Where do I send my funds?
We do not hold your funds in our own name. We have appointed highly regulated and respected custodians to provide safe custody and administration services.
The custodian holds clients’ securities separately and distinctly from its own assets.
As segregated assets they are fully protected in the extremely unlikely event of default or bankruptcy of either the custodian or its sub custodians. In most markets, the custodian operates through omnibus accounts where client securities are held on behalf of clients in the name of the custodian or its nominee company.
This structure provides asset protection for underlying clients as the market recognises the custodian or its nominee as merely the account holder who holds assets on behalf of underlying beneficial owners. This beneficial ownership is reflected in the custodian's book of record.
IMPORTANT
Our custodians are domiciled exclusively outside of the Republic of Ireland to avoid the risk of any precendent established in Irish Case Law arising from the collapse of Morrogh Stockbrokers in Cork applying to our client's investments.
Morrogh Stockbrokers in Cork
W & R Morrogh was a 100-year-old Cork stockbroker firm that was wound up in April 2001 as a result of a fraud. The collapse of the partnership occurred after a junior partner lost an estimated €12 million gambling on futures and options and fraudulently embezzling funds from clients to meet losses.
According to reports at the time. the firm had 9,000 clients but only 2,500 submitted claims for losses, and most were dealt with under the Irish Central Bank investor compensation scheme. The scheme did not protect larger clients who sustained a significant portion of the €7 million shortfall in client funds.
How safe are the recommended investments?
The investment funds we recommend to our clients are highly regulated under the European Union Undertakings for Collective Investment in Transferable Securities (UCITS) regulations.
UCITS are legally structured to protect investors from fraud and abuse.Two very important principles are employed in this regard.Firstly, the fund the shareholder purchases is a separate legal company from that of the manager. By keeping the fund separate from the manager, the manager cannot call on the assets of the fund for any reason. Unlike in some insurance products, if the manager or company is failing, that will not affect the assets in the fund. The fund is completely ring fenced.
Secondly, the manager is legally barred from having direct contact with the money that flows in and out of the fund. Therefore it is impossible for a rogue manager to run off with client assets.
The investments we recommend are totally transparent:
Your statement of investment comes from a reputable custodian.
Audited annual accounts mean that you always know exactly what you are holding in any fund.
All investments are marketable securities with daily valuations that I can find on the web, or in the newspaper.
Finally, your investments are fully liquid so that if you needed access to your money right away, you would be able to sell your investments and obtain immediate settlement.
Model portfolio backtesting important notes updated May 2012
Updated May 3rd 2012
Following a review of our portfolios by our Investment Committee we have made some minor amendments to our portfolios.
Key changes
Cautious portfolio now weighted to 15% Real Assets. The decision to increase the weighting in real assets in the cautious portfolio by 5% was taken in order to introduce greater diversification for smaller investors across real assets.
Portfolios now increase incrementally in even 10% bands. This has the effect of positioning the balanced portfolio exactly in the middle of the 10 portfolios.
Speculative portfolio replaced with an additional low risk portfolio to reflect actual investor demand.
Finally, we have also taken the decision to include an allocation to European (Euro area) Stocks to reduce currency volatility in the portfolios.
The impact of the changes on the risk/return profile of the portfolios can be viewed in this document
Prior to January 2010, GoldCore Ltd issued a monthly update of our 10 model portfolios using data from 1994. These portfolios were adjusted for investment fund costs and GoldCore advisory fees.
In January 2010 we amended our methodology (but not our asset allocations) in order to extend our data series back to 1970. Furthermore, to more accurately reflect comparisons with alternative funds, we now exclude the GoldCore advisory fee.
Full details of our advisory fees are available on request.
Construction methodology
In order to create our model portfolio results we back-test our recommended asset allocations for 10 portfolios over the longest possible time period.
We use extremely reliable index data from sources such as FTSE, S&P, MSCI and the Centre for Research in Securities Prices at the University of Chicago (CRSP)
In order to be able to draw reliable statistical inferences from the back-tested results, we need a long data series. For example, in order to statistically show that stocks outperform risk free Treasury Bills, you would need around 30 or 40 years of data. The media often reports results over short periods such as one month or a year, and Morningstar will typically rank mutual funds based on performance over the last 3 years.
Such short-periods do not allow for any meaningful conclusions to be drawn other than comparing the relative risk of various funds.
Data constraints
We are constrained by the availability of data for certain asset classes. For example the live price of gold can be traced back to January 1971 but prior to this was fixed at $35 per ounce. We therefore do not believe that it is possible to extend our analysis much beyond 1971
Code of Ethics
Code of Ethics and Professional Responsibility:
Principle 1 – Best interests of Clients
Act in the best interest of clients.
Acting fairly, honestly and professionally in the best interests of the client is a hallmark of professionalism, requiring the financial planner to act honestly and not place personal gain or advantage before the client’s best interests.
