About Investment Planning

  • No matter where you hold money, there is always risk.
  • Monies held on deposit hold the risk of losing real buying power through inflation.
  • Monies invested in Shares are subject to the volatility of the stock markets.

To understand a person’s risk profile, we bring them through our  NCT RISK ASSESSMENT. It is the combination of these three factors that determines our recommendation for your strategy:

  • Need for Risk

    We analyse the numbers to calculate how much growth is needed for you to achieve your goals.

  • Capacity for Risk

    In this area we consider factors such as your age, the percentage of assets being considered, other risks you are taking and your investment time frame.

  • Tolerance for Risk

    Your personal risk tolerance is determined by your ability to withstand short-term volatility without selling your investments (i.e. your “ability to sleep at night”). For this, we use a Risk Assessment Questionnaire, designed to measure the emotional response to changes in the value of your investments.

FOCUS ON COSTS

The chart below highlights the true importance of charges, by showing the impact of Annual Management Charges over time.

We show you the impact of charges, so that you understand the real and exact impact of charges on your long term investment and pension portfolio.

Neutral growth has been assumed so that the compounding effect of charges is readily apparent, and not obscured by investment returns over time (either positive or negative).

Annual Management
Charge expressed as
% pa. figure
Percentage of portfolio retained after costs
Years
1
3
5
10
15
20
25
30
0.10
99.90
99.70
99.50
99.00
98.51
98.02
97.53
97.04
0.15
99.85
99.55
99.25
98.51
97.77
97.04
96.32
95.60
0.20
99.80
99.40
99.00
98.02
97.04
96.08
95.12
94.17
0.25
99.75
99.25
98.76
97.53
96.31
95.12
93.93
92.77
0.30
99.70
99.10
98.51
97.04
95.59
94.17
92.76
91.38
0.35
99.65
98.95
98.26
96.55
94.88
93.23
91.61
90.02
0.40
99.60
98.80
98.02
96.07
94.17
92.30
90.47
88.67
0.45
99.55
98.66
97.77
95.59
93.46
91.37
89.34
87.34
0.50
99.50
98.51
97.52
95.11
92.76
90.45
88.22
86.04
0.55
99.45
98.38
97.28
94.63
92.06
89.56
87.12
84.75
0.60
99.40
98.21
97.04
94.16
91.37
88.68
86.03
83.48
0.70
99.30
97.91
96.58
93.22
90.00
86.89
83.89
81
0.80
99.20
97.52
96.08
92.28
88.65
85.16
81.81
78.59
0.90
99.10
97.32
95.58
91.36
87.32
83.46
79.77
76.24
1.00
99.00
97.03
95.10
90.44
86.01
81.79
77.78
73.97
1.10
98.90
96.94
94.62
89.63
84.71
80.15
75.84
71.76
1.20
98.80
96.44
94.14
88.63
83.44
78.55
73.95
69.62
1.30
98.70
98.15
93.67
97.73
82.18
76.97
72.10
67.53
1.40
98.60
95.86
93.19
86.85
80.94
75.43
70.29
65.51
1.50
98.50
95.57
92.72
85.97
79.72
73.91
68.53
63.55
1.60
98.40
95.28
92.25
85.10
78.51
72.43
66.82
61.64
1.70
98.30
94.99
91.78
84.74
77.32
70.97
65.14
59.79
1.80
98.20
97.70
91.32
83.39
76.15
69.54
63.50
57.99
1.90
98.10
94.41
90.85
82.54
75.00
68.14
61.90
56.24
2.00
98.00
94.12
90.39
81.71
73.86
66.76
60.35
54.55
2.10
97.90
93.83
89.93
80.89
72.73
65.41
58.83
52.90
2.20
97.80
93.54
89.47
80.06
71.63
64.09
57.34
51.31
2.30
97.70
93.26
89.02
79.24
70.54
62.79
55.89
49.76
2.40
97.60
92.97
88.56
78.43
69.46
61.52
54.48
48.25
2.50
97.50
92.69
88.11
77.63
68.40
60.27
53.10
46.79
2.60
97.40
92.40
87.66
76.84
67.36
59.04
51.76
45.37
2.70
97.30
92.12
87.21
70.06
66.33
57.84
50.45
43.99
2.80
97.20
91.83
86.76
75.28
65.31
56.67
49.17
42.66
2.90
97.10
91.55
86.32
74.51
64.31
55.51
47.92
41.36
3.00
97.00
91.27
85.97
73.74
63.33
54.38
46.70
40.41
Timing

We are not supporters of market timing, since it is impossible to accurately predict market movements consistently over time. We make no attempt, therefore, to engage in short-term market timing, which we believe is a lottery.

Past Performance

In a recent study of actively managed U.S. funds: – Out of the 687 funds that were in the top quartile as of March 2012, only 3.78% managed to stay there by the end of March 2014.

(Source: S&P Dow Jones Indices LLC. Data as of March 31, 2014.)

We believe that very few funds can consistently stay at the top and trying to pick which ones will be successful in the years ahead is another lottery.

Instead we look to areas or themes that we believe will be successful.

Asset Allocation

Studies have shown that more than 90% of the variability of a portfolio’s performance over time is due to asset allocation. It is therefore really important that an asset allocation best suited to your strategy is adopted.

This is one of the few areas that you have real control when investing.

Diversification Matters

You’ve heard the saying “Don’t put all your eggs in the one basket”. In the investment world that’s summed up as – Diversification.

Why we believe in it?

  • Because diversification reduces risk.
  • Because diversification among assets with low correlations to one another, further reduces risk.
  • Because we have no way of knowing which investments or asset classes will perform well or poorly or when.
Risk Profile

When considering your risk profile, we complete our “NCT” risk assessment.In this process we look at your Need for risk, your Capacity to take risk and finally your Tolerance for risk.

Need for Risk: We analyse the numbers to calculate how much growth is needed for you to achieve your goals?

Capacity for Risk: In this area we consider factors such as your age, the percentage of assets being considered, other risks you are taking and your investment time frame?

Tolerance for Risk – Your personal risk tolerance is determined by your ability to withstand short-term volatility without selling your investments (i.e. your “ability to sleep at night”). For this, we use a Risk Assessment Questionnaire, designed to measure the emotional response to changes in the value of your investments.

Our strategy in creating your ideal portfolio is to assume the minimum level of risk necessary to achieve the required level of return. It is the combination of these three risk factors, Need, Capacity and Tolerance, that determines our recommendation for your asset allocation strategy.

Passive or Active

We believe there is a role for active and passive strategies within a well-diversified investment. Our core approach is to use active strategies or themes to build your investment portfolio and execute these strategies using low cost index funds and/or Exchange Traded Funds.

Costs

We believe that reducing your investment costs through Index Funds and/or Exchange-Traded Funds is essential for your portfolio’s long-term performance.

Review & Rebalance

Finally, we believe that because things change, it’s important to review your investment strategy on a regular basis (at least annually), to ensure that it continues to meet your objectives.

We also believe that an investment should be rebalanced when needed.

Rebalancing a portfolio of funds is simply the act of returning your current asset allocations back to the original agreed allocations.

The primary goal of rebalancing is to focus on minimizing an investors risk by staying within the agreed asset allocations. Essentially, rebalancing helps you stick to your investing plan regardless of what the market does.

Tony Long

Have any question?

Together we will select the right protection plan for you..