Brindle Financial Services provide investment advice across a wide number of investments. We hold appointments with the majority of life companies in Ireland. This allows us access multiple collective investment funds in Ireland and globally that are managed by experienced fund managers.
The type of investment a person might choose is often driven by the type of taxation an investment will attract. Some investments attract capital gains tax while others will attract dirt tax.
Many of the investments available offer between 90% and 100% capital protection.
Collective Investment Funds
Collective investment funds are very common and are often provided through life companies. A lump sum is generally invested into a fund or a number of funds. Funds have different risk ratings and the type of fund should be in line with an investors attitude to risk and investment experience. Often funds will have the option to switch fund choice and many such investments incorporate a level of flexibility.
An example of a flexible fund choice approach is an umbrella fund; these can allow investors switch to sub funds within the umbrella structure without encashing their investment in the overall product. A fund of funds is similar in principle to an umbrella fund except the other funds may be operated by different fund managers in different companies and allow such transfers between the funds through agreement.
The fund manager can be very important and the investment strategy adopted. Some of the investment strategies include:
Active – this is where the fund attempts to outperform other funds in the market, it is a progressive approach seeking returns above other passive type funds;
Passive – this approach often will simply track a stock market index or an index of investment securities;
Deposit Based Investments
To invest in a deposit based investment you will invest a lump sum which is generally a minimum of €10,000.00, however this can vary depending on the investment company. You will generally have a fund choice option or the investment will track an index. The investment company will then split your capital investment; they will invest the majority of the capital sum on deposit with a bank to ensure the minimum capital amount is protected.
The balance of your capital is then invested into funds or an index, the investment aim is that the money invested in funds or an index provides the investor with an investment return. The return is then subject to dirt tax where applicable. The less capital protection the greater the money invested and potential return, however lesser capital protection increases the risk of the investment and the potential to lose some of the capital invested. If you are investing in funds or an index there will be charges, this can vary depending on the particular fund or index. The term of the investment can vary but 3, 5, 6, 7 would not be unusual.
Note Based Investments
Note based investments are essentially loans to corporates, the investor lends money to a corporation or corporations from a number of selected companies. The money is actually advanced through an intermediary investment bank. There could be hundreds of investors contributing to the note with is ultimately advanced. The investment return comes from interest paid on the corporate note. This can be attractive for investors as it is not subject to dirt tax but instead capital gains tax where applicable. This can also be attractive as losses can be offset against other capital gains in some situations. Capital gains tax is also significantly lower than dirt tax on deposit based investments.
Investment experience is very important when choosing the risk profile of a fund or other investment, we can help you with this. An investors ability to withstand an investment loss is very important, if you cannot sustain the risk financially, then the investment may not be appropriate for you and you should opt for a capital protected product.