Principle 2 – Integrity
Provide professional services with integrity.
Integrity requires honesty and candour in all professional matters. Financial planners are placed in positions of trust by clients, and the ultimate source of that trust is the financial planner’s personal integrity. Allowance can be made for legitimate differences of opinion, but integrity cannot co-exist with deceit or subordination of one’s principles. Integrity requires the financial planner to observe both the letter and the spirit of the Code of Ethics.
Principle 3 – Objectivity
Provide professional services objectively.
Objectivity requires intellectual honesty and impartiality. Regardless of the services delivered or the capacity in which a financial planner functions, objectivity requires financial planners to protect the integrity of their work, manage conflicts and exercise sound professional judgment.
Principle 4 – Fairness
Be fair and reasonable in all professional relationships. Disclose and manage conflicts of interest.
Fairness requires providing clients what they are due, owed or should expect from a professional relationship, and includes honesty and disclosure of conflicts of interest. It involves managing one’s own feelings, prejudices and desires to achieve a proper balance of interests. Fairness is treating others in the same manner that you would want to be treated.
Principle 5 – Professionalism
Act in a manner that demonstrates exemplary professional conduct.
Professionalism requires behaving with dignity and courtesy to clients, fellow professionals, and others in business-related activities, and complying with appropriate rules, regulations and professional requirements. Professionalism requires the financial planner, individually and in cooperation with peers, to enhance and maintain the profession’s public image and its ability to serve the public interest.
Principle 6 – Competence
Maintain the knowledge and skill necessary to provide professional services competently.
Competence requires attaining and maintaining an adequate level of knowledge, skills and abilities in the provision of professional services. Competence also includes the wisdom to recognise one’s own limitations and when consultation with other professionals is appropriate or referral to other professionals necessary. Competence requires the financial planner to make a continuing commitment to learning and professional improvement.
Principle 7 – Confidentiality
Protect the confidentiality of all client information.
Confidentiality requires client information to be maintained and protected in such a manner that allows access only to those who are authorised and legally entitled to access that information
Potential conflict of interest statement - gold bullion
Although investments in precious metals are not regulated by the Central Bank of Ireland, at
GoldCore we believe that, in the spirit of treating our customers fairly, all precious metals
transactions should be subject to the same fiduciary standards as apply to regulated
products.
As dealers in precious metals and agents of the Perth Mint of Western Australia, GoldCore
Ltd has a potential conflict of interest when advising clients to purchase precious metals.
We therefore wish to disclose this conflict of interest and offer our clients a choice of
options from which to make an informed choice.
Perth Mint Certificates
We believe that the reason for holding gold in an investment portfolio is as a form of
financial insurance against the infrequent but highly damaging events such as we saw in
1929, 1987 and 2008. Since Gold has no liabilities and is not a financial instrument (such as
a stock or a bond) we believe that investors should hold physical gold rather than a
securitised form such as in an Exchange Trade Fund.
The reason for this is that one of the risks one is seeking to avoid in holding gold in the first
place is that of “counterparty risk” i.e. the risk that the institution holding your
investments fails. We therefore recommend the AAA rated Perth Mint which is owed by
the Western Australian Government.
A further benefit of Perth Mint certificates is that there are no annual charges and the
bullion is insured with Lloyds at the Perth Mint’s expense. Since gold pays no interest or
dividends, any annual fee will gradually reduce the size of a holding over time.
The “market” price of gold is derived from a 400 ounce bar of gold which at current prices
(April 2010) would cost around $460,000. Therefore, when smaller amounts are purchased
it is at a small premium above the “spot price”.
If you would like to discuss alternative options for purchasing physical bullion (such as bars
or coins or alternative storage options) please contact our bullion traders on 01 632 5010.
GoldCore Portfolios Key Features
Key Features
Prospective investors should consider the following factors in determining whether an investment in GoldCore’s Bespoke Investment Portfolios is a suitable investment, and in particular prospective investors should note that the value of their investment may fall as well as rise.
Aims
GoldCore Ltd Bespoke Investment Portfolio service aims to provide investors with the following:
• To enable you to spread your investment among different types of investment funds from different investment managers in a portfolio in line with your objectives and attitude to risk
• To offer the potential for capital growth, income or both
• For the details of the specific aims of each fund, please refer to the product particulars of the fund
These services are advisory in nature and therefore we will seek your authority before acting on your behalf. You may accept or reject completely, or in any part, any recommendation from us and you have the sole authority with regard to the implementation, acceptance or rejection of any advice from us.
Our Commitment
GoldCore will be responsible for the design, execution and administration of your investment portfolio for those assets held with our Custodians and based on our understanding of your needs, objectives and attitude to risk as communicated to us by you. On an ongoing basis, GoldCore will provide valuations and rebalancing recommendations to bring your portfolio back to the target weights (See rebalancing below).
