Our investment approach

Our Investment Philosophy

Investment is both an art and a science, involving careful planning for the future. 

If you seek active management of shares and assets with the aim of outperforming markets through regular trading, we can assist. As part of your overall financial planning, we can help you find an investment manager who aligns with your preferred style. Our focus is on planning, while they manage the investments as you desire. 

Studies have shown that most active funds underperform their market indexes. For example, a recent study found that only 32% of actively managed equity funds outperformed their passive equivalents over ten years, and those that did often had lower-than-average charges. Additionally, FCA research has suggested that underperformance is more likely to persist than outperformance. 

We believe that our role as advisers is not to attempt what large investment firms with vast resources struggle to achieve. Instead, our investment approach within financial planning is distinct and based on the following principles: 

1. Diversification: This improves returns and reduces volatility. The act of diversifying itself provides benefits – it’s the only “free lunch” in investing.
2. Control Costs: Investment charges matter and compound over time. Keeping costs low can significantly impact long-term returns.
3. Question Value: When someone discusses market valuation, it’s often speculative. There’s no absolute value agreed upon for any investment, making investing viable.
4. Long-Term Assumptions: While we can make reasonable long-term assumptions, short-term market movements are unpredictable.
5. Avoid Chasing Trends: Last year’s successful investments may falter next year. Predicting future success based on past performance is unreliable.
6. Accept Volatility: It is a natural part of investing. Both upward and downward movements are expected.
7. Timing: Predicting the best time to invest is impossible without foreseeing future market movements. 

Our strategy involves using extensive available information to set reasonable long-term assumptions for various investments in relation to inflation. We then collaborate with you to create a diversified investment mix aimed at meeting your financial plan’s goals over the long term (10+ years). We monitor and rebalance the plan as necessary, making changes only when essential. This approach may not be thrilling, but often, the best action in investing is to do nothing and remain patient.

Speak to our Wealth management team