How to plan your Conservative Client Directed Portfolio
To implement a successful strategy, you can choose from a range of preselected investment strategies to suit your risk profile, or you can choose any investment available on the ASX subject to the limitations imposed by the investment platform.
Many clients tell us “They do not understand investments”, however most investments are just commonsense, and you merely need to understand the risk versus the reward that every investment holds.
For example, if you are conservative, you may be comfortable with a return of say 5% after fees and charges, and further you do not want to take too much risk with your portfolio.
You may layer your portfolio to ensure that you are comfortable with risks attached to your portfolio.
The first layer could be a term deposit – this is the part you do not want to risk losing any money as part of your investment. You can determine the amount to be invested in your term deposit, however we suggest a Portfolio percentage of 50%,
The next layer could be credit funds such as Metric Credits (MOT or MXT) or Gryphon Income Fund (GCI) or Qualitas Real Estate Income Fund (QRI), with returns of about 9% per annum paid by monthly distributions. Portfolio percentage 3 times 15% Total 45%.
The cash layer would be set at 5% of the portfolio value.
On a portfolio of $200,000, you would receive the following returns as at 26Sep24:
Term Deposit of $100,000 | 4.84% | $ 4,840.00 |
Credit Funds MOT, GCI & QRI $90,000 | 9.0% | $ 8,100.00 Estimated |
Cash $10,000 | 3.6% | $ 360.00 |
Total Income | $13,300.00 | |
Advice Fee 1% of $200,000 | $ 2,000.00 $166.66 per month | |
Platform Fee BT Panorama Admin Fee | $ 540.00 | |
Platform Fee BT Panorama Investment Fee | $ 300.00 | |
Platform Fee BT Panorama HIN Fee | $ 300.00 | |
Platform Fee BT Panorama Expense Recovery Fees | $ 40.00 Estimated | |
Total Income less fees | $ 10.120.00 | |
Average return after fees | 5% plus |
Most clients tell me that they are either Conservative or Balanced and they prefer not to lose any money from their investments.
The expectation is not realistic as every investment will carry some form of risk.
No-one can control risk and that is a reality.
What we can control is how much risk we are prepared to accept to achieve what we believe is a reasonable return on our investments.
The higher the risk, equates to a higher return.
With General Product Advice, we can help you select a range of investments to meet both your risk appetite and desire to achieve a reasonable rate of return on your portfolio.
What are the benefits of a Client Directed Portfolio?
- You control the investment selection process with Strategic Advice provided by your financial planner.
- Much lower fees to implement your investment plan and no expensive personal advice fees at all.
- You do not need to disclose personal information about your circumstances as the information is no longer required.
- You can change your investments at any time without any additional advice fees. Brokerage on the change will still apply.
- Client acknowledgement
I/We confirm that we do not require Price Financial Intelligence Pty Ltd (Licensee) to assess the adequacy of this investment in relation to our personal circumstances and acknowledge that the Authorised Representative and Licensee will receive an ongoing a fee for placing these investments.
In providing this service, PFI will be arranging on your behalf as our client to apply for, and acquire, a range of financial products. These may include financial products in the form of a bank deposit account, Managed Investment Scheme, Superannuation interests and securities. PFI holds appropriate AFSL authorities to offer these services.
PFI’s financial product advice is factual information and is statement of opinion on the suitability of a particular investment which may or may not be suitable for inclusion in your Client Directed Portfolio.
In providing general advice PFI, the advice provider does NOT take into account your own objectives, financial situation or needs and you should consider if the advice is appropriate for you before acting on it.