The unique benefits of investing in Clearwater investment funds

Building a portfolio of investments is a great way to help you get one step ahead financially. Exactly how you choose to invest your hard-earned money is, of course, down to you. You can try your hand at managing it yourself - you can even try your luck at buying shares on the stock market. But if you decide to give managing your own investments a shot, there are some downsides you need to be aware of before you get started.

The pros and cons of managing your investments yourself

First, you need to be prepared for high levels of volatility which could feel a little too uncomfortable to manage on a day-to-day basis. Second, many people feel the need to follow market performance closely, which can lead to experiencing a level of anxiety that's not sustainable in the long term. 

That said, you may see some large movements in profit over time, and there's absolutely no doubt that the right shares can do well.  On the other hand, if you're not keen on entering the share market, you could always invest in property or infrastructure. But it's important to note that investments like these involve significant assets that will tie up a good deal of capital and may prove too large an investment for your portfolio. 

When it comes to the question of what you should do with defensive assets in a challenging financial environment, you need to tread carefully. We're at a point in time when interest rates are at historic lows, and even seemingly safe bonds are carrying a higher risk than we've seen in a long while. Therefore, even if you have a long-term view of your investments, you want to do all you can to avoid losing money from defensive assets.

Your approach to risk

Many of your investment decisions will come down to your personal approach to risk. Some people really enjoy investing, and they're happy to spend a fair amount of time researching the financial markets. They get excited by opportunities, market movements, and the sense of control they feel from buying and selling shares. 

However, many people don't enjoy the stress of investing at all. They simply want their investments to fund their lifestyle. It simply comes down to what works for you. If the latter approach sounds appealing and you like the idea of having someone managing your investments for you, our DMG Diversified Portfolio and Clearwater Dynamic Portfolio are excellent options to consider.

A unique financial product

The Clearwater funds are unique in that most investment funds only cater to one asset class or asset type. As a rule, you'll find that most funds are formed of either shares, property, or a diversified pool of assets. 

At Clearwater, we take the diversified approach a step further. Our DMG Diversified Portfolio is, as it sounds, incredibly well diversified. This isn't by chance. We use highly skilled managers that specialise in each asset class and subclasses. And we draw heavily on their skills, which has proved invaluable in the current climate. 

Of course, you pay for the privilege of expert advice. Nonetheless, our managers offer a comprehensive service that we believe is well worth the cost. And we always ensure that every manager adds sufficient value to warrant the fees they charge for their service.

In short, the beauty of investing in our portfolios is that we do all the hard work for you. We have a highly experienced investment committee and an appointed specialist portfolio manager allocated to each portfolio. We also engage a research consultant who provides exceptional expertise and guides us in our decision making, ensuring you have a high calibre resource working on your behalf all the time.

Our team of experts provide significant peace of mind when the markets start to move. So, if you're the type of person who's happy to hand over the management of investments to others, this is a method of investing that could really work for you.

The DMG Diversified Portfolio

The DMG Diversified Portfolio is our original fund, and it's been running for more than eight years. Our aim has always been for this fund to experience less volatility than sharemarkets, with a 70% allocation to growth assets. As a result, it's a fund that delivers solid returns with reduced volatility. 

The benefit of investing in a fund like this means that there's no need to panic when you read about the share markets falling dramatically. Instead, you can rest assured that we'll be working hard on your behalf to limit losses - and we've demonstrated our expertise at doing just that.

For example, during March 2020, when COVID heavily impacted financial markets, many of our investors were pleasantly surprised to see how little their investment had been affected. At the time, headlines were both devastating and dramatic, on a personal and financial level, with many investors steeling themselves for a big hit. However, because of our unique approach, it didn't happen. And that's precisely our aim –to limit losses when volatility strikes.

The Dynamic Portfolio

Our Dynamic Portfolio is a little different to the DMG Diversified Portfolio. It allocates growth assets of 90%, so it carries more risk while targeting higher returns. What's more, a look inside this portfolio illustrates our unique approach. It contains Australian and international shares together with investments in large and small companies. It also includes investments in emerging markets, a specialist India fund, healthcare property and a range of private companies, plus one of Australia's newest banks and a specialist business lender. 

In short, we've packaged a range of well-researched investments into two unique portfolios that we manage on your behalf - leaving you to spend your time getting the very most out of life.

by Gary Lucas.