The Australian Business, 26 September 2007
TRUE CONFESSIONS: Anna Fenech
Hamish Carlisle's investment debut was in exploration shares
What happened?
I pooled some money with friends while I was at university to buy shares in a small gold exploration company after a friend of mine overheard his father talking about it over dinner with his friends.
The rumour was that it could travel from 90c to $6. We sold at a moderate loss after about four years.
What are your investment goals?
Providing my family with flexibility and security over the long term.
What's the best investment decision you've made?
Probably in my education. I borrowed $160,000 to do my MBA degree in the US at the Wharton School of the University of Pennsylvania, during which time I met my wife.
I also gained a much better perspective on what I wanted to do with my career. This was to be more entrepreneurial -- and run my own business.
What about the worst?
I am terrible at selling investments. There have been a number of times where greed has overridden common sense.
That is, I tend to hold on to investments for too long when they are profitable.
I have never kicked the habit but at least I am aware of it.
What's the best piece of investment advice you've received and who was it from?
The best advice I have received was at university when I learnt about the efficient markets hypothesis, the premise of which is that no one can beat the market other than by luck.
Since then I have been highly sceptical of any investment advice I have received as well as the merits of buying actively managed funds.
What advice would you give to an investor who is just starting out?
Set realistic return expectations, take a long-term view, don't get caught up in the latest craze of the day, pay your advisers by the hour, not as a percentage of your assets.
How do you react when markets get rocky?
I generally don't look at my investments every day and sit comfortably knowing that over the long term markets rise.
What's the biggest investment risk you've taken and did it pay off?
I am generally a fairly conservative investor and like to really think things through before making a decision.
Sometimes that might mean that I miss opportunities but ultimately it means I sleep better at night.
The biggest investments my wife and I have made are in our businesses but I don't like to think of these as big risks.
After all, our businesses are among the few assets whose value we can influence directly.
My current business is QuickDirect Online Mortgages -- where I am an investor and the managing director. I also sit on the boards of some other companies.
What would you never do with your money?
Expect it to double in anything under 10 years.
Setting realistic and long-term expectations will benefit the way you approach your investments.
Where do you source your investment information?
Being an ex-financial analyst I tend to do a lot of my own research or rely on industry contacts.
I prefer to focus on long-term trends rather than news flow but it's easy to be distracted.
Classic texts on investing such as The Intelligent Investor, by Benjamin Graham, are massively undervalued by the average investor.
More recent books I've enjoyed have been Jeremy Siegal's Stocks for the Long Run.
What are the important attributes of a good financial planner?
Charges by the hour and does not take ongoing commissions.
I don't have one at the moment. I use an accountant for tax matters and manage the rest myself.
What are your views on socially responsible or ethical investment?
Long-term performance relies on companies being socially responsible and ethical.
I am a long-term investor. That said, as per my earlier comments I would not pay 2 per cent plus (of my fund balance) per annum for a fund manager to invest on this basis.
Would you feel comfortable running a portfolio of individual direct shares?
My investments are primarily in direct shares, although a large part of this is in the well-established and diversified listed investment companies.
These offer exceptionally low fees and a conservative approach to investing.
How do you feel about investing overseas?
I have several overseas investments which have built up in recent years as Australian equities and property have become more expensive against other markets. These are listed international index funds.
The Australian market is finite and small within a global context.
It is silly to limit yourself to one market when there are better alternatives elsewhere.