NIALL Rooney has worked in the insurance and financial services industry for over 34 years. He joined CityLife Galway in May 2013 as financial planning manager and he is a chartered insurance practitioner and a personal financial planner.

Niall is well-known in racing circles and got his love of horseracing from his late father Raymond Rooney. Ray was senior steward of the Turf Club and chairman of Galway Race Committee. The two National Hunt horses that most people probably remember his involvement with were Golden Cygnet and Sky’s The Limit, both trained by Edward O’Grady. They were Cheltenham Festival winners in 1978 and 2006 respectively. Ray also had some flat horses with Dermot Weld, notably Arabic Treasure who gave him his first flat success at his local Ballybrit track.

Positive outcomes

The job of a financial planner is all about getting good financial outcomes for clients, very much focused on their current and future lifestyle needs; it’s about making sure that clients and their families never run out of money in all life circumstances. The role is to act as a financial coach, helping clients put the appropriate structures in place to get the best long-term outcomes.

Many people have lifestyle financial goals but no plan in place to achieve them. Niall assists individuals in effecting a personal financial plan. In racing parlance, this is like having a race plan prior to the white flag being raised! The jockey, trainer and owner(s) are all on the same page and fully aware of what the plan is pre-race. Occasionally as the race develops the riding instructions are not working as anticipated, and the plan needs to be tweaked a bit. This can happen with a personal financial plan as individual circumstances change over time. The plan needs to be reviewed on a regular basis.

A financial plan will embrace a myriad of different financial considerations and life scenarios. Almost certainly it will ensure that protection structures are in place to ensure income is available when it is most needed. It will address the optimum pension structures to maximise lump sums and pension income in retirement. It will also address the most tax efficient ways to arrange one’s finances and show the best way to plan for inheritance.

People are always challenged on how best to invest their funds for the future, but oftentimes the approach adopted is too short-term, too risk-specific and too impatient. Niall’s philosophy on investment is a proven one, tried and tested over a lifetime of watching the markets. It involves studying economic history and managing client behavior. The key tenets of this philosophy are:

In Niall’s experience the biggest challenge to investing successfully over the long-term is an investor’s own irrational behavior, particularly during periods of market stress.

This can mean doing the wrong thing at the wrong time. They will invest most when the market is at its highest, and exit when the market is at its lowest. This is a sure-fire way of going broke.

Behavioral Biases – Punters and Investors

Five attributes/tenets that an investor can learn from wise and savvy punters.

1Wise punters do not react to what they read in the print media and see on social media. They do their own research, get informed and analyse form. Once they have undertaken this process it is only then they will make an informed decision to have a bet or not. By kneejerk reacting to current market news and headlines investor’s decisions have a bad habit of not going to plan. Controlling one’s emotions when markets are falling is a difficult discipline to master. The S&P 500 index at its lowest point on March 23rd, at the start of the pandemic, was 2191 and this week it was at a high of 3436. How many investors switched to cash in late March on foot of this dramatic fall?

2Savvy punters and investors do not go with the herd instinct; the horse of the moment or the next best investment thing of the moment. It’s akin to the property boom in the mid-2000s when many individuals ploughed into property to try to make a quick buck. Cryptocurrency springs to mind these days.

3Professional punters will back horses from different stable yards and have no allegiance to any one trainer. Investors should do likewise and diversify their investment portfolio and not continually invest in one stock just because they work in that sector or the stock is the flavour of the month. If we learnt anything from the financial crisis in 2008/2009 it was to diversify one’s portfolio and have your investment fund in a mix of assets that are not co-related.

4Great punters are in the business for the long-term and do not try and make a quick buck or chase their losses. Successful investing requires a long-term, patient approach and strategy. Warren Buffett put it in very simple terms: “The stock market is a device for transferring money from the impatient to the patient”.

5Great punters stick with their bet/punt after careful consideration and are not swayed on the day of the race with ‘he’s a sure thing’ or ‘it’s only a steering job’. Investors similarly need to stick to their long-term financial plan and not deviate from it due to noise in the marketplace, for example Covid-19.

Successful investors have two choices. Get informed and manage your own investments or outsource the role to an investment professional. Getting informed is not difficult but it requires a lot of time and effort and you need to be extremely self-disciplined. If you are not prepared to acquire the necessary knowledge to manage your own investment portfolio you should look to engage with a trusted investment advisor to do so. The racing fraternity live busy lives and time is of the essence.

Niall Rooney B.Comm.ACII.QFA.FLIA can be contacted at 087-2482639 or call CityLife Galway, 17 St. Mary’s Road, Galway on 091-520608.