1 00:00:01,240 --> 00:00:14,360 Speaker 1: She's on the Money. She's on the Money. 2 00:00:17,120 --> 00:00:20,120 Speaker 2: Hello, and welcome to She's on the Money, the podcast 3 00:00:20,120 --> 00:00:23,880 Speaker 2: for millennials who want financial freedom. Now today we're chatting 4 00:00:24,079 --> 00:00:26,720 Speaker 2: risk profiles. They're those things you've heard us talk about 5 00:00:26,840 --> 00:00:30,800 Speaker 2: thousands of times on the podcast before, particularly when discussing 6 00:00:30,960 --> 00:00:36,280 Speaker 2: investing v so, especially when they go hand in hand. 7 00:00:37,080 --> 00:00:40,680 Speaker 2: So if you've always wondered what a risk profile actually 8 00:00:40,840 --> 00:00:43,000 Speaker 2: is and want to know where you fall on the 9 00:00:43,120 --> 00:00:47,559 Speaker 2: risk scale, then today's show is the perfect place to start. 10 00:00:47,720 --> 00:00:50,159 Speaker 2: It is, it really is. Can't wait for it. 11 00:00:50,280 --> 00:00:51,920 Speaker 3: I'm actually so everyone's excited. 12 00:00:51,960 --> 00:00:55,000 Speaker 2: You're excited. I'm excited now. If you don't know, my 13 00:00:55,160 --> 00:00:58,840 Speaker 2: name is Georgia King. I'm a copywriter and journalism student, 14 00:00:58,960 --> 00:01:02,280 Speaker 2: and joining me as she does every Wednesday morning, is 15 00:01:02,320 --> 00:01:05,080 Speaker 2: financial advisor Miss Victoria to fine Fee. 16 00:01:05,440 --> 00:01:09,080 Speaker 3: Good day, Hello g King. You are usually far or complimentary, 17 00:01:09,280 --> 00:01:12,520 Speaker 3: like I usually get like a glitzy, glamory introduction, but 18 00:01:12,600 --> 00:01:15,040 Speaker 3: today I just got Yeah, So she's a financial advisor? 19 00:01:15,120 --> 00:01:17,400 Speaker 2: Did I do Melbourne based? Sometimes I throw that into 20 00:01:17,600 --> 00:01:21,200 Speaker 2: for it geographical, you know what it'll do it. Moving on, 21 00:01:21,440 --> 00:01:24,080 Speaker 2: they talk us through what we are actually going to 22 00:01:24,080 --> 00:01:25,480 Speaker 2: be covering in today's episode. 23 00:01:25,520 --> 00:01:27,959 Speaker 3: Well, I'm really excited about this episode, namely because they 24 00:01:28,000 --> 00:01:30,120 Speaker 3: always talk about risk profiles, but I've never told you 25 00:01:30,160 --> 00:01:32,160 Speaker 3: what a risk profile is. So today we're going to 26 00:01:32,200 --> 00:01:34,600 Speaker 3: be covering the A Z E of what a risk 27 00:01:34,680 --> 00:01:36,360 Speaker 3: profile is. And I'm going to tell you the six 28 00:01:36,400 --> 00:01:39,480 Speaker 3: different types of risk profile there are. I'm going to 29 00:01:39,560 --> 00:01:42,480 Speaker 3: tell you how to I identify which categories you fall into, 30 00:01:42,600 --> 00:01:45,160 Speaker 3: and I'm going to tell you exactly why knowing your 31 00:01:45,240 --> 00:01:48,400 Speaker 3: risk profile is arguably the most important step in investing. 32 00:01:49,000 --> 00:01:49,480 Speaker 2: Can't wait? 33 00:01:49,880 --> 00:01:52,320 Speaker 3: Yeah? I knew you'd be excited. And if you're not 34 00:01:52,440 --> 00:01:55,160 Speaker 3: excited in listening on, well, grab hold of your seat 35 00:01:55,320 --> 00:01:58,240 Speaker 3: or you're you know, car set or the legs you've 36 00:01:58,240 --> 00:02:01,480 Speaker 3: got while you're on your walk like care strappy. 37 00:02:01,560 --> 00:02:03,720 Speaker 2: Because things are about to hate it are about to 38 00:02:03,720 --> 00:02:07,360 Speaker 2: get risky. Let's start from the start. It makes sense, 39 00:02:07,400 --> 00:02:10,240 Speaker 2: it's practical. What is a risk profile? 40 00:02:10,360 --> 00:02:14,360 Speaker 3: Okay, So before we even consider investing, we need to 41 00:02:14,560 --> 00:02:17,800 Speaker 3: assess the setup. We need to understand the framework for 42 00:02:17,880 --> 00:02:21,280 Speaker 3: how we're going to invest. A risk profile is basically 43 00:02:21,360 --> 00:02:23,840 Speaker 3: our assessment of what kind of investments you're willing to 44 00:02:23,919 --> 00:02:26,320 Speaker 3: take on and what ones you're not willing to take 45 00:02:26,360 --> 00:02:28,640 Speaker 3: on and is going to be based on the level 46 00:02:28,720 --> 00:02:31,240 Speaker 3: of risk you're happy to be exposed to. So this 47 00:02:31,280 --> 00:02:33,959 Speaker 3: is going to be so different for every single person 48 00:02:34,040 --> 00:02:37,000 Speaker 3: listening because not all of us have the same tenacity 49 00:02:37,040 --> 00:02:38,919 Speaker 3: to take on risk, but not all of us want 50 00:02:38,919 --> 00:02:41,480 Speaker 3: the same things or even have the same financial background 51 00:02:41,880 --> 00:02:44,720 Speaker 3: or the same types of assets to play with. Really, 52 00:02:45,080 --> 00:02:47,840 Speaker 3: so we need to take into account your personal preferences 53 00:02:47,880 --> 00:02:51,120 Speaker 3: and what kind of investor you are. That's actually really 54 00:02:51,160 --> 00:02:53,960 Speaker 3: really important. If you take on a risk profile that 55 00:02:54,080 --> 00:02:56,720 Speaker 3: you're not comfortable with, you're not going to be able 56 00:02:56,720 --> 00:02:58,480 Speaker 3: to sleep well at night. If you can't sleep well 57 00:02:58,520 --> 00:03:00,520 Speaker 3: at night, you're very likely to pull out of an 58 00:03:00,560 --> 00:03:03,000 Speaker 3: investment at a time that is not good for you. 59 00:03:03,080 --> 00:03:06,040 Speaker 3: And if you do that, you're putting future you at risk. 60 00:03:06,360 --> 00:03:08,720 Speaker 3: So we need to just make sure everything is hunky dory. 61 00:03:08,840 --> 00:03:12,040 Speaker 3: And I know that many people who have assets behind 62 00:03:12,080 --> 00:03:14,840 Speaker 3: them to be able to operate as high risk investors 63 00:03:14,919 --> 00:03:17,400 Speaker 3: or they're willing to take that risk if they don't 64 00:03:17,440 --> 00:03:20,960 Speaker 3: have heaps behind them, but also their personalities might be 65 00:03:21,040 --> 00:03:21,720 Speaker 3: to take that on. 66 00:03:22,320 --> 00:03:26,680 Speaker 2: So it can be a combination of what your financial 67 00:03:26,680 --> 00:03:28,600 Speaker 2: position says you can take on in terms of risk, 68 00:03:28,680 --> 00:03:31,080 Speaker 2: but also what you're comfortable with doing. So that's how 69 00:03:31,120 --> 00:03:33,120 Speaker 2: we kind of figure it out. 70 00:03:33,120 --> 00:03:37,000 Speaker 3: Absolutely, And there are six different types of risk profile 71 00:03:37,000 --> 00:03:40,880 Speaker 3: that we are going to cover today. They are capital stable, conservative, 72 00:03:41,000 --> 00:03:45,160 Speaker 3: moderately conservative, moderate growth, growth, and high growth. And I'm 73 00:03:45,200 --> 00:03:47,920 Speaker 3: going to go through them one by one. Which one 74 00:03:47,960 --> 00:03:49,040 Speaker 3: do you want to start with? Gking? 75 00:03:49,160 --> 00:03:50,280 Speaker 2: Let's go capital stable. 76 00:03:50,560 --> 00:03:53,280 Speaker 3: Oh, that's arguably the most bland one, but we have 77 00:03:53,360 --> 00:03:57,080 Speaker 3: to start somewhere. I explain this literally each and every 78 00:03:57,120 --> 00:03:59,640 Speaker 3: single week, two clients that are coming on board, I 79 00:03:59,720 --> 00:04:02,960 Speaker 3: take them through a risk profile before I will even 80 00:04:03,080 --> 00:04:06,200 Speaker 3: consider working with them. So if you start to see 81 00:04:06,240 --> 00:04:08,280 Speaker 3: a financial advisor, this will actually be a part of 82 00:04:08,320 --> 00:04:11,040 Speaker 3: the process. So you'll go through what's called a fact 83 00:04:11,080 --> 00:04:14,280 Speaker 3: find process, and the advisor will be like, hey, G King, 84 00:04:14,520 --> 00:04:17,440 Speaker 3: nice to see you. So here are all these forms 85 00:04:17,440 --> 00:04:18,880 Speaker 3: you need to fill in to tell me about your 86 00:04:18,880 --> 00:04:22,400 Speaker 3: personal situation, and here is your risk profile that you 87 00:04:22,440 --> 00:04:23,839 Speaker 3: need to fill in to tell me what kind of 88 00:04:23,880 --> 00:04:25,839 Speaker 3: investor you are. And you're like, oh, well, like I 89 00:04:25,839 --> 00:04:28,160 Speaker 3: thought this was going to be easy, and we're like, no, no, no, 90 00:04:28,279 --> 00:04:30,960 Speaker 3: have some admin is that like a little questionnaire? Is 91 00:04:30,960 --> 00:04:33,680 Speaker 3: something questionnaire? It's very pretty, very pretty document. I mean 92 00:04:33,720 --> 00:04:37,120 Speaker 3: it's a pretty document, Etzella, because obviously esthetics and everything. 