The fact is that even if a client is looking for capital growth it may be appropriate to include in their portfolio income producing assets and to reinvest or accumulate the dividends or interest produced by these assets. Alternatively for someone looking for income do not necessarily ignore growth-focused investments as part of the overall strategy.
In today’s ever changing and evolving world please remember that ultimately investment is an “art” and not a “science”. As US General George Patton once said: “Never tell people how to do things. Tell them what to do, and they will surprise you with their ingenuity.”
Andy Gadd is head of research of Lighthouse Group
Key points:
* The choice between income and growth might not be as simple as one might first think
* Some investors, such as Warren Buffett, have stated that there is no theoretical difference between the concepts of value and growth in consideration of the concept of an asset’s intrinsic value
* When considering an investment strategy certain investments are skewed to accentuate one or the other aspect of capital growth or income
