Our investment philosophy
How we invest our clients' money (and our own)
We don't believe successful investing needs to be complicated.
Our approach is based on a few simple principles: diversify globally, keep costs low, take the right amount of risk, ignore short-term market noise and stick with the plan.
We don't try to predict which market, fund manager or investment style will perform best next. We don't believe anyone can do that consistently.
Instead, we build diversified portfolios of global equities and high-quality bonds designed around your financial plan. How much investment risk you take should depend on what you're trying to achieve, how long you're investing for and how much return you actually need.
And we invest our own money in exactly the same way.
Please note, the value of investments may go down as well as up and you may get back less than you invest. Past performance is not a reliable indicator of future performance.
Our principles of investing
Nobody knows what markets will do next
Markets incorporate enormous amounts of information very quickly. We don’t pretend we can consistently predict which countries, sectors or shares will outperform next.
Simplicity is a strength
Complexity doesn’t necessarily lead to better investment outcomes.
The investment industry has a habit of making things more complicated than they need to be. We prefer portfolios that are straightforward, transparent and easy to understand. Every investment should have a clear purpose. If we can’t explain why it’s there, it probably shouldn’t be.
Take the risk you need
Your portfolio should reflect your goals, time horizon, capacity for loss and the return your financial plan actually requires. More risk isn’t automatically better. “Zero risk” assets are also risky though as they will underperform inflation.
Costs matter
Every pound unnecessarily spent on investment management is a pound that isn’t compounding for you. We therefore favour simple, low-cost investments where possible.
Diversification works
Rather than trying to find the next winner, we invest across thousands of companies around the world. We don’t have a UK bias simply because we happen to live here
Good Investing requires discipline
Markets will fall. Headlines will be frightening. There will always be a reason to think “this time is different”. A good investment strategy should help you avoid making expensive decisions at precisely the wrong time.
Keep enough cash
Not everything should be invested.
Money you are likely to need in the short term shouldn’t depend on what markets happen to be doing. We help clients maintain appropriate cash reserves so their investment portfolio can remain invested through difficult markets without being forced to sell at the wrong time.
Markets reward patience
Investing is a long-term activity.
Over short periods, markets can be unpredictable and uncomfortable. Over the long term, investors have historically been rewarded for accepting uncertainty and allowing businesses and economies time to grow. We build portfolios for years and decades, not the next few months.
What we invest in
Our portfolios are deliberately straightforward.
For growth, we invest predominantly in low-cost equity index funds, giving our clients exposure to thousands of companies around the world.
For defensive assets, we favour high-quality government bonds, particularly UK gilts, where their job is to provide stability rather than excitement.
We don't invest in something simply because it's fashionable or sophisticated. We generally avoid structured products, hedge funds, commodities, private equity and other unnecessary complexity.
For most clients, we manage this through our Custom Model Portfolio Service, built with Collidr (part of ISIO group) specifically for Thera clients.
Where circumstances require it, we can also build more bespoke portfolios, including individual gilt portfolios and responsible investment solutions