93 00:04:37,480 --> 00:04:40,360 Speaker 3: My financial advisors don't actually care. They're always like, oh cool, 94 00:04:40,480 --> 00:04:43,440 Speaker 3: she changed again, we have to use the most of 95 00:04:43,560 --> 00:04:45,919 Speaker 3: today one. But you know, I think it's beautiful, and 96 00:04:45,960 --> 00:04:47,920 Speaker 3: I think that people actually care about what their risk 97 00:04:47,960 --> 00:04:50,080 Speaker 3: profiles look like. Oh for sure, I'm not going to 98 00:04:50,120 --> 00:04:51,440 Speaker 3: do a questionnaire if it's not pretty. 99 00:04:51,720 --> 00:04:54,120 Speaker 2: Why would you capital stable? Though? Talk to me. 100 00:04:54,240 --> 00:04:57,040 Speaker 3: Yeah, Look, if you're a capital stable investor, it means 101 00:04:57,080 --> 00:04:59,480 Speaker 3: that you have a number of things going on, right, 102 00:04:59,560 --> 00:05:01,400 Speaker 3: so you might I might choose that because you have 103 00:05:01,480 --> 00:05:05,040 Speaker 3: little to no understanding of your investment risk profile or 104 00:05:05,080 --> 00:05:07,560 Speaker 3: investing in general. You might have a whole eve of 105 00:05:07,560 --> 00:05:09,640 Speaker 3: cash and you're about to retire, which means you have 106 00:05:09,839 --> 00:05:12,719 Speaker 3: no interest investing and being exposed to the share market 107 00:05:12,720 --> 00:05:14,640 Speaker 3: because that would be risky and you don't actually want 108 00:05:14,680 --> 00:05:17,280 Speaker 3: to lose any of your capital, because that's a terrible idea, 109 00:05:17,360 --> 00:05:20,520 Speaker 3: especially if you're going into retirement. When you think of 110 00:05:20,680 --> 00:05:23,560 Speaker 3: risks as an individual, you might go, oh my gosh, 111 00:05:23,600 --> 00:05:26,159 Speaker 3: that's so dangerous, Like I've got no interest, Like that 112 00:05:26,279 --> 00:05:29,200 Speaker 3: really scares me. I really don't want to have any investments. 113 00:05:29,560 --> 00:05:32,680 Speaker 3: A capital stable investor is your friend that only has 114 00:05:32,800 --> 00:05:35,280 Speaker 3: a bank account with a world or at return. Like 115 00:05:35,320 --> 00:05:37,760 Speaker 3: they weren't the friend that is chasing high returns in 116 00:05:37,760 --> 00:05:40,559 Speaker 3: the share market. They're the friends. They're just plugs away. 117 00:05:40,680 --> 00:05:44,120 Speaker 2: Yeah, they're you, Georgia king Ah, the boring one. That's 118 00:05:44,120 --> 00:05:46,479 Speaker 2: what you said at the start. Look, I tried to. 119 00:05:46,480 --> 00:05:51,599 Speaker 3: Put enough words and you, but you're you right now 120 00:05:51,880 --> 00:05:54,200 Speaker 3: because you don't invest and you just have money in 121 00:05:54,240 --> 00:05:57,080 Speaker 3: a savings account, like right now, I would classify you 122 00:05:57,240 --> 00:06:00,799 Speaker 3: as a capital stable investor because most of your assets 123 00:06:00,839 --> 00:06:04,800 Speaker 3: are sitting in domestic cash i e. In your bank account. 124 00:06:05,279 --> 00:06:07,880 Speaker 3: Someone who is a capital stable investor is someone who 125 00:06:08,080 --> 00:06:10,640 Speaker 3: you know makes a financial decision, and when they do, 126 00:06:10,720 --> 00:06:12,960 Speaker 3: they focus on the potential loss. It's like they're more 127 00:06:13,040 --> 00:06:15,479 Speaker 3: likely to look at the negatives in a situation than 128 00:06:15,480 --> 00:06:19,000 Speaker 3: what they can gain, and they seek pretty basic returns. 129 00:06:19,040 --> 00:06:22,040 Speaker 3: They're not really looking towards taking on any risk because 130 00:06:22,040 --> 00:06:24,080 Speaker 3: they genuinely are just a bit like really that's a 131 00:06:24,120 --> 00:06:26,400 Speaker 3: durable idea. I don't care how much you know about investment. 132 00:06:26,560 --> 00:06:27,279 Speaker 2: I don't care. 133 00:06:27,160 --> 00:06:29,719 Speaker 3: How good the upside is. All I think about is 134 00:06:29,720 --> 00:06:32,200 Speaker 3: the downside. So I'm just keep my money in the bank. 135 00:06:33,279 --> 00:06:35,560 Speaker 2: But there's nothing to say that you can't be a 136 00:06:35,600 --> 00:06:39,240 Speaker 2: capital stable and then become, you know, a moderately conservative. 137 00:06:39,440 --> 00:06:42,320 Speaker 3: No, no, absolutely not if it's all about education, and 138 00:06:42,360 --> 00:06:45,000 Speaker 3: that is what we are learning today. It is absolutely 139 00:06:45,040 --> 00:06:48,120 Speaker 3: not about just what is one size fits all. So 140 00:06:48,240 --> 00:06:50,640 Speaker 3: someone who has capital stable, it's not a bad thing. 141 00:06:50,920 --> 00:06:54,320 Speaker 3: It just means that approximately. And we're going to start 142 00:06:54,320 --> 00:06:57,120 Speaker 3: talking about percentages, which is very hard to articulate in 143 00:06:57,120 --> 00:06:59,800 Speaker 3: a podcast, but Jess is going to do an epic 144 00:06:59,880 --> 00:07:01,600 Speaker 3: little you know, I think she's going to do an 145 00:07:01,600 --> 00:07:05,560 Speaker 3: Instagram carousel post of all of the different risk profiles 146 00:07:05,720 --> 00:07:07,200 Speaker 3: so that you can have a look and see what 147 00:07:07,240 --> 00:07:09,279 Speaker 3: the percentages are. So it makes a lot more sense 148 00:07:09,320 --> 00:07:11,280 Speaker 3: to you. And we are going to ensure that that's 149 00:07:11,360 --> 00:07:13,280 Speaker 3: posted it about the same time, So maybe without your 150 00:07:13,720 --> 00:07:16,640 Speaker 3: jaw and have a hot look at your Instagram because 151 00:07:16,640 --> 00:07:18,920 Speaker 3: it will be right there on hopefully your homepage. 152 00:07:18,960 --> 00:07:21,200 Speaker 2: That's helpful with time, the well, visuals are helpful. 153 00:07:21,200 --> 00:07:23,200 Speaker 3: If you're going back through our podcast and this happens 154 00:07:23,240 --> 00:07:26,120 Speaker 3: to be a podcast that you're listening to hypothetically far 155 00:07:26,200 --> 00:07:28,400 Speaker 3: into the future, I'm sorry you've missed the boat. Please 156 00:07:28,440 --> 00:07:32,000 Speaker 3: scroll down on the Instagram by that content. But we'll 157 00:07:32,000 --> 00:07:34,960 Speaker 3: have a little pie chat now. The most important thing 158 00:07:35,000 --> 00:07:37,800 Speaker 3: to remember about this pie chat, apart from it being 159 00:07:37,920 --> 00:07:43,520 Speaker 3: really ridiculously attractive, is that each and every single asset 160 00:07:43,560 --> 00:07:46,040 Speaker 3: class is actually the same. 161 00:07:45,960 --> 00:07:49,000 Speaker 2: Between risk profiles. It's between risk profiles. 162 00:07:49,080 --> 00:07:52,760 Speaker 3: The thing that changes is the percentage of that asset 163 00:07:52,920 --> 00:07:57,000 Speaker 3: you hold, not the percentage of you know, different companies 164 00:07:57,040 --> 00:08:00,400 Speaker 3: that you're investing in or different asset classes. So the 165 00:08:00,440 --> 00:08:04,000 Speaker 3: cash inside a capital stable portfolio for those of you 166 00:08:04,160 --> 00:08:07,160 Speaker 3: play along at home, is going to be about sixty 167 00:08:07,280 --> 00:08:10,640 Speaker 3: five percent of your portfolio, whereas if we jump a 168 00:08:10,680 --> 00:08:14,560 Speaker 3: little bit ahead to someone who has a growth portfolio 169 00:08:15,120 --> 00:08:17,800 Speaker 3: or a high growth portfolio, they're going to have five 170 00:08:17,840 --> 00:08:22,200 Speaker 3: percent and three percent retrospectively. Oh so it's one of 171 00:08:22,240 --> 00:08:25,560 Speaker 3: those things that it actually just that asset class becomes 172 00:08:25,640 --> 00:08:29,720 Speaker 3: lower and the other asset classes increase. So if you 173 00:08:29,880 --> 00:08:32,760 Speaker 3: say invest a little bit of money into an ETF, 174 00:08:32,800 --> 00:08:36,320 Speaker 3: if you are a conservative investor, what that might mean 175 00:08:36,440 --> 00:08:39,040 Speaker 3: is you just invest a higher percentage. Which is why 176 00:08:39,120 --> 00:08:42,960 Speaker 3: I say I am a high growth but conservative investor, 177 00:08:43,000 --> 00:08:45,319 Speaker 3: because when I say that, what I mean is I 178 00:08:45,440 --> 00:08:47,720 Speaker 3: want most of my money to be exposed to the 179 00:08:47,720 --> 00:08:50,680 Speaker 3: share market. I don't actually want to be holding any 180 00:08:50,760 --> 00:08:53,520 Speaker 3: cash in a savings account. I have my emergency fund, 181 00:08:53,559 --> 00:08:56,240 Speaker 3: and to be quite frank that's pretty much the only 182 00:08:56,320 --> 00:08:59,559 Speaker 3: savings I personally have. Then, have you know a cash harbin. 