Archive for October, 2011

Unconventional Opportunities in Private Wealth Management

Unconventional investing does not mean taking additional risks, according to Helen Kearns, President & Chief Executive Officer, Bell Kearns & Associates Ltd. & Board Member, Ontario Teachers’ Pension Plan. On the contrary, it can mean reducing risks.

A keynote speaker at the upcoming marcus evans Private Wealth Management Summit Fall 2011 in Las Vegas, Nevada, December 5-7, Kearns talks about unconventional investment strategies, risk management and exploring new opportunities.

What unconventional, yet successful, investment strategies have you observed at the Ontario Teachers’ Pension Plan?

Helen Kearns: I have made a number of observations that investors could benefit from. Although they deviate from conventional thinking, that does not necessarily mean taking on more risks.

For instance at our firm, we utilize re-balancing tools to move capital between asset classes and portfolios in order to manage risk and returns. Our system means that we often advise clients to buy when they do not feel like doing so, and sell when they are optimistic. Selling Canadian equities to buy bonds in early 2008 is an example.

We also assign a risk budget, a discipline that we imported from the pension world. We can do this at the total portfolio level, deciding with the client how much of their assets can be used to try and achieve value added returns, this sometimes includes alternative asset classes. 

In most portfolios, real estate falls in the alternatives category. We try to find income producing real estate with boring but sustainable returns, as it can compliment bonds in bringing stability to the portfolio with slightly higher returns.

How do you identify investment opportunities?

Helen Kearns: One of the major lessons that I have taken away from Ontario Teachers’ is to embrace the exploration of new opportunities. To be unafraid of looking at new markets and investment opportunities, but in a very measured way and in incremental steps. If it does not work out, the risk will be contained in a small amount. If it does work out, then you will have identified a source of return that may punch above its weight in the portfolio.

What strategies are available for mitigating risks?

Helen Kearns: The first and most important risk management strategy is changing the conversation. Most investors begin the investment process by focusing on the return they are seeking: “I am looking to achieve eight per cent per annum”. We think this is a backwards way of approaching a portfolio, as risks become secondary.

We begin by discussing risks at length. One of the lessons of 2008 was that risk is not one word. There is capital risk, liquidity risk and duplication of risk. This helps us focus on diversification across the total portfolio and cross-check our risk reference points along the way, to ensure that all stakeholders are comfortable with the investment risks that we will be assuming.

Any final thoughts?

Helen Kearns: The most important thing that we do for our clients is to build a framework for decision-making. Instituting a framework and proper governance allows a family to go back to the dinner table and enjoy being a family.

Contact: Sarin Kouyoumdjian-Gurunlian, Press Manager, marcus evans, Summits Division

Tel: + 357 22 849 313
Email: press@marcusevanscy.com

About the Private Wealth Management Summit Fall 2011

This unique forum will take place at the Red Rock Casino, Resort & Spa, Las Vegas, Nevada, December 5-7, 2011. Offering much more than any conference, exhibition or trade show, this exclusive meeting will bring together esteemed industry thought leaders and solution providers to a highly focused and interactive networking event. The Summit includes presentations on unconventional investment strategies, Federal Tax Policy challenges, risk management strategies and the family office governance structure.

For more information please send an email to info@marcusevanscy.com or visit the event website

marcus evans group – investment sector portal

Complementing our summit format, the Investment Network – marcus evans Summits group delivers peer-to-peer information on strategic matters, professional trends and breakthrough innovations.

Please note that the summit is a closed business event and the number of participants strictly limited.

About marcus evans Summits

marcus evans Summits are high level business forums for the world’s leading decision-makers to meet, learn and discuss strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to individually tailor their schedules of keynote presentations, think tanks, seminars and one-on-one business meetings. For more information, please visit www.marcusevans.com 

All rights reserved. The above content may be republished or reproduced – kindly inform us by sending an email to press@marcusevanscy.com

Lord North Street: Getting Private Wealth Management Right

William Drake, a speaker at the marcus evans Elite Summit 2011, shares his thoughts on what should drive investment decisions in the private wealth management industry. Interview with: William Drake, Co-Founder, Lord North Street

FOR IMMEDIATE RELEASE

The most important question to ask in the private wealth management industry is, “What is the money for?” according to William Drake, Co-Founder, Lord North Street. Managers need to get to the very bottom of the family’s objectives and requirements before building the portfolio or selecting managers, he adds.

