Investment risks
Taru Singhal,Head of IFA Distribution.
John Astrup,Investment Product Manager.
Reena Vivek,Chief Operating Officer.

Investors like you - how experts are investing their bonus

Are you thinking about investing money in 2019? Did you just receive your year-end bonus and want to grow it into even more? Or are you thinking of increasing your monthly savings plan? If so, how will you go about it? What will you invest in? How will you divide your investments between, say, steady low-risk government bonds and higher-risk, higher-growth equities?

To help give you a sense of what others might be thinking, we spoke to three Zurich IQ experts about their plans.

Saving to send my kids to college - Taru Singhal , Head of IFA Distribution:

“As an investor, my personal circumstances really changed when my second son was born. Immediately, I became more focused on the opportunities I wanted both my boys to have later in life - I’d love to give them the option to study abroad at some point. While I'm not exactly sure when they will choose to do this, perhaps 10-12 years from now, saving to ensure we have enough to send them to a college of their choice is definitely a high priority for me.

So this year I'm de-risking my investments a little. What I want is a little more certainty around accessing my money so when it's time to put down a deposit for a college placement, I can more easily combine my savings with my wife’s. Even though my investment philosophy is still to diversify, this year I want to fundamentally change the overall mix of assets in my portfolio from 80% equities and 20% bonds to 60% bonds and 40% equities – creating a greater balance between equities and bonds.

I plan to use the Zurich US Dollar Cautious fund as my core investment fund. It offers my savings the possibility of a good appreciation because of its solid holding of higher-growth equities. I also don't have to worry about maintaining that balanced mix of bonds and equities as the US Dollar Cautious fund does all the rebalancing for me, which is perfect when you have other things to think about!’’

Ignoring the noise and sticking to my plan - John Astrup, Investment Product Manager:

‘’Even though I have spent my career working in investments and for asset managers, I don't consider myself smart enough to see what's around the corner for markets, let alone time my investments by second guessing economic news. So instead I follow the maxim that 'investing should be like watching paint dry'. I like it boring, which is why I invest in the Zurich Allocated Passive 60% Equity fund.

The portfolio invests in markets across the globe, with a huge natural level of diversification, and it provides the right mix of equities and bonds for me. The fund performed in 2018 as it was meant to: when markets went up, so too did my investments, and when they wobbled at the end of the year, the bond elements did their job and acted as a shock absorber. I like that I didn't have to do a thing.

I have a middle of the road approach to investing, taking on a balanced level of investment risk to achieve steady, dependable growth. My regular savings are in the Zurich Allocated Passive 60% Equity fund and I intend to continue adding to it this year and for as long as I can afford to do so.’’

Taking more risk to improve my earnings long-term - Reena Vivek, Chief Operating Officer:

"I'm a risk taker and I look to the long-term horizon, so the choice is pretty straightforward for me, which is to invest more in equities than in bonds. Hence, my core holding is the Zurich US Dollar Performance fund, which should improve my earnings potential in the long run.

This year I've reassessed my holdings in the light of recent market corrections and put some money to work in our Zurich Allocated Passive 100% equity fund. It's a bit of a strategic tilt in my overall portfolio as it means taking on even more risk. But then I'm still young, so that suits me as I have plenty of time.

I like that I gain exposure to more than 6,000 stocks from around the world. What's more, these stocks include larger blue-chip companies as well as smaller companies and those in-between. So I get the benefit of being invested in the Apples, Amazons and Netflix’s of this world but I'm also exposed to potentially faster-growing and more innovative small companies.”

Understand your priorities, select your own investment path

It can be instructive to see how other people build their investment portfolios; the thought processes they go through, the criteria they employ, and the priorities they set themselves. However, we are all different. Our Zurich IQ experts give you an inkling of the various possibilities. But it is important to note that what's right for them, may not be right for you. Always invest based on your own circumstances and get some specialist advice from a financial professional.

With bonus season in full swing, it is important to consider how you will make the most of your hard earned cash. There are plenty of ways to spend your money here in the Middle East, but it’s worth considering investing this cash windfall to turn today’s dollar into your dream for tomorrow. Read the blog article by investment expert, John Astrup to learn more about what to do with your cash this bonus season.

When working with a financial professional to select funds for your own portfolio, it is important to ask yourself a few key questions. In particular, what are your goals? How long are you investing for? And what level of risk are you comfortable taking? Then, create your own investment path.

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