183 00:08:59,559 --> 00:09:01,240 Speaker 3: I've got myn that comes in and out to pay 184 00:09:01,240 --> 00:09:03,840 Speaker 3: for my life. But I don't actually have a savings 185 00:09:03,880 --> 00:09:06,560 Speaker 3: account to say for anything, because it's really empty after 186 00:09:06,600 --> 00:09:09,319 Speaker 3: purchasing a home. Kind of sad, but that is okay. 187 00:09:09,880 --> 00:09:13,000 Speaker 3: But most of my assets are now in one a 188 00:09:13,040 --> 00:09:16,719 Speaker 3: really big mortgage, but two they're in my share portfolio. 189 00:09:17,040 --> 00:09:20,360 Speaker 3: But my share portfolio will just increase in comparison. And 190 00:09:20,559 --> 00:09:23,040 Speaker 3: what I mean when I say I'm conservative is I'm 191 00:09:23,040 --> 00:09:25,679 Speaker 3: not picking risk air sets. I would never and I'm 192 00:09:25,720 --> 00:09:28,439 Speaker 3: not saying this because everybody should. I'm saying this because 193 00:09:28,520 --> 00:09:31,880 Speaker 3: me personally, because I'm not willing to invest in risk 194 00:09:31,920 --> 00:09:35,200 Speaker 3: air sets like bitcoin, cryptocurrency, things that you know, have 195 00:09:35,360 --> 00:09:37,679 Speaker 3: just gone through an IPO. Like I'm a little bit 196 00:09:37,760 --> 00:09:40,840 Speaker 3: risk averse. I want tried and true blue chip stocks 197 00:09:41,160 --> 00:09:43,440 Speaker 3: that are going to make me feel safe and secure 198 00:09:43,440 --> 00:09:46,560 Speaker 3: at night, and that's what's inside my investment portfolio. I'm 199 00:09:46,600 --> 00:09:49,960 Speaker 3: not actually investing in things that make me feel uncomfortable. 200 00:09:50,200 --> 00:09:52,360 Speaker 2: So you're basically saying that you have like a very 201 00:09:52,400 --> 00:09:56,079 Speaker 2: low percentage of cash, yes, as in money in your 202 00:09:56,120 --> 00:10:00,520 Speaker 2: savings accounts, and most of your money is in but 203 00:10:00,559 --> 00:10:02,680 Speaker 2: it's invested in really safe places. Yes. 204 00:10:02,720 --> 00:10:05,400 Speaker 3: So if you made a pie chart for Victoria Divine, 205 00:10:05,520 --> 00:10:08,640 Speaker 3: hers would say that she's a high growth investor and 206 00:10:08,840 --> 00:10:11,720 Speaker 3: that you know, most of her assets are split between 207 00:10:11,960 --> 00:10:16,000 Speaker 3: domestic equity and international equity, which is a fancy way 208 00:10:16,120 --> 00:10:21,400 Speaker 3: of saying Australian shares and shares from overseas. So for me, 209 00:10:21,679 --> 00:10:24,560 Speaker 3: I think it's really important to preface that because I 210 00:10:24,600 --> 00:10:29,439 Speaker 3: think people use words like oh, risky or aggressive investors 211 00:10:29,559 --> 00:10:31,839 Speaker 3: or high growth, and you think, oh, that's actually a 212 00:10:31,880 --> 00:10:33,080 Speaker 3: little bit intimidating. 213 00:10:33,360 --> 00:10:35,800 Speaker 2: I don't emotionally charged. Yeah, I don't. 214 00:10:35,640 --> 00:10:37,840 Speaker 3: Want to be an aggressive investor, Like that's not me. 215 00:10:38,240 --> 00:10:40,760 Speaker 3: An aggressive investor just means that most of your portfolio 216 00:10:40,800 --> 00:10:43,520 Speaker 3: is made up of shares, not cash. So capital stable. 217 00:10:43,679 --> 00:10:47,480 Speaker 3: Summary of that is people who are either really worried 218 00:10:47,480 --> 00:10:49,559 Speaker 3: about the share market and don't really want to invest, 219 00:10:50,080 --> 00:10:52,640 Speaker 3: or they're close to retirement and they want to maintain 220 00:10:52,679 --> 00:10:55,920 Speaker 3: the capital that they're created over their lifetime and most 221 00:10:55,920 --> 00:10:58,520 Speaker 3: of their assets are in cash. That's capital stable. 222 00:10:58,679 --> 00:11:02,360 Speaker 2: Let's move on now to talk about the conservative risk profile. 223 00:11:02,520 --> 00:11:06,520 Speaker 3: Yes, so when you move into a conservative portfolio and 224 00:11:06,640 --> 00:11:10,800 Speaker 3: a conservative risk profile, you start to increase the amount 225 00:11:10,920 --> 00:11:15,319 Speaker 3: of assets that you hold and you hold less cash. 226 00:11:15,559 --> 00:11:19,720 Speaker 3: Conservatives is going to introduce some more assets. You're going 227 00:11:19,760 --> 00:11:23,120 Speaker 3: to be looking at having now domestic equity as well 228 00:11:23,160 --> 00:11:25,640 Speaker 3: as some international equity, not much, but a little bit 229 00:11:25,640 --> 00:11:28,480 Speaker 3: of international equity. You'll be looking at things like domestic 230 00:11:28,520 --> 00:11:31,360 Speaker 3: fixed interest, which is again a really fancy way of 231 00:11:31,360 --> 00:11:35,200 Speaker 3: saying a bond or a high interest rate term deposit. 232 00:11:35,800 --> 00:11:39,080 Speaker 3: You'll probably introduce something like property. And when we say 233 00:11:39,080 --> 00:11:43,160 Speaker 3: property in an investment portfolio, we aren't talking about property 234 00:11:43,320 --> 00:11:45,760 Speaker 3: as in, hey George, I've put this down in your 235 00:11:45,800 --> 00:11:48,400 Speaker 3: conservative portfolio, Go buy an apartment, because it needs to 236 00:11:48,440 --> 00:11:50,920 Speaker 3: be you know, it needs to be a portfolio. I'm 237 00:11:50,960 --> 00:11:54,720 Speaker 3: actually talking about shares that you can buy in property assets. 238 00:11:55,120 --> 00:11:58,120 Speaker 3: So we're talking high rise buildings in the Melbourne CBD 239 00:11:58,240 --> 00:12:01,800 Speaker 3: the least out right in companies that hold those buildings, 240 00:12:01,840 --> 00:12:06,280 Speaker 3: and then you essentially have exposure to the property market, 241 00:12:06,320 --> 00:12:07,120 Speaker 3: which is kind of cool. 242 00:12:07,200 --> 00:12:07,720 Speaker 2: Yeahtcha. 243 00:12:07,760 --> 00:12:11,720 Speaker 3: You can own property without owning that thing. Yeah, cool, 244 00:12:11,960 --> 00:12:16,360 Speaker 3: So that is conservative. Conservative portfolios are again for people 245 00:12:16,360 --> 00:12:19,800 Speaker 3: who a little bit worried maybe want to be a 246 00:12:19,800 --> 00:12:23,400 Speaker 3: little bit more conservative. They have a pretty basic understanding 247 00:12:23,840 --> 00:12:27,240 Speaker 3: of the investment world. When they think of risk, they 248 00:12:27,320 --> 00:12:31,080 Speaker 3: don't think it means danger. But they also are pretty weary, 249 00:12:31,679 --> 00:12:34,320 Speaker 3: and when you make a financial decision, you're more focused 250 00:12:34,320 --> 00:12:36,200 Speaker 3: on the losses not on the gain. So if I 251 00:12:36,240 --> 00:12:39,200 Speaker 3: ask you the question, hey, Georgia, you've got a thousand dollars, 252 00:12:39,280 --> 00:12:41,959 Speaker 3: do you want to invest it? You could make eleven percent, 253 00:12:42,480 --> 00:12:44,680 Speaker 3: You'd be like, oh, what could I lose? And I 254 00:12:44,760 --> 00:12:47,679 Speaker 3: might go, oh, you could lose eleven percent. You're like, hmm, no, 255 00:12:47,800 --> 00:12:50,959 Speaker 3: thank you. I might just hold on to that and 256 00:12:51,280 --> 00:12:53,199 Speaker 3: put my money in an asset that might make four 257 00:12:53,200 --> 00:12:56,800 Speaker 3: a five percent. Right, I'm more likely as a conservative 258 00:12:56,840 --> 00:13:00,800 Speaker 3: investor to chase returns that are about four or five percent, 259 00:13:00,960 --> 00:13:04,960 Speaker 3: not eleven or twelve, which a lot of more aggressive 260 00:13:05,040 --> 00:13:07,080 Speaker 3: investors are probably looking towards. 261 00:13:07,880 --> 00:13:12,360 Speaker 2: Moving on too. Moderately conservative you're good at keeping me flowing, yeah, 262 00:13:12,440 --> 00:13:12,720 Speaker 2: like it. 263 00:13:12,920 --> 00:13:18,200 Speaker 3: So moderately conservative is again just increasing the amount of 264 00:13:18,320 --> 00:13:21,880 Speaker 3: assets that you hold, So you're probably a little bit 265 00:13:21,920 --> 00:13:25,959 Speaker 3: more prepared to establish a well diversified portfolio that protects 266 00:13:25,960 --> 00:13:28,520 Speaker 3: you from inflation and tax. So that's something you need 267 00:13:28,559 --> 00:13:31,240 Speaker 3: to take into consideration. If you are young, picking a 268 00:13:31,280 --> 00:13:35,160 Speaker 3: capital stable portfolio that returns two percent isn't actually going 269 00:13:35,200 --> 00:13:37,840 Speaker 3: to help you get ahead in terms of tax and inflation. 