What is the Raiz Philosophy? (Dollar Cost Averaging)
The Raiz Philosophy is to invest small amounts regularly. While this can’t eliminate market uncertainty, the Raiz Philosophy can help manage it, and at the same time help you learn about the markets, build financial confidence or just save and invest in the background of life.
This is the well-known investment strategy, Dollar Cost Averaging. Raiz automates the strategy and does it more frequently, with the average Raiz customer investing at least once a week. By investing small amounts regularly, the Raiz philosophy protects your investments from emotion. If prices go up, you buy fewer of the now more expensive shares and, if they go down, you buy more of the now cheaper shares. It’s an automated, disciplined approach to investing for the long term.
Studies suggest that losses are twice as powerful, psychologically, as gains, leading this type of investment mindset to be more likely to make the mistake of needlessly selling holdings and switching to cash in a down market. By avoiding the media hype or fear in picking the ‘right time’ through regular contributions, investors can avoid both the euphoric and depressive investment traps.
Although there is no guarantee that our performance will continue, the average Raiz customer has made 10.1% p.a. over the last year and 11.0% p.a. since inception. This is more than $30 a year on a $300 investment (before the $1.25 monthly maintenance fee)*.
On average a Raiz customer saves $150 a month with the average balance of a customer is $1,250.
Warren Buffet recognises the strength of simple investing.
Even Warren Buffet, who is often referred to as the world’s greatest investor, recognises the strength of simple investing with ETFs:
In 2007, Buffett bet a New York hedge fund $1 million that his simple, low-cost investing strategy would outperform the hedge fund industry over 10 years. And he won.
Stick to your savings plan and invest small amounts regularly, no matter the market condition. By protecting your investments from emotion, the Raiz Philosophy is one of the keys to helping you and our community to better reach your financial goals and enable a healthier balance over the long term.
Remember: “The best time to plant a tree was 20 years ago. The second best time is now.”
Any returns shown or implied in this email are not forecasts and are not reliable guides of future performance.
Video – How Raiz Protects your investments from Emotion
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The information on this website is general advice only. This means it does not take into account any person’s particular investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the Raiz product.
The information in this website is confidential. It must not be reproduced, distributed or disclosed to any other person. The information is based on assumptions or market conditions which change without notice. This will impact the accuracy of the information.
Under no circumstances is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz.
Past return performance of the Raiz product should not be relied on for making a decision to invest in Raiz and is not a good predictor of future performance.