Our team has combined experience across the cutting edge of finance – investment bank trading floors, hedge funds, asset managers as well as top-tier management consulting firms. Through this, our collective experience, we have built an investment process that we believe stands the test of time.
We take our inspiration from investing giants such as Warren Buffett, George Soros and Stanley Druckenmiller along with modern greats such as Terry Smith and Christopher Hohn.
Principally our investment philosophy comes back to evidence based investing.
Evidence-based investing is the best kept secret in finance. Why you ask? Because its all about keeping costs low, using index funds and not following the latest financial fad that high-cost asset managers are trying to push out onto retail clients.
Our view is the days of the high-cost fund manager is his/her plush office with a team of research analysts trying to beat the market are over. They’ve continually failed and they failed not with their money (which they were collecting in fees) but your money – the investor’s hard earned money. Academic research has consistently proved this time and time again. Now can you see why Fund Managers are so keen to keep this quiet?
Sometimes certain funds will outperform our market-based approach. That happens and is to be expected. However in the long-run NOBODY can beat the market consistently. We have that on our side.
We focus on doing the basics well and let the market do the heavy lifting. Perhaps counter-intuitively, one of our key focuses is on what we can help you STOP doing. This includes actions such as picking the wrong funds, paying expensive fund fees and trying to time the market. Each of these has the potential to cause drag on overall performance and over the years can have a very big impact on achieving your goals.
A summary of our thinking on markets is as follows:
- Markets go up in the long-term but are impossible to predict in the short-term
- Every Government and Central Bank want asset prices to continue to rise because it builds confidence. Their interests and investor’s interests are aligned.
- Keeping costs low is always preferable
- There is no point trying to time the market
Markets go up and down. We all know that. The value of any investments at any point can be lower than the original amount invested. This is what we call “volatility” – and what others like to call risk. And it is precisely the acceptance of this volatility that provides us as investors with long-term returns. The higher the volatility you can handle, the higher the long-term returns should be. However, it is important to remember, volatility is not for everyone. For example, there may be cases when you need your investment to be steady and understand that will provide a lower overall return. That is sometimes the most sensible decision. The key point is this discussion on volatility and risk forms a key part of the overall discussions with you both initially and every time we review the portfolio.