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Flying Colours Investment Videos - the latest commentary on markets, investment portfolios and global economics hosted by Guy Myles
This month I'm going to provide my views on ethical, or ESG, investing because every year we see more interest in it from our clients, and it's an area that is getting a significant amount of press, due to the focus being placed on it by both Governments and regulators. The key issue with any ESG investing is that you naturally reduce the range of investments you can make in order to achieve the desired societal impact, but this can lead to low levels of diversification and higher levels of risk. Therefore, it is important that that is managed, as poorly managed risk can lead to bad outcomes and harm.
In part 2 of this two-part series, I consider what could happen if the Global Markets decide to allow inflation to remain high and focus instead on driving growth.
The last 40 years has been a great time to be an investor. Most asset classes, whether equities or bonds across the world, have tended to go up. In retrospect it's been a simple time. However, in the last two years we've seen the beginning of inflationary pressure which threatens this comfortable environment. The primary reasons for the increases in inflation have been shortages of commodities, a stagnation in population growth, global conflict and of course rising interest rates.
In this month’s video, I review the first quarter of 2023 for clients invested in the Flying Colours portfolios. I highlight the differences between the expectations of stock market investors and bond market investors, and what that means for the portfolios. I also look at a special topic with a review of property investment. Many clients ask us about Real Estate and ask why we don't hold it in portfolios or tend to recommend it outside of portfolios.
Many market commentators and journalists are expecting the world to avoid recession. We see evidence which disagrees with this prediction, and in today’s video I'm going to explain why. Despite feeling negative about the economy, we still expect that our portfolios will do well over the next three to five years. In addition, I’ll explain how looking at earnings yields can give you more confidence in the outlook.
Despite concerns over the direction of inflation and whether a recession is likely this year, we believe we have reason to be optimistic when it comes to your investments in Flying Colours portfolios. In this edition, I explain why.
Bonds are an important asset class in our portfolios and represent over half our assets at this point in time. Equities might get the most attention from a performance point of view due to their volatility, but the portfolios depend on bonds for returns and long-term risk control. This month I talk in detail about the bonds we have invested in for client portfolios and how we expect these to perform over time.
Most people reading this will know that we have been planning for 2022 to be a difficult year. Knowing this could happen ahead of time has meant all of our clients are doing much better than the peer group and average. We want to reassure you that we were prepared for weakness this year and we have a plan that is agile enough to move with the changing markets. In this video I will explain our expectations and what we will do about it.
In recent months, I've talked a lot in these videos about the problems that I see we see in the macroeconomic background, the economies, the investment background, and why, as a result of all of that, we're being quite defensive in portfolios. Now the insights that we have have really helped us this year, but they've helped us in terms of having lower losses than our competitors. But we are also implementing a framework to stay on top, even in today's environment, to ensure that we can make you the returns that you expect.
Over the last 30 years trade has grown tremendously, driven by countries like Germany, Japan and China, who deliberately favour exports over consumption. This has led to large trade surpluses and knock on effects that have impacted our lives. In our opinion we are transitioning to a less globalized world and it is going to be difficult. This is one of the reasons why we are defensive in our portfolios. We expect markets, at some point, will give us a great opportunity to increase risk at attractive prices.
Duration is the measure of the number of years of cash flows from an investment it requires for a buyer to get their cost of investment back.Generally the longer the duration of an investment the higher the risk. We know that we can only make returns by taking risks, but timing which risks to take, and when, is crucial. Our analysis tells us it is better to have low duration in portfolios today and we have benefitted greatly from that recently.
Guy Myles focuses on the Russian Ukrainian war and what it means for investors and portfolios. The immediate impact we've seen is all Russian securities that we hold in our funds with the bonds. All equities have been marked down to zero that's led to about 0.2% reduction in value in some of our portfolios and a little bit less in some others, so meaningful, but not that significant, the much bigger impact are the sanctions that have been put in place in Russia.
This month's email has a high-level review of the last two years, which is provided to give a better understanding of where we are today. It also focuses on an outlook for 2022 and what we think the coming 12 months has in store for investors. This video and editorial were produced before the onset of the Ukrainian crisis.
Guy Myles talks about his personal experience of how being an over-cautious investor can be as damaging as a high risk investor and offers a way of thinking about a balanced approach to investing. Capital at risk.
One year on Guy Myles reviews investment portfolio positions and investment decisions taken at the start of the global pandemic and how these strategic predictions have evolved - with surprising accuracy. A current update on the global economic conditions takes further expectations into account as Guy presents four major global economic factors impacting investment decisions going forward. Capital at Risk.
Guy talks in detail about two common misconceptions around inheritance tax planning and why it's better to take a holistic approach to IHT. Capital at Risk.
In discussing how to research and find the best fund, Guy presents three fundamental ingredients to fund management and investment. Capital at Risk.
Guy talks about why US and UK investments differ and why UK investments in the next 10 years are worth remaining committed to, and in contrast why US investments may experience reductions in a previously successful climate.
Passive investing can work really well, but there are situations where it doesn't work very well. Some of the risks around passive investment are very poorly understood. Guy Myles explains why.
In this video Guy Myles talks about why pushing higher risk investments within portfolios can be more damaging to your retirement and pension plans.
The recovery from Covid has led to some major moves within markets that are not seen by most people. This creates some risks and opportunity. To take advantage of this we suggest using ‘value’ style stockmarket investing and reducing high yield bond exposure. Put simply, value investing is a strategy that attempts to find investments that are trading for less than their intrinsic value. Some things that happen within a portfolio, behind the scenes, are very important to risk and return but pretty much invisible to most investors.
It isn’t hard to see problems in the world right now but for once the mainstream news doesn’t seem to be exaggerating. Today’s video is going to discuss what we think the problems will be for investors beyond Covid as well as some suggestions for how to handle them.The big areas of concern are: 1/ Rise of China 2/ Global debt 3/ US political risk 4/ Potential debt crises in the EU
Guy Myles talks about the significant changes in the global economy, the impact of Covid-19, China and inflation and discusses what changes are likely to take place.
Guy Myles talks about how Flying Colours Life have invested over the past 5 years in order to out-perform during the rising market, fall less during the COVID crises and bounce back better following. The FCL Investment Management team continue to drive investments based on a clear strategic approach.
Flying Colours Life presents an overview of financial investment fund performance, why it's important and 'how we do it'. FCL fundamentally believe that any financial investment or fund management is best approached by some key principles. Guy Myles talks more about the why's and how's to help you protect and maximise your investment potential.
Watch the latest investment videos, hosted by Chief Investment Officer, Guy Myles.
A brief overview of Flying Colours Life response to the financial crises following the onset of the COVID-19 pandemic. FCL has remained in a steadfast position and performed well despite the falling markets.