When I spend time with someone like Joel Fleming from UBS Asset Management, as I did while filming our latest TV show, due out in October, I realise just how many ways there are to invest in the world.
Joel manages a microcap fund and tells some fascinating stories of small companies with big ideas. He needs to have his finger on the pulse as it’s his job is to find the right idea and invest before the rest of the world figures out it’s a great investment.
As someone who runs their own business, I can appreciate how interesting it must be to identify good ideas, and even better management teams, to make it in the long term.
It’s not a mainstream asset class, and the fund Joel runs has limited capacity to take investments. It must, by its nature, remain small enough to truly capitalise on performance.
When I explain the concept of microcaps to my friends, most of them become enthusiastic. They can appreciate the nature of the investment.
Interestingly enough however, they’re also curious about fixed income, ETFs and global investing, which makes me realise that most people don’t even understand their full options when looking at investments.
Now, many would say that people don’t need to be experts to hold a good investment portfolio. That it’s the job of the adviser and the fund manager to look after this.
But I believe people will never truly get the most out of their investment strategy, until they at least have a rudimentary understanding of asset classes, diversification, and portfolio construction. I say this because I know if people understand what they’re buying, they’re more likely to make better long-term decisions, and avoid the state of low-level worry so many people go through when it comes to making money decisions.
As more and more people start to inherit money, usually from property that has increased in value astronomically, they need to up-skill their understanding of the investment landscape. This is a crucial time to talk to an adviser, but equally crucial is the need to self-educate. This will allow them to ask better questions, make better decisions and work with an adviser, rather than outsourcing everything with no understanding of what they are buying.
For advisers, the challenge is to direct your clients to non-product flogging, interesting and credible education that will teach them enough to feel they have an understanding, if not a mastery, about investing.
We realise this challenge can be increasingly difficult as many independent blogs and resources advocate that you don’t need an adviser.
We believe wholeheartedly in the value of advisers and the advice they give on an ongoing basis. Which is why we have created our client resources section for advisers: to share information for leading fund managers and commentators that are not about selling, but rather about educating.
We understand video can be expensive for advisers to make on an ongoing basis, which is why have used our economies of scale to provide it from our resource set.
If you want to check out our every growing client library you can access it here.
Education is everyone’s responsibility. We are happy to be part of the solution.
The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice or its related entities. All content is intended for a professional financial adviser audience only and does not constitute financial advice. To view our full terms and conditions, click here.
