Where do you invest now? Equity markets are very volatile, Government Bonds are increasingly risky, Cash deposit rates are low and Gold looks like it may be entering bubble territory? Most advisors are still recommending Capital Guaranteed 'Structured products', but they are expensive, have long investment periods and often don't give better than cash returns.

If I had one piece of advice for my friends and clients, it would be to ignore the Irish media and look at CNBC or other reputable international media outlets for your business and economic news. As the Irish Times continue to spread doom and gloom with that 2 page spread on Nama debt today, here is some positive, well thought out and non-sensationalist discussion from CNBC about Irish situation. Enjoy

video.cnbc.com/gallery/

CSO Launch new House Price Index

I noticed in the Irish Times today a small piece noting the launch of a new Independent House Price Index from the Central Statistics Office. The first index level will be announced on Friday 13th May. Whoever picked that date in the CSO has a dark sense of humour!  This has been badly needed for a long time and will replace the usual PTSB and Daft indices that are being used by the media at the moment. Everytime I hear new data from either index I feel they are not accurate and the reality seems different. The Daft indices in particular is limited and doesn't seem to mirror the wider market. The new CSO index will use data from 8 banks, gathering mortgage drawdown figures to estimate the average price for each particular unit type (Apartment, Semi D, Detached etc). The first index will show data going back to 2005 and will be issued monthly from May onwards. This will finally allow us to get a more accurate estimate of property prices and a reliable regular and independent monthly trend.

One downside of all this good information is its usefullness for the government if/when they introduce property taxes.

 

Link to article in Irish Times (28th April 2011, Property Supplement)

We regularly use the idea of Human Capital to help our clients establish and monitor their investments, pensions and general financial position. In a recent article published in ‘The Professional’ magazine, I set out the theory of Human Capital and how to apply it to your every-day finances. I put forward the notion that we often look at our financial position in isolation, and that we should really consider our future earnings (Human Capital) together with our investments and pensions (Financial Capital) and make sure they are compatible. This includes considering your employment stability when looking at the risk in your investment portfolio. For example, owners of filling stations should not really be invested in oil companies!

Read full article on Human Capital and Integrated Financial Planning.

The ‘Professional’ magazine is published quarterly and distributed to over 8,000 individuals in the finance and banking sector.

Its very encouraging for long term investors to see such a quick and dramatic bounce in equity markets over the past 2 weeks. Since the lows of mid March after the Japanese Earthquake and Libya 'troubles', the FTSE, DOW and Dax are all approaching new 2011 highs. This is a real sign that there are huge volumes of cash sitting on the sidelines. These investors feel they have missed the recoveries from March 2009 and are now waiting for any dip which offers value before getting into the markets. This gives me great comfort for the year ahead, which will be extremely volatile but should trend upwards as more cash enters the market.