How we manage your portfolio
At Credencis we understand that everyone is individual.
Through in-depth fact-finds and risk questionnaires, we get to know your circumstances, understand your aspirations, and help you think about your attitude to risk. This means that the investment portfolio we build is individual to you and aligned to your long-term goals.
We review your investments regularly to ensure they are on track and will rebalance them if needed. Our hard work doesn’t stop at retirement either. We can help you manage your invested funds through both the accumulation and the decumulation phase of your retirement.
Understanding your attitude to risk
The years leading up to your retirement are the “accumulation phase”. With your goal still some years away, you might consider taking a higher amount of risk, building up returns that can be consolidated as you approach retirement.
We will work with you, helping you to build the right portfolio for you. Before we can do that, you’ll need to think about these three important questions:
What are your long-term goals?
What timescales are attached to these goals?
What is your attitude to risk?
The answers to these questions will be strongly linked.
Your goal is your desired lifestyle in retirement, and only you know what that looks like. Your retirement date dictates the length of the investment and the further away that is, the more risk you might be willing to take.
Building your portfolio
A successful investment strategy focuses on attaining your goals. That doesn’t mean chasing large, high-risk returns, and we won’t expose your funds to risk unnecessarily.
The investment portfolio we build for you will comprise a mixture of equities, cash, and fixed-interest bonds. This is your “asset allocation” and each asset class carries its own level of risk.
Government bonds, for example, are effectively loans to the UK government and are considered low risk, whereas shares might be medium or higher risk.
Asset allocation is a type of diversification that we use to spread your investment risk, protecting your money from a fall in one asset class by offsetting it against a potential rise in another. The asset allocation we choose will be based on your individual profile.
We diversify your portfolio in other ways too.
By investing your funds in different sectors and industries, and in different parts of the globe, we spread your investment risk further. A fall in value for one sector or region won’t necessarily mean a matching fall in your investment because rises could be occurring elsewhere.
By getting to know you, your circumstances, and your aspirations, we at Credencis can build a portfolio that aligns with your attitude to risk and that is designed specifically to achieve your long-term goal.
Managing your portfolio
Stock market prices are changing all the time. That is why we conduct regular reviews, ensuring your investment is still on track.
While your portfolio might start with the “optimum mix” for your circumstances, rises and falls of the market can shift it off balance. Whether the shift is caused by assets gaining or losing value, it is important to remain focused on your investment goal and that might mean rebalancing.
If your portfolio contains 70% equities and 30% bonds, for example, any rise or fall across the markets that alters this balance will need to be addressed. This might mean selling some assets that are performing well, to buy more of an asset that is currently undervalued.
Rebalancing isn’t about achieving higher returns but keeping you on track over the long term.