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Call Richard Cook: 07770 575 122

email: richard@theinvestmentandretirementcoach.co.uk

BREXIT DANGERS – Think about reducing your investment risk!

How I changed my investment strategy

Don’t panic. I have not made wholesale changes but I have made some precautionary changes, mainly to reduce risk a little.

First a disclosure. I am no longer a regulated Financial Adviser so nothing which follows should be taken as personal advice. However I was a regulated adviser for more than 30 years so what follows is based on many years of experience in guiding clients through their investment strategies at times of uncertainty, oil crisis, dot com crashes, recession, and goodness knows what else. What is slightly different this time around is that I am semi-retired and drawing on my pension fund so this is no longer theory. It is what I am doing to protect myself.

Until ten days ago I was comfortable that a “stay in” EU referendum result was likely which would probably mean the return to positive stock market performance, not forgetting the inevitable daily fluctuations. Today I am much more nervous about the outcome regardless of what the polls and bookies tell us.

So what am I doing about it?

Let’s go back to the starting point for all sensible investment strategies.

NO FUNDS TO WHICH YOU MAY NEED TO ACCESS WITHIN THE NEXT TWO YEARS SHOULD BE EXPOSED TO STOCK MARKET FLUCTUATIONS.

That is the number one risk control strategy.  So my first step was to check that my cash reserves were still adequate – and I have gone beyond that by moving the time scale out to three years.

Secondly I have looked at my pension fund and made absolutely sure that I will not need to sell any equity type funds to fund my planned withdrawals for three years (also up from two years). If you are selling funds every month to meet income needs you are in a high risk situation whatever your adviser tells you.

Thirdly I have looked at my overall strategy and monitoring process to make sure everything else is working as it should do.

I still expect clients to ask me:

if you are that nervous why don’t you move everything back into cash?

The answer is that I am still a firm “buy and hold” advocate. Making a decision to put everything in cash is easy. What is far more difficult is making the re-investment decision when everyone around you is full of gloom and despondency.

Those few clients who over the years have insisted on selling everything when things were looking bad have finished up losing money. Why? Well the answer is they have only re-invested when their confidence has returned – without exception, at above the level at which they sold.

Those of you who read my regular blogs know I have one primary message.

pay-attention-its-your-mone

This, I think, is just one of those “pay attention” times. Not massive risks but you may need time on your side whichever way the vote goes. We could be in for a period of uncertainty and there is nothing stock markets hate more than uncertainty.

So just take the time to make sure you don’t have short term money exposed to stock market fluctuations. If you are paying annual fees to a financial adviser ask what he/she thinks and if you don’t get a good answer ask yourself, what am I paying for?

Once again this is not personal advice. However, if you would like a little more guidance or would like someone to talk your situation through with please pop your details in the request more info box or phone me on 07770 575122.

I would love some feedback. Sometimes I think I must be talking to myself and then someone says something which shows they have been paying attention and it’s all worthwhile.

 

IMPORTANT INFORMATION
This document and our on going services are not personal advice. We'll give you all the help and guidance you need to make your investment and retirement decisions, but we can't advise you. If you're not sure whether you need regulated financial advice we can put you in touch with a suitably qualified and experienced regulated adviser. Because we are not regulated by the Financial Conduct Authority you will not have access to the Financial Ombudsman Service in respect of any complaints. If you use one of the "no advice" on line services to handle investment transactions they will be Regulated and you will have access to the Ombudsman and The Financial Compensation Scheme in respect of their services. The value of investments/pension plans can fall or rise depending on market performance. The Retirement Team and The Investment and Retirement Coach are trading names of Capture Success Ltd Reg No 01825075 Tel 07770575122

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