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(01252) 626200   
 contact@cometwealth.uk

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Our Investment Approach
Investment Approach

Our Investment Approach

Our Investment Philosophy 

Often when working with clients we are asked about investment planning process and our investment philosophy. With this in mind we have created a series of guides to explain. Click cover to download.

1) The basics of investing

Part 1) The basics of investing
This introduces some basic insights into why investing is important and why being a saver (placing bank deposits) rather an investor (investing in bonds and equities) is likely to be a riskier strategy in the longer-term.

2) How to invest sensibly

Part 2) How to invest sensibly
A more detailed look at the key elements of the Comet Wealth investment philosophy, with a focus on the evidence that underpins it.

3) Building robust portfolios

Part 3) Building robust portfolios
How Comet Wealth implements its investment philosophy and builds the portfolios recommended to clients.

The Comet Wealth Investment Policy Committee

The Comet Wealth Investment Policy Committee meets regularly to ensure that the information clients receive remains up to date and relevant.

The growth of assets depends upon our unrestricted access to all investment options on our clients behalf as we work for them. Being independent advisers provides our clients with the best possible framework for the service we offer any restriction would compromise our support of you.

We are not predicting the market and its future we are simply helping you capture the market returns our clients deserve based on their exposure to risk in the most cost efficient way possible.

Systematic Investing

Comet Wealth advocates a systematic approach to investing. In today’s often unpredictable market environment, systematic investing offers a compelling approach for investors seeking to achieve their financial goals. This data-driven strategy leverages automation and clear rules to remove emotion and bias from investment decisions. Here are 10 key points that highlight the advantages of our systematic investing strategy:

1. Reduced Emotionally Driven Decisions

The stock market can be a roller coaster. Systematic investing removes emotions from the equation by following a predefined plan. You set your investment amount and schedule, and stick to it, avoiding panic selling during downturns when fear is rampant, or impulsively buying hyped-up stocks based on fleeting market trends.

2. Discipline and Consistent Investing

Building wealth requires discipline and consistency. Systematic investing enforces this by setting up automated contributions at regular intervals. This ensures you invest consistently, regardless of what the market is doing, and helps you benefit from the power of compounding returns over the long term.

3. Built-in Diversification

Diversification is the principle of spreading your investment risk around. Our investment portfolios therefore hold the shares and bonds of many companies and governments in many countries around the world. Because we believe in the power of capital markets rather than individual predictions or judgements, we are able to invest our clients’ assets in many thousands of individual investments. This means the negative and positive influence of each individual investment is reduced, producing, on aggregate, less risk in our portfolios.

4. Lower Costs

Our Systematic strategies tend to use passively managed funds which typically have minimal expense fees charged by the fund manager. Lower fees translate to a larger portion of your returns staying in your pocket compared to actively managed funds that often underperform the market after accounting for their higher fees.

5. Time Efficiency

In our fast-paced world, time is a valuable commodity. Systematic investing saves you significant time by eliminating the need for constant research on individual stocks. With a set plan in place, you can automate contributions and rebalancing, freeing up your time to focus on other priorities.

6. Outperforms Active Management (Generally)

Studies have consistently shown that over extended periods, passively managed index funds outperform a significant portion of actively managed funds after fees are considered. This is because actively trying to time the market and pick winning stocks is notoriously difficult, while systematic investing focuses on a long-term, buy-and-hold approach. For example, a June 30th 2023 SPIVA®Scorecard by S&P Dow Jones Indices found that only 7.16% of funds outperformed the S&P Europe 350 Index over a 10-year period. (https://www.spglobal.com/spdji/en/research-insights/spiva/#europe)

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7. Focus on Long-Term Goals

Systematic investing encourages a long-term perspective. The pre-defined strategy removes the temptation to get caught up in short-term market fluctuations and emotional reactions. This allows you to stay focused on your long-term financial goals, whether it’s retirement planning, saving for a child’s education, or building wealth for the future.

8. Peace of Mind

Knowing your investments are on autopilot can provide significant peace of mind. Systematic investing allows you to trust the pre-defined strategy to weather inevitable market ups and downs, reducing stress and anxiety associated with actively managing your portfolio.

9, Adaptable to Changing Needs

Life circumstances evolve, and your investment needs may change along the way. Systematic investing offers the flexibility to adapt. You can adjust your asset allocation, the percentage of your portfolio invested in different asset classes, as your risk tolerance or time horizon changes, ensuring your investment strategy remains aligned with your evolving goals.

10. Accessibility

Systematic investing strategies are accessible to everyone, regardless of investment experience. Low-cost index funds are widely available through various investment platforms, making it easy for anyone to get started with a systematic investing approach and begin building wealth for the future.

Comet Wealth’s systematic investing strategy offers a compelling and data-driven approach to navigate the complexities of the financial markets. By prioritizing discipline, diversification, and cost-effectiveness, systematic investing empowers you to achieve your long-term financial goals with greater peace of mind. For further information please view our “Systematic Investing – Our Philosophy and Process Summary” document and visit the “Frequently asked Questions” section of the website.

Ongoing governance of the investment process move to top

Investing is not a set-and-forget process; new theory, empirical evidence and product development keeps an Investment Committee on its toes, on a client’s behalf. By wearing a risk hat, instead of a performance hat, advisers can ensure that a client’s portfolio remains structured to weather all storms, and avoid the dangers of investing in ‘hot’ markets and managers. Perhaps unsurprisingly, this risk-based approach often results in little portfolio activity, despite all the work that goes on behind the scenes. Our ongoing governance is over seen by Albion Strategic Consulting.

For further information please download Comet Wealth’s Briefing Note – Ongoing Governance of the investment process  

For further information please download Comet Wealth’s Briefing Note – Ongoing Governance of the investment process