You should never start this process by playing the financial service industry’s game of product comparison.
A common theme runs through the investment advice we provide to clients: Focus on those things within your control. Too many investors focus on the markets, the economy, manager performance, or the performance of a given security or strategy instead of the core fundamentals that we believe should drive a successful portfolio. We believe a top-down approach, starting with a suitable asset allocation mix aligned with the investor’s goals and constraints (timeframe, willingness, need and capacity for risk etc), offers the best chance of success.
Because investing evokes emotion, even sophisticated investors should arm themselves with a long-term perspective and a disciplined approach. Abandoning a planned investment strategy can be costly, and research has shown that some of the most significant issues are behavioural: the failure to rebalance, the allure of market-timing, and the temptation to chase performance.
I have 20 years’ experience as a Financial Planner and I can assure you that if you put in place a structured plan which prudently diversifies your investments globally across thousands of different securities you will be less concerned about your savings and you will earn the right to a higher expected return than you currently receive.
We also believe that by having a clear plan and a documented investment policy statement which sets out how you will react to the inevitable bad news that will come along in the future you will be able to deal with short term bumps in the road.
Get a plan, not a product!