What makes LYFORDS different to other financial adviser companies?

We continually question, analyse and review. Our financial advisers use high quality independent research from different sources to qualify both investment and insurance recommendations. All fees are fully disclosed and tax deductible to the investor. Alison and Richard have a combined experience in financial advising of over 65 years.

One of the keys in selecting an adviser is experience, have they experienced both the the highs and lows (corrections) in the investment markets.

What are your fees?

The fees are clearly explained and very transparent. They are detailed in our Scope of Service and Statement of Advice documents and specific to the recommendations made.

Will my money be safe?

Yes. Your investments are held in an independent custodial company, independent of Lyfords and only you can withdraw funds from your private investment account.

Please note that the capital value of your investment portfolio will fluctuate with market movements.

How do you determine how I should invest?

We start by accessing your attitudes and tolerance to investment risk and return using a psychometric risk profiling tool and matching your income and investment objectives. This goes into more detail than the risk return calculator on this web site. It has been scientifically tested.

Do you use research?

Yes. We use research from a variety of resources.

For investments we use Morningstar research (an internationally recognised research company) enables us to access research on more than 46,000 investment products. For asset allocation we have chosen to use ‘Farrelly’s research’, an Australian company specialising in robust, proactive asset allocation modelling and the Occam’s razor approach. Consilium NZ also provide very detailed research and auditing of portfolios.

With insurance we use an independent research company that compares, premiums, and policy wording on the various insurances including income protection, life, trauma and  medical insurance that are recommended by Lyfords.

Do you use index tracking funds or active fund managers?

After reviewing our clients investments and the performance of active fund managers we now focus on constructing portfolios using evidence based investing using a combination of  Index and Smart Beta funds. This allows portfolios constructed in this way to capture a wider spread of the market while also benefiting from lower overall fee structures.

A portfolio constructed using active fund managers will have an average MER of 2.2% whereas using passive and Beta index funds the underlying manager fees can be reduced to around 0.7%. A portfolio using active managers tends to have lower diversification perhaps 300-400 underlying securities whereas a passive/beta portfolio maximises diversification with investments spread across over 9,000 underlying securities.

What are Smart Beta and Index Funds

In the last 10-15 years there has been a big swing towards using index funds in portfolios mainly driven by reducing costs to invest. Active fund managers have difficulty consistently beating the market after taking into account their fees.

Index funds in the broadest terms are funds which have a collection of shares in a certain percentage which is rebalanced back to this every three to six months. An index fund representing the S&P500 (top 500 shares on the US share market) would have the top 500 shares in the percentage that is represented by the market capitalisation of each share to the total.

Beta Funds are like index funds but will have filters applied. Dimensional Fund Advisors has applied this philosophy since 1981. Dimensional’s investment philosophy is based on the works of Eugene Fama (Nobel laureate, professor at the University of Chicago) and Ken French (professor at Dartmouth College).

Their research identified the fundamental factors that are the long term drivers of investment returns. By investing in portfolio of shares that apply these factors, investors generate returns on par with market returns or above market returns in the long run. The factors that they identified are; the market effect (shares outperform bonds long term), size effect, value effect, and profitability effect.

Can I view my investments at any time on the web?

Yes. You will be given access to a secure 128 bit encrypted web site where you can see how your investments are going. You can view your investment portfolio at any time. It pays to remember to be patient when markets correct and to stick with the plan agreed with your financial adviser.

How often do you review my investments and the funds in my portfolio?

The underlying investments selected are reviewed quarterly. Your investment portfolio is reviewed 6 to 12 monthly depending on what you have agreed with your financial adviser. This can be via a face-to-face meeting, zoom call, or if you prefer, a telephone call. We also may review your risk/return profile and investments goals every 1-2 years to check that you are on track.

Do you transfer UK Pensions?

Yes we do transfer UK Pensions into New Zealand HMRC approved QROPS superannuation schemes. This is a specialist area and we have dedicated a separate web site to this, Lyford UK Pension Transfer

Do you review, or give second opinions on existing investment portfolios?

I see you are based in Lower Hutt. Does this mean you only have clients living in the Wellington region?

No. While our premises are in Lower Hutt we visit clients in the North and South Islands several times a year. We communicate regularly with our clients by phone, email or zoom meetings. We also have New Zealand clients who are currently living overseas.

Our clients find distance is not an issue especially with email and being able to view their investments at any time directly via a secure web site. Any portfolio changes are agreed before they are implemented via email.

What fund managers do you use?

For individually constructed portfolios we use a combination of research, mainly from Morningstar research, to filter more than 46,000 investment options available in the Australasian markets to give a recommended list of between 45-60 investment funds. We also use an approved products list of funds which have been thoroughly researched by Consilium NZ.

The Investments selected are reviewed quarterly. Where available we use mainly wholesale fund managers utilising lower fee structures. If retail investment funds are used all commissions and brokerages are rebated back to the client’s cash account.

How to identify a scam

If an offer sounds too good to be true then it probably is.

New Zealanders are losing around $10-15M each year to scams. The Government web site shows how to identify scams and how to report scams to help others avoid getting trapped.

Professional Code of Conduct for Financial Advisers

Are Financial Adviser regulated, what are the consumer protections?

Financial advisers are regulated by the Financial Markets Authority (FMA) and are required to follow a Professional Code of Conduct for Financial Advisers.

What questions should I ask an investment adviser?

We believe there are seven key questions you should ask any financial adviser.

Please refer to the Seven Key Questions to ask a Financial Adviser

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