Wealth management service &

Investment
Philosophy

Wealth management service

Investment
Philosophy

Our investment philosophy

Successful and efficient investment plans

Our finely tuned investment plans are set against a background of clear and achievable goals derived from our holistic financial planning process. Allowing for your attitude to risk and analysing your capacity for loss we integrate our bespoke service with your personal and professional plans and ambitions.

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Investment Essentials

Companies make profits (create wealth) and pay dividends to shareholders. Of course not all companies prosper, some fail, but overall businesses create wealth in the equity market by thriving and growing, we intend to capture the profits from this growth through a portfolio of funds.

Part of our job is to seek out fund managers whose charges are as low as possible, as long as the fund itself, from an investment tool perspective, is worth buying.

Asset allocation is the balance between the four main investment asset classes; cash, bonds, real estate and shares, as well as the differing segments within these classes.

The most certain way of achieving a successful investment experience is to manage the relative proportions of these asset classes within a portfolio which takes account of your attitude to risk, capacity for loss and time horizon.

Diversification of your investments reduces risk by ensuring not all of your ‘eggs are in one basket’. Therefore it is necessary to construct at portfolio where the underlying holdings (companies stocks and sectors) within funds are not correlated, so that any risk factor that can be reduced or cancelled out by diversification, has been. This also applies to geographic location – why concentrate your portfolio in the UK market when that market represents only about 7% of global market? Diversification globally reduces risk, and should increase returns.

We need to be dispassionate to avoid overly emotional or reactive investment choices and we achieve that by implementing and following a disciplined and clearly defined investment process.

Utilising modern technology we integrate our client management system with investment administration platforms in order to provide the most efficient services available.

Keeping you informed both with client literature and regular review meetings.

Academic Background

Market efficiency

We believe that at any one instant in time all information about any investment security is available to and known by all investors in the market. Consequently the price of the security accurately reflects this situation. In the next instant all this information is updated and the price changes again to account for any new knowledge. This information flows constantly and we believe it to be the closest representation of real prices.

Therefore it is our understanding that market returns are the most consistent and reliable returns that you can attain. This belief is shared by academics, financial economists and many investors who have long realised that it is possible to capture these market rates of return by the use of passive investment techniques. However passive investing alone still does not provide the best returns or even risk adjusted returns.

Therefore we combine the diversification and low costs of passive investing with additional market evidence to create portfolios with modest tilts to higher weightings in asset segments where it is evidenced that risk premiums can be exploited, for example smaller company and value stocks. That is to say, we capture a higher level of return from a similar level of risk just by tilting our clients’ portfolios in certain areas or sectors where the risk premiums can be captured.

Investment Management
  • Active management
    Many Studies have been carried out to check whether or not active management provides consistent real returns (above fees and inflation). All of these studies (at least those with true academic rigour) have shown that they cannot consistently do so. We are therefore convinced that active management generally offers no advantage for the retail investor and is costly.
  • Index-tracking funds (passive management)
    Very often the buys and sells of passively managed funds are executed in a manner that affects the share price.Frequent dealing also increases the costs of the fund. Furthermore it is difficult for index tracking funds to properly sample and efficiently deal in the less liquid sectors of the market, for example smaller companies.
  • The Third Way – ‘Evidence Based investing’
    There now exists a large body of evidence based on the work of various financial economists, some of which are Nobel Prize Laureates, as well work by financial professionals that can be applied to portfolio constructions that will provide our clients with a successful investment experience.

At the core of this is our belief that market returns are the most consistent and reliable returns that you can attain. This belief is shared by academics, financial economists and many investors who have long realised that it is possible to capture these market rates of return by the use of passive investment techniques. However passive investing alone still does not provide the best returns or even risk adjusted returns.

Therefore we combine the diversification and low costs of passive investing with additional market evidence to create portfolios with modest tilts to higher weightings in asset segments where it is evidenced that risk premiums can be exploited, for example smaller company and value stocks. That is to say, we capture a higher level of return from a similar level of risk just by tilting our clients’ portfolios in certain areas or sectors where the risk premiums can be captured.

Our Wealth Management Service

Our portfolio management is designed to protect your wealth by both shielding it from inflation, and generating enough real returns so that you could feasibly withdraw an income without effecting the value of your capital.

We balance your exposure to different asset classes and segments to provide a rate of return compatible with the risk you are prepared to take. This is strategised into a long term plan and reviewed over time to ensure that we are up to date and aligned with your goals and circumstances.

