Buying Opportunity … for Investors

One of the most successful investment strategies over time has proven to be working to a plan – a strategic plan – and to support that tactically with buy or sell activity to take advantage of market volatility, fear or exuberance. Wealth management, whilst strategic can also be opportunistic – but needs to be to a plan.

We have recently published an article dealing with the basic key elements in considering acquisition of an investment. That article talks about security of capital; security of the income stream flowing from an investment; and liquidity – the ability to dispose of the asset for cash at a time when higher priorities arise (or are imposed) and concludes that the market situation prevailing at the time of writing may well be presenting a buying opportunity.

Seasoned investors will be aware of a contrarian approach to the buy/ sell decision-making process and will recognise that buying when the inexperienced investor is in deep panic selling; and selling, when the inexperienced investors are buying with gusto has proven a useful strategy by which to increase the growth of their portfolio.

Market circumstances prevailing during this third quarter of 2011 are demonstrating the ‘deep panic selling’ characteristic and should be heightening the interest of investors who have a longer-term strategy to guide their activity in the marketplace.

In recent articles we have referred to a 2010 survey that showed that investors who take advice from a financial planner are generally more comfortable about their investments; sleep more comfortably at night than their colleagues who use DIY processes; and actually attain a higher average return on their investments. Continuum Financial Planners develop personalised wealth management strategies for clients who appreciate that ‘we listen, we understand and we have solutions’ when engaged by investors to develop strategic financial plans.