Critical thinking

Keep it simple!

Sep 29, 2017, Written By Asset magazine

If United States financial advice guru Carl Richards had his way, the New Zealand industry would stop trying to make things complex for clients and admit a lot of it is actually really simple.

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Consilium Platform smart rebalancing enhancement released

Sep 27, 2017, Written By Consilium

Independent financial services specialist, Consilium, today announces the release of stage one of the smart rebalancing algorithm onto Consilium Platform. This automated algorithm allows client portfolios to be managed much more cost-effectively, whilst simultaneously ensuring they remain consistent with the overall risk parameters discussed and agreed in the client’s investment plan. Consilium Managing Director, Scott Alman, said, “This project has been in the pipeline for some time and it is very exciting to finally have it come to fruition”. According to Alman, “By always striving to achieve incremental efficiencies, such as reducing trading costs through smarter portfolio rebalancing, Consilium ultimately helps contribute to clients achieving their investment goals and objectives. It also enables the advisers we work with to spend more of their time on even higher value interactions with their clients, rather than on portfolio administration.” Consilium Platform is one of the fastest growing custodial platforms in New Zealand, targeted specifically towards supporting the needs of the professional financial adviser community. The focus on delivering innovative best practice solutions to advisers has a positive flow on effect for investment clients all over the country. Consilium, a finalist in the 2017 AUT Business School Excellence in Business Support Awards, has added over $1 billion of assets to Consilium Platform in the last 12 months and now works closely with advisory practices around New Zealand, with collective assets in excess of $2 billion.

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The expected return of residential property

Aug 30, 2017, Written By Consilium

Since the 1950s, investors have had access to a simple formula to help them calculate the price of an investment. Created by Myron Gordon and Eli Shapiro, and based heavily on the ‘Theory of Investment Value’ by John Burr Williams, the formula describes the price of an asset in terms of only three variables - yield, required return and an expected growth rate.

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The stupidest thing you can do with your money

Aug 14, 2017, Written By Freakonomics

A podcast by Freakomonics: It’s hard enough to save for a house, tuition, or retirement. So why are we willing to pay big fees for subpar investment returns? Enter the low-cost index fund. The revolution will not be monetised.

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Generating referrals from accountants

Jun 20, 2017, Written By Consilium

Wouldn’t it be nice if you had a close relationship with an accountancy practice that consistently referred new business to you? Being fortunate enough to have worked in the past at an accountancy firm, I’ve learned that about three out of every ten clients will ask their tax preparer for help with their personal finances during tax season. That’s an incredible opportunity for you as a financial adviser, if you’d like those tax preparers to refer their clients to you. All you need to do is find a way to be top of mind, so that you’re included in the conversations they’re having with their clients. The problem is that every other financial adviser also knows this, and is vying for the accountant’s attention, too. So how do you stand out from the crowd? To get results, you have to understand the three biggest problems that accountants face, that you can help solve for them. Only then will you have the relationship necessary to get them to refer their clients to you.

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Consilium increase support staff

May 29, 2017, Written By Consilium

Independent financial services specialist, Consilium, announced today that Nicole Stewart has joined the company as a Client Support Representative, with her key focus as assisting independent financial advisers and their administrators on Consilium Platform. Additionally, University of Canterbury graduate (MAFE and BMSci) and CFA Level 1 candidate, Lydia Luo, joins the expanding investment team in a newly created analytical role.

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Synergy SRI Portfolios available 3 April 2017

Mar 29, 2017, Written By Consilium

The Synergy Investment Programme, with FUM of $112m, is launching four new model portfolios on 3 April 2017. These portfolios will allow investors to support higher levels of social responsibility whilst still favouring low cost, widely diversified and non-speculative investments.

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A consideration of term deposits for investors

Mar 21, 2017, Written By Consilium

Although term deposits are very popular in New Zealand, there are two main reasons why you may not want to invest the bulk of your long term investment or retirement assets in term deposits. 1. You want a more secure investment 2. You want a better lifestyle

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The wisdom of hedge funds and high priced fund managers

Mar 15, 2017, Written By Consilium

This excerpt is from Warren Buffet, considered to be one of the most successful investors of all time. In it, he shares his unmitigated view on the wisdom of hedge funds and high priced fund managers. Before you consider using a high priced manager with a good recent performance record, please read these ideas carefully.

