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
In September, the Long portfolio showed resilience delivering a positive return for the month. Despite ongoing global economic uncertainties, well-diversified long-term investments benefited from steady gains, supported by solid performances across various sectors. While inflationary pressures and interest rate adjustments remain key factors, the Long portfolio continues to navigate these conditions effectively, with a focus on quality assets and stability. This approach is designed, and proven, to provide a balanced return over time, supporting growth while managing potential risks. As always, we’re here to discuss any questions you may have.
Short Term Portfolio
In September, fixed income markets delivered positive returns, driven by major monetary policy shifts. Central banks globally, particularly in the U.S. and China, accelerated their rate cutting cycles to bolster growth. The US Federal Reserve’s 50 basis point rate cut, its first in the current cycle, sparked expectations of further aggressive easing. While U.S. inflation remained firm, softening labour market conditions and the Fed’s dovish stance boosted market optimism.
Conversely, the RBA held its cash rate steady at 4.35%, maintaining a hawkish stance and resisting market pricing for 2024 rate cuts. However, the lack of discussion around future hikes hinted at a potential shift in the RBA’s outlook.
Fixed income assets remain well-positioned for strong returns as central banks lower rates. Despite the expected cuts, yields are historically high, providing solid income streams. Against this backdrop, we have increased our allocation to real estate mortgage funds. These funds offer attractive yields and perform well in high-interest-rate environments, generating steady income. As central banks’ balance growth and inflation, real estate mortgage funds are strategically positioned to deliver strong returns and enhance portfolio resilience in the coming months.
Micro Cap Portfolio
The local stock market is trading at record highs, however the performance is highly bifurcated with banks and a number of other large cap stocks driving the market higher. Whilst we have seen strong performance in the portfolio recently, we expect a rotation out of those large caps and further improvement once the inflation battle is won in Australia.
In the US, the Fed cut rates by 50 basis points in September signalling that the fight against inflation is largely done with focus now turning to supporting the underlying economy. The Chinese government announced stimulus measures creating a late in the month surge in their stock market and a late benefit to commodities and resources in the Australian market.
The portfolio maintains a 30% international exposure and is positioned to benefit from a reducing interest rate environment both globally and in the domestic market.
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.