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Don’t accept unnecessary risk

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By Michael O’Connor, theislandinvestor.com

I always advocate for long-term investing, but this buy-and-hold narrative can be misinterpreted as 'do absolutely nothing'.

I disagree with this take, and if your financial advisor has made no changes to your portfolio over the last few years, you should probably go shopping for a new one.

We had the most predictable and forecast interest rate hiking cycle over the last 18 months. If your portfolio was left sitting in bonds when negative asymmetric returns were clearly on the table (only downside), then you need to be asking some questions.

There is a difference between patience and incompetence. Unfortunately, over the short term, the two are indistinguishable.

If your financial advisor hasn't made any changes to your portfolio because they believe that 'time in the market' is all that matters, that's perfectly fine. That is an investment approach that has been successful for so many. But why are you paying them to sit on your money when you can just invest that money directly yourself on any online brokerage? If the middle-man isn't adding value, remove them.

Check your exposure

Just because you're a long-term investor doesn't mean you need to blindly reach for returns. Tactically adjusting your portfolio to mitigate against obvious risks on the table is an important part of the investment process.

With that said, growing expectations around a recession should not be seen as a 'sell everything' event. You simply need to reassess where your exposure lies.

Ensure you are invested in companies with;

Strong 'Net Margins': Improving revenue is great, but it needs to make the business more profitable. Far too many companies are spending more than they are making, all in the name of customer acquisition. This 'growth at any cost' tactic was rewarded when money was free, but with credit standards tightening and interest rates jumping higher, the endless growth narrative is about to catch up on many of these 'high growth' names.

High 'Free Cash Flow' Margins: In its simplest terms, free cash flow is just the cash that can be taken from a business without disrupting the operations of the business. Importantly, this number factors in the cost of growth. So, if a business is growing and has a good FCF margin, it should pique your interest.

Stable Return on Invested Capital (ROIC): ROIC is just the profits a business makes on the money invested into it. The premise is pretty straightforward. You want to invest in companies with a history of using their equity to generate more profits. Looking at companies with sky-high ROIC can be compelling, but what you want to see is a consistent history of stable ROIC over time. Ignore the once-off data; always analyse the trend.

You can find all this info on any company by simply typing the company's name into sites like stratosphere.io.

Be selective in the risks you take.

My portfolio

I have moved to underweight equities with a focus on quality and energy.

The remainder of my holdings have been moved into short-term treasuries, with a very small portion in long-term treasuries with zero corporate bond exposure.

I also hold roughly 20% in a short-term tactical portfolio mostly made up of distressed financials, tech and mining, but I would categorise these as bets more than investments and not something I necessarily recommend doing.

If you have any questions, please don't hesitate to reach out.

To get my latest 10 stock recommendations, sign up for my newsletter by scanning the QR code or go to www.theislandinvestor.com.

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Killarney for Palestine film screening

Killarney for Palestine recently held a sold-out screening of the Oscar-winning documentary ‘No Other Land’ at the West End School of Arts, raising €2,100 for Camp Breakerz. The event, which […]

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Killarney for Palestine recently held a sold-out screening of the Oscar-winning documentary ‘No Other Land’ at the West End School of Arts, raising €2,100 for Camp Breakerz.

The event, which took place on July 3, included two screenings, both of which were fully booked. Guests enjoyed cheese and wine before the shows.
‘No Other Land’ depicts the ongoing destruction in Masafer Yatta, a cluster of villages in the Southern West Bank, and shows the experiences of Palestinians under Israeli occupation. The film won in the Best Documentary category at this year’s Academy Awards.
The screenings were organised in association with the West End School of Arts.
All proceeds from the €25 tickets benefited Camp Breakerz Crew, a children’s charity based in Gaza that provides creative outlets through dance and is involved in food distribution programs in Nuseirat Camp and Deir-Al-Balah due to food shortages.
Sally MacMonagle, who recently spent time in Aida Refugee Camp in Bethlehem, also spoke at one of the screenings.

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Bid to host European Presidency summit meetings gathers pace

Fianna Fáil Spokesperson on Tourism, Michael Cahill TD, has highlighted Killarney’s suitability to host summit meetings of international Government Ministers during Ireland’s six-month European Presidency tenure in 2026. Deputy Cahill […]

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Fianna Fáil Spokesperson on Tourism, Michael Cahill TD, has highlighted Killarney’s suitability to host summit meetings of international Government Ministers during Ireland’s six-month European Presidency tenure in 2026.

Deputy Cahill believes Kerry’s available accommodation, food, and conference facilities are “second to none,” with Killarney as the central location.
“Visitors from every corner of the earth have been coming to Kerry for centuries now, to experience its beauty and serenity and have returned on many occasions because of the fabulous time they have enjoyed during their stay here,” said Deputy Cahill. “Where else would you want to bring the senior Government Ministers of all of our EU counterpart states, to experience Ireland, its customs and heritage?”
The Rossbeigh TD outlined various attractions available for visitors during downtime: “During their downtime, they can visit the Blaskets and Slea Head, Sceilg Mhichíl and the Ring of Kerry, Killarney’s Lakes, Gap of Dunloe, National Park and Sliabh Luachra, all of our glorious beaches from Ballybunion to Rossbeigh, Kells to Ventry, Whitestrand to Inch, Ballinskelligs to Cromane, Waterville to Derrynane.” He also cited Kerry’s golf courses, Listowel Writers Week, the Rose of Tralee, and Puck Fair as potential experiences.
Deputy Cahill confirmed he has raised this matter with An Taoiseach, Micheál Martin; An Tánaiste and Minister for Foreign Affairs, Simon Harris; and Minister of State for European Affairs, Thomas Byrne.
“If Killarney’s bid is successful in bringing the Heads of State to our county for meetings, conferences and functions, it will be a massive boost to the local economy in Killarney and also throughout the county,” added Cahill.”Iwill continue to push in the coming months for Killarney and Kerry to be included as bases for the rounds of meetings that are to take place from July 1 to December 312026.”

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