Keep INVESTING Simple and Safe (KISS)
****Investment Philosophy, Strategy and various Valuation Methods****
The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.
Consumers rank past performance as the most important consideration when choosing a prospective investment, followed by who the fund manager is and how the portfolio is distracted.
Although fees and charges are a hot topic among investment forums and financial advisers, the survey, conducted by the Association of Investment Companies (AIC) using survey data from Morningstar, revealed investors themselves care less about cost.
Jacqueline Lockie, at the AIC, said that investors should rethink their priorities when it comes to constructing their own portfolios.
She considered portfolio composition by far the most important of all the options.
"Research shows us that the way to control returns is to identify the asset allocation," she said. "It’s all about risk."
She considers charges the second most important factor: "All charges on a fund drag back its performance and reduce it. If a fund increased by 7pc in the last year, but the total charges were 1.5pc, the returns to the investor would be only 5.5pc. The bigger the charge, the harder the fund has to work to stand still."
The charges levied on investments and pensions have come under intense scrutiny in the past two years. The Telegraph has led a powerful campaign against high fees on retirement savings, in particular.
Critics say most fund managers are failing to reveal the true cost of investing. The vast majority of managers of unit trusts and Oeics, the most commonly held investments, advertise an annual management charge, which is normally around 1.5pc.
But this doesn't include the other costs of investing. Analysts also use a measure called the total expense ratio (TER) to compare funds but even this does not capture the full cost.