1.
Jamals path to succesful
investing
Investme Financial Services LLC

2.
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3.
Why is my risk tolerance important
• Suffer large losses due to misunderstanding the risk
• How to achieve your long term goals
• Is standard risk profiling fundamentaly flawed.
• Understanding your ow risk structure before you meet an advisor
• What is my capacity for loss assessment
• What level of risk do I need to achieve my goal
• Being able to do a gap analysis (how much am I missing)
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4.
How do I determine my true risk profile
• Everyones perception of risk is diffent
• Determine your own risk using online tools such as
http://investme.ae/riskManagement/
• This should give you expected returns based upon your risk
• This is the basis of determining your potential of reaching your
retirement goal
• Most people base their strategies on the returns they want. This is
wrong.
• Focus on managing risk and accept returns that go along with it.
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5.
How much do I need when I retire
• Determine your inflation adjusted income needs
• Work out how much you need to retire using online tools such as
• How much do I need to save
• http://investme.ae/retirement-calculator/
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6.
Retirement Equation

7.
Life Expectancy Probabilities

8.
Goal-Based Wealth Management

9.
Where to allocate assets
• Rule of thumb, the older you get the less risk you should take.
• Rule 1 the time horizon is one year, stay in cash
• Rule 2 time horizon is 1-5 years safe income producing investments
• Rule 3 Money you dont need for at least 5 years is a candidate for the
stock market
• Rule 4 Diversify into other asset classes
• Rule 5 Get your fees as low as possible
• Rule 6 No Lock in Periods
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10.
The Market is too risky ?
Market falls by this much Historical frequency
10% Every 11 months
15% Every 24 months
20% Every four years
30% Every decade
40% Every few decades
50% 2-3 times per century
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11.
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Impact of Being Out Of The Market

12.
Warren Buffett summed up this chart with his
famous philosophy "Be fearful when others are
greedy. And be greedy when others are fearful."

13.
Did you know when the Bear market would
end?
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14.
How do I achieve the returns with my risk
profile
• Fees are the biggest detriment to long term performance
• 3% p.a. Fees requires 3% return just to stand still
• Asset allocation has the second biggest effect on long term returns
and volatility.
• Do not do market timing, the average investor underperforms the
market by 4% p.a.
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15.
Start Saving Late assuming 8% return
• 30 year old investing 10,000 p.a. for 35 years total saved 360,000
• 40year old investing 17,000 p.a. For 25 years total saved 357,000
• Despite saving 70% more per month to catch up.
• 30 year old would have approx 1.75 million in equity
• 40 year old would have approx 1.4 million in equity
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16.
so
Source : Journal Of Financial Planning 16

17.
Major Asset Classes vs. Inflation

18.
Maintain a Diversified Approach and Rebalance

19.
Why Diversify? BACAUSE WINNERS ROTATE.
Perhaps nothing better illustrates the need for an asset allocation plan than the chart below, which shows how various asset classes performed
on a year-by-year basis from 1994 through 2013. The best-performing asset class is at the top of each column. Please remember, past
performance does not guarantee future results.
Annual Return of Key Asset Classes Between 1994-2013
Ranked in Order of Performance from Best to Worst.

20.
Chasing yesterday’s winners is a losing game!

21.
Similar returns different outcomes
1972-2007 Portfolio A Portfolio B Portfolio C Portfolio D Portfolio E
Return* 11.2% 11.8% 13.0% 11.7% 13.2%
£1 turned into... £45.50 £54.53 £81.79 £52.81 £87.31
Standard deviation 17.0 21.7 17.4 24.5 11.0
Sharpe ratio 0.39 0.35 0.48 0.34 0.68
Worst 1-year return -26.5% -23.2% -21.4% -35.7% -12.8%
Worst 3-year return* -14.6% -17.0% -10.5% -9.6% -0.6%
Worst 5-year return* -2.3% -2.6% 3.3% 4.5% 3.3%
Worst 10-year return* 5.9% 4.3% 9.1% 2.1% 8.7%
*Compound annual total return. Source: Roger C. Gibson, Gibson Capital Management.
Source : GIBSON (Capital Management)
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S&P 500 EAFE Property Commodities Equal Parts ABCD
Nareit GSCI Annual Rebalancing

22.
What is asset allocation
• Different investments that are non or low correlated
• Reduces volatility (highly correlated assets do not lower risk)
• Tends to outperform due to rebalancing
• Non or low correlated assets are Real Estate, fixed income, natural
resources or commodities
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23.
Should you do it yourself?
• Not if you have little or no experience with finances
• Not if fear or greed determines how you invest
• You dont have the time or inclination to do it
• You want an objective outside perspective
• You have a complex financial situation
• This is now where you need the help of an IFA
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24.
Investing is a very serious business
• Ensure that the company and advisor you are speaking to is regulated
by either
• The Insurance authorities or The Securities & Commodities Authority
(SCA)
• www.sca.gov.ae/english/pages/default.aspx
• Ensure that the advisor is employed by the company
• Ensure that the advisor has financial qualifications from the relevant
authorities.
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25.
Ask the following questions
• What experience do you have
• What services do you offer
• How will I pay for your services
• How much do you typicaly charge
• How are you compensated (No double dipping)
• What are the hidden charges
• Can I have it in writing
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26.
Active Portfolio Management
• The IFA should be able to use financial modelling tools to determine
the probability of achieving your goals with the selected asset
allocation model
• The IFA should be doing a constant rebalancing of the portfolio
• Every meeting should be based upon reviewing your portfolio and not
selling new products
• You should be doing an annual risk analysis as time changes
everything
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27.
Our solution
• Investment Portfolio using Exchange Traded Funds (ETF’s)
• Asset allocation model
• No Lock in Periods
• No redemption costs
• Set up fee 1%
• Total asset management costs of approx. 1.75%

28.
InvestMe
How do our costs compare?
Type of Investment
Solutions
Typical Multi Asset
Funds
InvestME
discretionary
managed ETF
portfolios
InvestME
Protected
Portfolios
Typical Bespoke
DFM
AMC 1.00% 1.00% 1.00% 1.00%
Investment Fee n/a 0.10% n/a 1.00%
Underlying
Investments
1.85% 0.30% 0.50% 0.50%
Platform Fee 0.35% 0.35% 0.35% 0.35%
Total annual
cost
3.20% 1.75% 1.85% 2.85%