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October 11, 2016 | The Insatiable Hunt for Bigger Returns

Adrian Mastracci

Adrian Mastracci, Discretionary Portfolio Manager, B.E.E., MBA. My expertise in the investment and financial advisory profession began in 1972. I graduated with the Bachelor of Electrical Engineering from General Motors Institute in 1971. I then attended the University of British Columbia, graduating with the MBA in 1972. I have attained the “Discretionary Portfolio Manager” professional designation. I am committed to offering clients the highest standard of personal service by providing prompt, courteous and professional attention. My advice is objective, unbiased and without conflicts of interest. I’m part of a team that delivers comprehensive services and best value in managing client wealth.

Savers have endured eight years of low returns.
Borrowers have enjoyed avalanches of low rates.

Current portfolio returns don’t satisfy investors.
Even though many market indices are near their highs.

At the same time, demand for safe investments is through the roof.
The old adage of seeking returns with no risks lives on.

There is one important discussion too often glossed over.
That is, the risks incurred deliver your investment returns.

Revisiting some realities of investing is a worthwhile exercise.
Consider these pointers:

Patient investors are rewarded over the long run.
Nobody knows what happens next.
Fixating on daily headlines takes your eyes off the ball.
Wise investors assume low return environments linger on.

Slowing global growth continues unabated.
Dynamics of oil demand resembles a roller coaster.
Quarterly earnings and future prospects are being unveiled.
US Fed has fewer tools left in its toolbox.

Long term investing plans typically cover at least five years.
Always think logically and don’t get emotionally attached.
Sticking with quality investments is a prudent approach.
Timing the markets is a low percentage strategy.

These are steps I prefer to mull over:

Focus on controlling market risks the portfolio incurs.
Asset allocation delivers the biggest portfolio impact.
Rebalance the portfolio when funds are added or withdrawn.
Contemplate how to invest during market corrections.

Don’t dwell in the rear view mirror.
Be mindful of how desired returns affect investing styles.
Treat volatility as potential opportunity.
Keep readily available cash for periodic purchases.

In summary:

Sensible approaches are best to guide the nest egg throughout the long haul.
Understand personal needs to preserve and grow family capital.
Make portfolio decisions based on available data.
Long term patience is strategy that moves the needle forward.

Hunting for bigger returns increases your exposures to market risks.
Aim for modest long term returns in the 3% to 5% ballpark.

Be pragmatic.
Ensure your game plan matches the target risk/return aspirations.

Regards,

Adrian

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October 11th, 2016

Posted In: Adrian Mastracci Blog

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