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Hewison Private Wealth - Insights
Hewison Insights
Portfolio management strategies

There’s nothing boring about a 2000% return

Glenn Fairbairn
Director/Private Client Adviser
6 Nov 2013

At the latest Hewison Investor Insights Seminar, ‘Supercharging Investment Returns,’ Nathan Lear and I provided an insight into the portfolio management strategies and investment principles followed by Hewison Private Wealth.

Failing to plan is planning to fail: One key point highlighted was the need to have a plan. A diligent and disciplined portfolio management strategy involves sticking to your plan and not being swayed by short term uncertainty, paranoia, or sensationalist news stories.

Progressively rebalancing your portfolio back to your original asset allocation is the best possible way to buy low and sell high without attempting to time markets.

Alternative portfolio management strategies involve trying to pick the bottom or top of the market: a feat near impossible to do on a consistent basis. You’ve also got the ‘Set and Forget’ strategy: however there’s a chance here that you may miss out on opportunities.

Invest for the long term: History shows attempts to ‘get rich quick’ through speculative investments on the Australian sharemarket have been an investor’s downfall. In our view, it’s better to invest in high quality assets for the long term.

Take the Commonwealth Bank of Australia (CBA) for example. If an investor was fortunate enough to purchase CBA shares at float for $5.40 back in 1991, they would have received dividends of almost $39 over the past 22 years. This is a return of their initial investment outlay almost 8 times over. Further to dividend receipts, a CBA shareholder would have watched their shares increase by more than 1300%. In other words, a total return of over 2000%

Not a bad return for a boring old bank!

Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email info@hewison.com.au or visit www.hewison.com.auPlease note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.