TALKING FINANCE with Michelle Higgerson of Baiocchi Griffin Private Wealth WEED OUT THE WEEDS Last weekend the weather Gods finally smiled down on us and delivered a whopping amount of rain. Never have I seen the rain gauge so full and close to spilling over! For once there was no begrudging of the friend who lives on the other side of town who scored more millimetres than you; after that rain event, we were all winners. Now that the sun has reappeared and the land is drying out, we prepare for the aftermath of such beautiful rainfall; gardens flowering, shrubs standing back to attention, and the symphony of lawn mowers firing up, all ready to deal with a yard that better resembles a dense and lush forest. Unfortunately, what the rain is also good for, is weeds. And if you had some of these unwelcome nasties in your yard beforehand, chances are you now have twice as many. When you head out with your trowel, fork and sickle, it can be confusing as to what needs pulling and what doesn't - sometimes the weeds are the greenest, most thriving looking thing in the garden, particularly if you're lucky enough to have the type of weeds that flower (hello onion weed, oxalis or milk thistle). Doing a little prior research is a good way to prevent the healthy flowers being pulled out of your garden, instead of the weeds. Just like an uncharacteristic rain event, certain events may also prompt you to firstly, review, then tidy up your investment portfolio. In times of uncertainty, this can be a difficult or confusing task, made harder by the fact that our long-term decision-making abilities are often clouded by short-term factors. Famed American investor Peter Lynch famously said that when it comes to your investment portfolio "selling your winners and holding your losers is like cutting the flowers and watering the weeds" (this quote was so appreciated by Warren Buffett that he asked Lynch if he could include it in his famous Berkshire Hathaway year-end report). What this quote tries to explain is the tendency of investors to quickly sell off quality companies after a quick run of performance, whilst forever hanging onto those companies who continually disappoint. In doing so, investors are selling themselves short of future performance and worsening the final outcome from the poor investment. Also, as quality investments are sold off, the remaining portfolio may have a growing allocation to dubious investments, with the effect similar to weeds pervading your garden bed of beautiful flowers. So, while selling investments at a profit might feel as good as having a vase of homegrown flowers on display, make sure doing so doesn't open up more space in the portfolio for weeds. BAIOCCHI GRIFFIN PRIVATE WEALTH Level 1, 462-464 Peel St, Tamworth NSW 2340 6766 9000 AFSL No 424658 This article is general in nature and does not take your individual situation into account. You are advised not to act on anything contained herein, or discussed as a consequence of the contents of this document, without receiving financial advice from a suitably qualified person such as a financial planner, lawyer or accountant. Follow us on Twitter @BaiocchiGriffin facebook.com/Baiocchi GriffinPrivate Wealth Find us on Facebook www.bgprivatewealth.com.au AW7447695 TALKING FINANCE with Michelle Higgerson of Baiocchi Griffin Private Wealth WEED OUT THE WEEDS Last weekend the weather Gods finally smiled down on us and delivered a whopping amount of rain . Never have I seen the rain gauge so full and close to spilling over ! For once there was no begrudging of the friend who lives on the other side of town who scored more millimetres than you ; after that rain event , we were all winners . Now that the sun has reappeared and the land is drying out , we prepare for the aftermath of such beautiful rainfall ; gardens flowering , shrubs standing back to attention , and the symphony of lawn mowers firing up , all ready to deal with a yard that better resembles a dense and lush forest . Unfortunately , what the rain is also good for , is weeds . And if you had some of these unwelcome nasties in your yard beforehand , chances are you now have twice as many . When you head out with your trowel , fork and sickle , it can be confusing as to what needs pulling and what doesn't - sometimes the weeds are the greenest , most thriving looking thing in the garden , particularly if you're lucky enough to have the type of weeds that flower ( hello onion weed , oxalis or milk thistle ) . Doing a little prior research is a good way to prevent the healthy flowers being pulled out of your garden , instead of the weeds . Just like an uncharacteristic rain event , certain events may also prompt you to firstly , review , then tidy up your investment portfolio . In times of uncertainty , this can be a difficult or confusing task , made harder by the fact that our long - term decision - making abilities are often clouded by short - term factors . Famed American investor Peter Lynch famously said that when it comes to your investment portfolio " selling your winners and holding your losers is like cutting the flowers and watering the weeds " ( this quote was so appreciated by Warren Buffett that he asked Lynch if he could include it in his famous Berkshire Hathaway year - end report ) . What this quote tries to explain is the tendency of investors to quickly sell off quality companies after a quick run of performance , whilst forever hanging onto those companies who continually disappoint . In doing so , investors are selling themselves short of future performance and worsening the final outcome from the poor investment . Also , as quality investments are sold off , the remaining portfolio may have a growing allocation to dubious investments , with the effect similar to weeds pervading your garden bed of beautiful flowers . So , while selling investments at a profit might feel as good as having a vase of homegrown flowers on display , make sure doing so doesn't open up more space in the portfolio for weeds . BAIOCCHI GRIFFIN PRIVATE WEALTH Level 1 , 462-464 Peel St , Tamworth NSW 2340 6766 9000 AFSL No 424658 This article is general in nature and does not take your individual situation into account . You are advised not to act on anything contained herein , or discussed as a consequence of the contents of this document , without receiving financial advice from a suitably qualified person such as a financial planner , lawyer or accountant . Follow us on Twitter @BaiocchiGriffin facebook.com/Baiocchi GriffinPrivate Wealth Find us on Facebook www.bgprivatewealth.com.au AW7447695