Our Investment Philosophy

1. Capital Markets Work

We believe that capital markets are pretty efficient. Every day, global equity and bond markets process billions of dollars in trades between buyers and sellers. They’re not perfect but generally do a good job of fairly pricing assets, most of the time.

2. Consistent Outperformance Is Rare

It’s difficult to consistently beat the market, and there is overwhelming evidence that the vast majority of active managers don’t. We prefer a mainly passive-based investment approach, one that largely tracks the market, but with a ‘tilt’ towards certain ‘factors’ (see point 6).

3. Asset Allocation Is The Key

The most crucial factor determining portfolio returns and the variability of those returns is asset allocation, i.e., the split between equities and bonds, and the geographical spread within these. And these should be rebalanced in a consistent manner- driven by market movements.

4. It’s Time In The Market, Not Timing The Market

The financial markets have rewarded long-term investors and we see no reason for that changing. Time in the market is key and far more impactful than trying to time market entry and exit.

5. Costs Matter. A Lot

Costs reduce an investor’s net return and represent a hurdle for a fund - before it can add value, the fund must first cover its costs.

Sadly, most professional fund managers fail to add value and high cost has been a strong predictor of poor fund performance.

And Finally…..

6. There’s Good Risk And Bad Risk

Within the equity asset class, there are higher-risk sub-classes (aka. ‘factors’) that should, over time, compensate investors with higher returns. 

We advocate portfolios that mainly track the market, but with a ‘tilt’ towards small caps, value stocks and consistently profitable companies.

We can’t say whether now is a great time to invest or not. And we can’t predict the ‘next big thing’. Instead, we focus on what we can control:

  • Creating an investment plan to fit your needs and risk tolerance.

  • Structuring a portfolio that is positioned to capture long-term returns.

  • Diversifying globally.

  • Managing costs, turnover and taxes.

  • Staying disciplined through market peaks and troughs.