Portfolio Management

At Dobbrick Financial Services we design and manage portfolios with your individual requirements and objectives in mind.

This means your investments are handled in the most efficient manner possible and ensures your goals are met. We provide the people, tools, and methods you require to effectively manage your investment portfolio.

Your portfolio manager keeps abreast of the changes in the investment market, saving you the trouble of doing the research yourself and you maintain control of your investments while eliminating unnecessary risks and delegating the everyday tasks and complex decisions to your experienced investment manager.

Portfolio Management made easy!

How do I know which investments are right for me?

Your asset mix should:

  • Help you balance risk with your expected rate of return on your investments
  • Fit your comfort level for risk
  • Enable you to get your money when you need it
  • Help you get the growth you need to reach your goals
  • Change as your needs and goals change over time.

Your age and life situation can play a big role in your choices. If you are about to get married, you might need your money to buy a home. If you’re in your 40s, you may be saving for retirement or your kid’s education.

We’ve created some sample asset mixes to show you how some people invest at different stages of life. Note that personal factors will help you determine the amount of risk and the mix of assets that would work best for you.

If I am in my early working years, what investment mix may be right for me?

If you’re just starting to work, you may not have a lot of savings. Still, time is on your side. For this reason, many people at this stage are willing to take more risks when making long-term investments.

If I am in my middle years, what investment mix may be right for me?

You may be earning more than ever, and you may also have a lot more responsibilities, including:

  • Children to support or help through school
  • Saving for retirement
  • Debt

Some people are in second marriages with younger children or they may have lost a spouse and be on their own for the first time in many years. If this is you, you may want to shift your investments more toward safety.

If I am in my retirement years, what mix of investments may be right for me?

Older investors usually move their investments gradually over to safer, guaranteed investments. They want to protect their savings because they’ll need to live on their investments after they retire. They may also prefer investments that create a steady, reliable stream of income.

Risk and return

Your portfolio is usually invested in financial markets, and therefore you are exposed to investment risk.

What is investment risk?

Investment risk is the degree to which returns go up and down in value over time. You cannot consider return without risk and, generally, the higher the potential return, the higher the risk.

How can I get higher returns?

In order to achieve higher returns, you must be willing to take on more risk. While shares, property and fixed interest securities historically offer higher long-term returns than cash, they also expose you to higher levels of risk, particularly in the short term. The variability of returns is a risk associated with investment and the assets that offer higher potential returns generally have the highest fluctuations in returns. The assets that have lower risk (and lower potential returns) generally have less pronounced fluctuations in returns.

What if I choose low risk options?

In financial terms, there is also a risk of not having enough assets or money to provide you with the lifestyle you desire in retirement. Therefore, if you try to avoid investment risk altogether, you may have to save more for your retirement.

How much risk should I take on?

Your tolerance to risk is an important factor to consider before making your investment choice. Everyone has a different tolerance to risk, and you need to be comfortable with the level of risk that is associated with the investment option or mix of investment options that you choose.

The risk/return profile of each of our investment options is determined by the percentage allocated to growth assets relative to defensive assets. The greater the proportion of growth assets, the riskier the investment becomes and the greater the potential return in the long-term.

If you want to talk to an expert about Transition to Retirement, Salary Sacrificing or superannuation in general, contact us.

A Dobbrick Financial Services Financial Planner will:

  • Summarise your current financial position and future goals;
  • Analyse any taxation or superannuation laws, or Centrelink rules that will apply to your situation;
  • Recommend investments that will help you achieve your goals;
  • Explain what you need to do next;
  • Highlight any fees payable;
  • Create a framework for future financial decisions and show you;
  • Provide advice how you can still earn a regular income once you’ve retired;
  • Recommend suggestions on how you can reduce your tax payable;
  • Explain how you can top up your income with Centrelink benefits; and
  • Provide insights on how to maximise your super – even after you’ve retired.

Managed Funds

A managed fund is a professionally managed investment portfolio that individual investors can buy into, purchasing ‘units’ rather than shares. Each managed fund has a specific investment objective. This is usually based around the different asset classes (cash, fixed interest, property and shares). The money you invest is used to buy assets in line with this investment objective.

When you invest in a managed fund, you are allocated a number of ‘units’. The value of your units is calculated on a daily basis as the market value of the assets in the fund rises and falls.

