JMMB Helps Male Investors to Navigate their Investment Style 

Iris Apfel, fashion icon, stated, “The key to style is learning who you are, which takes years. There's no how-to road map to style. It's about self-expression and, above all, attitude." The statement also holds true for one’s investment style. 

It is often debated who is the better money manager, men or women; and in some circles, men are thought to be more aggressive investors, aka, bigger risk-takers. It is against that background that the recent JMMB Goal Getter Live episode decided to take a look at the investing style of men.  Although the discussion is specially tailored for men this month (September), the episode had some great nuggets that can be useful to all investors. 

Greig Lindo, assistant general manager, trading and treasury, at JMMB, explained, “One’s investment style is (a) method or the principles that you use to choose which assets to invest (your) funds as part of (your) portfolio. These principles can be influenced by a number of factors, such as: your personality; how you (tolerate) risk; what asset classes (such as bonds, equities, cash, real estate et al) you personally like, (and this) can go from personal attributes to technical attributes – whether you want a growth or value objective.”

One size does not fits all – Style is personal
“Style is something very individual, very personal, and in their own unique way, I believe everyone is stylish,” this statement by actor, Salman Khan, probably best captures the misconception that one size fits all, when it comes to investing.  Greig noted that one’s investment style “is unique to each investor, even though (we) typically classify you as conservative, moderate or aggressive… you may find persons are a blend… (your investment style) is a unique attribute per person.“  In sum, your objective and your risk tolerance is really the bottom line.  In giving insight into his own approach, Greig shared that he invests funds based on each goal in his life, taking a more conservative approach to his long-term goals, versus a more aggressive approach to goals where he wants to maximize his return. 

Peter Thompson, JMMB Group client investment manager, outlined that, “Although there is no perfect style, regardless of your investment style, you need to have a plan around what you want to achieve.” He, therefore, outlined the first step in this plan is to know your goals, while cautioning investors to invest in assets that they are comfortable with.  Thompson underscored the need for financial literacy, so that investors can become more informed and broaden their risk appetite, which should be complemented by the guidance of an investment professional. 

The investment manager further shared, “(As) your personality changes with time, so will your investment style,” and, as such, it is important that you implement the strategies to become more informed about investing so that you can reshape your investment style accordingly. Additionally, as the market changes and things change, your investment style needs to change to match the new realities. 

Investing requires discipline and a willingness to take risk and is not typically a ‘get rich quick’ way to money. In speaking more to risk, Peter outlined that risk appetite is defined as one’s willingness and his/her ability to take risk, and is dependent on each individual, especially the psychological aspect of taking risk. He encouraged investors to be balanced in their approach and not use funds earmarked for immediate or critical needs, to invest, as the risky nature of investing could result in losses that can cause significant lifestyle shifts.” 

Greig cautioned that investors should develop their own investment philosophy and principles to guide their investment style before investing, and not simply be driven in a herd-like manner; sharing the advice of investment guru, Warren Buffett, “Be greedy when others are fearful, and fearful when others are greedy.” Adding, “Whatever investment decision you make, it has to be coming from a place of sound principles.” In giving a guide for developing these sound investment principles, Peter shared that investors should: know their objective; get expert advice and research, “So that you know what to expect from it (an asset), so (that) if it goes down, you're not surprised because you're focused on some long-term investment, and you know exactly why you bought it, and you know which area in your portfolio this asset actually plays a part.” 

Diversification is Key 
In order to buffer any fallouts and to ensure that you can still achieve your investment objectives, the investment experts recommended investors diversify their portfolio.  Diversification allows investors to not just spread the returns but also spreads the risk.  Thompson underscored that this is the practice of most top investors and persons who are wealthy. 

Even with limited funds, investors can begin to build a diversified portfolio by investing in collective investment schemes, such as unit trusts. A unit trust is a pooled fund that is managed by an investment manager, on behalf of these investors; these investors are called unitholders. He noted, even with a minimal funds, investors can have exposure to several assets that make up that specific unit trust, which would require more funds, if you had invested in these assets individually.  In touting the other upsides of unit trust investing, Thompson revealed unit trust investments give investors “automatic diversification; it gives you active management and it offers you a structured investment towards a particular goal.” 

Opportunities Still Abound
Greig in giving further pointers in building a diversified portfolio noted that although the economy is now unpredictable, for persons with the risk appetite, there are good assets that may be undervalued, or being sold at a discounted price, on the stock market and the bond market. He also pointed to “real estate as a long-term play… (especially with low interest rates now)… (in addition), real estate  tends to outperform bonds and equities over the long-term.” The choice for taking advantage of the market opportunities should be driven by your investment philosophy, however. Greig added that investors can seek opportunities outside of the financial markets, “As COVID-19 has created a number of opportunities for entrepreneurs to start businesses,” and this will, in the long-run, also bolster economic recovery. Peter also encouraged persons who have any additional talents to utilize them to add more money to their investment portfolio. 

Though at the end of the discussion the verdict may still be out on who is a bigger risk-taker with money (men or women), the financial experts reminded investors to stay invested and stay courageous, even in challenging times; but, most importantly, stay true to themselves.   This episode is a part of a special edition of the JMMB Goal Getter Live series dubbed, “All Man Talk”, which runs until the end of September, each Tuesday at 8:30 p.m., across JMMB Group’s social media platforms.