Is now a good time to change my investment portfolio?

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Ask the expert at Smith & Pinching about the right time to develop your investment portfolio - Credit: Getty Images/iStockphoto

I have a number of investments both in my pension and in a portfolio that contains a range of funds. I was a little overwhelmed by what was happening last year with both the virus and Brexit and so I was nervous about making changes in such a difficult time. It was hard to know if my chosen investments were doing what they should, so I just sat back and waited for things to settle. Is now a good time to start changing my portfolios?

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Matthew Beck is an Independent FInancial Adviser with Smith & Pinching - Credit: Smith & Pinching

Matthew Beck of Smith & Pinching responds:

You are right that last year was a tough one and that markets were very unpredictable. Things have settled down a little, but it has never been as important to have your pensions and investments properly managed.

The critical starting point for managing your investments is to have a financial plan in place. At Smith & Pinching, we create a financial plan for every client: we use this initially to set out your goals and refer back to it regularly to track how your investments are performing, making adjustments as needed. It’s all about creating a plan that ensures your investments are suitable both in the short and the long term.

It looks like investing in 2021 will continue to be unpredictable, so it’s important to manage your portfolios well. We have seen some fast-moving markets recently, and efficient management could help to take advantage of this. Discretionary portfolio management can help in this regard, because you are allowing the investment manager to make changes to your portfolio – within agreed parameters – without obtaining your prior agreement. This should naturally be quicker than an advisory service, which requires prior agreement to changes. This may give you some peace of mind, but you do of course need to consider if the service on offer is right for you and be aware of any charges you may incur.

Market changes will happen, but it is the way that you react to them that can make a difference to the success of your investment strategy. Investor behaviour is often a matter of education and it’s a core element of our role to inform and support our clients through the ups and downs of markets.

My suggestion for you is to have a full financial review with a Chartered Financial Planner. This will give you a starting point from which you can begin to establish your financial plan. Once you have a plan, you can then build a suitable portfolio and explore what investment management options will be the most appropriate for your needs.

Any opinions expressed in this article do not constitute advice. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

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