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Re-weighting your risk

Portfolio re-weighting is an essential risk management process that every investor should use

But what is portfolio re-weighting and why should you do it?

What is ‘portfolio weighting’?

Portfolio weighting describes the percentage of an investment in a portfolio – usually by asset class. For example, a typical balanced fund will have around a 60 per cent weighting in growth assets and 40 per cent weighting in defensive assets.

Why re-weight?

As time passes, portfolios change as different investments perform better or worse than others. These returns change your portfolio weightings which means your portfolio may no longer align to your chosen risk profile, potentially exposing you to more or less risk than you intended.

Re-weighting means your portfolio is shifted back to your original risk profile.

Another reason you may want to re-weight is that your risk profile has changed. As we get older and our circumstances change so does our tolerance for risk.

If you are 30 years old and planning 35 years ahead for retirement, you will probably be happy to accept greater risk, as short-term volatility can be tolerated in order to achieve your goals. On the other hand, if you are nearing retirement, you’ll probably not want to risk losing your money as you don’t have the luxury of time to recover from losses.

Contact us to help you choose, review and re-weight your investment portfolio on a regular basis. Omnis Group’s financial planning service is managed by Daniel Morcombe, a qualified and licensed financial planner with more than 20 years’ experience.  Daniel will carefully review your needs, identify what’s really important to you and map out a plan for achieving the goals that make your life meaningful.

Disclaimer: This article is for information purpose only and does not constitute advice and does not take into account any of your objectives, financial situation or needs. Before you make a decision about whether to acquire a financial product, you should obtain and read the product disclosure statement. NEO Financial Solutions: AFSL 385845 ABN 64 141 607 098
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Omnis is a strategic accounting and financial planning firm that understands you and your business, and helps you maximise the opportunity you have.

We go beyond numbers and are driven by insight, guidance, and a personalised approach tailored to your unique needs.

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Justin Flavel

Managing Director

Justin’s experience spans across 20 years in accounting, financial analysis and general business practice.

Although born and bred on the land, Justin’s interest was more in spreadsheets, ledgers, and finance which led him to attend university. In 1992, Justin graduated with a Bachelor of Business majoring in Accounting and Finance. As well as qualifying as a CPA member and becoming a Fellow of the Taxation Institute of Australia, he began gaining practical experience in small and mid-tier accounting practices.

During the late 90s, Justin decided to expand his horizons and travel through Europe. It was during this time that he seized the opportunity to expand his knowledge on the workings of large organisations by taking on roles in multinational corporations.

Today, Justin’s passion is in facilitating businesses to grow and evolve. His focus is on acting in the role of business mentor to help clients develop the full potential of their businesses. He joins clients on their unique journey, and provides the tools and knowledge they need along the way to make the right decisions.

Justin’s aim for his clients parallels his own philosophy and personal journey—focusing on his own career growth and business success while maintaining balance in his life with his wife and three daughters.

Omnis Group Managing Director - Justin Flavel