this is on the clients direct investment, but due to internal leveraging, the MER is closer to 1.50%. 1.50% is not going to make us all rich, but the revenues generated, plus existing Cash reserves held by HFA (not HFA's managed funds) will see us through for the time being.

Personally I am not going to get in on the arguement of how much I think it will be and when. I believe that I have bought a few parcels in the last month at a discount to what I believe is a fair value.

This is just some food for thought to promote further discussion.