Invest
3 ways to pandemic-proof a portfolio
There are a number of lessons high-net-worth investors can teach the rest of us about wealth preservation during a downturn, according to an investment specialist.

3 ways to pandemic-proof a portfolio
There are a number of lessons high-net-worth investors can teach the rest of us about wealth preservation during a downturn, according to an investment specialist.

In an opinion piece for nestegg’s sister brand InvestorDaily, Citi investment specialist Jonathen Chan said high-net-worth individuals are usually attuned to world events and will seek out defensive portfolio allocations that focus on wealth preservation.
“This prepares them well for periods of volatility, even unpredictable volatility like COVID-19,” he considered.
“Everyone can take a leaf from this book, as uncertainty is on the cards for the foreseeable future.”
He highlighted three main lessons that everyday investors can take from the high-net-worth investor playbook.
- Don’t try to time the market
For investors that try to time the market, COVID-19 “has been and continues to be a wild and sometimes scary ride”, Mr Chan said.
The opposite is true for long-term investors with an asset mix “that allows for absorption of volatility”.
According to the investment specialist, high-net-worth investors tend to be more cautious in their approach, as protecting their wealth forms a key part of their portfolio planning.
“Instead of chasing high returns but high risk opportunities, investments to them is about steadily growing their portfolio and limiting the downside,” he said.
- Diversification is the only free lunch
“In the wealth management industry we have a saying, ‘diversification is the only free lunch’. This saying has certainly proved true while navigating the impacts of the pandemic.”
Mr Chan has observed that Australians traditionally concentrate their investments in property, shares and cash: “The first two suffer in downturns, and the latter is certainly not king in the current low-interest environment.”
He advises that more asset classes need to be considered, particularly in times of volatility.
Noting a move by high-net-worth investors towards bonds, term deposits and hedged equities (structured investments), Mr Chan said these individuals have “managed solid portfolio performance at a time when risk in equities was escalating”.
While some investors would have made higher returns out of straight equities, the investment specialist argued they would have been the minority.
“Most investors tend to wait for more gains as equities rally, and get caught in the panic selling when markets suddenly fall,” he explained.
- Learn about and use different asset classes
“Australians are overweight to shares,” Mr Chan reiterated, while conceding that the benefits of holding shares is fast diminishing.
It’s why, again, the investment specialist touted the benefits of other asset classes – term deposits, corporate bonds and managed funds “just to name a few”.
From Mr Chan’s perspective, “investors should remember to not just dismiss an investment type because the returns seem lower than other asset classes – it’s about balance and risk”.
Another trend of high-net-worth individuals that is rising in popularity throughout the pandemic is diversification through holding investments in multiple currencies.
“This is to take advantage of the benefits of safe-haven currencies like the US dollar and the Japanese yen in times of high risk, and the strengthening of the Australian dollar as risk lowers,” he explained.
While it’s okay to heavily invest in the sharemarket, Mr Chan has advised that “it remains important to learn how to balance a portfolio with other elements, so that when trouble hits, the downside loss is manageable”.
About the author

About the author


Investment insights
Australian investors undeterred amidst global uncertainty, prioritise financial security, tech stocks, and tangible goals
In a world marked by economic fluctuations and geopolitical uncertainties, Australian investors are showing resilience and confidence, according to a recent survey by wealth app Sharesies. The survey,...Read more

Investment insights
Escaping the dollar trap how treasuries and bullion are reshaping portfolios
Gold’s geopolitical premium has broken out of the margins and into the mainstream of reserve and portfolio strategy. Central banks have been net buyers for years and, since 2022, their accumulation ...Read more

Investment insights
From check-up to edge: a portfolio review case study that turned volatility into advantage
With rates rising more than 400 basis points in 18 months and asset correlations behaving badly, periodic portfolio reviews have moved from hygiene to edge. This case study shows how a disciplined rev...Read more

Investment insights
Policy risk meets cost shock: Why investors are exiting housing — and what business can do about it
A sudden jump in holding costs and a rising ‘policy risk premium’ are pushing Australian property investors to sell, thinning rental supply and pushing rents higher. Industry surveys point to fear...Read more

Investment insights
Australia's investor shuffle as policy risks and rising yields squeeze the rental market
A quiet but consequential shift is underway: more property investors are exiting, citing higher holding costs and fear of future tax changes. That retreat risks worsening the rental shortfall just as ...Read more

Investment insights
State Street Markets report highlights resilient investor sentiment amid shifting allocations
In a climate of evolving global financial landscapes, State Street Markets has released its latest institutional investor indicators, revealing a sustained positive sentiment across the investment spe...Read more

Investment insights
Consumer strength lifts Australia’s GDP — but the investment slump is the risk line every CFO should read
Australia’s June-quarter growth surprised to the upside as households and government spending outpaced a steep fall in public investment. The services economy is doing the heavy lifting, but the han...Read more

Investment insights
Gold prices surge to record highs amid economic uncertainty
In a remarkable start to September, spot gold prices have soared to unprecedented levels, breaching the US$3,500 per ounce mark. This surge has been fuelled by a complex interplay of macroeconomic fac...Read more

Investment insights
Australian investors undeterred amidst global uncertainty, prioritise financial security, tech stocks, and tangible goals
In a world marked by economic fluctuations and geopolitical uncertainties, Australian investors are showing resilience and confidence, according to a recent survey by wealth app Sharesies. The survey,...Read more

Investment insights
Escaping the dollar trap how treasuries and bullion are reshaping portfolios
Gold’s geopolitical premium has broken out of the margins and into the mainstream of reserve and portfolio strategy. Central banks have been net buyers for years and, since 2022, their accumulation ...Read more

Investment insights
From check-up to edge: a portfolio review case study that turned volatility into advantage
With rates rising more than 400 basis points in 18 months and asset correlations behaving badly, periodic portfolio reviews have moved from hygiene to edge. This case study shows how a disciplined rev...Read more

Investment insights
Policy risk meets cost shock: Why investors are exiting housing — and what business can do about it
A sudden jump in holding costs and a rising ‘policy risk premium’ are pushing Australian property investors to sell, thinning rental supply and pushing rents higher. Industry surveys point to fear...Read more

Investment insights
Australia's investor shuffle as policy risks and rising yields squeeze the rental market
A quiet but consequential shift is underway: more property investors are exiting, citing higher holding costs and fear of future tax changes. That retreat risks worsening the rental shortfall just as ...Read more

Investment insights
State Street Markets report highlights resilient investor sentiment amid shifting allocations
In a climate of evolving global financial landscapes, State Street Markets has released its latest institutional investor indicators, revealing a sustained positive sentiment across the investment spe...Read more

Investment insights
Consumer strength lifts Australia’s GDP — but the investment slump is the risk line every CFO should read
Australia’s June-quarter growth surprised to the upside as households and government spending outpaced a steep fall in public investment. The services economy is doing the heavy lifting, but the han...Read more

Investment insights
Gold prices surge to record highs amid economic uncertainty
In a remarkable start to September, spot gold prices have soared to unprecedented levels, breaching the US$3,500 per ounce mark. This surge has been fuelled by a complex interplay of macroeconomic fac...Read more