For many investors the past few years have demonstrated how flawed investing money can be.
The whole process of investing has it seems come under question.
The reason being that markets have not performed to investors liking in recent times and in a modern world it seems that some of the more established investment practices simply fail to work. Perhaps they have been exposed by the turbulence of recent times.
Investing became simple during the 1980’s and 1990’s. All one had to do was place one’s money in the market and it tended to go up.
There were very few assets that didn’t rise throughout this period. Property and shares were the main areas where people were investing, creating profits simply by being involved. The actual extent of any money that was made was - to a large extent - irrelevant and investors did not necessarily pick up on the fact that underperformance was often occurring within the investments they were making - because they were going up so much. The fact they weren’t going up as much as they possibly could was not a great concern to the average investor.
Study after study show that something around 80% of all funds under-perform the market on a consistent basis. This begs the question ‘why bother investing in a fund?’ It is actually quite a difficult question to answer. There are reasons why funds are useful to investors in certain situations but fundamentally people are using funds for convenience rather than any other reason; because they could be getting better returns by NOT using funds in most cases.
The big difference today is that we’ve been swimming around in the sea and suddenly the tide has gone out and we can see who has been swimming naked. The fact is that the conditions of the last 20-30 years have engendered an investment process which has probably worked by default.
Our intention is to examine that process and to put that into some context with a view to seeing how that process stacks up today.
We then wish to look forward and put forward an alternative process which we call ‘Investing – the New Way’. This new process is intended to be more robust, more results focused, more risk protecting. In every respect we believe that the process that we are putting forward is a better process and we would encourage investors to investigate and use this process for their own benefit.
