As the year draws to a close, we reflect on the returns that investors have made.
The markets have been volatile and hence there have been good trading opportunities.
Investments in Government-Guaranteed deposits of finance Companies and banks have given excellent risk free returns.
The opportunity to invest at double inflation with a government backing has given many clients a return of 7% plus at no risk!
This is the first time in my life that I have seen this.
The Resource sector has been strong. The economies of the BRIC nations (Brazil, Russia, India and China) have grown strongly, demanding large resources.
The result has been some fantastic returns on stocks. We had recommended stocks such as Lynas Corporation (LYC.ASX) and we have seen the Company’s price increase approximately 300% in just three months.
The demand for resources and the associated costs and risks have meant that returns in this sector can be outstanding.
Bonds and Managed funds have performed well over the period.
There have been positive results by many bonds and funds giving investors generally returns from 2% to 12 %.
These funds tend to have diversified portfolios, allowing investors to have a spread of investments without the hassles of different investments in their own name
KiwiSaver has been a big success this year. We have seen the inflows increase and this form of saving for retirement has grown substantially.
All parents should consider enrolling their children immediately. The Government currently contributes $1000 directly into the account of the child (and all other applicants). With the Government’s accounts looking as bad as they are, I cannot see this lasting long and hence if you join after the Government stops its contribution ($1000), you will lose on the benefit.
It has been a rollercoaster of a year for most people and 2011 would be no different.
The investment market has been dynamic and with many diverse investment products in the market with varying risks and returns, it is very difficult for an investor to make the most appropriate choice of investments.
Hence, all investors should ask questions, get good advice and understand their choice of investments.
There are sharks out there waiting to gobble up your hard-earned money. Hence, this is the time for doing investment through an advisor, who will identify the sharks and protect your investments.
Investment Research Group specialises in giving safe and appropriate advice on investments in bonds, shares, fixed interest deposits, managed funds, KiwiSaver, portfolio management and all other investments.
Brent King is the Managing Director of Investment Research Group (IRG). A copy of the disclosure statement is available on request and free of charge. Phone (09)3040145. Email: brent.king@irg.co.nz
