Investment philosophy

We are lifestyle financial planners, not investment managers. We let the experts deal with fund picking and portfolio management, so that we can focus on what we do best; helping you to achieve your dreams.

When it comes to investing your wealth, we don’t know when the best time is to invest. We only know that you should invest for the long term and accept that markets can go down as well as up.

If you choose to work with us to oversee your investments, our philosophy is encapsulated in the following four core beliefs:

Markets work

In a ground-breaking paper, Eugene Fama (1970) Nobel Prize in Economics (2013) demonstrated that, while capital markets are far from perfect, they do a good job of fairly pricing all available information and investor expectations about publicly traded securities.

While this assertion has been constantly challenged, it remains by far the best evidence on how the majority of ordinary investors should approach investing. We believe the objective is to capture the market’s return, rather than assert that one knows better than the market.

Portfolio structure drives return

The way to maximize returns for any given level of risk is to combine asset classes rather than individual securities.

Diversification of the funds that make up an investment portfolio, along with regular rebalancing of the portfolios, should ensure an appropriate return on investment, according to the level of risk the investor is willing to take.

 

Costs matter

Over long-time periods, high fund charges expenses can be a significant drag on wealth.

Keeping fund management fees as low as possible, is as important as ensuring that the investment generates the best return possible. The greater the amount of money invested, the greater the potential for high returns.

Behaviour counts and discipline pays off

All too often, investors let their emotions get the better of them with dire consequences for investment returns. The plausible explanation is that investors are chasing past winners and end up buying high and selling low.

The portfolios we recommend maintain a disciplined approach and stay the course even in extreme market conditions. We help clients to deal with the ‘behaviour gap’ by being the voice of reason when markets fluctuate.

A white paper by Vanguard suggests that the discipline and guidance that a financial adviser provides through behavioural coaching adds an estimated 1.5% pa net return, when compared to an average DIY investor. This is what we call ‘Adviser’s Alpha’

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Meet the team

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Fee philosophy

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