Wealth planning is a complex task but you can make it simple with the help of our professional advisors. They will help with financial strategies not only for you, but also for your family and your businesses by advising you on the accumulation, preservation and transfer of wealth throughout the various stages of your life.

Professional help will get you the following benefits:

• A big international team of educated and experienced professionals at your disposal.
• A holistic approach to all your individual aspects and wishes.
• Professional software to analyse and offer you appropriate and suitable solutions.
• Professional software to modify, analyse and rebalance your investment portfolio.
• Access to macroeconomic research and single instrument recommendations.

It is impossible to protect yourself from all types of risk, but following some simple rules you can significantly reduce them. An efficient way to do so is by diversifying. As an investor, you confront two major types of risk – diversifiable and undiversifiable. The latter must be taken as is. It is called “market risk” or “systematic” risk. It is type of risk associated with every company without exception. Examples of such risks are political instability, inflation, currency exchange rates etc. However, diversifiable risk (or “unsystematic” risk) can easily be reduced. These are your main diversification options (ideally an investor should use them all):

• The minimum number of direct investments (stocks, bonds etc.) must exceed 15-18 units. Not applicable for investment funds or index funds, since each of these consists of a number of securities.
• Regional diversification. Despite globalisation, regions develop unequally and may by in different stages of the economic cycle. Betting on only one region or economy (North America for example) an investor will be more dependent on it and will not reap benefits from economic success in other regions.
• Industrial diversification. There are many types of industries (extracting raw materials, manufacturing, service, high tech etc.) and these develop at an unequal pace in different stages of the economic cycle. It is good to include several different industries in your portfolio in order to reduce dependence of any one of them.
• Asset class diversification. It is all about correlation. The value of some asset classes changes in different directions over time or has weak correlation. Including different asset classes in your portfolio (stocks, bonds, commodities, real estate etc.) reduces volatility and risk.
• Diversification by liquidity. Accumulating wealth is a long process, but you still have to think about your short-term goals and unexpected expenditures. If you have only real estate in your portfolio, you may find it difficult to finance some urgent needs.
• Legal diversification. It is good to accumulate your wealth through different entities. By dividing your wealth between personal and legal entities you may be more flexible in terms of taxation, liquidity etc.

How does diversification work? Let’s look at an example of an undiversified portfolio. Let’s say you have a portfolio of only German airline stocks. If it is publically announced that German airline pilots are going on strike and all flights are cancelled, the share prices of that airline will drop. Your portfolio will experience a noticeable drop in value.

The Lithuanian (tax system is quite simple and transparent, but there are some tips investors should keep in mind.

Tax liability arises at significantly different moments for legal and private persons. A legal entity (legal person) may have a portfolio of securities, buy and sell them and not be obliged to pay income tax on them until it pays dividends to its owners.

A private person will have to pay income tax immediately after selling any security with profit. In order to avoid the inconvenience private persons have to deal with, you can use a so-called investment account. It allows you to postpone the income tax liabilities of certain financial assets.