A panacea to all our financial woes!
The simple answer is “long-term investing”. It sounds too simplistic, but when accepting the longevity of the investment cycle (naturally advocating affordability) using the twin forces of time and compounding, the inevitable truth is there is no better place for return on capital than the financial markets. Time and compounding are far more powerful than any analysis, economic forecast or trading strategy.
A good eye for investing
Yes, it’s true you have to obtain good sound advice in stock picking over the long term. Take our friend, the industry guru Warren Buffett as an example: in April 1980, if you’d invested $10,000 (round numbers) of available cash and bought 40 shares (shares were trading around $275 at that time) of Berkshire Hathaway stock, today those 40 shares are worth (as of October 10 2014) over $205,000 a share. A cool sum total of $8,200,000, that’s an 82,000% gain over 33 years.
Ok, I hear you say: “Let’s not forget that Berkshire Hathaway has been a phenomenal success story.” Let’s take a broader picture as opposed to a single company share performance. So, let’s analyse the UK Financial Times top 100 companies as a base measure but keeping to a similar time frame.
In 1984 the UK stock exchange launches FTSE 100
FTSE 100 index – the Footsie, as it is colloquially known – was introduced on January 3, 1984 with a base value of 1000 and is the most widely monitored barometer of UK equity market. The FTSE 100 index comprises the 100 largest publicly quoted companies in the UK, many of which are multinationals, and represents about 80% of the All Share index by market capitalisation.
Taking the same $10,000 and investing it in an Index Tracker Fund (unfortunately these index tracker instruments were not around at that time), and assuming the fund tracked and reflected 100% of the index performance, the return would have been circa 620% increase (at the closing bell on Friday October 10). One issue with index tracker funds is that there is a potential mismatch between the liquidity offered to investors and the liquidity of the underlying investments represented by the index.
A long term approach to equity investing with sound advice
The epicentre is sound advice. So suffice to say that should one have the good fortune to invest in the stock market over a protracted period, it’s fair to assume that the returns would outperform most other forms of investment vehicles!
Now, to find sound financial advice with an unassailable track record spanning centuries is the $64,000,000 question. Fear not, amongst the very few there is a British company that has survived the test of time (older than USA) and since inception in 1771 has provided financial advice to private individuals. Quilter Cheviot – one of the UK’s largest and independently owned discretionary investment management firms.
Recognising Quilter Cheviots’ preeminent financial history, The Blacktower Group are proud to launch the Nexus Global Portfolio Range of funds and has selected Quilter Cheviot Investment Management to craft a unique offering with wealth preservation and capital growth at its core.
Encapsulated sound advice
David Miller is the head Fund Manager for the Nexus Global Portfolio Range of Funds. He has appeared on the BBC, Sky, CNBC and Bloomberg. In addition, David has won the 2013 City of London Wealth Management Award for best performing fund and recently won Best Industry Commentator at City of London Wealth Management Awards 2014.
With “Sound Advice” from a renowned industry expert at the helm of the Nexus Global Portfolio Funds, David Miller will help to ensure investor confidence.
The unpredictable events of late can have a negative impact on investor confidence however; short term declines should not detract from the long term potential of stock market investing as highlighted above.
For more information on Nexus Funds, please contact Antonio Rosa, Financial Adviser at Blacktower Financial Management (International) Ltd. Edificio Jomavipe, Rua Cesaltina Fialho Gouveia 703, Cascais.
Tel 214 648 200
Mobile 911 518 461
Email [email protected]
By António Rosa
Blacktower Financial Management (International) Ltd is licensed by the Financial Services Commission in Gibraltar. Licence 00805B. Blacktower Financial Management Ltd is authorised and regulated in the UK by the Financial Conduct Authority.