The recent volatility in equity markets should serve as an opportunity for financial advisors to assess the resilience of their clients’ investment portfolios against future market downturns.
It’s almost impossible to consider investing in an asset class without touching on the subject and relative merits of active versus passive products. Ultimately, there is no ‘right’ answer, as it will depend on each investor’s own circumstances.
“The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood… Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.”
There’s no denying the attraction investors currently have to ETFs. Market growth continues to surge (up to nearly $10 billion in late 2013) and as new products are launched, growth shows few signs of slowing.
The beauty of compounding is that while growth initially adds only small amounts to an investment, returns soon accelerate because you are compounding growth on larger and larger amounts, writes JD de Lange, Head of Retail, Allan Gray.
Prepare your clients and yourself for reporting season by reviewing the cash position of the companies in their portfolios, says Skaffold’s general manager, Chris Batchelor.
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