Your commitment
To pay a lump sum investment into the GoldCore Ltd Bespoke Investment Portfolio Service.
You should regard your investment as a medium to long term commitment (5 years+)
You may make further lump sum payments whenever you like, subject to a minimum of €10,000.
Risk factors
• What you get back depends on future investment performance and is not guaranteed. Investment returns may be lower than illustrated.
• Information about past performance should not be taken as a guide to future performance.
• Charges also affect what you will get back and the amount you get back may be less than your original investment.
• The value of your investment and any income from it may go down as well as up, whether you are invested in equities, property, bonds or commodities.
• Some funds may include overseas investments where the value may be affected by movements in currency exchange rates.
• The fund managers may increase the charges on the funds in the future.
• Inflation may reduce the buying power of your investment and income.
• If you invest in a property fund or other fund with limited liquidity, such as a fund of Hedge Funds, you should be aware that these investments may not be readily realisable and it may be difficult for investors to sell or realise the investment and/or obtain reliable information about its value or the extent of the risks to which it is exposed.
• Tax law and Revenue practice may change in the future.
• Some investments in certain markets may be subject to increased risk and volatility.
Questions and answers
Where is my investment held?
Your investment is made into UCITS regulated Investment Funds with major US Fund Managers such as BlackRock, Vanguard or Dimensional Fund Advisers who between them manage around 5 Trillion US Dollars. These investment funds are registered with an Independent custodian either with our Stockbroker (FXCM Securities in London) or with Royal Bank of Canada (CI) Ltd or with Zurich Assurance Ltd for the Professional Pension Plan. You will be advised which custodian will apply in your case. GoldCore Ltd does not hold client money .
Can I switch Investments?
Switches between investment portfolios are possible at any time and would be subject to dealing costs of selling and repurchasing new investments and an administration charge by GoldCore Ltd. Investors should note that some investments within the portfolio may be subject to limited liquidity and/or costs associated with early encashment. Tax is also due on encashment (see taxes below).
What is the GoldCore Ltd Bespoke Investment Portfolio Service?
GoldCore Ltd Bespoke Investment Portfolio Service is not an investment fund or product. It is a service in which we research and recommend portfolios of collective investments such as:
• Unit trusts
• Open-Ended Investment Companies (OEICs)
• Investment trusts
• Exchange Traded Funds
• Alternative investments such as precious metals*
We aim to simplify this huge market and select the most appropriate investment strategy for our clients
Terms of Business
These terms of business set out the basis on which we will provide advisory portfolio services, associated financial services and advice to you. These terms of business are valid from 1st December 2011 until further notice.
Please ensure that you read these terms thoroughly. If you have any queries, please feel free to contact us and we will endeavour to clarify matters for you.
GoldCore Ltd trading as GoldCore has offices at: 14 Fitzwilliam Square, Dublin 2, Ireland
The contact details for the company are:
Phone number: (01) 632 5010
Facsimile number: (01) 661 966
E-mail address: wealth@GoldCore.com
Web site: www.wealth.goldcore.com
Regulatory Status – GoldCore Ltd is regulated by the Central Bank of Ireland under the Investment Intermediaries Act 1995. As an Authorised Adviser, we will provide advice on the basis of a fair analysis of the whole marketplace for financial products. GoldCore can receive and transmit orders on your behalf for products from any of the product providers from which GoldCore Limited holds a written letter of appointment. GoldCore Limited has access to a wide range of product providers operating in the Irish market as well as internationally (see Appendix 1).
Our Authorised Status reference number is 39656.
We are authorised to provide investment advice on a broad basis. Included in the advice offered are the following regulated activities:
• Shares in a company or bonds that are listed on a stock exchange, prize bonds
• Units or Shares in undertakings for collective investment schemes including unit trusts and UCITS
• Tracker Bonds
• Insurance Policies
• Personal Retirement Savings Account (PRSA’s)
GoldCore Ltd can also act as a Deposit Broker and give advice in relation to deposits
We are not a tied agent for any of the above services.
Codes of Conduct
We must comply with these codes which offer protection to a consumer:
Consumer Protection Code – GoldCore is subject to The Central Bank’s Consumer Protection Code which offers protection to consumers.
GoldCore is also subject to and complies with the Minimum Competency Code and the Fitness and Probity Standards as laid down by the Central Bank of Ireland. These codes can be found on the Central Bank website www.centralbank.ie
Financial Planning Standards Board (FPSB) – As CERTIFIED FINANCIAL PLANNER professionals, our advisers are subject to a Code of Ethics and Professional Conduct of the FPSB in Ireland. The code can be found on the FPSB website www.fpsb.ie.
Consumer Protection
We are members of the Investor Compensation Scheme established under the Investor Compensation Act, 1998. This legislation provides for the establishment of a compensation scheme and to the payment, in certain circumstances, of compensation to clients of firms covered by the Act