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Some Investments can seriously damage your wealth!

Fiduciary Wealth Team

Were we really surprised when reading through a recent edition of a trade publication to find the following headlines (full names have been removed to avoid embarrassment to either those who have recommended them or clients who have bought their products)?

“B******** suspends entire eight strong fund range, uncertainty in student accommodation market cited as reason for suspension of all funds. Investors advised not to panic as note from B*******seeks to reassure that all funds remain completely solvent.”

“Ernst & Young audit report slams death bonds cheerleader. *** Fund Management a year late in delivering annual report on suspended Life Settlements Fund. Auditors disagree with directors, claiming fund is worth $100 million less than *** valuation.”

“Advisers form ** action group to fight for investors’ interests. Adviser committee formed as Australian ** goes into voluntary administration. At least $ 400 million had been invested in the fund range.”

We are not here to say we told you so but what do all these funds have in common? They are illiquid and speculative investments.

Unfortunately we have come across investors whose total portfolio consists of funds from these three suppliers and you can imagine how these individuals must be feeling at the moment-sick with worry and desperate to find out when and if they will get some or all of their money back.

You have to ask the question why would advisers shun quality funds with long term track records to recommend this type of investment product? Is it in a chase for higher than reasonable returns, following the latest new fangled idea or possibly the chance of greater reward from the product provider to the adviser. What it does suggest is that all concern over balancing risk and reward and constructing a proper investment portfolio which is fit for purpose has gone out of the window.

At Fiduciary Wealth, as you might have guessed, we do things rather differently. Having risk profiled a client and assessed their financial goals and objectives we build an investment proposal using our in house technical know how and using tools such as Bloomberg and Morningstar to assess fund volatility, peer group performance and long term track record. A range of funds from leading fund managers, names such as First State, Franklin Templeton, Pimco, Invesco is put forward to the client and then those positions and funds are regularly monitored. All recommendations are made using the four eyes principle which means that two people sign off any suitability report for a client, and yes the client does receive a written proposal not only outlining the reasons for selecting a particular product or fund but is also fully advised of any charges or commissions that apply.

We know which approach we would prefer if we were investing our life savings or transferring our pension into a QROPS. If you prefer the Fiduciary way why not contact us on +34 956796911 or email enquiries@finduciarywealth.eu to arrange a private consultation with an adviser in your area.