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Yesterdays post was a superb swell of positive data that couldn’t help but leave the reader up beat about the UK’s prospects for the future. The post is called DevDosh Ltd : UK Confidence Rises and you can find it on our blog pages.

In that post I referenced “Indicators” which is a word readers will have different levels of awareness of. However anyone who is serious about investing needs to be aware of and use economic indicators. They are the bedrock of our investment choices and guide our actions.

The blog post actually has a VW Beetle car indicator as the featured image. This visual metaphor is an excellent way to think about economic indicators. When you see a car travelling down the road, approaching a junction with its left turn indicator flashing, you have a a pretty good idea the car is about to turn left. This is a forward indicator so called because it is an indication of something which is going to happen in the future.

Similarly, if a car comes into view on the road you are travelling on with it’s left indicator flashing and there is no left turn ahead of it, then you can be pretty sure it just turned into your road. That is a trailing indicator. So called because it is indicating a past event.

DevDosh Ltd : Why are indicators so important?

It’s a common misconception that traders get out of bed and make their trading decisions for the upcoming day based off the mornings financial news. Nothing could be further from the truth. A structured process called the Asset Selection Process is actioned to enable traders to make investment decisions well in advance of market movements. Forward indicators are an essential part of this process as they indicate how the markets will be moving in advance enabling the trader to position himself for maximum benefit prior to the event.

DevDosh Ltd : How does this help fixed income investors

With fixed income the main influencing factors are interest rates and rates of inflation. These are large slow bohemoth indicators. The key to positioning your fixed income portfolio for success is to read the forward indicators that will effect your country risk profile influencing factors. For instance, you have a UK bond portfolio. What are the reasons that interest/inflation rates will go up or down in the UK? Identify those reasons and you have identified the crystal ball for your exposure.

DevDosh Ltd : The secret sauce

There are lists of indicators and I will go through some of them in a different blog. Be aware though, the best indicators are the ones nobody else knows about. If everyone is working from the same data then they will largely make the same decisions. Finding economic/sector indicators that get the jump on the market is essential to enable you to position yourself for their movement.

Of course in the case of DevDosh Ltd the need for investors to constantly monitor economic data is redundant. Our fixed income investment product does not suffer interest and inflation risk due to the premium yields available. Furthermore the forecasting of UK residential property prices which ensure that the LTGDV rate is accurate is taken care of by qualified RICS valuers.

If you are interested in the safest fixed income investment in today’s market, contact DevDosh Ltd and see how we can help.