The greater the liquidity an investment has, the greater the amount of emotional activity! Market cycles are continuous so know what emotional response to expect at different points in the cycle.
Why?
Emotional activity within an investment is mostly dictated by price. People get excited when they make a gain and upset when they make a loss.
Our suggestion, flip the emotional rollercoaster above and you’ll do well when investing, but this is easier said then done
To create or improve liquidity within an investment, the need to determine a set pricing point of that particular asset increases as the need for liquidity increases.
An example of this is property, not liquid, only able to obtain accurate pricing at sale or at auction and takes months to sell. Considered stable by most investors!
Compare this to shares, highly liquid, able to obtain accurate pricing by the minute and buy or sell within minutes. Considered highly risky by most with minimal investment experience!

Make sure that when you invest, that you know which point of the market cycle you are investing. Because if you’re on the negative side of the market cycle you’ll experience regret. Regret aversion can lead to losses being sustain indefinitely. It’s highly unlikely that anyone could ever definitively tell you which point of the market you‘re experiencing, but this is why the next point is so important!

Know how you can invest. Because aligning who is investing, to the purpose of that investment could save you thousands in taxation!
There are three main types of investment structures, each with their own individual tax rates, these are:
• Individual or personal
• Company’s Or Trusts
• Super & pension
Personal investment are mostly for short term to medium term investments. They provide access to the capital and income and are easy to understand. The downside is that they have the potential to be taxed at the highest marginal tax rate of 46.5%.
So if you have a partner, what is their marginal tax rate? Should they invest for you?
Company’s and trusts receive a flat rate of 30% tax. Depending on your level of wealth and income this may be attractive, mostly because these types of structures allow you to split your income between family members, whilst affording limited asset protection.
Super is mostly misunderstood. Most think of it as investment that goes up and down. They have no confidence in it because they don’t understand it!
Super is not an investment, it is a tax structure that can hold investments. So associate the ups and downs with your investment choice and seriously consider super if the investment is long term!
Why, because its tax rate is 15% on income and 10% on investment capital growth held for over 12 months. But this is where it gets exciting. Super after you reach your preservation age, now 57, has the potential to be TAX FREE, that’s right, NO TAX.
So seek advice, because what we do most is coach people on how to create wealth in their early years and then effectively transfer this into TAX FREE investment structures in their later years.