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Lyford Investment Management join Consilium

Mar 02, 2017, Written By Consilium

Consilium today announced it has added Lyford Investment Management Ltd, with $85m in FUM, as a client to its full partner firm service, including access to Consilium Platform.

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Costs matter, advice matters more

Feb 10, 2017, Written By Ben Brinkerhoff, Head of Partner Firm Services

In an age where advisers are facing greater and greater fee pressure, we stop and reflect on the value of advice. Quantitatively we break that value into investment management, fee negotiation and behavioural change and look at evidence for how advisers add value in all three. In summary we find the value to be multiples of their annual advice fee.

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Investment News article

Feb 05, 2017, Written By Investmentnews NEW ZEALAND

Auckland-based boutique advice firm, Private Wealth Advisers (PWA), will tip in close to $375 million to the FNZ-backed Consilium investment administration platform following a deal confirmed last week.

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Private Wealth Advisers

Jan 31, 2017, Written By Consilium

Independent financial services specialist, Consilium, today announced that after a period of thorough due diligence, highly respected Auckland firm, Private Wealth Advisers, have transferred custody of their assets onto Consilium Platform.

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Summer update 2017

Jan 20, 2017, Written By Consilium

In this Summer Update: i) The investment market review touches on these major news events as it reflects on the performance of the different asset classes through the year. ii) In the accompanying feature article, True Prosperity, we examine why the Legatum Institute, a London based research organisation, considers that New Zealand is arguably the most prosperous nation on earth.

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Marketing Specialist Appointment - Carl Richards

Oct 20, 2016, Written By Consilium

Consilium today announced that world renowned expert in investor behaviour, Carl Richards, has been employed in the position of Marketing Specialist, effective 3 October 2016. Consilium is CEFEX certified, and is New Zealand’s largest provider of back and middle office services to over 60 independent financial advisory firms.

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Investing in foreign investment funds – a tax comparison of PIEs and AUTs

Jul 22, 2016, Written By Consilium

For many of us, there is nothing more tedious than learning the detail of prevailing tax policy on the investment returns of international assets. The majority of investors do not need to be tax experts, but simply want to know the answer to two central questions: Which investment structure results in paying the least amount of tax? and, which investment structure is more convenient to administer? Therein lies the problem.

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Diversification rules!

May 03, 2016, Written By Consilium

Over the last several years we have collected articles highlighting local sharebrokers’ best picks for the year ahead. In late December each year the National Business Review features an article in which the brokers compete with one another by nominating their three or four top investment picks for the year. What makes this a really enlightening exercise is that, at the end of the next year, you can review the results and see exactly how they each performed.

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A vanishing value premium?

Feb 12, 2016, Written By Weston Wellington

Value stocks underperformed growth stocks by a material margin in the US last year. However, the magnitude and duration of the recent negative value premium are not unprecedented. This column reviews a previous period when challenging performance caused many to question the benefits of value investing. The subsequent results serve as a reminder about the importance of discipline.

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Mutual Funds and Outperformance: The difficulty of generating positive alpha

Oct 28, 2015, Written By Dr Bart Frijns

The following article “Mutual Funds and Outperformance: The difficulty of generating positive alpha” was written by Bart Frijns F Fin, Professor of Finance, Department of Finance, Auckland University of Technology and Director of the Auckland Centre for Financial Research, Auckland University of Technology. The article was published in JASSA The Finsia Journal of Applied Finance, Issue 3, 2015.

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A long term lesson in residential property investment

Oct 22, 2015, Written By Ben Brinkerhoff & Scott Alman

In Amsterdam, just on the outskirts of the medieval city, lies a canal. On the edge of that canal sits Herengracht, one of the most prestigious neighbourhoods in the city, built in the 1600s at the start of the golden age of Holland. Over time it has housed wealthy financiers, slave traders, diamond cutters and the like. It has always been considered a premium area, in one of Europe’s most prosperous cities. We’ve all heard the refrain, adopted as fact, that property is a great investment. Read on to find out more

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A Responsible Approach to Socially Responsible Investing

Oct 21, 2015, Written By Consilium

SRI combines investors’ financial objectives with their concerns about environmental and social issues. For example, an investor may not want to own shares in businesses that produce tobacco, make firearms or produce fossil fuels. This idea is so attractive that one publication estimated SRI increased in the United States from $641 billion in 2012, to almost $2 trillion by 2014 . There are over 450 SRI funds in the United States alone. While attractive in theory, there are potential issues with SRI.

