Dear Sir/Madam,

Well it's Christmas time again.  A time to be manic for a few weeks then collapse in a heap and recover!  It marks the end of what has been another epic year of events both here and abroad.

Some of the events we have witnessed this year were.............

  • 3 different Prime Ministers in Australia
  • Super Typhoon Haiyan devastated the Philippines
  • Meteorities injured hundreds in Russia
  • The US Government closed for business
  • Detroit filed for Bankruptcy
  • Tokyo won their bid for the 2020 Olympic Games
  • Pope Benedict XVI resigned
  • Bush fires destroyed hundreds of Blue Mountains properties
  • The passing of a hero - Nelson Mandela
  • The redemption of the Australian Cricket team!

I wonder what is in store for us all in 2014!

Turning to your has been a stellar year of performance for everyone.  I am proud to say that the Chrysalis portfolios have performed at the highest level in the industry this year across all risk profiles and for the minimum amount of risk.  They were up there with the highest returns earnt for diversified portfolios in Australia this year.  We wish to thank the Chrysalis Investment Committee for their skillful and diligent oversight of your investments to deliver this result.

Looking forward we continue to see indicators which point to continued growth and optimism.  Most of the debt ridden parts of the world are now officially out of recession and moving forward (albeit very modestly).  US jobs and manufacturing figures are a lot more promising.  Japan has embarked on an aggressive stimulus program for the first time in 2 decades and confidence has returned to investors who are now no longer waiting in cash for the most part but are invested back into share markets and earning strong returns for doing so.

That said, however, we do expect the performance returns to moderate in 2014.  They have to.  You can't get 20% pa year in and year out without consequences.  We envisage that the markets will slow to high single figure returns (the sweet spot) in 2014.  We believe that the impetus for this slowdown may occur in the first quarter of 2014 and be initiated by decisions the US Fed makes.  Their debt ceiling will be reached again early next year and they are also wanting to taper off their stimulus (QE3) which cannot continue indefinitely.  When they do we expect many investors to take profit by selling and this will cause a market correction for a period of time (possibly a 10% - 20% drop).  As I write this, the ASX is down 8% from it's highest point a couple of weeks ago.  This is normal and nothing sinister to worry about and is a healthy sign for the markets.  We have protections in place in your portfolio to minimise the impact of downward movements so we are set to take advantage of this correction when it comes.

We also expect China to play a much bigger role in their influence and shaping of world economics from here on in as a result of the many dynamic sweeping reforms recently announced by the new Premier Xi Jinping.  The word 'watershed' has been used to describe them!

The entire team at Chrysalis would like to thank you for choosing to partner with us.  We also greatly appreciate your endorsement of us via the many referrals we have received this year.  These referrals are our lifeblood and we greatly appreciate you thinking of us with your family and contacts.

We wish you and your family a wonderful and memorable Christmas and look forward to serving you on the Journey of 2014.

Chrysalis Lifestyle Planning

Chrysalis Advice team

Chrysalis Lifestyle Planning


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Any Questions?

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