Our investment philosophy is driven by years of academic research and study. At the outset, we aim to take the emotion out of investing.
- Many investors are not aware that two out of three actively managed funds are likely to underperform the market
- Investors are also not aware that timing the market is difficult to execute successfully and can be costly
- Over the long term, those who try to time the market are likely to be less successful than those who simply hold their investments
- Often investors focus too much on trying to pick the right stocks or funds and not enough on diversification and asset allocation
Using the above guiding principles, we have established our beliefs:
1. Markets work
The basic premise that underlies our approach is the belief that capitalism and markets work effectively most of the time. Despite the turmoil in the global economy, capitalism remains an effective process for generating wealth in the longer term and allocating capital to companies operating within it.
2. Diversification is key
Diversification reduces uncertainty. Concentrated investments add risk with no additional expected return.
3. Risk and return are related
Given that it is exceptionally difficult to time when to be in or out of markets, successful investing is founded on structuring and maintaining a portfolio of appropriate market risks.
4. Portfolio structure explains performance
Asset allocation along with size, value and market exposure dimensions primarily determines the results of a broadly diversified portfolio. A diversified portfolio does not guarantee it is allocated effectively.
5. Lower expenses increase returns
The nature of active fund management increases portfolio turnover. Trading costs are not disclosed in annual management charges or total expense ratios. Reducing the cost of the portfolio enhances returns.
6. Fixed-income strategy
Adding fixed income to an equity portfolio reduces overall risk.
Hear from our clients
“During the seven or so years that I have been with Ainsworths, Ian Duffy has been in regular contact. He is keen to ensure that I am getting maximum value and benefit from my investments. I could not ask for a better service. Highly recommended.”
“Having never previously received financial planning advice, I was somewhat sceptical. However, I am now delighted that we had that first meeting. It’s great to have an experienced adviser looking after my portfolio. I can leave it to the expert.”
“As I have been so focused on saving money over the years, it’s refreshing to be told it's okay to spend some! I feel more confident in managing my financial affairs. It's good to know that the same advice will continue over the years to come.”
“We have been very pleased with the financial services provided by Panacea. Their financial experts are very hands-on and take a structured approach to personal wealth management. From the initial analysis of our finances and ongoing needs, through a comprehensive planning process, Panacea have managed our funds well, consistently outperforming alternative services to optimise our financial requirements. We highly recommend their services.”