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| • EXCH RATES |
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Baht/$ 34.21/26 (Bid/Ask)
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GOLD |
13650
-250
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NET Worth
ANDREW WOOD
The world's markets are in turmoil. No one seems to have escaped difficulties and the likelihood of being affected by them recently. Equity markets have been the most volatile but if you have cash in the bank you may have had some jitters about this too.
Banks have gone to the wall. Some have been rescued by takeovers or governments. Still more have experienced the most unexpected and unlikely events. This has resulted in the supposedly safest havens for cash being questioned in some quarters.
Probably the most sensible advice around right now is not to panic. Do not sell out of what you have. Rather, you need to carefully evaluate your current position before you make a move. Remember that for the majority of self-managed investors, downfalls come from taking the wrong action at precisely the wrong time. Such actions are often repeated many times by the same investors who simply do not seem to realise their error.
Equity markets will grow once again and exceed their previous highs. That could take some time and timing is something that is difficult to pinpoint. What is highly likely is that rebounds will come suddenly and unexpectedly. When they arrive it will be too late to buy in again if you sell out now. So the lesson to learn is to stay where you are and wait for the wave on which to ride up once again.
If you have diverse holdings of various types of investment in, say, equity funds, directly held shares, bonds, commodities or other vehicles, you will be juggling the markets and in communication with the many institutions through which your holdings are placed.
One of the ways to streamline this is to have all your holdings in a single vehicle. These Offshore Personal Portfolio Bonds (OPPBs) are platforms within which all your holdings are housed. They are held through major custodian institutions in tax havens where there is no exposure to taxation on the base assets or the capital gains. Within the structure various assets are held and managed. You may hold direct equity in listed corporations in almost any jurisdiction in the world. Thus your shareholdings can be under one roof along with your other holdings including cash and funds in diverse worldwide markets.
You can appoint a professional financial adviser to manage the vehicle on your behalf and in accordance with your instructions. You also have the luxury of only one point of contact. Your adviser will take instructions from you and make the changes you desire or manage on your behalf in accordance with your instructions.
Such vehicles can also be structured in trusts to assist you in dealing effectively with your affairs with your beneficiaries. Without being written into trust, these bonds will pay benefits to heirs within 30 days without the requirement for your executors to obtain probate and without deduction of taxes at source. If you choose to utilise trusts then the trustees will carry out your wishes on your behalf at times and in the manner in which you predetermine. Trusts tend to be complex and it is therefore advisable for you to discuss your intentions with a professional adviser who can guide you and arrange the details on your behalf.
In addition to these benefits, custodian institutes based in specific tax-haven jurisdictions are protected by guarantee programmes. If they fail and are unable to meet their liabilities, these schemes will guarantee up to 90% of your investment value with no upper limit to the amount guaranteed.
While there are no guarantees on market performance, at least you have the peace of mind that in the unlikely event that the institute goes bankrupt your investment is at least guaranteed up to 90%. That will beat some of the banks whose demise we have recently experienced.
The consolidation and management of assets under OPPBs is surprisingly inexpensive. With very low dealing fees for purchases and sales of assets and a fixed fee for custodian services, they beat the cost of paying many different brokers and intermediaries for your various holdings.
Because the custodian institutes are substantial, they are buying and selling units in investment funds in large transactions. They are thus able to demand substantial discounts on upfront loadings, sometimes known as bid/offer spreads. These are typically 5% to 7%, which are regularly negotiated down to zero or very close. Such benefits are passed onto to you, the investor. All these cost saving benefits give you predictable and reliable total operating costs for your entire portfolio under one roof.
OPPBs will also allow you to make additional contribution payments in and can be structured to allow you to take regular income withdrawals as well as ad hoc lump-sum withdrawals as you require.
Talk to your professional financial adviser today and get your existing assets transferred under one roof in a cost-effective vehicle that is as safe as you will find with the guarantees in place.
Questions to the author can be directed to Barclay Spencer International on 0-2653-1971 or e-mail to info@barclayspencer.com
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