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Sticking with it

Oct 14, 2015, Written By Jim Parker

It's often said that the secret of success in any endeavour is "stickability", your capacity for staying committed to a goal. But success also depends on having goals you can stick with. Managing that tension is what an advisor does.

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NZ income: funds or direct?

Aug 12, 2015, Written By Consilium

Financial advisers and private client advisers at banks and broking firms have a long history of buying fixed interest securities as direct holdings for their clients. However, over recent years there has been a shift in behaviour, with fixed interest funds increasingly becoming the solution of choice.

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Winter update 2015

Jul 30, 2015, Written By Consilium

In the investment market review we summarise some of the key talking points in the markets over the last three months. Although recent developments in both Greece and China have caused global markets to become a little unsettled, the performance of diversified investment portfolios through this period has been significantly better than the news headlines would have us believe. Given the intense media coverage given to the Greek debt crisis, we have also included a separate article called “Greece - The Path to Austerity”. This catalogues how Greece got into its current predicament and outlines some tentative thoughts as to what could happen from here. The final article focuses on how the New Zealand courts are interpreting (or reinterpreting) trust law, and on the current Law Commission trust law reform proposals. This is recommended reading for anyone with a family trust.

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Trusts in the Spotlight

Jul 10, 2015, Written By Ben Brinkerhoff

Trusts have many uses, including creditor protection, protection against relationship property claims from partners or spouses under the Property (Relationships) Act 1976, estate planning and even tax minimisation in certain instances. Alongside other developments, recent court judgments have set new precedents that suggest trusts may be becoming less effective against these types of claims. In this article, we take a look at a few of the issues.

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Portfolio Exposures in Greece

Jul 10, 2015, Written By Damon O'Brien

We don’t know what the Greek situation will mean to the immediate future performance of other assets or other markets. There is a significant amount of published opinion suggesting that a default by Greece does not represent a significant threat to the global economy. Equally, we don’t know whether Greece will come back to the negotiating table in the next few days and seek to conclude a new deal with its creditors. This is yet another entry in the very long list of crises faced by the markets over the years. In each previous case the markets have survived and ultimately flourished. We have no reason to believe the current situation will be any different.

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Outsourcing asset management

May 15, 2015, Written By John Bowen

A 'first word' video with John Bowen of CEG Worldwide The percentage of financial advisors who choose to outsource asset management has nearly doubled over the last five years and continues to grow. Apply one of the four Ds—drop it, defer it, delegate it or do it—to decide which direction is best for your practice. Click here to view

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Hindsight Bias

May 14, 2015, Written By David G. Meyers

Hindsight bias refers to our tendency to see a past event as obvious after the fact. It can make investors start to see links between cause and effect where none existed. The truth is we often don’t expect something to happen until it does. A professor of psychology explains. The below article relates this tendency to a major U.S. sporting event.

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Slow and steady wins the race

Mar 31, 2015, Written By Robert Stammers

Many investors spend too much time chasing returns and not enough on factors within their control. And one thing you can control is the amount of capital you invest. This writer shows how slow and steady contributions to your savings, together with patience, can make a big difference.

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A Simple Explanation For Volatility and Prices

Dec 16, 2014, Written By Ben Brinkerhoff

The value of shares goes up and down a lot. All this volatility creates uncertainty for investors. It’s not very clear, for most investors in shares, exactly what the value of their share portfolio will be at any point in the future.

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Market Timing - A Picture is Worth 1,000 Words

Dec 09, 2014, Written By Ben Brinkerhoff

They say a picture is worth a thousand words... I could easily spill a thousand words on market timing. I could talk about how each trade involves a willing buyer and seller; each with equal interests, each with the same access to information.

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Eugene Fama Wins the Nobel Prize

Sep 09, 2014, Written By Ben Brinkerhoff

The 2013 Nobel Prize in Economics was awarded to Eugene Fama, along with two others, for laying “the foundation for the current understanding of asset prices”. Having been (along with our clients) the direct beneficiaries of Eugene Fama’s work, we wish to congratulate him on this achievement

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