Tending your portfolio will make it bloom

All successful gardeners will understand the need to regularly tend their plants, shrubs  and lawns in order to ensure a garden can flourish. And, for investors, taking a similar approach with their financial affairs can also bear fruit by ensuring their investment portfolios don’t become neglected and, as a result, underperform.

Weeding, sowing…

As with a garden, your investment portfolio requires regular careful attention in order to ensure it continues to grow. Typical tasks include weeding out any perennially underperforming funds and switching to potentially more profitable ones and, for those with new money to invest, sowing the seeds of your portfolio with carefully selected additional new investments.

…pruning and trimming

Another important task is pruning. This will ensure your investment portfolio stays balanced and continues to fully reflect both your current and long-term financial goals as well as any changes in your appetite for risk. Tending your portfolio will make it bloom It may also require taking profits at certain points in time to ensure you are using any potential tax allowances.

However carefully your initial range of investments were selected, your portfolio will also inevitably get out of shape over time. This creates an ongoing need to regularly review the allocation of different asset classes, such as cash, equities, bonds and property. And such a review may result in the trimming back of certain assets in order to restore balance to your portfolio.

Help is at hand

Many people now seek professional help to create and maintain their garden and it’s obviously wise for investors to do the same thing. Indeed, with ongoing political and economic uncertainties causing increased market volatility, there has arguably never been a more important time to seek professional financial advice. Keep in touch, so that we can help you keep your investment portfolio in full bloom.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.

It is important to take professional advice before making any decision relating to your personal finances. Information within this newsletter is based on our current understanding of taxation and can be subject to change in future. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK; please ask for details. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. If you withdraw from an investment in the early years, you may not get back the full amount you invested. Changes in the rates of exchange may have an adverse effect on the value or price of an investment in sterling terms if it is denominated in a foreign currency. Taxation depends on individual circumstances as well as tax law and HMRC practice which can change.

The information contained within this newsletter is for information only purposes and does not constitute financial advice. The purpose of this newsletter is to provide technical and general guidance and should not be interpreted as a personal recommendation or advice.

The growing appeal of multi-asset funds

It’s no secret that, in recent times, a combination of geopolitical uncertainties, weaker growth and increased volatility has heightened awareness of risk amongst investors. And this, in turn, has sparked fresh interest in multi-asset funds, as investors try to manage risk and protect capital whilst also seeking growth opportunities.

Why invest in multi-asset funds?

Multi-asset funds invest in a combination of asset classes, which typically include equities and bonds, but can also cover a wider range of assets such as property and commodities. Their appeal is that they provide diversification and thus ensure investors ‘do not put all their eggs in one basket’.

Surge in sales

Increased interest in this sector has fuelled a surge of new money into existing funds and a flurry of new fund launches too. According to Morningstar, there are now 1,027 UK domiciled multi-asset funds, while Investment Association data shows the mixed-asset sector was last year’s bestselling asset class with net retail sales of £7.9 billion.

While the wide choice of funds is clearly great news for investors, it has enhanced the need to seek advice.

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