Also, it’s important to look at our model portfolio, which is run by a professional fund manager, and at the activities of our new speculator, Ivo Budelman. These show that you don’t always get ideas right, but you need to minimise your losses and let your winners run. Risk is a very individual thing, but seeing how a portfolio is run gives you an idea of the level of risk that you are comfortable with.
Our portfolio manager’s return in the past year has been 13 per cent, which is based on investing a portion in an index related fund, and also buying and selling Small Caps, and lastly, holding cash.
The share market over the long term returns about 10.5 per cent. Small caps give you ability to outperform this.