The top investing strategies of the wealthy are to diversify, to seek advice and to know the fees, reveals chief executive of the deVere Group, Nigel Green.
Green’s comments come as he continues one of his regular global tours of some of his firm’s 70-plus offices where he meets consultants and high net worth clients.
He observes: “It is always a useful exercise to study and learn the habits and processes of successful people – and it is no exception with investing. It is something I have been doing since I started working in the financial advisory sector.
“Over the years I have noted time and again three key strategies that high net worth individuals typically use to create, grow, maximise and protect their wealth.
“Whilst these three traits offer all investors invaluable insights, they also underscore how those with considerable investable assets play by the same set of fundamental rules that everyone should be following.
“The top investing strategies of the wealthy are to diversify, to seek advice and to know the fees on their investment.”
He continues: “Diversification is crucial as it helps manage risk. Savvy investors know, the greater the diversification across asset classes, sectors and regions, the more overall portfolio risk is reduced. Failure to diversify a portfolio is widely regarded as one of the most common investment pitfalls.”
Green goes on to say: “Like successful sportspeople who have trainers and mentors, the wealthy are keen on seeking help from investment experts. They are aware of the costly risks of DIY investing and take advice from professionals in the industry.”
“In my experience, knowing the fees on investments is also vital for high net worth investors. They understand the importance of having any fees or tax implications involved with their investments explained to them before committing. They will put this high on their strategy list as costs could erode returns – and regardless of existing wealth, no-one wants that.”
The deVere CEO concludes: “Clearly, there are more key investment strategies of the wealthy than those I’ve mentioned, but I believe that if you follow these fundamentals, most investors will be able to boost the performance of their portfolios.”