Presentation on theme: "NICHE Discretionary Fund Management. NICHE Discretionary Fund Management 2 Why are you here? We want to give you a reason to go and talk to your clients."— Presentation transcript:
NICHE Discretionary Fund Management 2 Why are you here? We want to give you a reason to go and talk to your clients and to be rewarded for doing so.
NICHE Discretionary Fund Management 3 Background to a need for a DFM Extremely volatile/unpredictable markets since 2001 Dreadful market conditions in 2008 Stock markets below levels last seen ten years ago Near collapse of World economic system Illiquidity, fund closures, gates or suspensions Clients questioning their investment returns FSA acting as a peoples champion, rather than a regulator Retail Distribution Review Tightening of FSA/Network compliance on investment advice Networks and IFAs wishing to de-risk their business Quantitative easing, new territory for financial advisers Wealth Managers planning to enter top-end IFA market
NICHE Discretionary Fund Management 4 Tend to be long only Overweight in mainstream investments, even in difficult market conditions Overly exposed to equities – even a balanced client will hold as much as 80% in UK and International stocks Guilty of churning holdings to increase dealing charge income Bias towards in-house funds They have an adverse affect on the strength of client relationship They undermine the positioning of the IFA as the financial brain They offer little or no access to alternative or esoteric investments They are not worth the additional cost They can resemble passive index trackers at times They have unloaded their own toxic holdings onto their clients in the past The perceived downside of DFMs
NICHE Discretionary Fund Management 5 Why was Niche developed? Existing IFA clients specifically requested it because they wanted: Access to a Discretionary Fund Manager (DFM) – NOT a wealth manager The DFM to be responsible for the client risk profile The DFM to undertake the necessary due diligence, both now and in the future Asset allocation to be actively managed The DFM to be responsible for asset allocation and to blend specialist fund managers in their field The DFM to be responsible for the rebalancing of the client portfolio in line with, either the original client risk profile or a subsequent risk mandate The client relationship to remain firmly with the IFA
NICHE Discretionary Fund Management 6 The solution Rigorous research and due diligence of existing and potential funds Asset allocation is actively managed An extensive investment portfolio is designed using the risk profile mandate completed by each client Access to a wide range of global investment opportunities via specialist fund managers, expert in their field We monitor the individual underlying fund performance The portfolio will be rebalanced. The client relationship remains yours
NICHE Discretionary Fund Management 7 Behind the scenes - security Custodian: Close International Custody Services Limited (Close) Close provides full custodial services and secure banking securities for all assets within Niche. Legal Advisors: Carey Olsen Carey Olsen provide legal advice on the set-up and operation of Niche, in line with the legal requirements of the GFSC. Fund Administrators: Legis Fund Services Limited (Legis) Legis provides full fund administrative services, ensuring compliance with all GFSC regulations and is fully licensed by the GFSC. Auditors: PKF (Guernsey) Limited (PKF) PKF serves as the independent auditor for Niche. All outsourced professional international companies with strong reputations and integrity.
NICHE Discretionary Fund Management 8 The decision makers Investment Manager: Argyll Investment Services Limited Licensed and regulated by the Guernsey Financial Services Commission Proven track record in the investment arena An independent organisation Enviable reputation as a DFM and Trustee Manager Objective decision making regarding asset allocation and choice of fund managers Highly sensitive to risk and risk management Highly supportive of both the IFA and their respective clients
NICHE Discretionary Fund Management 9 Client portfolios can include alternative investments (diversified) and those that specifically exclude them (traditional) The client makes these decisions via the risk profile questionnaire The Investment Manager fully embraces the plethora of fund strategies available in the market place and could not be described as long only The Investment Manager makes independent decisions about asset allocations and individual managers skills and risk management Unconflicting use of funds You are Niches client. The DFM will be as proactive with your client as you wish us to be The vast majority of funds will be accessed at institutional rates Funds are specifically chosen to add growth, not additional cost Niche is a DFM managing client money – not a global investment bank (size is not always a good thing!) Why is Niche different?
NICHE Discretionary Fund Management 10 The results of the risk profile questionnaire are fed into the Niche risk profile software and a detailed proposal is produced. This comprises of four core asset class components, each one accessing expert managers in the following: Core equity Core fixed interest Core alternative Core property The construction of the four core components, plus a cash holding, establishes the building blocks for the portfolios. Percentage weightings are purely defined by the answers provided on the risk assessment questionnaire. Asset Allocation
NICHE Discretionary Fund Management 11 The Investment Portfolios Asset allocation is the science of adjusting exposure to different asset classes to produce a risk profile that matches the investors particular circumstances. Niches range of seven investment models will cover the majority of clients current and future investment needs. The example shown on the next page is the Balanced Diversified Portfolio, which has exposure to over 25 individual funds. Furthermore, the actual positions held within each fund can contain up to 150 individual securities ensuring diversification. Defensive DiversifiedDefensive TraditionalBalanced DiversifiedBalanced TraditionalAggressive DiversifiedAggressive TraditionalAlternatives
NICHE Discretionary Fund Management The Balanced Diversified Portfolio Example 12 The most appropriate model for many of our clients, the Balanced Diversified model, has exposure to over 25 individual funds (the holdings within the equity can contain up to 150 individual securities) ensuring diversification. Equities 35% Cash 5% Alternatives 30% Property 10% Fixed Income 20% Niche makes a distinction between those portfolios that includes alternative investments (Diversified) and those that specifically exclude them (Traditional). A client indicating an interest in alternative investments will enjoy access to assets such as; Student accommodation Life settlements Fine wine Traded endowments Commodities Hedge and currency funds Alternative investments are designed to offer low volatility with little or no correlation to bond or equity markets The portfolio above is an illustration of the diversification offered by the Balanced Diversified Portfolio. It is not indicative of the positions that the fund would hold on an ongoing basis, as these positions will change in line with future investment management decisions.
