Looking for opportunity

Looking for opportunity

Amanda Gillespie

Advisers can look to a number of different products for growth, but it is crucial they understand the fundamentals before embarking on their investment journey.

This week on the Investment Series, we watch Maria Cook, an investor who is looking to build Opportunity in her investment portfolio. We have provided you with a brief overview of Opportunistic Investments or Growth Investments as they are sometimes referred, and how they generally operate within a clients portfolio.

There are many types of growth opportunities available to investors. Growth opportunities are those that offer a source of long term capital growth, whilst additionally providing diversification to income/defensive assets, such as fixed income and cash.

Growth Opportunities include asset classes such as listed equities in Australia and offshore, property, infrastructure and also investment products that combine a mix of growth assets to provide investors with a diversified exposure capital growth opportunities.

These types of assets form an integral part of most clients’ portfolios, irrespective of their objectives or risk profile. However, a clear understanding of the risk, return and liquidity profiles of each opportunity needs to be understood prior to investing.

Over the long term, growth investments are expected to deliver higher returns than income/defensive assets and are expected to increase in value by more than the rate of inflation.

Whilst growth-oriented investments provide the greatest opportunity for wealth appreciation in the long term, they also carry a higher level of risk. These risks include the greater likelihood of fluctuations in the value of the investment, greater chance of negative returns over the shorter term and in some instances, less access to capital (i.e. a growth asset may be less liquid).

The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice or its related entities. This information is general in nature and does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. To view our full terms and conditions, click here.

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