Our investment philosophy

What we believe in

Matrix Capital Limited is committed to providing expert, independent, impartial advice and a complete range of products to individual clients and corporate entities. Our loyalty is, and always has been to you, our clients. We review the whole marketplace to produce tailored product and service solutions and will only recommend those we consider suitable for our clients.

We strongly believe that money should simply be a means to achieve the peace of mind and quality of life you deserve and our aim is to build long-standing, lifetime relationships that help you to maintain and improve your lifestyle.

We base all our portfolio recommendations on multi-class investing and implement investment strategies that emphasise asset class allocation with minimum trading. The result should be a portfolio that aims for a solid longterm rate of return while minimising expenses and taxes. Our goal is not to beat the market, but to achieve a healthy rate of return that allows you to achieve your financial goals without being exposed to unreasonable levels of risk, by matching attitude to risk to investment objectives.

By using investment management strategies that have been extensively researched and refined to work in both good times and bad, we believe that an investment portfolio should withstand the day-to-day and year-to-year fluctuations in the market. Concentrated investments add risk with no additional expected return. Investors can reduce their potential for loss by investing in a basket of different securities. In less technical terms, diversification means the same thing as the adage, ‘Don’t put all your eggs in one basket’. However, it is important to note that a diversified portfolio in itself is not necessarily a properly constructed portfolio.

Investment fund performance can be unpredictable. Our approach to investment planning centres on the fundamental principal that asset allocation is the critical factor that determines investment performance in the long-term.

How we deal with risk

A key consideration when we select investments on your behalf is to understand your attitude to risk. Everyone has a different perception of risk and a different attitude towards it. Your attitude to risk may also vary in respect of different areas of financial planning and can also be affected by:-

  • your age and the age of your dependants
  • your past experience
  • your personal goals
  • your financial circumstances
  • the timeframe during which you wish to invest
  • the mix and performance of your existing investments

Our investment philosophy

In order to fully understand your attitude to risk we ask you to complete a detailed risk assessment questionnaire. We use the findings from this questionnaire to understand the level of risk that you are prepared to accept and use this risk profile to build an appropriate investment strategy for you. That said, we would always point out that, because inverstments can fall as well as rise, you may not get back the full amount invested. Also, past performance is not a guide to future performance.

How we allocate assets

Traditionally investment decision making has centred on which funds or provider to choose but research has shown that in most circumstances asset allocation is the critical factor in determining long-term investment performance.

Different types of assets, such as equities or bonds, behave in different ways. The first step in formulating any investment strategy is to achieve the right balance between the major asset classes. This ‘asset allocation’ is fundamental in aiming to meet your investment goals in the medium to long term.

How Stochastic Investment Models can also reduce risk

Our investment analysis approach uses a Stochastic Investment Model, which seeks to forecast the investment returns of different assets, such as equities or bonds, and allows us to calculate the effects on client investments over time. Such modelling techniques are not widely available for retail investors and are typically used by pension fund managers and large institutional investors.

Keep in control of your investments; Review – Reassess – Rebalance

Funds can suffer from a deterioration in performance for many reasons; the fund manager may leave and the succeeding manager may be less skilled, the fund may grow too large to continue to deliver its goals or a rapid change in stock market conditions may prove just too challenging. Depending upon the level of service agreed at outset, we regularly monitor each fund within your portfolio to ensure it continues to meet expectations.

When there is an indication that funds may no longer meet your objectives, we either place them on a watch list, to give them a temporary stay of execution, or agree that a change of investment fund is necessary. If a fund should be replaced it will be unsuitable for either new or existing investors.

Different parts of your investment portfolio will perform differently over time. For example, if you invested 80% in equities and 20% in bonds, over time equities may outperform bonds, so your portfolio may become unbalanced. Left unchecked, you could be taking more risk than you really want.

Regularly reassess your objectives

Your asset mix should suit your personal needs in terms of investment goals, the level of risk with which you are comfortable and the time period over which you wish to invest your money. These needs may vary from time to time so you should review your decisions at least annually or when your personal circumstances change.

The value of your investments can go down as well as up and you may not get back the full amount invested.