Direct Shares

By investing in shares directly, you have complete control over where, and in what quantity, your money is invested at all times. The spread across stocks, or asset classes, can be entirely customised to suit your personal investment needs. On the downside, you as an individual investor, will have to take care of the legalities of investing, as well as tax reporting and account keeping. As an individual it is likely that the amount of money you have to invest is limited and this may mean that you cannot achieve an effective diversification to reduce risk or raise returns to your satisfaction. The extent of your personal knowledge is not as deep as the combined resources of a managed fund team of financial advisors and investment managers.

Fixed Interest Investments

Fixed income investments provide certainty and capital stability in a portfolio. A greater allocation provides greater certainty; a key requirement for many investors contemplating retirement.

Recent volatile stock market performance has highlighted the need for greater understanding of fixed income.

Dobbrick Financial Services has many resources available to help you understand and invest in fixed income including a dedicated Research Team producing specific, detailed fixed income analysis.

Term Deposits

With wholesale access to Australian Deposit-taking Institutions (ADI’s) we can source a high returning and diversified portfolio of term deposits suitable to your portfolio and risk profile.

Bank Accounts

With wholesale access to Australian Deposit-taking Institutions (ADI’s) we can source high returning and highly liquid bank accounts which can act as the hub to your overall investment solution.

Wrap Accounts

Through a wrap account your investments are consolidated in one place. This allows you to access managed funds, shares, cash and margin lending and gives you online access to view reports on your consolidated holdings. The available investment choices allow you to better diversify across asset classes and reduce risk. Wrap accounts also provide access to wholesale managed funds and ‘boutique funds’ that are often not available to retail investors as the minimum investments can be anywhere from $500 000 to several million.

Managed Accounts

Unified Managed Account, a professionally managed investment service that can accommodate every investment vehicle (e.g. Managed funds, stocks, term deposits and cash) all in a single account, all or part of the portfolio can be rebalanced regularly. The UMA provides consolidated reporting of holdings, transactions and taxation. The UMA we access is one of the most flexible, dynamic and cost efficient in the market place.

Superannuation

Superannuation is an excellent way to invest money for your retirement. It’s about planning a path for your future and making the most of your investment dollars to generate the income you will need once you retire. For many Australians, it is the key to a secure and financially independent retirement. If you are aged between 18 and 70 and earn more than $450 per month, your employer is generally required to contribute at least 9% of your salary to a complying super fund on your behalf, known as the Superannuation Guarantee.

Superannuation is one of the most tax-effective means of creating retirement wealth. Those who hold a super fund benefit from tax concessions that apply to contributions, to earnings within the fund and to the accumulated benefit. All contributions and investment returns are generally taxed at a flat rate of 15%, with capital gains on assets held for greater than 12 months taxed at 10%. For many people, an investment in super could outperform an equivalent investment outside super due to these tax benefits. As super is a long term investment where all earnings are reinvested and any returns compounded, the earlier you begin making decisions, the more effective your super will become upon retirement. In addition to all the tax advantages of investing in a super environment, you can access your super completely tax free after you turn 60.

A common misconception about super is that it is an investment asset but rather it is actually an investment framework within which you can invest in many different asset classes. Superannuation provides investors access to virtually the same menu of funds available outside of super all the while being taxed at a maximum 15%.

Account Based Pensions

Account based pensions, also known as allocated pensions, offer retirees a simple and flexible way of receiving their superannuation balance as a tax effective income stream. Allocated pensions have significant tax benefits if you are aged 60 and over, all investment earnings and payments from your pension account are tax-free.

Account based pensions allow you to control your retirement income by varying the amount (subject to minimum pension payment requirements) and frequency of income paid, as well as allowing you to draw a lump sum if and when you need it. You can choose how your money is invested by your chosen pension fund provider. Fund managers offer different investment options to suit your investment strategies. Most retail pension master trusts offer dozens of investment options and easy switch facilities.

How it works

An account based pension is an investment that lets you rollover your super money into an account held in your name in a super fund (you can only start an account based pension with money you hold in superannuation). The returns you make on your investments are added to your account, which pays you regular income payments. You can commence a pension once you have met a condition of release, such as reaching your preservation age. Click herefor more information on when you can access an account based pension. Many superannuation funds offer a pension option allowing you to simply rollover your super benefits without needing to sell down your existing investments.

There is no maximum limit on how much income you are able to draw from your pension, however a minimum payment based on your age must be paid each year. The income stream will continue until there is no money in your account. How long the pension lasts depends on the initial starting amount of your superannuation, how you choose to invest it and its overall performance, the level of income that you receive and whether you take out any lump sum payments along the way.

Dobbrick Financial Services - Portfolio Management

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Rochelle StonePortfolio Management