Forager is not a financial advisor. We don’t know enough about you to give you financial advice. But here is some information to help you and / or your financial advisor think about our role.
Forager’s investment approach works best for investors who think the same way as we do. If you are considering investing with Forager, you should understand value investing, have a long investment horizon and tolerance for volatility.
If you meet those criteria and think we can help, you still have a big decision to make: what is the right percentage of your portfolio to invest with Forager?
Decide on your asset allocation
Step one is to have a plan. It doesn’t need to be complicated or sophisticated but you need to sit down and come up with an asset allocation plan that suits your personal situation. If you don’t have one of these, there are some good online guides to building one, including on ASIC’s Moneysmart website, or you could seek out a financial planner.
Find Forager’s Role
Once you have your asset allocation plan, you should have some target weights for Australian and International equities. This is the part of your portfolio designed to generate higher returns over the medium to long-term (more than three years). This is also where Forager potentially comes in.
Our Target Market Determination (TMD) for both of our Funds guide that your allocation to that Fund be a minor (Up to 25%) or satellite allocation (Up to 10%) of your overall portfolio. Other factors around investing objective and timeframe are also outlined in the TMDs for both Forager Funds:
Investors with a high risk tolerance and long investment horizon (more than 5 years) can contemplate being close to this maximum recommended portfolio allocation, whereas investors with lower tolerance for volatility and those who need to access their money sooner should select a lower allocation to Forager.
Stick to It
It has been well documented that the average investor gets worse results than the average fund. Mostly this is a result of buying in at the top and then panic selling at the bottom.
Once you have decided on the right asset allocation, don’t faff with it. While it is not hard to find evidence after the fact, there is very little evidence that anyone can consistently and repeatedly predict market crashes.
There is a strong case for being invested in equities over the long term and if you can find a fund manager who does a bit better than average, the case is even stronger.
Get your portfolio allocation right and let us worry about nabbing the bargains.
If you are interested in investing with Forager, please get in touch by calling Alex Irish on 0493 597 303 or booking a meeting with him here.