Your dedicated financial advisor will continually review available products and services making sure they are using the most appropriate and high quality investment tools for your needs.

Investment Essentials

Companies make profits (create wealth) and pay dividends to shareholders. Of course not all companies prosper, some fail, but overall businesses create wealth in the equity market by thriving and growing, we intend to capture the profits from this growth through a portfolio of funds.

Part of our job is to seek out fund managers whose charges are as low as possible, as long as the fund itself, from an investment tool perspective, is worth buying.

Asset allocation is the balance between the four main investment asset classes; cash, bonds, real estate and shares, as well as the differing segments within these classes.

The most certain way of achieving a successful investment experience is to manage the relative proportions of these asset classes within a portfolio which takes account of your attitude to risk, capacity for loss and time horizon.

Diversification of your investments reduces risk by ensuring not all of your ‘eggs are in one basket’. Therefore it is necessary to construct at portfolio where the underlying holdings (companies stocks and sectors) within funds are not correlated, so that any risk factor that can be reduced or cancelled out by diversification, has been. This also applies to geographic location – why concentrate your portfolio in the UK market when that market represents only about 7% of global market? Diversification globally reduces risk, and should increase returns.

We need to be dispassionate to avoid overly emotional or reactive investment choices and we achieve that by implementing and following a disciplined and clearly defined investment process.

Utilising modern technology we integrate our client management system with investment administration platforms in order to provide the most efficient services available.

Keeping you informed both with client literature and regular review meetings.

Academic Background

Market efficiency

We believe that at any one instant in time all information about any investment security is available to and known by all investors in the market. Consequently the price of the security accurately reflects this situation. In the next instant all this information is updated and the price changes again to account for any new knowledge. This information flows constantly and we believe it to be the closest representation of real prices.

Therefore it is our understanding that market returns are the most consistent and reliable returns that you can attain. This belief is shared by academics, financial economists and many investors who have long realised that it is possible to capture these market rates of return by the use of passive investment techniques. However passive investing alone still does not provide the best returns or even risk adjusted returns.

Therefore we combine the diversification and low costs of passive investing with additional market evidence to create portfolios with modest tilts to higher weightings in asset segments where it is evidenced that risk premiums can be exploited, for example smaller company and value stocks. That is to say, we capture a higher level of return from a similar level of risk just by tilting our clients’ portfolios in certain areas or sectors where the risk premiums can be captured.

Investment Management
  • Active management
    Many Studies have been carried out to check whether or not active management provides consistent real returns (above fees and inflation). All of these studies (at least those with true academic rigour) have shown that they cannot consistently do so. We are therefore convinced that active management generally offers no advantage for the retail investor and is costly.
  • Index-tracking funds (passive management)
    Very often the buys and sells of passively managed funds are executed in a manner that affects the share price.Frequent dealing also increases the costs of the fund. Furthermore it is difficult for index tracking funds to properly sample and efficiently deal in the less liquid sectors of the market, for example smaller companies.
  • The Third Way – ‘Evidence Based investing’
    There now exists a large body of evidence based on the work of various financial economists, some of which are Nobel Prize Laureates, as well work by financial professionals that can be applied to portfolio constructions that will provide our clients with a successful investment experience.

At the core of this is our belief that market returns are the most consistent and reliable returns that you can attain. This belief is shared by academics, financial economists and many investors who have long realised that it is possible to capture these market rates of return by the use of passive investment techniques. However passive investing alone still does not provide the best returns or even risk adjusted returns.

Therefore we combine the diversification and low costs of passive investing with additional market evidence to create portfolios with modest tilts to higher weightings in asset segments where it is evidenced that risk premiums can be exploited, for example smaller company and value stocks. That is to say, we capture a higher level of return from a similar level of risk just by tilting our clients’ portfolios in certain areas or sectors where the risk premiums can be captured.

Our Wealth Management Service

Our portfolio management is designed to protect your wealth by both shielding it from inflation, and generating enough real returns so that you could feasibly withdraw an income without effecting the value of your capital.

We balance your exposure to different asset classes and segments to provide a rate of return compatible with the risk you are prepared to take. This is strategised into a long term plan and reviewed over time to ensure that we are up to date and aligned with your goals and circumstances.

Your dedicated financial advisor will continually review available products and services making sure they are using the most appropriate and high quality investment tools for your needs.

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