At Forrest Private Wealth, our investment philosophy underpins our financial planning advice, which ensures our client’s wealth benefits from long-term exposure to equity markets. We believe holding a well-diversified portfolio of predominantly dividend-paying businesses over a long-term period is essential in financial planning for wealth accumulation and, ultimately, retirement planning.
By following our retirement planning process, a Forrest Private Wealth financial planner stays true to their investment advice, ignoring the noise and pressures of the market to provide their clients with a stress-free retirement. At Forrest Private Wealth, our financial planners capitalise on an investment philosophy that provides predictable income streams from equity markets, setting clients up for their desired retirement.
Long Term Portfolio
Global shares pushed to fresh record highs in early August, with major US indices climbing on cooling inflation data and another strong round of earnings from the world’s largest technology companies.
That strength didn’t hold all month though. As bond yields crept higher through August, some of the same growth focused companies that led the rally gave back ground into month-end.
It’s a pattern worth understanding. Higher bond yields make future profits worth a little less in today’s terms, and richly valued growth companies tend to feel that first.
None of this changes the underlying case for owning quality growth businesses over the long run. It simply means the path there is rarely a straight line, and August was a fairly ordinary reminder of that.
Short Term Portfolio
The Reserve Bank held the cash rate again in August, its second hold in a row.
Just two weeks later, fresh inflation data complicated that picture. Headline inflation eased, continuing its slow drift down from earlier in the year, but the measure the Bank watches most closely held steady, and the monthly reading behind it rose at its fastest pace in over a year.
Markets reacted quickly, moving from expecting no more rate rises this year to pricing a September increase as close to a coin flip within days.
It’s a reminder that rate expectations can shift fast on a single data release. This portfolio is built around income and capital stability so that those shifts matter less here than they do elsewhere.
Micro Cap Report
One of the better stories in August came from CSL, a household name that had been quietly written off by many investors after a rough couple of years.
When full year results landed in mid August, showing a clear turnaround plan taking shape, the stock rose sharply in a matter of days and clawed back a large share of lost ground almost as quickly as it had been lost.
It’s a useful illustration of something that happens constantly, and usually far more quietly, at the smaller end of the market this portfolio invests in.
A single results release, contract win or change in management can move a small or micro cap share price by a similar magnitude, just without the headlines to go with it.
That volatility cuts both ways, which is exactly why patience and genuine
Forrest Private Wealth’s discipline in providing financial planning, retirement planning, and wealth management services to its clients allows our clients to benefit from years of experience providing financial advice through major impacts to equity markets where staying the course has helped them.
Forrest Private Wealth has a dedicated team of financial planners and support staff providing clients with peace of mind in working towards and achieving their life goals.