Corrected how geared funds are simulated
A visitor on Reddit pointed out a mistake in the simulation of the geared funds (GHHF, GGBL and GNDQ), which borrow to invest more. The simulation reset their borrowing every day, as many leveraged funds in the US do. These funds don't.
Each of them keeps its loan between 30% and 40% of its assets. The loan stays the same while prices move, so after a fall it is a bigger share of the assets and after a rise a smaller one. Betashares says the funds only borrow more or repay part of the loan when that share moves outside 30% to 40%. The simulation now does the same, and brings the loan back to 35%, the middle of the range, as Betashares does in its own simulations.
This changes the simulated years before each fund launched. The old simulation sold some assets after every fall, so the biggest change is in long falls such as the early 2000s. Figures to 25 September 2026, where drawdown is the largest fall from a high point:
| Fund | Annual return since 2000 | Drawdown since 2000 |
|---|---|---|
| GHHF | 7.8% → 8.2% | -67.8% → -65.2% |
| GGBL | 5.9% → 6.0% | -79.5% → -77.9% |
| GNDQ | 6.3% → 7.4% | -96.2% → -95.3% |
Checked against GHHF's and GNDQ's real prices since they launched, the new simulation comes closer than the old one. How geared funds are simulated