Relying on a digital platform and offering a guided architecture model has prepared FinecoBank’s selectors to face the challenges of a competitive AM industry.
Carlo Giausa is head of Investments and Wealth Management at FinecoBank, which is part of the UniCredit group headquartered in Italy.
Recently he outlined to InvestmentEurope how his team of advisers selects funds for the private client segments of the business.
Of the total €52.5bn in financial assets managed by FinecoBank, the total investment fund AUM is €24.8bn. Of this, €21.9bn is invested in funds managed by a ten-strong selection team.
“Fineco has expanded its expertise thanks to a strong adviser network, which offers financial advice and works on the asset allocation, leveraging off fund selection services that start with a completely open architecture structure,” Giausa says.
Fineco proposes customised portfolios to its advisers, who thanks to a buy list can rely on more than 5,000 mutual funds from 67 asset managers.
It also avoids any conflicts of interest, as Pioneer Investments, the UniCredit group’s asset management arm, is considered in exactly the same way as other managers.
The fund screening process starts by looking at Morningstar and Factset databases, and performing a quantitative analysis of funds’ decile performances and ratings, before moving on to the quartile data, Giausa says.
“After this first screening, we meet the management team, conduct our due diligence and put together a final list with about 300 strategies,” he adds.
After the selection team has done its job, the advisory team adds its view to build eight risk/return investment profiles to propose to clients.
Each profile is adaptable to clients’ personal requests but each has a risk threshold which cannot be passed. Once the list has been built, each strategy is reviewed quarterly and is monitored through weekly meetings with the management team.