Be prepared: Plan, Protect, Grow

The financial planning framework to help you achieve your short- and long-term goals.

To be prepared for the road ahead, it’s critical for everyone to think about having a plan, protecting against downside, and looking for growth opportunities.

Despite the good start in 2019, there is still clearly cause for caution. Global growth is muted, earnings growth is slow, the bond market is telling us to worry, and there are plenty of risks which could still upset markets.

We're in an environment in which clients need to both prepare for near-term risks and position for long-term growth. It might be tempting to try to time the market, but history suggests this is almost impossible. We recommend our future clients prepare their portfolios for the current market backdrop by making sure they Plan, Protect, and Grow.

How to plan for your long-term goals?


The starting point for protecting and growing your wealth is having a clear plan, linked to your financial goals. The past six months have shown how times of uncertainty create the potential for very costly financial decisions. Our Liquidity. Longevity. Legacy* approach to wealth management can help you plan for your long-term goals while reducing the danger of falling prey to poor decisions during periods of market volatility. The Liquidity. Longevity. Legacy. framework allocates your wealth into three strategies:

A Liquidity strategy is designed to fund expenditures and meet liabilities for the next two to five years. Investments should be held in stable assets with low volatility, such as cash and/or a high quality bond ladder.

A Longevity strategy helps you meet your financial goals for the balance of your lifetime, and is characteristically well-diversified across asset classes with a growth orientation. The exact composition depends on your situation, goals, financial personality, and values.

A Legacy strategy is for assets in excess of what you need to meet your lifetime objectives. Its investment portfolios can be more aggressive and could be less liquid than those in the Liquidity or Longevity strategies given the time horizon is much longer term.

How can you protect your financial portfolio against downside risk?


Equities are an important part of any long-term portfolio growth strategy. But slower economic growth and various macroeconomic risks mean that investors need to think carefully about downside protection. In our view, one key part of this is diversification, across both regions and asset classes. Incorporating quantitative strategies to reduce equity position in times of high volatility is another way to control portfolio risk. Our clients can also use the current period of relatively low volatility to take out relatively low cost protection on the riskier parts of their portfolio. Our recommendation:

  • Diversify across regions

  • Diversify across asset classes: don't forget bonds

  • Use the low volatility environment to hedge equity positions

  • Incorporate quantitative risk mitigation strategies

  • Be selective in crossover credit

Where are the best portfolio opportunities?


  • First, if you are worried about the state of the short-term economic cycle. We expect various innovations to support "Smart Cities". They include fintech, medical devices, and genetic therapies, 5G, health-tech , and smart mobility. These should deliver above-GDP revenue growth through the cycle. We can also benefit from the increasing opportunities in sustainable projects funding, by substituting existing asset classes for sustainable alternatives with comparable risk-return profiles.

  • Second, we can look to pick up stocks left behind in the year-to-date rally but which still have a positive fundamental outlook.

  • Finally, some of our highest conviction regional ideas include companies benefiting from profitable oil trading below book value in Europe, technology disrupters globally and properties project in Indonesia.

Find out where the best portfolio opportunities are.