Our Investment Philosophy

Research shows that investing in shares over the longer term produces returns far in excess of other asset classes.

I attended a seminar a few years ago and one of the presentations was provided by a former director of a large, well-known investment platform which offered two ways of investing: Directly and via a Financial Adviser.

The astounding fact was that those who invested directly got better returns than the advised clients, not because the clients picked better funds but because they invested in equities, without getting bogged down by investing in fixed income investments such as gilts and corporate bonds.

Financial advisers have a vested interest in "reducing the volatility" of a portfolio, as it protects you from the severe downturns that occur once in a while. However, this means that for most of the time you are leaving thousands of pounds of lost returns on the table.

Clients are also less likely to complain in a market downturn, so advisers opt for a dull and boring approach which often means that, after charges, their clients are not even beating cash.

In retirement, a market crash could temporarily hammer an equity-heavy portfolio, so having some lower volatility assets is wise, so you could continue to take an income from these less volatile assets, whilst allowing your equity funds to recover. This is extremely good practice.

But here is the difference between us and most other advisers. Rather than watering down your total returns by investing in fixed income assets (which after costs have been beaten by cash over the last few years), why not just keep a healthy, cash, rainy-day fund for the bad times (which does not incur any fees) and then invest the lion's share into global equities, for long-term growth?

A picture paints a thousand words, so you only need to look at the current (and previous) "why we invest in shares" graphs to see that this makes total sense.

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