INVESTMENT VALUE PROPOSITION

The shape market movements take is a function of one of two forces – rational forces or behavioural forces. Rational forces are fundamentals-based. Behavioural forces are not. In the long term, rational forces dominate while in the short-term, behaviour informs market movements.

We strive to implement strategies that combine quantitative and qualitative analysis backed by our comprehensive knowledge of the market.

Our Philosophy

We believe that:

  • Markets are generally efficient in the long term, but there are short-term inefficiencies that can be exploited;
  • The degree of market efficiency varies across asset classes, sectors and geographies at different points in time;
  • Markets are cyclical;
  • No single manager can consistently outperform the market;
  • Managers subscribe to different philosophies and have different styles which make them perform differently under different market environments;
  • Over time, specialist managers outperform generalists more often than not.

Our Style

We align ourselves with the Adaptive Market Hypothesis (AMH), evidenced in our approach to dynamically blend managers with complementary investment styles.

  • We identify these managers through our rigorous and integrated quantitative and qualitative analytical approach to manager research;
  • Our approach allows managers to focus only on their core competencies – stock selection within their disciplines – while we take care of risk management aspects at an aggregate level;
  • Short-term underperformance risk can be reduced without compromising on long-term returns by blending different specialist managers;
  • We emphasise the importance of people as opposed to organisations.

 

 

Our Approach

Our approach is guided by our view that:

  • Strategies available for use by investment managers are continually evolving in line with innovation and technological advancements and a multi-manager is best positioned to research and exploit these trends to accurately meet investor needs;
  • Because markets are ultimately a zero-sum game, research-based multi-manager knowledge of the markets gives us the ability to generate superior investment returns;
  • A multi-management approach is an effective way of achieving capital growth with stable returns by more smoothly navigating the ups and downs of investment market waves;
  • Asset allocation is the primary source of investment performance, and diversification across managers is key to return stability;
  • Risk management is a fundamental and strategic component of the investment management process.

Why Specialist Mandates

  • We retain total control over the risk profile of our investment strategies;
  • We are able to quickly change the risk profile of our investment strategies in response to changes in market conditions;
  • Our investment strategies are genuinely diversified and are not mere splits across different balanced portfolios which require no expert multi-manager skills to manage;
  • Our investment strategy is not overly dependent on manager selection, but manager selection is used, rather, as a tool for portfolio diversification and risk management while the bulk of the performance is generated from strategic and tactical asset allocations over which we have control.

Risk Management

In crafting our investment solutions we take a statistically quantitative and fundamentally theme-based multi-managed portfolio modelling approach using technologically robust and disciplined risk-focused investment management processes.