Dynamic Asset is a distinctly different investment business with a different approach to managing investments. We believe in helping investors to understand why they are investing and in keeping them informed transparently and openly. For peace of mind, it’s important to understand what’s going on and that you’re on track to achieve your goals.


The common approach is failing
too many investors

According to research by Schroders, the Risk Profiling or Strategic Asset Allocation (SAA) approach that is commonly used for managing investments does not deliver reliable results to investors. The research showed that they underperform a 5% real return objective 49% of the time on a rolling 5-year basis, and 47% of the time on a rolling 10-year basis.

Mark Wills from State Street Global Advisors also found that an SAA balanced fund fails in 35% of market cycles.

Their research shows that through time, between one-third and one-half of investors may not reach their financial goals.

That is a real risk to the wealth and lifestyle of individual investors. It is why you consider a different approach.

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Goals based investing managed
through dynamic asset allocation (DAA)

Dynamic Asset understands that the world is complex, constantly changing and uncertain. We believe that to achieve specific results for investors, we must take a dynamic approach to achieve the investment objectives of each portfolio. Sitting back and expecting investment returns to accrue just because you’re investing can work sometimes, but if you’re serious about having your money managed properly, then you should make sure it’s looked after proactively.


At Dynamic Asset all our investment portfolios have clear goals:


Preserve capital


Grow investor’s wealth, and


Target a real rate of return on every portfolio
– i.e. after fees and inflation

To achieve these very specific goals, we take a forward-looking and dynamic approach to managing your investment portfolios.

Investment philosophy

Because the world and financial markets are continually changing, we believe a Dynamic Asset Allocation (DAA) approach is the most appropriate way to manage investments and risk properly.

We believe we need to be responsive and flexible enough to cope with rapidly moving markets and to reduce the impact of short-term market volatility.

We believe in providing investors with a high probability of meeting portfolios objectives over stated timeframes.


Investment Approach

We believe that the best way to achieve investment objectives is to:

  • Apply flexible and wide asset allocation across a broad range of potential investments including cash and cash-based securities, fixed income, direct securities, real estate, managed funds, exchange-traded funds and derivatives
  • Apply a robust and disciplined risk management framework to actively manage the risk and return profile of each investment in line with its objectives
  • Be medium to long-term focused
  • Focus on value and not follow the crowd or common benchmark assumptions
  • Ensure each investment is well understood, transparent and well managed
  • Be mindful of tax implications and transaction costs

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Investment process

1. asset allocation

Asset allocation is the single biggest influencer on portfolio performance, so we dedicate time and resources to determine the right allocation for each portfolio. The asset allocation of each portfolio is regularly modelled and reviewed using forward-looking returns and potential risks. The results are assessed alongside current asset allocations, valuations, outlooks for markets, sentiment and momentum to determine whether any adjustments to the asset allocation of each portfolio is appropriate.

2. investment selection

Once the appropriate asset allocation is determined, it is implemented by selecting those investments and managers which are considered best placed to produce the targeted risk-adjusted returns when combined as an overall portfolio across the relevant timeframe.

During this stage, detailed investment, and investment manager due diligence are conducted to ensure they meet the required objectives.

We select based on quality, competitive advantage, independent thinking and the ability to deliver strong returns relative to cost.

Performance is monitored and managed.

3. portfolio management

The final element involves the implementation of the investment strategy and management of the ongoing compliance and operational requirements of each portfolio.

Every selected investment is managed according to a target weighting, determined by:

  • The risk and return target of each portfolio
  • The way it interacts with other investments
  • Its impact on asset, sector and theme weightings

The entire portfolio is constantly monitored, assessed and optimised.

Understanding the difference

There is a very clear difference between Goals Based Investing (DAA) and Risk Profile Based Investing (SAA). This table lists some of the main points to consider.

Goals based investing

Investors actual needs and goals are the most important starting point when developing an investment strategy

Every investor has different goals - so no one strategy or profile will suit all needs

Forward-looking insights are the best guide to future outcomes

Risk is defined as the probability of not meeting an investor goals

An individual’s portfolio is dependent on the quality of its asset allocation and management

The world is continuously changing - more flexible and broad-ranging Dynamic Asset Allocation tolerances can help derive value and protect against capital losses

Protecting capital is of paramount importance. Buy when value is apparent and sell when it’s not.

Risk profile based investing

Risk profiling is the most important starting point when developing an investment strategy

Your risk profile is appropriate for all your investing needs

Optimal portfolios based on historical data as markets are always efficient and repeatable. Therefore, history is the best guide to future outcomes

Risk is defined as volatility of capital

An individual’s portfolio will generally adhere to the market averages

Markets will always adhere to historic rates and ratios, so there is little value in managing asset allocation

Investors are always rewarded for risk so a long-term Strategic (or Static) Asset Allocation works best. Buy and hold.

In summary, Goals Based Investing focuses on the individual investor and targeting specific outcomes on a forward-looking basis, while Risk Profile based investing focuses on a belief in the efficiency of markets and that historical performance and behaviour is a reliable indicator of future behaviour.

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In keeping with our purpose of making the investment experience better for investors, we have taken great care in creating a robust system of governance and security that overlays the management of your clients’ investments. We want to ensure that we not only manage investments towards your clients’ goals but also make sure that their money is secure if something goes wrong.

The management of this process is very rigourous, as you would expect. Every detail of this is provided within the offer documents. The summary is:

  • You and your clients have full transparency over all investments, transactions and fees. Your have full control over everything - 24 hours a day,  365 days of the year.
  • Every investment mandate we manage has a pre-agreed set of parameters to which it must operate. These parameters cover aspects like return targets, risk allowances, types of assets in which we can invest. All these have been assembled with great care and due diligence
  • Dynamic Asset has established extensive governance measures over how the assets are managed. This begins with the Investment Committee. Its role, in addition to mandates, is to ensure that all rules are kept.
  • Although Dynamic Asset is the manager of the investments, we have no access to any of the capital. Our role is to ‘instruct’ on investments.
  • A Managed Discretionary Account (MDA) Operator and Administrator, provides the licencing, trading and administration capabilities, and platform. They also ensure compliance with investment mandates and that every transaction is in keeping with what you ask us to do.
  • The investments are held by a Custodian, while the beneficial ownership of all assets remains with the investor, always. The Custodians role is to keep the money at arm’s length from everyone in the day-to-day process with the objective of securing of assets in the interests of you and your clients.
  • For superannuation investors, there is another layer of oversight through the Trustee. Their role is to ensure that everything that is managed is in the superannuation fund member's best interests, and in line with regulations.
  • Overarching all of this is the fact that everything we do is heavily regulated and that we have a robust legal system in place if anything goes wrong.

In short, our business focus and reputation hinges on taking great care of your money. However, if something does go wrong, then there are layers of protection that ensure your money stays under your legal ownership, giving you ultimate control and surety.


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