Strategic investment action
…Investing using dollar cost averaging
Strategic investment action –
- implemented by clients in the early months of the recovery from the GFC that started on 9 March 2009,
- included cautiously applying dollar cost averaging.
As the ‘dark (became) less dark’(1) –
- we noted improvements in client portfolios – and
- our clients gradually became more confident that even greater gains were coming.
We encouraged investors to –
- consider their investment objectives and their timeframes –
- and then to act as their level of confidence grew,
…along with their selected investment markets.
Strategic investment action – is it timeless?
As the events of those times affirmed –
- and the investment outcomes for these clients demonstrated,
- investing to a well considered strategy works well over time.
The investments may suffer occasional setbacks – sometimes quite extreme – but
- provided the financial resources; and
- the reasoning behind the strategy are sound,
- progress toward feasible goals and objectives is achieved.
Clients who implemented our advice in the months following the nadir of the GFC, as to the suitability of re-entering the investment market for long-term strategic purposes, have been rewarded. Our long-term view is that –
- the time is almost always right to start placing investment funds into
- appropriately rated, well researched equity-based products
– subject to the investment being in line with the individual strategic financial plan.
Our confidence in this approach has been formed through extensive experience in monitoring the market –
- listening to predictions and forecasts of economists and analysts (in whom we have confidence); and
- in observing the behaviour of the marketplace participants generally.
In early 2009, we took the view that there was likely to be continuing volatility in share markets right around the globe – probably for much of the remainder of 2009: and that there was the possibility of occasional retractions as markets worked through the shock of the GFC. We also agreed with the consensus view that when the markets recover from those retractions, they would likely settle in to a sustained period of steady growth. [In hindsight, we were not expecting the term of growth to be as lengthy, nor for it to be so gradual.]
Strategic investment lessons learned
Where clients are new to investing, perhaps with recently gained capital, we often encourage entering the market gradually, proportionally investing over a calculated, extended period: that is, investing the committed amount in a number of smaller tranches. This process is also known as ‘dollar-cost-averaging‘. Utilising this process you acquire investment assets at an average price over the investment term and minimise the risk of trying to ‘time the market’.
Please remember the following (to which the above comments are subject):
- This is general information only: do not act without obtaining specific personal advice from a qualified , experienced financial adviser;
- ContinuumFP advice in relation to investing is provided to clients in a strategic financial planning context; and
- Our investment strategies focus on the appropriate term; and
- always set for the circumstances of the specific individual to whom they are provided.
Strategic investment advice is available
Continuum Financial Planners Pty Ltd can advise and assist you in relation to entering, or indeed re-entering the investment market. To arrange a meeting with one of our experienced financial planners –
- call our office, on 07-34213456, or
- at your convenience, use the linked Book A Meeting facility.
‘we listen, we understand; and we have solutions’ that we deliver with personalised, professional wealth management advice.
1 In April 2009, we suggested the financial demise was turning, in our post ‘There is light at the end of the tunnel‘ (subsequently renamed ‘Investor Support – 2008’.
(This post was originally posted by us in April 2009. It has occasionally been refreshed/ updated, most recently in May 2025.]
