Is gold a safe haven for your money in these troubled times. Fredrik Nerbrand, Head of Global Strategy at HSBC Private Bank (left) thinks it may not be after all.

Many investors are becoming increasingly conservative in the search for safe havens. Throughout the centuries, gold has often been perceived as the ultimate safe haven and, judging by the markets, today is no different. However, we tend to differ with this consensus view, as we do not believe gold necessarily offers the characteristics of what we would call wealth preserving assets.

Our view primarily focuses on one issue which is often forgotten: volatility. From an overall portfolio perspective, gold is likely to boost rather than reduce portfolio volatility. As such, we do not believe gold is such a safe haven after all.

Despite government intervention, hangover from the banking crisis will be long lasting and profound, writes Paul Niven, Head of Asset Allocation, F&C Asset Management (pictured left).

In less than three weeks the credit crunch has been transformed into a financial maelstrom, destroying some of the best known and longest established names on Wall Street and, over recent days, taking some large European casualties on the way. Popular press and investment professionals alike have been transfixed by the speed and brutality of the shakeout in the financial sector, as names such as Lehman Brothers, Merrill Lynch and Washington Mutual have been consigned to history.

After years of the NICE non-inflationary continuous expansion) global economy, we appear to be facing a VILE period (volatile inflation and lower earnings, says Fredrik Nerbrand (pictured)

“Goldilocks is dead! Her era of a not too hot and not too cold growth environment with well-behaved inflation has come to an end. In her place, a gloomier era is emerging with the three bears of Inflation, Recession and Regulation.  On average, consumers around the globe are feeling the pinch of weaker labour markets, falling house prices and costlier energy and food. This results in an outlook of measly growth and heightened inflation.  In our minds, central bankers are behind the curve on this outlook and find themselves caught between a rock and a hard place.  For that reason, inflation is likely to continue to cause market angst.

Issues surrounding the environment have moved from the fringe to centre stage over recent years. Along with this has come some confusion over where the boundary lines are drawn, with investors on the whole being content to decide for themselves where green starts and ends.

The demolition of tropical rain forests in South America, the warming of the atmosphere via the ever constant output of carbon dioxide by mankind and the loss of another animal species, are just some examples of why the subject remains as emotive as ever.

Some even question whether the Earth is warming at all, or whether what we are currently seeing are simply natural phenomena, which have always taken place. Then, assuming that global warming is in place, the next challenge is to engage hearts and minds in doing something about it. 

I have waited 30 years to use this virtually forgotten expression. My father used to say 'he wants cake and th’ ha’penny' to describe someone who wanted everything at the best possible price. Today I think it could be argued there is an investment opportunity which encapsulates this saying perfectly.

With investments you usually have to choose whether you want the potential for capital growth or a high income. It is rare that the high income element also offers the potential for some growth. I believe fixed interest and other high yielding investments could currently offer just that.

In announcing its £12 billion rights issue, it seems that the Royal Bank of Scotland loosened the tap of rights issues in the UK market. Given where we are in the current environment, will this trickle turn into a flood? By way of reminder, rights issues are a means by which listed companies can raise extra capital by going to their shareholders and offering them new shares on a pro rata basis – and, most importantly, at a discount to the current market price by way of incentive.

Investors are being warned that being out of the market for any length of time could mean their missing out on the potential long-term growth that cash accounts cannot usually offer.

Simon Holt, managing director of Skipton Financial Services, says that £10,000 invested in a typical cash account three years ago would now be worth £10,939 or 3.1% pa.  This compares to £12,120 or 6.6% pa if invested in the Schroder Multi-Manager Cautious Managed Account, one of the top funds in the IMA Cautious Managed sector. 

The Budget 2008 confirmed the changes to Capital Gains Tax (CGT) for mutual funds announced in the Pre-Budget report. The changes announced see the introduction of a flat rate of 18% tax on capital gains, with the removal of indexation allowance and taper relief.

Tim Rees, head of financial planning at Clerical Medical, said: "There are winners and losers to the Capital Gains Tax changes. In the mutual funds versus investment bonds debate Clerical Medical believes that, when the tax efficiency, relative product costs and administrative simplicity are compared, financial advisers will continue to recommend investment bonds."

Most investors know that diversification is an important investment strategy, but many may not be really sure what it means, writes Kate Warne (pictured left).  Diversification simply means owning a variety of investments that typically perform differently from one another. Why diversify? It reduces the risk, or volatility, of your portfolio. We believe constructing a well-diversified portfolio is one of the most important principles of investing and that it’s particularly important for your ISA, pension scheme and other long-term investments.

Offshore investment conjures up images of numbered Swiss bank accounts and shady dealings with Caribbean islands. But you don’t have to be a tycoon or a money-launderer to want to hold your money offshore, as there are many advantages for the ordinary citizen holding funds outside the UK.