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
A Trump-led rally assisted with returns in November helped the Long Portfolio to a 2.61% return for the month. The combination of GDP expansion, robust company profits and low unemployment set the backdrop for a strong period for equities. Markets are betting on a Trump administration that will be net beneficial to equities.
In Australia, eyes were still on inflation and the RBA after another hold in early November. However, a hawkish outlook indicated interest rate relief would likely be on its way in the first half of 2025. We expect the combination of lower inflation and reducing interest rates to be beneficial to equities during 2025.
Short Term Portfolio
The Short Fund aims to deliver returns above the RBA Cash Rate with a shorter timeframe objective, emphasizing income generation and capital preservation. With a lower-risk profile, the fund targets a very low frequency of negative returns relative to benchmark over the long term. By actively managing fixed income and credit exposures, the fund seeks to capture attractive risk-adjusted returns, minimise losses, and provide stability and consistent income for investors.
The bond market displayed mixed signals throughout November. Early in the month, volatility and inflation concerns arose following a Trump victory in the U.S. elections. However, as uncertainty subsided, bond yields declined, creating a more favourable outlook by month-end.
The Short portfolio delivered a return of 0.63% for November. In Australia, the RBA kept rates steady at 4.35%, with minutes indicating potential scenarios for monetary easing (more likely first half of 2025). Meanwhile, in the U.S., the Federal Reserve implemented a 25-basis-point rate cut, citing a softening job market and a continued push toward its 2% inflation target.
Micro Cap Portfolio
The investment thesis underpinning the micro portfolio is that smaller listed companies tend to be under researched which creates an opportunity for active fund managers to purchase high quality companies that present as undervalued. This creates opportunities for overperformance relative to the market in the long term.
In November the Micro portfolio performed well delivering a 4.48% return for the month. With the US election in the month the global exposure performed particularly well following the Trump victory. On the domestic front there were no major drivers with the RBA holding rates steady in a watch and wait mode. We continue to monitor the mix of global and domestic exposure.
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.