NICHE Discretionary Fund Management 13 Performance History Argyll Equity & Alternative Strategy allocation back tested performance
NICHE Discretionary Fund Management 14 Performance History Argyll Equity allocation back tested performance
NICHE Discretionary Fund Management Why is Niche the solution? Risk profiling: Due diligence of funds: Asset allocation: Ongoing fund performance monitoring: Rebalancing: Business relationship: 15 undertaken by you with your client – using the automated Niche Risk Profiling System undertaken by the Niche Investment Manager remains with you and your client
NICHE Discretionary Fund Management How to Invest in Niche Once the risk profile questionnaire is completed, Argyll will produce a proposal, which confirms the most suitable model for the client. Following the clients approval of the proposal, the application process is straightforward for client and advisor alike. 16 Key Features: Available directly, via offshore bonds, platforms, wrappers Access via SIPPs and SSASs Monthly dealing Available in GBP, USD, EUR Access to alternative investments where appropriate
NICHE Discretionary Fund Management In Summary Why use the Niche DFM? De-risks network/your business Compliance/RDR Income stream Strong performance history More time for you to do what you are good at Huge diversity of investment choice Simplicity Competitive costs Alternative fund access Ring-fenced management of your clients No VAT charged on Service charges 17
NICHE Discretionary Fund Management Any questions? We believe that we have the right solution for the right environment at the right time. Is there anything else that you would require from a DFM that Niche does not offer? 18
NICHE Discretionary Fund Management Who should you, the IFA, talk to? 19 The right client profile for a DFM Clients with larger portfolios Portfolios that are time consuming Monies already invested in Offshore Bonds, SIPPS/SSAS' and platforms Existing DFM Clients, where a change of Manager is due Clients that are wealthy enough to become litigious Clients you would like to reduce exposure to unregulated or single asset funds
NICHE Discretionary Fund Management 20 For further information please review the Supplemental Scheme Particulars at www.nichefundmanagement.com www.nichefundmanagement.com Past performance is no guarantee of future performance. The value of investments in the Fund can go down as well as increase and may be affected by changes in rates of exchange. Investors may not get back the entire amount originally invested. Disclaimer
NICHE Discretionary Fund Management The information in this document does not constitute, or form part of, any offer to sell or issue, or any offer to purchase or subscribe for shares, nor shall this document or any part of it or the fact of its distribution form the basis of or be relied on in connection with any contract. Interests in any investment funds managed by Argyll Investment Services Limited (the Manager) will be offered and sold only pursuant to the prospectus relating to such funds and is deemed to carry a high degree of risk and is not suitable for retail investors. The Manager has not taken any steps to ensure that the securities referred to in this document are suitable for any particular investor and no assurance can be given that the stated investment objectives will be achieved. The Fund is not an authorised or recognised collective investment scheme for the purposes of the Financial Services and Markets Act (2000) and the promotion of the Fund is accordingly restricted by law. The Funds Prospectus may only be issued in the United Kingdom to categories of persons permitted under the Financial Services and Markets Act (2000) (Promotion of Collective Investment Schemes) (Exemptions) Order 2001. This document is being issued inside and outside the United Kingdom to and/or is directed at persons who are both (a) professional customers or eligible counterparties for the purposes of the FSA Conduct of Business Sourcebook (COBS) and (b) of a kind to whom the Fund may lawfully be promoted by a person authorised under the Act by virtue of Section 238(5) of the Act and Chapter 4 of COBS. The investments and investment services to which this document relates are only available to the persons referred to above and other persons should not act or rely on it. Argyll Investment Services Limited is licensed and regulated by the Guernsey Financial Services Commission under the Protection of Investors (Bailiwick of Guernsey) Law 1987 (as amended). Company Registration Number 36763. The investment is not subject to the protections of the UKs Financial Services Compensation Scheme (FSCS), nor is it being operated in accordance with UK requirements for the protection of consumers. This advertisement is not an invitation to make an investment, nor does it constitute an offer of sale. In addition, it does not constitute an advertisement in a country where a fund is not registered for sale. The full documentation required to make an investment, including the Scheme Particulars, is available from the Manager or an Independent Financial Adviser. 21