Philosophy & Process
We are top down investors.
We believe that getting the asset allocation right is the most powerful driver of investment returns and so our starting point is the overall macroeconomic backdrop. We then consider how this affects each asset class before taking a geographical and sector perspective. We then use this research and insight to select individual assets.
In our view, this is the most efficient way of identifying which investments will outperform at any given point in the economic cycle.
Our multi-asset unconstrained approach allows us to invest only where our managers have the highest conviction, rather than creating a best ideas buy list. By blending asset classes, we believe we can create a portfolio that produces the best risk-adjusted returns for clients. Our high conviction approach to investing means that we are not subjected to style, sector or thematic bias in our portfolios. Our managers are therefore able to exploit investment opportunities throughout a variety of market conditions, irrespective of the asset class, geography or sector. That said, all our funds have a global but diversified approach to investing, to ensure investors are not exposed to unnecessary risk as macroeconomic or market conditions change.
Construction of our Funds is via a proven, robust and repeatable process. Our belief is that 90% of returns are derived from a top-down, asset allocation driven approach to investing. However, we still employ a rigorous approach to selecting the underlying assets, using in-depth quantitative and qualitative research. Although quantitative research can narrow down our list of investable funds, we believe that qualitative analysis is the key to identifying the future of good performance. Our research involves analysing the key drivers of performance, assessing the repeatability of those processes and returns, understanding the decisions that drove the performance and ensuring the managers have the people, processes and systems in place to continue to perform in the future.
Subsequently, all holdings we invest in are subjected to continuous monitoring, if an underlying holding no longer suits our selection criteria for whatever reason, we will disinvest. A close working relationship with all the management teams in which we invest is an essential part of our process. We believe that this approach is the most sustainable methodology for the creation of diversified Funds and peace of mind for our investors.