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
Despite August being one of the more challenging months, the Long Portfolio remained in positive territory. In the US, the Federal Reserve signalled a cautious approach, balancing tariff risks with a softer employment outlook. Proposed tariffs on AI chips, Indian exports, and pharmaceuticals all created some uncertainty.
Closer to home, the Reserve Bank of Australia cut rates to 3.60%, reflecting cooling inflation and steady unemployment. Throughout the month, we stayed focused on quality and made timely adjustments to take advantage of opportunities as they arose. Our strategy continues to emphasise patience and resilience, aiming for long-term positive direction over chasing possible short-term sugar hits.
Short Term Portfolio
The Short SMA delivered another steady result in August, returning 0.57% for the month. This continues the portfolio’s disciplined approach to managing risk and generating consistent income.
The RBA cut the cash rate by 0.25% to 3.60% in August, citing easing inflation and a softening labour market. This supported bond prices and income-focused strategies, with most fixed income holdings posting modest gains. Income generation remained strong and diversified, with contributions from La Trobe, Western Asset, and MA funds.
Globally, economic data was mixed. The US and Eurozone showed signs of resilience, but trade tensions and cautious central banks kept markets on edge. While manufacturing remains subdued, services and consumer spending have held up, supporting a cautiously optimistic outlook.
Cash levels in the portfolio were reduced as new investments were made, reflecting our active management approach. We continue to balance yield, credit quality, and liquidity.
In uncertain markets, consistency matters. The Short SMA remains focused on its core purpose: managing downside risk, maintaining discipline, and delivering reliable income.
Micro Cap Report
The Microcap portfolio delivered another solid result in August. Despite the challenging sentiment in the small cap and microcap investment space in the previous years, the Microcap fund is back in positive territory over it’s benchmark. The valuation gap between large companies and small companies remains at historical highs. This is providing a great opportunity for growth in valuations at the smaller end which is being taken advantage of in the Microcap portfolio.
During August we sold our position in the OC Microcap fund, a domestic fund, in favour of distributing these funds across existing investments and commencing a position with Eley Griffiths Emerging Companies Fund. This change restructures the portfolio to better align to our investment thesis and we feel provides more upside to the portfolio over the medium and longer term.
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.