Without exception, our relationship with you will be founded on these nine beliefs
1: Mutual Trust
We will earn your trust by telling you the pure, undiluted truth - as we understand it - all the time.
2: The Plan Comes Before The Portfolio
Our relationship will only have meaning and value through your financial plan. Your portfolio is never anything more than a function of your plan. A portfolio is never an end in itself.
3: Equities (Great Companies) Preserve Purchasing Power
Owning a share in all of the great companies of the world will give you the best chance of beating inflation. So we will give your investment portfolios as much equity exposure as we think is suitable, also allowing for the required return needed to fuel your financial plan.
4: Our Value Comes From Modifying Your Behaviour
Equities offer potential superior long-term returns. Because of this, they are volatile (share prices can and will rise and fall, sharply). You can expect a significant fall in share prices every three to five years or so. However, all such share price declines have been temporary, a downward blip on an upward, soaring trend.
The risk of owning shares is not therefore their volatility: it is your emotional response to this volatility. The dominant factor in long-term, real-life financial outcomes is not “investment performance”; it’s investor behaviour.
5: Predictions Are Worthless and Pointless
The economy, the markets, and the future can’t be consistently predicted or timed. The only way to capture the full potential long-term return of the great companies of the world is to be willing to sit through their full and temporary volatility.
We do not even attempt to analyse current events or perceived threats: we will always counsel patiently holding the long-term portfolio that is a function of your long-term financial plan.
6: Our Fees Are Essentially For Behaviour Management
We effectively throw in financial planning; portfolio design; tax-harvesting; rebalancing; monitoring and reporting; most if not all service. You need to see the value in our behavioural advice, or you ought not to engage us.
7: It Is Never “Different This Time”
Uncertainty is the only certainty. We don’t move from periods of the former to the latter; we simply move from one uncertainty to the next.
8: The News Cycle Reinforces Uncertainty
99% of the time, the events behind news headlines have no direct impact on our lives. Nor can you influence these events, to any significant degree. Appreciate that 24/7 news is not your friend. It’s “business”: don’t take it personally. In fact, don't take it all: turn the news off!
9: We Live In A Golden Age
For all the long-term uncertainty in the world, there are countless reasons for long-term optimism. Wealth and prosperity is spreading around the globe. Poverty is being eradicated. Once dread diseases are now curable. Technology is changing millions of lives for the better.
History teaches us to be long-term optimists. Look how far we have come in the last two million years.