Strategies for all Seasons



I am often asked where I feel the markets are heading and what the best strategy is for investing your money. Everyone has an opinion, be it the man on the street, a fund manager, trader or financial planner.

And you can bet your bottom dollar, everyone has a slightly different opinion, either on where the markets are heading or how best to invest your money. There are numerous products out there suited to investors. As financial planners, our role is to try and fit our knowledge of products to investor needs, but differing market conditions require different investment approaches.

As a result, this issue focuses on Strategies for all seasons, whether you are an income investor, bullish or bearish on where 2011 is headed, we’ve highlighted a number of investment strategies suited to your needs.

Inflationary issues

I expect that the focus over 2011 will gradually move towards the inflationary issues many countries are likely to face.

Currently, economists are divided as to how inflationary concerns are going to pan out. The huge levels of debt have been moved from the private sector to government borrowing, effectively, robbing Peter to pay Paul. Eventually this debt will need to be repaid.

The initial focus has been on boosting the economy with stimulus packages, after all, an unemployed economy leads to unrest, and a productive economy, ensures more taxes. However, allowing the economy to run away creates inflation, devaluing the value of the currency leading to the withdrawal of investment stimulus from overseas.

The majority of economists are erring on the side of greater stimulus to further boost economies, which could be the potential catalyst for 20%+ digit returns over the next year, however, we are still sitting in uncharted territory and investors would do well to consider some of the alternative investment options we have highlighted in this issue.