270 00:13:38,440 --> 00:13:41,520 Speaker 3: You're actually going to end up going backwards. Good financial 271 00:13:41,559 --> 00:13:43,439 Speaker 3: advisory is going to explain that to you and talk 272 00:13:43,480 --> 00:13:45,440 Speaker 3: you through your risk profile and the positives and the 273 00:13:45,480 --> 00:13:47,600 Speaker 3: negatives of it and what it might suit, who it's 274 00:13:47,640 --> 00:13:50,840 Speaker 3: best for. But it's really important to understand that when 275 00:13:50,840 --> 00:13:52,400 Speaker 3: you think of risk, you might be like, oh, it's 276 00:13:52,400 --> 00:13:54,720 Speaker 3: a little bit uncertain. I don't really know, but you 277 00:13:54,760 --> 00:13:57,160 Speaker 3: know you want to have some more shares. Going back 278 00:13:57,200 --> 00:14:00,800 Speaker 3: to percentages, around forty forty five percent of your total 279 00:14:00,840 --> 00:14:03,640 Speaker 3: portfolio is going to be made up of shares. You'll 280 00:14:03,679 --> 00:14:06,640 Speaker 3: then have a larger portion, so we're talking about twenty 281 00:14:06,720 --> 00:14:10,679 Speaker 3: percent of a domestic fixed interest asset, so essentially bonds 282 00:14:10,679 --> 00:14:13,600 Speaker 3: and high interest rate term deposits. But then you'll also 283 00:14:13,679 --> 00:14:18,920 Speaker 3: still have property. You will have some domestic property, international property. 284 00:14:18,920 --> 00:14:21,480 Speaker 3: You're going to have some international fixed interest, which is exciting, 285 00:14:21,520 --> 00:14:25,120 Speaker 3: So international bonds and you're also going to add in 286 00:14:25,320 --> 00:14:28,080 Speaker 3: alternative assets, which is kind of cool, kind of different. 287 00:14:28,360 --> 00:14:32,280 Speaker 2: I'm surprised to see that they only have twenty percent 288 00:14:32,360 --> 00:14:34,960 Speaker 2: of domestic cash, so money in the bank, but they're 289 00:14:34,960 --> 00:14:37,280 Speaker 2: still only considered to be moderately conservative. 290 00:14:37,480 --> 00:14:40,520 Speaker 3: You need to remember that it might be twenty percent cash. 291 00:14:40,680 --> 00:14:42,880 Speaker 3: So if you break it down one thousand dollars investment 292 00:14:42,920 --> 00:14:46,440 Speaker 3: portfolio two hundred dollars, if that would be in your pocket, 293 00:14:46,480 --> 00:14:48,760 Speaker 3: it would just be in cash. When I say in 294 00:14:48,840 --> 00:14:51,720 Speaker 3: your pocket, I don't mean hey, you're actually retain that. 295 00:14:51,760 --> 00:14:53,960 Speaker 3: Often it's put into a bank account on your behalf 296 00:14:54,000 --> 00:14:57,440 Speaker 3: that makes up your investment portfolio. But then you also, 297 00:14:57,600 --> 00:14:59,640 Speaker 3: if you're looking at that pie chart, you can see 298 00:14:59,640 --> 00:15:02,680 Speaker 3: domestic fixed interest, so that's a bond. So another twenty 299 00:15:02,680 --> 00:15:05,320 Speaker 3: percent is actually setting in a very conservative asset that 300 00:15:05,440 --> 00:15:07,920 Speaker 3: is only going to return maybe like three or four percent. 301 00:15:08,720 --> 00:15:12,280 Speaker 3: So when you think about a moderately conservative portfolio Georgia, 302 00:15:12,400 --> 00:15:15,280 Speaker 3: we are actually looking at something a little bit more diversified. 303 00:15:15,360 --> 00:15:17,760 Speaker 3: So when I say diversified, I mean there's just a 304 00:15:17,800 --> 00:15:20,640 Speaker 3: lot more colors on it, there's more options. It doesn't 305 00:15:20,680 --> 00:15:24,800 Speaker 3: mean it's a better diversified portfolio. Because these risk profiles 306 00:15:25,000 --> 00:15:28,440 Speaker 3: have different amounts of diversification allocated to them based on 307 00:15:28,440 --> 00:15:31,360 Speaker 3: your risk profile. So I feel like I'm talking really 308 00:15:31,400 --> 00:15:34,160 Speaker 3: quickly today, so I do apologize, but I'm just really 309 00:15:34,200 --> 00:15:38,520 Speaker 3: excited about this. But essentially, you will be allocated a 310 00:15:38,600 --> 00:15:42,480 Speaker 3: certain percentage. So if you were a moderately conservative investor, 311 00:15:42,600 --> 00:15:45,320 Speaker 3: you'd be allocated this pie chart, and then your financial 312 00:15:45,320 --> 00:15:49,080 Speaker 3: advisor would allocate investments in line with your risk profile, 313 00:15:49,080 --> 00:15:51,520 Speaker 3: which means they would then go, hey, Georgia, well for 314 00:15:51,560 --> 00:15:54,320 Speaker 3: the twenty one percent domestic equity or bonds that you're 315 00:15:54,360 --> 00:15:57,840 Speaker 3: meant to be holding, we recommend these options. So then 316 00:15:58,040 --> 00:16:01,640 Speaker 3: you would make up an investment portfolio with that amount 317 00:16:01,720 --> 00:16:04,880 Speaker 3: of that asset in your portfolio, as I choose to 318 00:16:05,240 --> 00:16:07,560 Speaker 3: just filling in the pie chat. But moving on to 319 00:16:07,680 --> 00:16:10,680 Speaker 3: the next risk profile, Georgia from memory, what is it? 320 00:16:10,680 --> 00:16:12,000 Speaker 2: It is moderate growth? 321 00:16:12,200 --> 00:16:13,480 Speaker 3: But like, what's moderate growth? 322 00:16:13,640 --> 00:16:14,680 Speaker 2: What is moderate growth? 323 00:16:14,800 --> 00:16:17,920 Speaker 3: It's like putting one sugar in your tea? Maybe it'll 324 00:16:18,000 --> 00:16:19,800 Speaker 3: bit good, Okay, you didn't need sugar. 325 00:16:20,040 --> 00:16:21,560 Speaker 2: Slightly sweet but naughty. 326 00:16:22,120 --> 00:16:22,520 Speaker 3: I don't know. 327 00:16:22,800 --> 00:16:24,520 Speaker 2: I don't know. Let's let's talk about it and then 328 00:16:24,520 --> 00:16:25,800 Speaker 2: find out what you tell me. 329 00:16:25,720 --> 00:16:27,720 Speaker 3: About moderate growth right, and then you're gonna by the 330 00:16:27,800 --> 00:16:30,280 Speaker 3: end at me explaining moderate growth. You're going to have 331 00:16:30,280 --> 00:16:32,720 Speaker 3: a better label for it, challenge accepted. Okay, cool. So 332 00:16:32,880 --> 00:16:36,320 Speaker 3: when you are a moderate growth investor, you're going to 333 00:16:36,320 --> 00:16:39,800 Speaker 3: be looking and adapting a more diversified portfolio to somewhat 334 00:16:39,840 --> 00:16:42,400 Speaker 3: protect you from information and tax more so than the 335 00:16:42,440 --> 00:16:44,560 Speaker 3: other one, because you're going to be chasing a little 336 00:16:44,560 --> 00:16:47,520 Speaker 3: bit higher of a risk. You have a pretty reasonable 337 00:16:47,680 --> 00:16:50,480 Speaker 3: understanding of what the investment markets do and the way 338 00:16:50,520 --> 00:16:53,080 Speaker 3: they operate and how they flow. You might have been 339 00:16:53,120 --> 00:16:55,880 Speaker 3: doubling a little bit in investments yourself, like you've probably 340 00:16:55,960 --> 00:16:59,120 Speaker 3: used a micro investing platform before, or you've even bought 341 00:16:59,120 --> 00:17:01,680 Speaker 3: your own ETF for you know, you've had a shot 342 00:17:01,760 --> 00:17:05,280 Speaker 3: you've had to try. When you think about risk, you're 343 00:17:05,320 --> 00:17:08,880 Speaker 3: thinking possibilities. You're not really thinking about the negatives. You're going, yeah, 344 00:17:08,920 --> 00:17:11,600 Speaker 3: I understand the negatives, I get that they exist, but 345 00:17:11,880 --> 00:17:14,879 Speaker 3: and more interested in the possibilities of investing my money. 346 00:17:15,400 --> 00:17:18,600 Speaker 3: And when you personally make a financial decision, you are 347 00:17:18,720 --> 00:17:21,840 Speaker 3: far more focused on the possible gains, but you're also 348 00:17:22,040 --> 00:17:24,520 Speaker 3: kind of still thinking about the possible losses because you're 349 00:17:24,520 --> 00:17:26,439 Speaker 3: a little bit concervative. If you're not like all in 350 00:17:26,520 --> 00:17:28,359 Speaker 3: boots and all, you're just like, you know what, let's 351 00:17:28,359 --> 00:17:32,000 Speaker 3: be reasonable about it. I reckon moderate growth is pretty pragmatic. Yeah, 352 00:17:32,040 --> 00:17:34,240 Speaker 3: like a name Sandra, she lives in Sandringham. 353 00:17:34,400 --> 00:17:38,840 Speaker 2: She's like form. I just made that. See, I told 354 00:17:38,880 --> 00:17:40,800 Speaker 2: you I'm not creating good. 355 00:17:42,160 --> 00:17:45,159 Speaker 3: Someone who is a moderate growth folio is going to 356 00:17:45,240 --> 00:17:47,680 Speaker 3: accept that there is some level of volatility in risk 357 00:17:47,760 --> 00:17:51,040 Speaker 3: in investing. Volatility another word. It's going to be in 358 00:17:51,040 --> 00:17:54,120 Speaker 3: my glossary of my book, because I wrote the glossary yesterday, 359 00:17:54,160 --> 00:17:55,360 Speaker 3: which was very exciting. 360 00:17:55,440 --> 00:17:56,000 Speaker 2: That's helpful. 361 00:17:56,080 --> 00:17:59,399 Speaker 3: Volatility essentially just means when the stock price goes up 362 00:17:59,440 --> 00:18:02,080 Speaker 3: and down. It's when a price fluctuates full stop. Like, 363 00:18:02,119 --> 00:18:04,360 Speaker 3: I don't know why we use these complicated words. It's 364 00:18:04,400 --> 00:18:05,240 Speaker 3: just not necessary. 