What is Investing?


Investing is about understanding your current and future needs and developing a plan (or investment strategy) to put your money to work to create income or grow your wealth.

Setting goals

Setting realistic goals before you invest is very important. Take the time to work out how much you have to invest, why you’re investing and when you need a return.

It’s easier to make decisions about your investment strategy once you’ve established your goals.

We can help you as things change

Your investment needs will change as your life changes. Marriage, a new baby, moving house, an inheritance or a divorce can have a major impact on your lifestyle and financial goals.

We can help you work out the most effective investment strategies so you can:

  • Establish your goals and financial plan
  • Build wealth and accumulate assets
  • Protect and maximise your assets
  • Consolidate wealth for the future
  • Reap the rewards and enjoy the life you want
Contact Us today for help with your investment strategy.
 
        The Key Principals of Investing

Investing can help you to reach your goals, but it can be quite confusing choosing how and where to invest.

When building your investment portfolio, there are five core investment principles to consider. These principles help you make informed investment choices.

1. Know your risk profile

It’s important to understand your personal attitude to money as this will affect how much risk you are willing to take with your investment.

Investing in financial markets always involves some risk as your investments may rise or fall in value. You need to consider whether you are willing to experience ups and downs for potentially greater returns long-term or whether you would prefer slower, steadier growth.

2. Diversify, diversify, diversify

The old saying about not putting all your eggs in one basket is very valid. Spreading your investments across different asset classes (eg cash, fixed interest and shares) and different fund managers helps to minimise risk.  You will find that a diverse investment portfolio will yield relatively good long-term returns with less variation along the way.

Diversifying across asset classes
The performance of each asset class is affected by different factors at different times. This means that although one type of asset may perform poorly during a particular period, another may perform well. For example, property prices may fall while the sharemarket rises or vice versa.

Spreading your investments across the different asset classes helps to smooth your returns.

Diversifying across fund managers
Diversifying across fund managers is another way to reduce your risks in a volatile market. Fund managers have different investment and management styles, which may be more or less suited to certain market conditions.

We have access to a variety of investment options with a range of leading New Zealand and international fund managers.

3. Keep it simple

Always make sure you ask lots of questions so you know exactly what you’re investing in and what to expect from your investment. Making sure you really understand your investment is the key to avoiding disappointment.

In New Zealand, one of the best and simplest ways to invest is through a managed fund.

4. Keep expenses low

All fund managers charge fees for managing your money. What seems like a small amount in fees each year can make a significant difference over time, so it pays to ask your Adviser what the charges are for your investment and compare this with other options.

5. Stay the course

Once you’ve worked through the investment principles above and developed a sound investment strategy, it’s important to stick with it to achieve your goals. Investment markets can climb and plunge wildly in response to economic and world events. History shows the investor who weathers the storms and stays the course will come out ahead in the end.
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