Launch of Model Portfolio for Rivkin Local Members

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New industry benchmark put forward for performance and reporting.

The model portfolio offers Rivkin members a simple platform from which they can manage risk and returns across a portfolio of trade ideas.

Rivkin has recently launched a live $300,000 model performance portfolio with the objective of providing indisputable performance statistics and contextual investment recommendations to Rivkin Local general advice members.

“The objective of the model portfolio is to offer its members a simple platform from which they can manage risk and returns across a portfolio of trade ideas,” said Rivkin CEO, Scott Schuberg.

“We want to guide members away from becoming solely focussed on individual trade ideas and toward a holistic portfolio management approach, so they can avoid being prone to the investment psychology pitfalls associated with an emotional attachment to a select few trade ideas,” said Mr Schuberg.

The model portfolio will deliver performance statistics and reporting to current and prospective clients that incorporates factors largely overlooked by other participants in the general advice space.

Parameters of the Rivkin Local model portfolio:

  •     $300,000 live portfolio, backed by fully-paid shares and cash.
  •     Basic premise of model portfolio is that Rivkin trades what it recommends, within the compliance restraints of Rivkin’s house trading policy (see http://www.rivkin.com.au/rivkin-staff-trading-policy.aspx).
  •     Due to the delays associated with its house trading policy, Rivkin’s orders will sit behind the majority of members, so if the price or liquidity of a stock prevents Rivkin from entering a trade, it will never be claimed as a successful recommendation.
  •     The cost of brokerage is incorporated into every trade.
  •     Rivkin reports full details of each trade to members every Monday in the Rivkin Local weekly issue, ensuring full transparency and accountability.

Investment strategy
The approach used to build the model portfolio for Rivkin Local comprises three strategies:
1.    Events: Event-driven trades are a hallmark of the Rivkin brand, encompassing takeover trades and other corporate activity such as buy-backs, share purchase plans and rights issues.
Investment opportunity: capital growth.

2.    Income: Rivkin maintains a list of stocks that have high income characteristics. Chiefly coming in the form of hybrid securities, this ASX niche is highly specialised.
Investment opportunity: income from bond-like coupon payments (primary), as well as potential capital growth through share price appreciation (secondary).

3.    Blue Chip: A systematic, low-maintenance strategy that has 22 years of back testing and five years of real performance under its belt, this Blue Chip strategy has formed an investment bedrock for many Rivkin Local members.
Investment opportunity: blend of capital growth, income and tax credits

Because market cycles vary, the asset allocation between these three strategies is fluid. Ultimate responsibility for the model portfolio rests on Rivkin’s Head of Local Advice, Shannon Rivkin, and is traded in a way that reflects Rivkin’s desire to create a blend of capital growth and income that consistently surpasses that offered by the local share market.

Performance of Rivkin trade recommendations (since inception)
The performance recorded from May 1997 up until April 1 stands at:

  •     74% of Rivkin recommendations were profitable
  •     On average, including losing trades, a Rivkin recommendation returned 8.8%
  •     The average hold period of a trade was 33 weeks
  •     When annualised, annual performance averaged 13.9%

Rivkin Global also employs model portfolio methodology
While this methodology is new for Rivkin Local, it is not new to Rivkin. Since 2009, Rivkin has used the same methodology for its Rivkin Global advice product, which has proved invaluable to clients trading global markets by allowing them to put individual trades into the context of a well-managed portfolio of ideas.

Rivkin Global’s $50,000 model portfolio (this portfolio uses derivatives, so is able to gain greater exposure using less cash) serves as a blueprint to those members wishing to construct a diversified, managed portfolio in a risk framework that borrows from the experience inherent in the Rivkin Investment Team.

The launch of the model portfolio for Rivkin Local members cements Rivkin’s position as a genuine competitor in the retail space for providing solutions to Australian retail investors seeking to outperform the All Ordinaries Accumulation index.

-ends-

Rivkin is a general advice financial services firm that offers three products to Australian retail clients: Rivkin Local, Rivkin Global and Rivkin Super.

Rivkin Securities ABN 87 123 290 602 holds an Australian Financial Services Licence (332802). Tarfaya Nominee Pty Ltd (AFS Rep Number 426366), trading as The Rivkin Report, is an authorised representative of Rivkin Securities Pty Ltd.

The content of this email is confidential and is intended only for the recipient(s) to whom it is addressed. Any information perceived as advice in this email has been prepared without taking account of any particular person's investment objectives, financial situation or needs. We strongly suggest that you consult your financial advisor before acting upon any advice contained in this email. Rivkin Securities makes no representation and takes no responsibility as to the soundness of any opinion or the accuracy or completeness of any information contained within this email.

There may be a product disclosure statement or other offer document for the securities and financial products written about in this email. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product.

Directors and employees of Rivkin Securities may, from time to time, hold securities in companies mentioned in this email. Directors and employees may also earn fees, commissions, rebates and/or interest from products and services offered to clients.

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Jane Bryant

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