365 00:18:05,440 --> 00:18:06,119 Speaker 2: No, they're definitely not. 366 00:18:06,280 --> 00:18:08,639 Speaker 3: So to restart that, guys, what I mean is you 367 00:18:08,640 --> 00:18:11,160 Speaker 3: can accept that stock prices go up and down over time. 368 00:18:11,760 --> 00:18:15,840 Speaker 3: That's much more interesting. Well, it's easier, it's easier to understand, easier. 369 00:18:15,920 --> 00:18:18,000 Speaker 3: That's what we're here for. And you are a moderate 370 00:18:18,080 --> 00:18:20,080 Speaker 3: risk caker in life, and you can accept that there 371 00:18:20,119 --> 00:18:22,320 Speaker 3: is some level of risk involved in investing. But it's 372 00:18:22,359 --> 00:18:26,080 Speaker 3: not too risky again. Talking about percentages, I want you 373 00:18:26,160 --> 00:18:28,160 Speaker 3: to visualize these. Hold your hands out in front of you, 374 00:18:28,200 --> 00:18:31,200 Speaker 3: have a pie chart, and then select twenty three percent 375 00:18:31,240 --> 00:18:34,320 Speaker 3: of that hand pie chart. That's going to be domestic equity, 376 00:18:34,440 --> 00:18:37,280 Speaker 3: so Australian shares, and then twenty seven percent is going 377 00:18:37,280 --> 00:18:40,879 Speaker 3: to be international equity, which is international shares, which is 378 00:18:41,000 --> 00:18:44,679 Speaker 3: very exciting. You're going to have fifteen percent fixed interest, 379 00:18:44,720 --> 00:18:47,880 Speaker 3: so fifteen percent of that portfolio is going to be bonds. 380 00:18:48,119 --> 00:18:50,320 Speaker 3: You're going to have some international property in there now, 381 00:18:50,359 --> 00:18:53,240 Speaker 3: which is very exciting. Your alternative assets are going to 382 00:18:53,240 --> 00:18:55,359 Speaker 3: be about five percent, which is more than what the 383 00:18:55,440 --> 00:18:57,760 Speaker 3: last portfolio was, and you are going to have some 384 00:18:57,880 --> 00:19:01,359 Speaker 3: international bonds as well, which is very excited. Well diversified, 385 00:19:01,520 --> 00:19:05,160 Speaker 3: you're seeing the percentages come down in this portfolio as 386 00:19:05,200 --> 00:19:08,200 Speaker 3: you go towards the middle of the risk profiles, they 387 00:19:08,240 --> 00:19:10,480 Speaker 3: become a lot more even, and in the end they 388 00:19:10,600 --> 00:19:12,919 Speaker 3: kind of skew. You would have noticed that the capital 389 00:19:12,960 --> 00:19:16,520 Speaker 3: growth had some bigger percentages, like sixty five percent cash, 390 00:19:16,640 --> 00:19:18,959 Speaker 3: and you can expect the same thing to happen at 391 00:19:19,000 --> 00:19:21,639 Speaker 3: the other end of the spectrum when someone's a growth 392 00:19:21,680 --> 00:19:24,280 Speaker 3: investor or a high growth investor. They're going to hold 393 00:19:24,280 --> 00:19:28,400 Speaker 3: more shares and quote riskier assets than someone who wants 394 00:19:28,440 --> 00:19:29,960 Speaker 3: to be a little bit more stable. 395 00:19:30,560 --> 00:19:34,680 Speaker 2: Okay, can I ask you potentially a silly, dumb dumb question. 396 00:19:34,960 --> 00:19:36,800 Speaker 3: Can you please stop saying they're silly dumb? 397 00:19:37,480 --> 00:19:38,800 Speaker 2: I don't know I've ever said that. 398 00:19:39,040 --> 00:19:41,000 Speaker 3: Maybe you haven't, but you always preface it with like, 399 00:19:41,000 --> 00:19:42,560 Speaker 3: oh my gosh, I probably should know this. 400 00:19:44,280 --> 00:19:47,239 Speaker 2: Well, I don't know a finance podcast for a year 401 00:19:47,240 --> 00:19:50,959 Speaker 2: and a half. What you're talking about here with all 402 00:19:51,000 --> 00:19:55,280 Speaker 2: of the percentages. Is this like a financial investment across 403 00:19:55,320 --> 00:19:57,560 Speaker 2: Australia official way of doing it? Or is this the 404 00:19:57,720 --> 00:20:00,920 Speaker 2: Victoria divine intent way of doing it? 405 00:20:00,960 --> 00:20:03,480 Speaker 3: Like unfortunately, there is no victory a divine way of 406 00:20:03,560 --> 00:20:06,480 Speaker 3: risk profile. I wasn't sure because they wouldn't meet compliance. 407 00:20:06,680 --> 00:20:09,080 Speaker 3: Right at the end of each podcast we say that 408 00:20:09,200 --> 00:20:14,240 Speaker 3: I actually am authorized representative of Australia Pacific Funds Management Limited. 409 00:20:14,440 --> 00:20:16,399 Speaker 3: I won't go through that right now as you guys, 410 00:20:16,720 --> 00:20:18,280 Speaker 3: I don't know why you do, but most of you 411 00:20:18,359 --> 00:20:22,199 Speaker 3: sit through that. But because I am legitimate, I have 412 00:20:22,320 --> 00:20:25,280 Speaker 3: to adhere to the standards that have been set by 413 00:20:25,280 --> 00:20:29,880 Speaker 3: Australia and the law. So for me, this This isn't victorious, 414 00:20:29,960 --> 00:20:33,280 Speaker 3: it's a standardized He's just standardized across Australia. Like the 415 00:20:33,320 --> 00:20:37,480 Speaker 3: percentages do differ from advisor to advisor, and dealer grouped 416 00:20:37,520 --> 00:20:39,880 Speaker 3: deal groups or deal group is like the person who 417 00:20:39,880 --> 00:20:43,640 Speaker 3: owns the financial services license that then licensed financial advisors, 418 00:20:44,080 --> 00:20:47,760 Speaker 3: and it might differ depending on what types of portfolios 419 00:20:47,760 --> 00:20:50,480 Speaker 3: are being made up. But this is pretty stock standard 420 00:20:50,800 --> 00:20:53,760 Speaker 3: and when you look at your superannuation, for example, this 421 00:20:53,920 --> 00:20:57,520 Speaker 3: is so applicable. When we talk about a balanced portfolio, 422 00:20:57,840 --> 00:21:01,600 Speaker 3: they're talking about a conservative folio. So if you've listened 423 00:21:01,640 --> 00:21:04,240 Speaker 3: to this and you go, hey, Victoria like conservative. That 424 00:21:04,359 --> 00:21:07,080 Speaker 3: does not suit me at all, my friend, Why is 425 00:21:07,119 --> 00:21:11,640 Speaker 3: your investment in your superannuation conservative? Then they just set balanced, 426 00:21:11,720 --> 00:21:13,760 Speaker 3: which sounds a little bit more exciting because you think 427 00:21:13,760 --> 00:21:14,679 Speaker 3: it's a little bit safer. 428 00:21:14,880 --> 00:21:17,639 Speaker 2: Okay, there you go, Yeah you're welcome. Let's move on 429 00:21:17,720 --> 00:21:19,760 Speaker 2: to growth now, but not before I quickly give that 430 00:21:19,840 --> 00:21:22,639 Speaker 2: a rebrand. I'm going to call it. What is that 431 00:21:22,840 --> 00:21:26,280 Speaker 2: I'm going to call it? Gets it? That's it, but 432 00:21:26,400 --> 00:21:29,760 Speaker 2: still a bit sweaty about risk. Do you like it? 433 00:21:30,080 --> 00:21:31,359 Speaker 2: I love it. 434 00:21:32,400 --> 00:21:35,119 Speaker 3: I're gonna love as well. The job I'm about to 435 00:21:35,160 --> 00:21:38,840 Speaker 3: give you, and that is writing a blog post on 436 00:21:39,359 --> 00:21:44,000 Speaker 3: the new improved names for risk profiles from Shees on 437 00:21:44,040 --> 00:21:44,399 Speaker 3: the Money. 438 00:21:44,440 --> 00:21:47,239 Speaker 2: Love it done, but it's the list. Okay, talk to 439 00:21:47,280 --> 00:21:51,439 Speaker 2: me about talk to me about growth, all right? Growth. 440 00:21:51,760 --> 00:21:55,320 Speaker 3: Growth portfolios tend to be where people our age shore 441 00:21:55,480 --> 00:21:59,240 Speaker 3: just sit. Not heaps of us are actually high growth investors, 442 00:21:59,280 --> 00:22:02,080 Speaker 3: albeit real say we want to be. This is where 443 00:22:02,480 --> 00:22:05,240 Speaker 3: you desire to have a broad spread of really good 444 00:22:05,400 --> 00:22:09,240 Speaker 3: quality investments, but predominantly growth, so that you can achieve 445 00:22:09,400 --> 00:22:12,960 Speaker 3: growth over the long term. Because you personally understand that 446 00:22:13,000 --> 00:22:15,159 Speaker 3: you'll be investing for more than ten years, so it 447 00:22:15,200 --> 00:22:18,040 Speaker 3: makes sense to be investing in assets that are going 448 00:22:18,080 --> 00:22:21,800 Speaker 3: to last that long. You understand investment markets will fluctuate, 449 00:22:22,160 --> 00:22:25,600 Speaker 3: There'll be volatility. Georgia. We're learning words today. Maybe we 450 00:22:25,600 --> 00:22:27,360 Speaker 3: should have a word of the week. Every single week 451 00:22:27,480 --> 00:22:29,160 Speaker 3: we all learn a new finance term. 452 00:22:29,359 --> 00:22:30,840 Speaker 2: Volatility. Is that today? 