A speaker at the upcoming marcus evans Elite Summit 2011, in Montreux, Switzerland, 21 – 23 November, Drake talks about asset allocation, manager selection and the latest trends in the industry.

What is the best starting point in the private wealth management industry?

William Drake: To manage a family’s wealth, you need to have very intense discussions with the different family members and get to the very bottom of their objectives, requirements and risk appetite. Wealth managers need to ask, “What is the money for?” and build the portfolio around those objectives. That is what all investment decisions should be based on.

Wealth managers often pitch their clients into pre-designed portfolios, but we start with a blank sheet of paper, design a series of portfolios of asset classes, build out a number of possibilities and stress test them. We try to play back the nature of the portfolio to the client, to match them to the set risk criteria.

How does this translate to the manager selection criteria?

William Drake: Manager selection is the next important step. Once the portfolio has been designed, the question is how to execute it.

We prefer to find talented fund managers who can add some value over the indices, but manager selection is not as critical as getting the risk profiling and asset allocation right. If we cannot find talented managers in a particular mandate, we use trackers to get exposure to the asset class until we do.

As the economy rebounds, investors are trying to immunise their portfolios against future crises and market fluctuations. How can they achieve this to some degree?

William Drake: Not all families are risk averse at the moment; some are taking advantage of the current markets and buying undervalued assets that will perform well in five or ten years.

For very risk averse families, we choose a mix of asset classes with some protection built in, so assets will compensate each other if the worst happens.

What are the latest trends in this industry?

William Drake: The big trend today is making sure the wealth manager is aligned to the family’s interests. Families should not take advice from managers who make money from recommending certain assets, so it is important to ask how staff is remunerated.

A number of single family offices are finding it difficult to manage a large pool of wealth in-house and are looking for outsourcing solutions. A number of clients are choosing to go to a private investment office or a multi-family office, instead of trying to manage everything in-house. 

Currency management is another trend, as families are often dispersed around the world and different members think in different currencies.

What are your thoughts on the emerging markets?

William Drake: Emerging markets will continue to increase their share of global GDP, therefore portfolios should be looking globally and internationally.

Western economies are slowly growing out of the recession, led by the emerging markets. The most interesting long-term assets at the moment are international companies that are selling goods in the emerging markets profitably. The shares and bonds of these companies are more attractive in the medium to long term than government debt.

Contact:
Sarin Kouyoumdjian-Gurunlian
Press Manager
marcus evans, Summits Division
Tel: + 357 22 849 313
Email: press@marcusevanscy.com

About the Elite Summit 2011

This unique forum will take place at the Fairmont Le Montreux Palace, Montreux, Switzerland, 21 – 23 November 2011. Offering much more than any conference, seminar or trade show, this exclusive meeting will bring together esteemed thought leaders in institutional investing and market leading solution providers for a highly focused and interactive networking event. The Summit addresses the ongoing evolution of private wealth management trends and provides attendees with fresh perspectives on both asset allocation and family governance strategies for a profitable investment portfolio of both financial and human assets despite market uncertainty.

For more information please send an email to info@marcusevanscy.com or visit the event website at www.elitesummit.com 

marcus evans group – investment sector portal

Complementing our summit format, the Investment Network – marcus evans Summits group delivers peer-to-peer information on strategic matters, professional trends and breakthrough innovations. Lend an ear to fellow experts and live news from our events on our LinkedIn and Twitter accounts!

About marcus evans Summits

marcus evans Summits are high level business forums for the world’s leading decision-makers to meet, learn and discuss strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to individually tailor their schedules of keynote presentations, think tanks, seminars and one-to-one business meetings. For more information, please visit www.marcusevans.com

All rights reserved. The above content may be republished or reproduced – kindly inform us by sending an email to press@marcusevanscy.com

Vallis Capital Partners:
Enhancing Portfolios through Sustainable Investing

Luís Carvalho from Vallis Capital Partners, an investment advisory firm at the marcus evans Middle East Investments Summit 2011, on the increasing demand for sustainability in the marketplace. Interview with: Luís Carvalho, Partner & Chief Financial Officer, Vallis Capital Partners

FOR IMMEDIATE RELEASE

Private equity funds with a focus on sustainability will be better prepared for the future business and economic landscape, says Luís Carvalho, Partner & Chief Financial Officer, Vallis Capital Partners.

