Our investment philosophy outlines the guiding principles that shape our investment advice for you.
Our investment philosophy reflects our beliefs about managing your money and your involvement in investment decisions. We want you to feel empowered and informed, so please don’t hesitate to ask us any questions – we’re here to help you protect and grow your wealth.
To learn more about our investment beliefs and how we collaborate with you to invest your money, click on the links below.
Risk and reward go hand in hand when it comes to investing. It’s crucial to acknowledge that all investments come with a certain level of risk before making any decisions.
Taking on risk offers the potential for higher investment returns as a reward.
For long-term financial goals, investing in riskier asset categories such as equities is often more beneficial than solely relying on safer options like cash.
However, if your financial goals are short-term, it may be appropriate to focus on cash investments.
To help understand risk we break it down into four elements:
Investing for the long term involves considering the impact of inflation and the potential benefits of riskier assets.
While the desire for safety is understandable, the long-term value of investments in real assets like equities, property, and commodities can outweigh the seemingly safer option of cash deposits.
However, the decision is not as straightforward as it may seem.
Our view is that basing investment decisions on the longer-term historic behaviour of asset classes enables investors to participate in market growth. But that regular review is critical.
Asset allocation plays a crucial role in portfolio returns, with strategic allocation being more influential than other factors like stock selection or market timing. To achieve the best results, investors and advisors should focus on constructing a suitable asset allocation model aligned with individual investment objectives and risk tolerance. This is our primary focus when providing investment advice.
An analogy can be drawn to baking a cake, where the right proportions of ingredients matter more than their source. Similarly, we use a risk profiling tool to propose an appropriate asset allocation based on historical data. We will discuss and ensure your comfort with the recommendations.
Diversification is a strategy summarised by the saying “Don’t put all your eggs in one basket.” It involves spreading your investments across different options so that if one investment performs poorly, others may compensate for the losses.
A diversified portfolio should have two levels of diversification: among different types of assets and within each asset type.
This means allocating your investments among stocks, bonds, cash, and other categories, as well as distributing investments within each category.
Investors often find it convenient to diversify within each category by investing in mutual funds (unit trusts) rather than individual assets.
Mutual funds pool money from multiple investors to invest in various financial instruments, such as stocks and bonds. By owning a small portion of many investments through a mutual fund, investors achieve broad diversification.
We collaborate with specialised fund managers to build portfolios that are diversified across asset classes and individual stocks. Importantly, these portfolios align with the determined asset allocation suitable for you.
We aim to make your investments tax efficient by utilising pension wrappers and ISAs. These help reduce the amount of tax your investments will incur.
In addition, we use technology platforms called wraps or fund supermarkets to hold your investments. These platforms offer security, easy access to your investment valuations, and tax wrappers such as pensions and ISAs. They also provide cost-effective options for future fund transfers if necessary.
We have a structured approach to building and managing investment portfolios. This helps overcome emotional biases and ensures the best decisions are made for our clients. Our consistent multi-stage process is designed to provide suitable advice tailored to individual objectives.
Regular progress reviews are essential to stay on track with your financial plan. We will work with you to determine the most effective way to conduct these reviews and ensure your investment strategy remains aligned with your goals.
We follow a set of standard rules for all portfolios, unless clients request a customised approach.
• No individual bonds/shares
• No direct hedge funds
• No direct unauthorised funds
• Only use funds run by FCA regulated managers
Remember, we are here to help you protect and grow your wealth – please don’t hesitate to ask us any questions.
Take control of your financial future and discover how we can strategically invest your money to help you achieve your goals. Contact us to arrange your initial first consultation at no cost.