453 00:22:31,320 --> 00:22:32,800 Speaker 3: I mean in our Facebook group and tell me if 454 00:22:32,840 --> 00:22:34,439 Speaker 3: you want that, because I'll teach you finance words. But 455 00:22:34,480 --> 00:22:37,199 Speaker 3: it sounds really true. And you understand that there are 456 00:22:37,200 --> 00:22:40,160 Speaker 3: different sectors and they perform differently, and there are different 457 00:22:40,240 --> 00:22:45,000 Speaker 3: levels of risk and income and growth associated with your investment. Platforms. 458 00:22:45,359 --> 00:22:48,400 Speaker 3: So when you personally, if you're a growth investor, look 459 00:22:48,440 --> 00:22:51,720 Speaker 3: at the horizon for long term investing, you're looking at 460 00:22:51,760 --> 00:22:54,800 Speaker 3: investing for a minimum of seven years. So I would 461 00:22:54,840 --> 00:22:57,520 Speaker 3: never expect someone who's like, oh, I've got three or 462 00:22:57,520 --> 00:23:00,200 Speaker 3: four years to invest to be a growth in so 463 00:23:00,320 --> 00:23:02,720 Speaker 3: because that's a silly thing to do, because you don't 464 00:23:02,760 --> 00:23:05,760 Speaker 3: have enough time to get a return. It is too risky. 465 00:23:06,320 --> 00:23:09,200 Speaker 3: And when you as an individual think about making financial 466 00:23:09,200 --> 00:23:12,640 Speaker 3: decisions or investing, usually focus on the possible gains. You're 467 00:23:12,640 --> 00:23:17,040 Speaker 3: not so much worried about any losses. You're more concerned 468 00:23:17,040 --> 00:23:19,000 Speaker 3: about making sure you make the right decision over the 469 00:23:19,040 --> 00:23:20,960 Speaker 3: long term because you know that there will be a 470 00:23:21,000 --> 00:23:24,760 Speaker 3: positive return. And in life you're more likely to take risks, 471 00:23:24,800 --> 00:23:27,560 Speaker 3: and you're just feeling a little bit more comfortable with 472 00:23:27,680 --> 00:23:30,520 Speaker 3: taking higher levels of investment risk. So that to me 473 00:23:30,800 --> 00:23:33,720 Speaker 3: is a growth portfolio. Again, when we look at the 474 00:23:33,840 --> 00:23:37,719 Speaker 3: very cute high charts, you'll see again the international shares 475 00:23:37,760 --> 00:23:41,359 Speaker 3: and the Australian shares make up about or fifty percent, 476 00:23:41,640 --> 00:23:44,720 Speaker 3: fifty to fifty five percent of the portfolio. Then you've 477 00:23:44,720 --> 00:23:47,160 Speaker 3: got to mextic fixed interest, so you've got bonds sitting 478 00:23:47,200 --> 00:23:51,399 Speaker 3: at fifteen percent. You've then got Australian fixed interest sitting 479 00:23:51,440 --> 00:23:54,840 Speaker 3: at another I think that's ten percent. And yeah, everything 480 00:23:54,960 --> 00:23:57,960 Speaker 3: is becoming a little bit more so, remember how I 481 00:23:57,960 --> 00:24:01,199 Speaker 3: said in the middle, you have less percentage, and coming 482 00:24:01,240 --> 00:24:04,119 Speaker 3: towards the end, like your growth portfolio, you're going to 483 00:24:04,160 --> 00:24:06,840 Speaker 3: be more aggressive. You are going to expose your share 484 00:24:06,840 --> 00:24:12,520 Speaker 3: portfolio to more shares than cash, so more risky assets, 485 00:24:12,520 --> 00:24:15,120 Speaker 3: which means more shares, less bonds, less. 486 00:24:14,920 --> 00:24:18,640 Speaker 2: Cash, but ultimately a higher return. Yes, and we will 487 00:24:18,680 --> 00:24:21,080 Speaker 2: be talking about the relationship between risk and return a 488 00:24:21,080 --> 00:24:22,040 Speaker 2: little bit later on. 489 00:24:22,240 --> 00:24:24,560 Speaker 3: And that's something that I really really want to talk about. Arguably, 490 00:24:24,600 --> 00:24:27,000 Speaker 3: we probably should have flipped this episode on its head 491 00:24:27,040 --> 00:24:30,280 Speaker 3: and talked about the relationship between risk and return before. 492 00:24:30,040 --> 00:24:32,800 Speaker 2: We we'll get that too late. We're not willing to 493 00:24:32,800 --> 00:24:37,040 Speaker 2: fix ou finish us off here, V with a little 494 00:24:37,119 --> 00:24:40,400 Speaker 2: chat about high growth. So this is the the highest 495 00:24:40,520 --> 00:24:42,919 Speaker 2: growth of the risk profiles. 496 00:24:42,960 --> 00:24:46,919 Speaker 3: You're excited, Thank you so high growth. You'll notice the 497 00:24:47,520 --> 00:24:51,840 Speaker 3: chart actually has less asset classes. Do you say that, jeking. 498 00:24:52,320 --> 00:24:56,199 Speaker 3: We've got rid of the bonds, We've gotten rid of 499 00:24:56,280 --> 00:24:56,800 Speaker 3: the cash. 500 00:24:56,800 --> 00:24:57,560 Speaker 2: There's no cash. 501 00:24:57,600 --> 00:25:01,840 Speaker 3: There's no cash. Sure, there's no bonds, there's no fixed interest. 502 00:25:02,280 --> 00:25:05,640 Speaker 3: Bry is made up of shares and other shares. So 503 00:25:05,800 --> 00:25:08,560 Speaker 3: we've got forty two percent domestic shares and we have 504 00:25:08,640 --> 00:25:11,520 Speaker 3: forty one percent international shares. We have a little bit 505 00:25:11,600 --> 00:25:14,840 Speaker 3: of international property, we've got some domestic property, and then 506 00:25:14,840 --> 00:25:17,639 Speaker 3: we have alternative assets. You're not going to be surprised, 507 00:25:18,200 --> 00:25:21,200 Speaker 3: but an alternative asset isn't a share, it's not a bond, 508 00:25:21,359 --> 00:25:22,840 Speaker 3: not the usual. It's also not cash. 509 00:25:22,960 --> 00:25:24,640 Speaker 2: Okay, it's alternative. Huh. 510 00:25:24,880 --> 00:25:26,920 Speaker 3: It's also not that emo kid you went to school 511 00:25:26,960 --> 00:25:31,119 Speaker 3: with different form of alternative, but it is a relatively 512 00:25:31,160 --> 00:25:34,040 Speaker 3: loose term, so it can actually include a whole heap 513 00:25:34,080 --> 00:25:37,520 Speaker 3: of things. Alternatives are used to explain an asset that 514 00:25:37,520 --> 00:25:40,480 Speaker 3: doesn't really fit in any of those other categories. So 515 00:25:40,480 --> 00:25:43,119 Speaker 3: it could just be a little bit left field. But 516 00:25:43,480 --> 00:25:47,440 Speaker 3: it can be in some circumstances wind collections, it could 517 00:25:47,560 --> 00:25:51,200 Speaker 3: be antiques or coins, it could be stamps, it could 518 00:25:51,240 --> 00:25:54,200 Speaker 3: be some types of different forms of finance assets, so 519 00:25:54,280 --> 00:25:57,639 Speaker 3: like real estate or commodities or private equity. So you 520 00:25:57,760 --> 00:26:02,520 Speaker 3: might have purchased into a fund that promises a certain 521 00:26:02,600 --> 00:26:04,760 Speaker 3: red term, but it is not a listed fund on 522 00:26:04,800 --> 00:26:08,080 Speaker 3: the ASX. That could be it. It could also be 523 00:26:08,240 --> 00:26:10,080 Speaker 3: hedge funds. You would have heard of that. I don't 524 00:26:10,119 --> 00:26:12,560 Speaker 3: recommend them for anybody who is not a high growth investor. 525 00:26:12,600 --> 00:26:14,720 Speaker 3: And even then I've never recommended one to a client 526 00:26:14,760 --> 00:26:19,120 Speaker 3: because they, to be honest, carry two much risk. And 527 00:26:19,200 --> 00:26:22,840 Speaker 3: then it could be venture capitalist. It could be cryptocurrency. 528 00:26:23,160 --> 00:26:26,520 Speaker 3: That would be an alternative asset, albeit that is not 529 00:26:26,560 --> 00:26:28,560 Speaker 3: an alternative asset I've ever put into one of my 530 00:26:28,640 --> 00:26:33,000 Speaker 3: client's portfolios. I do think it is really important to 531 00:26:33,080 --> 00:26:35,280 Speaker 3: understand what this is though, because it does come up 532 00:26:35,280 --> 00:26:37,560 Speaker 3: and people always flippantly say it, but at the end 533 00:26:37,560 --> 00:26:40,119 Speaker 3: of the day, it is something that is not a bond, 534 00:26:40,200 --> 00:26:42,560 Speaker 3: it is not a share, and it could be a 535 00:26:42,600 --> 00:26:43,879 Speaker 3: lot of things. Could be gold. 536 00:26:44,040 --> 00:26:47,879 Speaker 2: My friend, oh, sovereign hill? Have you been? I have 537 00:26:48,040 --> 00:26:49,200 Speaker 2: been to a sovereign hill. 538 00:26:49,240 --> 00:26:52,879 Speaker 3: I think I went in grade four. Same. Yeah, well 539 00:26:52,920 --> 00:26:54,960 Speaker 3: we did go to school together, but yeah, I did 540 00:26:54,960 --> 00:26:58,719 Speaker 3: go gold paining beautiful stuff. Thank you. A high growth 541 00:26:58,840 --> 00:27:03,639 Speaker 3: portfolio a high growth investor means that you are interested 542 00:27:03,680 --> 00:27:06,920 Speaker 3: in capital growth and you are interested in accumulating more 543 00:27:06,960 --> 00:27:10,480 Speaker 3: wealth more quickly relative to your investment timeframe, so you 544 00:27:10,720 --> 00:27:14,080 Speaker 3: understand the cyclical nature of investments. And accept that there 545 00:27:14,119 --> 00:27:16,240 Speaker 3: is going to be a very high