From an investment advisory firm at the upcoming marcus evans Middle East Investments Summit 2011 in Dubai, UAE, 23 – 24 November, Carvalho discusses the importance of adopting the UN’s Principles for Responsible Investments and the Environmental, Social and Corporate Governance (ESG) approach.

Why is sustainability an attractive approach for private equity funds?

Luís Carvalho: Private equity fund managers who focus on sustainability are able to plan for the future business and economic landscape. When looking at investments, their approach combines long-term economic, social and environmental factors. A more comprehensive view of the company’s potential will lead to better informed investment decisions, creating the potential for attractive returns.

Sustainability is a growth approach that will enable corporate best practices, providing portfolios with long-term value.

How can investors meet the increasing demand for sustainability?

Luís Carvalho: Investors are now demanding portfolios that focus on sustainability. This request can be met by seeking out sustainable corporate and/or credit exposures.
 
Investors have to look forward and consider “People, Planet and Profit” as said by John Elkington, the founding father of sustainability, in their investment decisions on the triple bottom line.

‘People’ looks at the shifting trends of the population (i.e. growth, ageing, health) that bring new pressures to the industry and force businesses to re-shape. ‘Planet’ refers to natural resources; we must consider clean technologies, energy efficiency, food production, water trends and waste management. Reflecting on these themes and their growth potential will lead to profit.

Investors should take a wide view that looks at sustainability as an overlying theme.

Why should investors make use of the ESG approach?

Luís Carvalho: ESG is a practice that leads to a strong business foundation. Investors looking at long-term structural and sustainable growth should consider this approach along with the UN’s principles for responsible investments.

Investors will then be able to focus on growth drivers and reinventing the business to adapt to the rapidly changing market, rather than being troubled over governance issues. These principles will help establish the necessary base for long-term growth.

What are the most important drivers of long-term structural growth?

Luís Carvalho: Social change and scarcity of natural resources pressures that define the need to re-shape existing industries are forcing the creation of new businesses while driving long-term growth.

The marketplace is facing increasing risks due to the present competitive landscape. This leads to market inefficiencies that sustainable investors can exploit since they are anticipating upcoming changes.

A flourishing portfolio includes companies that have the opportunity to grow and prosper on a competitive and changing business environment, as they will be able to manage current and future trends.

Companies that properly address economic, environment and social factors through innovation and productivity will generate enduring value. 

Contact:
Stacey Melvin
Journalist
marcus evans, Summits Division
Tel: + 357 22 849 400
Email: press@marcusevanscy.com

About the Middle East Investments Summit 2011

This unique forum will take place at the Park Hyatt Dubai, UAE, 23 – 24 November 2011. Internationally acclaimed as the leading event for Middle East institutional investors, the Summit offers much more than any conference, seminar or trade show. This exclusive meeting will bring together esteemed thought leaders in institutional investing and market leading solution providers for a highly focused and interactive networking event. The Summit includes presentations on seizing attractive investment opportunities, gearing up for new regulatory regimes, and securing portfolio performance.

For more information please send an email to info@marcusevanscy.com or visit the event website at www.mei-summit.com 

marcus evans group – investment sector portal

Complementing our summit format, the Investment Network – marcus evans Summits group delivers peer-to-peer information on strategic matters, professional trends and breakthrough innovations. Lend an ear to fellow experts and live news from our events on our LinkedIn and Twitter accounts!

About Vallis Capital Partners

Vallis Capital Partners is a Portuguese private equity firm which manages Vallis Sustainable Investments I. Vallis acquires companies with high growth potential and long term demand strongly correlated with sustainability under the theme of “People, Planet, Profit”. Aiming at delivering superior returns, we create value incorporating economic, social and environmental factors while applying a hands-on operating approach.

www.vallis.pt

About marcus evans Summits

marcus evans Summits are high level business forums for the world’s leading decision-makers to meet, learn and discuss strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to individually tailor their schedules of keynote presentations, think tanks, seminars and one-to-one business meetings. For more information, please visit www.marcusevans.com

All rights reserved. The above content may be republished or reproduced – kindly inform us by sending an email to press@marcusevanscy.com