Investment Portfolio Management

Whether investing a lump sum or saving on a regular basis every individual will ultimately have their own financial goals and objectives. To achieve your goals, it is important a clearly defined strategy is implemented that considers your current position and looks to the future. Your SIP Wealth Management adviser will identify and analyse your current position and will then collectively recommend the most suitable financial plan for you.

A suitable financial plan will be different for every individual as we all have different levels of acceptable risk, which will ultimately determine our goals. Your SIP Wealth Management adviser will discuss with and assist you in establishing your risk criteria. Once your risk criteria have been identified, the next stage is to establish how your financial and strategic objectives might be achieved. Your SIP Wealth Management adviser will fully review and evaluate your existing arrangements and will then formally propose your individual financial plan.

Once a financial plan has been implemented it is important this is reviewed on a regular basis, as life is full of surprises. Our service proposition allows you to choose the ongoing service level you require; this allows your SIP Wealth Management adviser to adapt your financial plan to encompass the changes in life we all experience.

Core Elements of Portfolio Management

Effective portfolio management requires consideration and management of all the following:

Asset Allocation
It is vital in the portfolio management process to consider the mix of assets held. Whether the portfolio consists in majority of funds invested in equities, fixed income securities or a mixture of both, the allocation of assets is key to determining the risk level of the portfolio as well as the expected return. A portfolio constructed using mostly equity invested funds would be considered relatively risky, while one with a focus on bonds and other fixed income securities would be considered low risk. Blends of these can be constructed to create optimal potential return for the desired risk tolerance.

Active Portfolio Management
There are two main types of managed funds which you may find in one of our portfolios. The first of which is what is known as an actively managed fund. Managers of these funds are decision makers who utilise investment strategies to attempt to outperform a designated index, such as the FTSE 100, the FTSE 250 or the S&P 500. These managers use detailed research, expertise and speculation to tailor their funds in such a way that finds the winners of the market and includes less of the losers. While this sounds great in theory, it is not all plain sailing. This is because the fees are generally considerably higher than the alternative passive funds and most active fund managers do not actually achieve their intended outcome of beating the market. However, those that do, can do so by quite a considerable margin.

Passive Portfolio Management
This form of asset management refers to the strategy employed whereby a fund aims to track or replicate the return of a specific index or benchmark. Unlike active managers, these managers do not do deep levels of research, instead they invest in the same securities included in their specified index and weight their basket of investments to match the index.

Many client’s investment will be different as everyone has their individual needs and attitudes when it comes to their investments; as a result, the make-up of our portfolios will differ on whether we focus on actively managed funds or passively managed funds, as well as the constructed asset allocation.

Independent Financial Advice

The success of investment management lies in determining the right balance between risk and return. Your SIP Wealth Management adviser will fully assess all your current assets and provide a full appraisal on suitable solutions to aim to help you to achieve your financial goals. Your SIP Wealth Management adviser is completely independent therefore has the whole of the market to choose from.

Achieving your objectives is likely to involve utilising several different investment methods, whilst ensuring maximum tax efficiency.

Examples of some of the investment structures offered are:

• Examples of some of the investment structures offered are:
• Unit Trusts
• Investment Trusts
• Open Ended Investment Companies (OEICs)
• Offshore Investments
• Capital Investment Bonds (Onshore and Offshore)
• Structured Products
• Enterprise Investment Schemes
• Venture Capital Trusts
• Individual Savings Accounts (ISAs)

SIP Wealth Management also work closely with several leading Stockbrokers and Discretionary Fund Managers (DFMs) and are able to continually review and monitor share portfolios. The precise structure or combination of structures depends on your aspirations, limitations imposed and tax status.

Most of these contracts are excellent in their own right, however, are they suitable for you? It is important during the review process to take into consideration your accepted attitude to risk and investment timescale. In determining your investment approach and acceptance of risk, it is essential to consider the volatility and level of risk associated with an investment.

SIP Wealth Management utilise a risk profiling system allowing your attitude to risk to be clearly identified and to ensure we find the right product for you. Your advisor will discuss this area with you at your first meeting.