level of volatility 546 00:27:16,440 --> 00:27:19,479 Speaker 3: in the value of your investments. So somebody who is 547 00:27:20,080 --> 00:27:23,800 Speaker 3: a high growth investor might one year see at twelve 548 00:27:23,880 --> 00:27:27,280 Speaker 3: percent return and another year seeing negative six or seven 549 00:27:27,320 --> 00:27:30,520 Speaker 3: percent return, But they have to be okay with that 550 00:27:30,600 --> 00:27:32,880 Speaker 3: because over the long term, the average return of their 551 00:27:32,880 --> 00:27:36,480 Speaker 3: portfolio might be eleven percent. So you might go okay, cool, Well, 552 00:27:37,200 --> 00:27:39,480 Speaker 3: over my ten year timeframe, I might see a couple 553 00:27:39,520 --> 00:27:42,159 Speaker 3: of years that actually my portfolio has a negative return, 554 00:27:42,359 --> 00:27:44,520 Speaker 3: but in the grand scheme of things, I actually end 555 00:27:44,600 --> 00:27:47,359 Speaker 3: up over the long term better off. I just have 556 00:27:47,440 --> 00:27:52,760 Speaker 3: to be emotionally okay with seeing my portfolio being negative 557 00:27:53,280 --> 00:27:57,520 Speaker 3: and sitting down with my financial advisor and having them go, hey, Georgia, 558 00:27:57,640 --> 00:28:01,440 Speaker 3: so this year we've been working on ab and as 559 00:28:01,480 --> 00:28:04,000 Speaker 3: you would know, your total return of your portfolio is 560 00:28:04,000 --> 00:28:07,560 Speaker 3: actually negative seven Like, you've got to be okay with that? 561 00:28:07,960 --> 00:28:08,680 Speaker 2: Does that make sense? 562 00:28:08,800 --> 00:28:11,040 Speaker 3: Yep, you say, shooting your own heart. 563 00:28:12,440 --> 00:28:15,560 Speaker 2: It was a step. It was a step. Well, I 564 00:28:15,560 --> 00:28:18,360 Speaker 2: mean that would hurt me, and that's because I am 565 00:28:18,800 --> 00:28:21,600 Speaker 2: capital stable and I fear risk. 566 00:28:21,840 --> 00:28:25,480 Speaker 3: But also exactly which is why it's really important for 567 00:28:25,600 --> 00:28:29,440 Speaker 3: you to understand this portfolio, because if I then made 568 00:28:29,480 --> 00:28:31,760 Speaker 3: the suggestion for you to take all of your cash 569 00:28:31,800 --> 00:28:33,360 Speaker 3: that you've saved up and put it in a high 570 00:28:33,359 --> 00:28:36,680 Speaker 3: growth portfolio, you'd be really uncomfortable with it. You wouldn't 571 00:28:36,680 --> 00:28:39,200 Speaker 3: be comfortable, you wouldn't sleep, it would be something that 572 00:28:39,600 --> 00:28:42,440 Speaker 3: didn't make you feel like you're working towards the right things. 573 00:28:42,760 --> 00:28:44,440 Speaker 3: That's not a good place to be at all, because 574 00:28:44,440 --> 00:28:47,440 Speaker 3: if we are stressing ourselves, that's a rib terrible outcome. 575 00:28:48,520 --> 00:28:52,680 Speaker 3: So someone who is high growth is pretty experienced in investing, like, 576 00:28:52,720 --> 00:28:55,240 Speaker 3: I would never see and I would never be comfortable 577 00:28:55,240 --> 00:28:57,920 Speaker 3: with somebody coming on board, you know, to my advice 578 00:28:58,000 --> 00:29:00,360 Speaker 3: practice and going I'm higher growth and I go what's 579 00:29:00,400 --> 00:29:04,040 Speaker 3: your experience And they say absolutely nothing. I've never had 580 00:29:04,080 --> 00:29:07,000 Speaker 3: any experience in any asset class. And I go, okay, cool, 581 00:29:07,000 --> 00:29:08,560 Speaker 3: what's a share? They're like, Victoria, I've. 582 00:29:08,400 --> 00:29:10,880 Speaker 2: Got no idea, I don't know ready, but. 583 00:29:10,960 --> 00:29:12,840 Speaker 3: I am here and I'm ready, And I'll be like, 584 00:29:14,040 --> 00:29:17,280 Speaker 3: probably not, my friend. So for me, you have to 585 00:29:17,360 --> 00:29:20,680 Speaker 3: have had experience in most of the asset classes already. 586 00:29:21,000 --> 00:29:23,680 Speaker 3: You have to at least understand what a share is 587 00:29:24,120 --> 00:29:26,640 Speaker 3: and probably have been working at it. So I do 588 00:29:26,720 --> 00:29:28,600 Speaker 3: have clients who are high growth who have just come 589 00:29:28,640 --> 00:29:31,600 Speaker 3: off micro investing platforms. We're not talking about people who 590 00:29:31,600 --> 00:29:35,280 Speaker 3: are just investing exotic asset classes or our collections or 591 00:29:35,360 --> 00:29:38,080 Speaker 3: luxury car collections or whatever. We're not talking about that. 592 00:29:38,120 --> 00:29:40,800 Speaker 3: We're just saying you need to fully understand the market, 593 00:29:40,960 --> 00:29:43,320 Speaker 3: and you know what micro investing platforms, if you need, 594 00:29:43,440 --> 00:29:47,280 Speaker 3: can teach you that. So somebody who is investing as 595 00:29:47,280 --> 00:29:50,280 Speaker 3: a high growth investor will be investing for the long term. 596 00:29:50,320 --> 00:29:53,440 Speaker 3: So we are talking minimum seven years, like that is 597 00:29:53,480 --> 00:29:56,520 Speaker 3: minimum seven years of not taking your money out. Ideally 598 00:29:56,680 --> 00:30:00,800 Speaker 3: it's thirty plus years because we are actually investing for retirement. 599 00:30:01,040 --> 00:30:05,240 Speaker 3: We're investing to create financial freedom, and unfortunately that usually 600 00:30:05,640 --> 00:30:06,880 Speaker 3: can't be done in seven years. 601 00:30:06,920 --> 00:30:08,080 Speaker 2: So I do apologize. 602 00:30:08,160 --> 00:30:10,400 Speaker 3: I wish there was a quick get reach quick scheme 603 00:30:10,440 --> 00:30:16,160 Speaker 3: that I could bitcoin baby, but we could do bitcoin. 604 00:30:16,240 --> 00:30:18,600 Speaker 3: We could probably start in MLM, but like none of 605 00:30:18,600 --> 00:30:21,000 Speaker 3: those actually aligned to other No, they don't. 606 00:30:21,000 --> 00:30:23,800 Speaker 2: How much does that suck just going to recap before 607 00:30:23,800 --> 00:30:24,960 Speaker 2: we quickly go to a break? 608 00:30:25,040 --> 00:30:27,160 Speaker 3: So it's got okay, wants so break for me to 609 00:30:27,200 --> 00:30:27,720 Speaker 3: get it. 610 00:30:27,800 --> 00:30:30,600 Speaker 2: In the from the levels of low risk to high 611 00:30:30,680 --> 00:30:34,360 Speaker 2: risk and return based on that as well, so low 612 00:30:34,360 --> 00:30:37,280 Speaker 2: return to high return. We have capital stable coming in 613 00:30:37,320 --> 00:30:39,400 Speaker 2: at the lowest form of risk, then so. 614 00:30:39,440 --> 00:30:41,520 Speaker 3: The lowest form of return correct. 615 00:30:42,000 --> 00:30:45,920 Speaker 2: Then it goes up to conservative. Then we have moderately conservative, 616 00:30:46,200 --> 00:30:50,680 Speaker 2: moderate growth growth, and then we finish off with high growth. 617 00:30:51,320 --> 00:30:53,520 Speaker 2: So hopefully our little chat today has helped you kind 618 00:30:53,520 --> 00:30:56,840 Speaker 2: of figure out where you sit in that space. We 619 00:30:56,880 --> 00:30:59,640 Speaker 2: will be back after a very short break where we 620 00:30:59,640 --> 00:31:02,640 Speaker 2: will about what to do if your risk profile doesn't 621 00:31:02,680 --> 00:31:05,680 Speaker 2: quite match up with our investment preferences, and we will 622 00:31:05,720 --> 00:31:22,960 Speaker 2: be chatting about that very important relationship between risk and return. Okay, 623 00:31:23,040 --> 00:31:25,000 Speaker 2: b let's go back to the start where it all 624 00:31:25,040 --> 00:31:27,800 Speaker 2: should have begun and chat about risk and return. 625 00:31:28,080 --> 00:31:31,120 Speaker 3: The concept of risk and return it pretty much says 626 00:31:31,160 --> 00:31:34,280 Speaker 3: that where there is a very low level of risk taken, 627 00:31:34,680 --> 00:31:37,160 Speaker 3: a low return will follow, and vice versa. So if 628 00:31:37,200 --> 00:31:40,320 Speaker 3: you are taking a high level of risk, the probability 629 00:31:40,360 --> 00:31:44,000 Speaker 3: of you getting a high return bit more risky, so 630 00:31:44,040 --> 00:31:45,840 Speaker 3: we've got to be aware of that. So over the 631 00:31:45,920 --> 00:31:49,160 Speaker 3: long term there is great volatility, but at the same 632 00:31:49,320 --> 00:31:52,600 Speaker 3: time you are more likely to have positive returns. So 633 00:31:53,040 --> 00:31:56,480 Speaker 3: cash is arguably the lowest risk and the lowest return 634 00:31:56,520 --> 00:31:59,280 Speaker 3: asset that we can hold. Then you've got fixed interest 635 00:31:59,360 --> 00:32:02,040 Speaker 3: and bonds, which is the next level up, so a 636 00:32:02,040 --> 00:32:04,840 Speaker 3: little bit more return, a little bit more risk. Then 637 00:32:04,880 --> 00:32:09,040 Speaker 3: you would have property, again more return, more risk. Then 638 00:32:09,080 --> 00:32:12,680 Speaker 3: you have Australian shares, and then after Australian shares pretty 639 00:32:12,760 --> 00:32:16,480 Speaker 3: much sitting together, but has a higher level of volatility, 640 00:32:16,520 --> 00:32:19,920 Speaker 3: so their share prices fluctuate a lot more is international 641 00:32:19,960 --> 00:32:23,840 Speaker 3: shares because they have higher return but also a higher 642 00:32:23,920 --> 00:32:26,120 Speaker 3: level of risk. And that is why we need to 643 00:32:26,240 --> 00:32:29,840 Speaker 3: understand what that risk return trade off is, because we 644 00:32:29,960 --> 00:32:33,600 Speaker 3: compromise something when we want something else. So when I 645 00:32:33,640 --> 00:32:35,800 Speaker 3: say that, I mean you want to purchase a share 646 00:32:35,880 --> 00:32:38,400 Speaker 3: because you actually want that level of risk, So you're 647 00:32:38,440 --> 00:32:42,680 Speaker 3: compromising your financial stability and your security, which is why 648 00:32:42,720 --> 00:32:44,880 Speaker 3: then we want to invest over the long term because 649 00:32:44,960 --> 00:32:49,520 Speaker 3: that then takes that risk away, not completely obviously. 