Our Core Beliefs

We recently attended a Masterclass run by the Portfolio Construction Forum. The first session focused on what we as advisers believe to be our investment philosophy and core beliefs.

Sitting with competitor colleagues we certainly heard a range of investment philosophies and some focus, as we do, on the life goals of our clients.

Our philosophy is to help clients reach their goals and then to maintain their income requirements throughout retirement without diminishing their wealth prematurely. The session was useful because it made us reflect on what we believe are the essential ingredients of a good investment strategy. One essential ingredient that our long-term clients will recognise is our emphasis on peace of mind.

The second ingredient is consistency. Even though the markets may go up and down, and the economy goes through different cycles, and the investment industry comes up with hot fads, our core beliefs remain the same.

We don’t jump around or chase the latest get-rich-quick opportunities. Rather we create investment portfolios that are tailored to the client’s needs and objectives.

We do this through

• Setting in place a structured asset mix
• Taking risks only within each client’s tolerance and financial capacity
• Ensuring those risks carry a reliable reward
• Staying diversified – never putting all the eggs in one basket
• Seeking cashflow assets
• Keeping costs and taxes as low as possible

Our approach asks clients to acknowledge some basic investment principles, and to understand their own comfort level with risk. We also encourage clients to focus on the things they can control.

Diversity is the key to reduce the volatility of an investment portfolio. Those asset classes that rate best or worst will vary from year to year, so in the long run it is better to hold a wide mix and to stay disciplined and to capture gains (by rebalancing) when these occur. The workshop was a good opportunity to re-assess our framework of beliefs: we remain very comfortable with our approach.