RCIS - The Philosophy of Wealth

RICHARD CLUVER INVESTMENT SERVICES

The Philosophy of Wealth
Richard Cluver

Wealth is the elusive dream
Universally sought but practically achieved by only one in a thousand of the world's population, wealth is nevertheless one of the easiest attained of life's challenges.
Property as an Investment
Property is a poor performer unless you fully understand what you are doing.
Investing in Gilts and the Money Market
Gilts are universally regarded as the safest of all forms of investment but are at risk because of the hazards of inflation.
Investing in Shares
Why well-chosen blue chip shares offer the safest tax-free returns.
Why share trading seldom pays
Taxation and brokerage charges have stripped share trading of the advantages they formerly offered.
Defining an investment grade share
Investment grade shares have clearly defined balance sheet statistics.
Why value investing became fashionable
Since taxation stripped share trading of its profitability, it has become increasingly important to be able to select the long-term winners.
Refining the share selection process
The search for "The Grand Old Favourites."
In search of reliability and performance.
Companies that have paid consistently-increasing dividends over many years have become highly valued investments.
Summarising what we have learned
Six methods of share selection_and then a seventh exponential approach that really delivers growth.
How do these shares rate long term?
If you seriously want a portfolio to go to sleep on, then your only safe situation would be to buy one consisting solely of the Grand Old Favourites
The dividend trend is everything?
Even so an occasional trade might pay provided one could develop a really reliable indicator of impending change
Signs of an impending price change!
Dividend trend changes signal impending price changes in most classes of shares.
How to distinguish share quality
What makes a rising star a long-term investment grade share.
How to distinguish the long-term performers
Its all about market capitalisation.
Adding a few new categories
Balance sheet statistics that distinguish the top-performers.
Low tradability shares perform better
Tightly-held shares should in theory under-perform the average, but if they have quality credentials they outperform it.
Return on retained earnings
What a company does with its undistributed profits distinguishes the top performers.
Balancing reward with risk
Introducing the concept of measured risk.
Creating a basis for evaluating risk
Comparing the relative risk ratings of various categories of investments.
How much risk can an individual afford
The degree of risk you can cope with depends upon age and circumstances.
Understanding the need for diversification and the role of cyclic profit companies
Diversifying a portfolio is just as much about balancing categories of shares as it is about numbers.
Recognising that different people have different investment needs: capital growth versus income growth
Most investors believe that share selection is all about aggregate price growth when in truth many actually need income growth. Appreciating the difference.
How to construct a portfolio
The nuts and bolts of putting together a portfolio tailored to one's personal needs.
How to anticipate big market crashes
Learning how to anticipate those regularly recurring market crashes and how to take avoiding action.
How to predict optimum share buying and selling points
It is one thing to be able to choose the best shares and quite another to know when to buy and sell.
Using simple chart formations to recognise signs of impending market change
Learning how to recognise a few simple technical analysis patterns can greatly assist your buying and selling.
Corporate pyramids can be a dangerous trap for unwary investors
Understanding why pyramid companies are seldom attractive for investors.
Preference shares can be an attractive option when interest rates are low
Understanding the difference between Ordinary and Preference shares and why they pay a higher dividend.
Why I do not favour Unit Trusts
High management fees and poor returns have made unit trusts relatively unattractive investments.

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