650 00:32:49,280 --> 00:32:51,480 Speaker 2: But it allows that level of risk. 651 00:32:51,360 --> 00:32:54,760 Speaker 3: And so does diversification. So holding a lot of different 652 00:32:54,800 --> 00:32:57,680 Speaker 3: shares as opposed to just one, so that if one 653 00:32:57,720 --> 00:33:00,760 Speaker 3: share completely plummets, you don't actually feel a much because 654 00:33:00,800 --> 00:33:03,120 Speaker 3: you have a lot of different options in your portfolio. 655 00:33:03,840 --> 00:33:06,800 Speaker 2: Does that make sense? Perfectly explained, thank you, And that's 656 00:33:06,840 --> 00:33:09,360 Speaker 2: why I know a lot of people in our community 657 00:33:09,480 --> 00:33:12,760 Speaker 2: ask about wanting to invest for like two years, but 658 00:33:12,800 --> 00:33:15,640 Speaker 2: they have the big goal of buying a house. 659 00:33:15,960 --> 00:33:18,120 Speaker 3: Yes, and that is why I don't recommend investing for 660 00:33:18,160 --> 00:33:22,400 Speaker 3: the short term. Obviously, chasing again is going to put 661 00:33:22,400 --> 00:33:24,880 Speaker 3: you in a position where you are at risk, and 662 00:33:25,040 --> 00:33:28,520 Speaker 3: that risk is not worth it in my opinion. And 663 00:33:29,000 --> 00:33:31,280 Speaker 3: for those of you who are considering, and this is 664 00:33:31,360 --> 00:33:33,640 Speaker 3: just like a little hot tip, those of you who 665 00:33:33,760 --> 00:33:37,400 Speaker 3: are considering investing over a short period of time because 666 00:33:37,400 --> 00:33:39,400 Speaker 3: you've got a house to deposit. First things first, have 667 00:33:39,520 --> 00:33:42,160 Speaker 3: you considered the first time Super Saviors game? If not, 668 00:33:42,520 --> 00:33:46,080 Speaker 3: why not because that is essentially free money from the government. 669 00:33:47,040 --> 00:33:50,240 Speaker 2: All right, My last question for today's episode B is 670 00:33:50,360 --> 00:33:52,400 Speaker 2: what we are meant to do If our risk profile 671 00:33:52,760 --> 00:33:55,160 Speaker 2: doesn't match our investment preferences. 672 00:33:55,360 --> 00:33:59,320 Speaker 3: You can change your risk profile. I say this at 673 00:33:59,320 --> 00:34:02,520 Speaker 3: the office. You go through this entire fancy questionnaire and 674 00:34:02,560 --> 00:34:06,360 Speaker 3: it pops out with a hey, Victoria, you're a conservative investor. 675 00:34:06,800 --> 00:34:10,120 Speaker 3: You can go oh no, no, no, sir, and you can 676 00:34:10,160 --> 00:34:12,000 Speaker 3: actually change it. You will have to sign a form 677 00:34:12,040 --> 00:34:15,160 Speaker 3: to say no, I actually don't want that risk profile 678 00:34:15,160 --> 00:34:17,720 Speaker 3: that's been allocated to me based on your silly little 679 00:34:17,719 --> 00:34:21,320 Speaker 3: survey Victoria Devine, I actually want to be a growth investor. 680 00:34:21,600 --> 00:34:23,160 Speaker 3: You will be able to change it. You just have 681 00:34:23,280 --> 00:34:25,680 Speaker 3: to justify it and say no, I want to change it. 682 00:34:25,880 --> 00:34:27,600 Speaker 3: But at the end of the day, it is definitely 683 00:34:27,680 --> 00:34:30,600 Speaker 3: worth considering why you answered those questions in a certain way, 684 00:34:30,880 --> 00:34:32,959 Speaker 3: because if you're saying, oh, no, I want something else, 685 00:34:33,040 --> 00:34:36,640 Speaker 3: it's like, well, do you actually fully understand those because 686 00:34:36,680 --> 00:34:38,160 Speaker 3: it's come out that maybe. 687 00:34:37,880 --> 00:34:38,400 Speaker 2: You do not. 688 00:34:40,200 --> 00:34:40,560 Speaker 3: All right. 689 00:34:40,600 --> 00:34:43,240 Speaker 2: To help you guys figure out exactly where you fall 690 00:34:43,280 --> 00:34:45,360 Speaker 2: in terms of risk, we will be putting together a 691 00:34:45,360 --> 00:34:47,120 Speaker 2: little risk profile quiz that. 692 00:34:47,120 --> 00:34:49,120 Speaker 3: I'm actually just going to give you guys, the ones 693 00:34:49,160 --> 00:34:51,640 Speaker 3: I use in my business. I'll just brand it pink. 694 00:34:51,680 --> 00:34:52,120 Speaker 3: How about that? 695 00:34:52,320 --> 00:34:56,200 Speaker 2: Stunning perfect Before we wrap, though, let's do a quick recap. 696 00:34:56,320 --> 00:34:58,799 Speaker 2: So a risk profile is essential. It really is that 697 00:34:58,840 --> 00:35:02,200 Speaker 2: first step in figuring out how we will invest. It's 698 00:35:02,200 --> 00:35:04,480 Speaker 2: going to go how we do it, what we're investing in, 699 00:35:04,480 --> 00:35:07,759 Speaker 2: et cetera, et cetera. There are six profiles. Six risk 700 00:35:07,800 --> 00:35:11,799 Speaker 2: profiles capital stable, conservative, moderately conservative, moderate growth, growth, and 701 00:35:11,960 --> 00:35:14,920 Speaker 2: high growth, and those were ordered from least risky to 702 00:35:14,960 --> 00:35:18,880 Speaker 2: most risky. And finally we learned about the relationship between 703 00:35:19,000 --> 00:35:22,680 Speaker 2: risk and return, establishing that the riskier the share, the 704 00:35:22,800 --> 00:35:26,719 Speaker 2: higher the potential return. Advice versa v. I think that 705 00:35:26,800 --> 00:35:27,720 Speaker 2: is all we have time. 706 00:35:27,520 --> 00:35:30,560 Speaker 3: For today, almost all we have time for. G Just 707 00:35:30,640 --> 00:35:32,839 Speaker 3: before we head off, we'd like to acknowledge and pay 708 00:35:32,880 --> 00:35:36,600 Speaker 3: respects to Australia's Aboriginal and torrest Rate islander peoples, the 709 00:35:36,640 --> 00:35:39,960 Speaker 3: traditional custodians of the lands, the waterways and the skies 710 00:35:40,040 --> 00:35:42,920 Speaker 3: all across Australia. We thank you for sharing and for 711 00:35:43,000 --> 00:35:45,200 Speaker 3: caring on the land which we are able to learn. 712 00:35:45,520 --> 00:35:47,640 Speaker 3: We pay our respects to it is past and present, 713 00:35:47,680 --> 00:35:49,719 Speaker 3: and we share our friendship and our kindness. 714 00:35:50,719 --> 00:35:53,359 Speaker 2: And please remember, friends, that the advice shared on shees 715 00:35:53,400 --> 00:35:55,440 Speaker 2: on the money is general in nature and does not 716 00:35:55,520 --> 00:35:59,000 Speaker 2: consider your individual circumstances. She is on the money exists 717 00:35:59,040 --> 00:36:02,080 Speaker 2: purely for educational purposes and should not be relied upon 718 00:36:02,120 --> 00:36:05,719 Speaker 2: to make an investment or a financial decision. And we 719 00:36:05,840 --> 00:36:09,800 Speaker 2: promise Victoria Divine is an authorized representative of Australia Pacific 720 00:36:09,800 --> 00:36:13,279 Speaker 2: Funds Management Propriety Limited ABN three four one three two 721 00:36:13,280 --> 00:36:16,600 Speaker 2: four six three two five seven AFSL three three nine 722 00:36:16,680 --> 00:36:19,239 Speaker 2: one five one And a big thank you to the 723 00:36:19,320 --> 00:36:22,640 Speaker 2: dream team of Beck, Ryan and Jess for helping us 724 00:36:22,640 --> 00:36:23,800 Speaker 2: put together today's show. 725 00:36:24,040 --> 00:36:26,920 Speaker 3: We literally would have not our head screwed on without. 726 00:36:26,680 --> 00:36:29,080 Speaker 2: Them, we wouldn't and we'd probably talk for hours. 727 00:36:29,200 --> 00:36:31,279 Speaker 3: Oh my gosh, we've already been talking for a very 728 00:36:31,320 --> 00:36:33,520 Speaker 3: long time. So good luck editing this one guy. 729 00:36:33,880 --> 00:36:45,480 Speaker 2: See you next week. Bye, guys,