Our investment philosophy

Investments form a critical part of most of our clients’ personal financial plans. We are acutely aware that our advice will shape your financial future and do not take this task lightly. As professional advisers, we have a duty to do what we feel is right and when it comes to investing, gambling with your money is something that we will not entertain.

We will manage your investments in a sensible, low cost manner to try to achieve the best market return possible. Our approach is based on a wealth of academic research, experience and independent studies.

Investments are inherently quite simple.  It is their packaging that can be complicated.  We are aware that our philosophy of using index tracking funds is not the message that you will hear from most investment advisers, stockbrokers or IFAs. Our view is that index funds offer the lowest cost, lowest risk and most tax efficient way of accessing the performance of the world’s main investment markets. We have access to many institutional and specialist index funds which are not usually available to retail investors. This brings considerable enhancements in terms of cost and asset allocation opportunities. We do not believe that there is any credible evidence to support the idea that active fund management leads to consistently better returns.

The research we have carried out has demonstrated that over the long term, risk and reward are inextricably linked and that equity investment has delivered the best long term returns when compared with cash, fixed interest and property, although it has not been a smooth ride. In our portfolios, fixed interest investment in high quality, short-dated bonds provides the balance to the volatility of equities, whilst offering the prospect of slightly higher future returns than holding cash on deposit.

We blend lower risk/return assets with higher risk/return assets to achieve the desired portfolio characteristics and model the historic returns to ensure that our theory is backed up by the actual results. Our investment portfolios are designed to offer a range of risk/return profiles to suit different clients and different requirements.

We also ensure that our clients’ portfolios are further diversified by introducing exposure to international markets. For investors willing to accept greater volatility and risk we also incorporate smaller and ‘value’ companies, which have historically demonstrated higher returns than larger and ‘growth’ companies.

All asset classes are accessed using very low cost, highly diversified passively managed funds. We currently use institutional class funds from Legal & General, Vanguard & Dimensional Fund Advisors but are constantly looking to improve our offering to clients. Annual management charges of the funds we use range from 0.15% per annum to 0.55% pa, with overall composite Annual Management Charges being in the region of 0.24% - 0.30% p.a. and Total Expense Ratios from 0.30% - 0.37%. For the avoidance of doubt, please note that our fees and the investment platform/investment custody fees are in addition to this. 

It is important to us that our clients understand why we have decided to do things the way we do, which is why we have written this guide to our investment philosophy.

The guide will look at the following key areas:

• Why invest at all?
• The active v passive management debate and our belief that markets are efficient
• The benefits of diversification and asset allocation
• The role of fixed interest in portfolios
• Asset class investing
• Individual circumstances
• The impact of charges & rebalancing
• Why become a client of Evolve?

Please contact us via our message pad or call us on 0845 602 7875 if you would like us to send you a free copy of our Guide to Efficient Investment Planning.

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