Investment Investment Process
Investment Process
Please hover over any stage of the investment process diagram to the left and you will see a full explanation of that part of the process displayed in the preview window below.
- TAX WRAPPER
Tax Wrapper is simply another name for product. The most popular products used for investing clients money are Bank and Building Society Accounts, National Savings, ISA’s, Unit Trusts (or OEICS), Bonds (both onshore and offshore) and Pensions. Choosing the most suitable one is an important part of the investment process as it will determine the level of tax your product will pay and/or the level of tax incentives it will receive. It is also an important decision based on the taxation position of the investor. An inefficient tax wrapper simply means giving part of the investment return to the government when it’s simply not necessary. - SELECT SUITABLE PROVIDER
As independent financial advisers we have access to a very wide market place of investment houses and insurance companies. Based on your needs, attitude to risk and chosen investment style we will then be able to guide you to suitable providers that meet your criteria. At Ideal we conduct a quarterly investment meeting on your behalf to review which providers remain competitive and thus are suitable for our clients. - IDENTIFY INVESTMENT STYLE
Here we will discuss the different style of investment that managers use to try and achieve investment growth. Be it an active management style, passive investment style, ethical or any of the other popular methods we will discuss and explain these to you so you can make the choice that you feel most comfortable with, even if it’s a combination of more than one. - CREATE ASSET ALLOCATION MODEL
It’s fairly common knowledge that some investments are riskier than others and it’s also well known that different investment classes perform differently in different economic climates. It’s important to understand therefore how these different asset classes work so we can make sure we use the most suitable ones for the job, and in the right proportion. Putting different amounts of money into different asset classes is called asset allocation and is a very large factor in the variability of a portfolio’s return (variability meaning the different extremes in the rise and fall of an investments value). In fact various studies over the last 20 years or so have shown that asset allocation can be responsible for between 80-93% of the performance variability, with the remainder being down to stock selection, market timing or other factors. - ESTABLISH ATTITUDE TO RISK
Here we will establish, through a psychometric risk profile, the level of risk you are willing to accept with your investments. Knowing the purpose for your investment together with the level of risk you are happy to take means we can then start to structure your portfolio in an attempt to create the highest possibility of achieving your goals within your risk level. Most clients find that establishing their risk profile is always an interesting discussion point. - FACT FINDING
Our first priority is to ensure we fully understand what you want to achieve. We do this by a comprehensive data gathering process to find out the purpose of your investment. Do you need the funds to be available at a specific time? Does it need to reach a certain figure? DO you want your investment to grow above the rate on inflation and, if so, by how much? Establishing your goals and objectives in this way will help us to identify the guidelines for your investment portfolio. - REVIEW
It’s vital to keep an eye on both the performance of the investment as well as the performance of the individual asset classes/funds within the investment. We can review your performance against some set criteria, say inflation or RPI or maybe a specific target you want to achieve at a specific date. It may also be a good idea to compare it with its peers or similar funds in the same sector. This helps to establish whether you’re investment is doing its job. We suggest that you review your investment at least annually and maybe quarterly for funds that are of a larger nature. This stops your investment ‘drifting’ should things not go well in the portfolio and allows you/us to make necessary changes early.
PREVIEW WINDOW
