Event recap: Sharesight Investor-tech Conference 2023

In Sydney this August, we had the pleasure of hosting the inaugural Sharesight Investor-tech Conference, where we brought together Sharesight partners, financial industry experts and investors of all levels of experience. Focusing on the concept of risk in investing, we heard from experts on key market trends, future insights and strategies, while also showcasing industry-leading tools to help investors make informed decisions about risk in their portfolios.

We would like to thank our partners, panellists and presenters for helping us bring this event to life, and most importantly to all the investors who attended, many of whom are Sharesight customers. It was amazing to meet so many passionate and engaged investors, and to learn more about the issues investors face in today’s market – plus practical strategies we can all use, no matter our investing skill level.

For those who were unable to attend, we’ve put together a brief summary of the key insights from our main panel discussion, plus a full video of the panel session.

Panel event and Q&A session

Left to right: Panellists Danielle Ecuyer of ausbiz, Mark LaMonica of Morningstar, Rachel Waterhouse of the Australian Shareholders’ Association and moderator Doug Morris, Sharesight CEO

Danielle Ecuyer, Anchor at ausbiz

Understanding risk

• Volatility is a narrow definition of risk. It doesn’t actually become a risk to your portfolio unless you act on it.
• For the average person, risk is about defining how you’re trying to grow wealth over time and knowing your risk parameters.
• If you’re a huge risk-taker, you need to be very diversified.

Diversification and investing strategy

• To diversify during a liquidity (or drawdown) event, you need non-correlated assets. This means you need diversification in your investment portfolio, as well as your whole asset portfolio.
• However it’s also important not to overdiversify – in that case you might as well have just bought an index ETF and cut down on all those fees.
• To prepare for retirement, you want to set up a portfolio that can generate income without you needing to touch the capital.

Mark LaMonica, Director of Product Management at Morningstar

Understanding risk and mistakes investors make

• At any point in time there are always risks. Investors have the problem of feeling like they need to constantly balance due to current conditions.
• At Morningstar we have an uncertainty rating that refers to the risk levels of individual companies. For example, a large multinational company that is old and has little debt has a low risk profile.
• You can observe this in practice with the fact that until recently, Australia had two airlines, and during COVID Virgin went out of business because it had a lot of debt.
• The biggest risk for society is that most people don’t save enough. They don’t think about retirement enough because they don’t estimate what they need.
• We also tend to have recency bias – we expect the same thing to keep happening. Yet the world seems to be going through a structural shift, pulling away from globalisation. The low interest rate and inflation period is gone and we need to adjust to this new world.

Rachel Waterhouse, CEO of Australian Shareholders’ Association

Mistakes investors make

• Investors can sometimes get too excited about specific companies.
• At the ASA, members also talk about not feeling diversified enough, particularly women.
• As an investor, you need to think hard about your investment strategy and review your portfolio regularly.
• Also stop waiting for losing stocks to come back to where they were. Don’t hold onto these stocks for too long – consider whether you should just take the loss.

Investing strategy

• I try not to look at my portfolio too often and remind myself of my time horizon.
• I’m taking advantage of compound interest.
• As an investor, if you’ve got five ETFs, you really need to know what’s in those ETFs. Know what’s in your portfolio, determine whether you have enough international shares, learn to avoid the noise and know your time horizon.

For the full discussion and Q&A session, see our video below:

Embedded content: https://www.youtube.com/watch?v=bF8nZ0GLQ8o

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FURTHER READING

• Event wrap-up: Sharesight customer celebration
• Event recap: ASA Investor Conference 2023
• Key takeaways from the ASX Australian Investor Study 2023