More than ever, as uncertainty and volatility continue, there is demand for independent advice and innovative products. Victoria Private Investment Office discusses how the team will meet client needs
He was also a founder of Forward, an agency sold to WPP in 2001, and remains as a director of London’s Soho Theatre.
Russell is responsible for day-to-day management of the firm. He began his career at Lloyds Merchant Bank before moving to CIBC/Wood Gundy in Hong Kong & Tokyo, and then WestLB. He joined UBS on his return to the UK as a relationship manager, advising entrepreneurs and larger complex accounts, including the Scanlon family.
Van den Berg, a convertible bond specialist, is responsible for managing Victoria’s investment activities and specifically researching financial, utilities and telecom sectors. He started in the industry with SG Warburg in 1987, then moved to Smith New Court and subsequently to HSBC James Capel. He met Russell when he joined UBS in 2001.
Interest in convertible bonds faded from their high point in the late 1980s, but Van den Berg is detecting renewed appetite now.
”There is definitely a move back to converts, and it’s growing stronger. Typically, what happens is that issues start at the top of the credit quality spectrum and then move down. It is always difficult to get the right names to come to the market.”
Another key member of the Victoria team is managing director Heather Maizels, who joined last September to broaden out the firm’s consultancy services. She is credited with building the private banking business at Barclays, and became a member of the advisory board as it became Barclays Wealth.
A former barrister and with markets experience in currency swaps and private placement, she has championed family philanthropy, the wider investment needs of women and art as an asset class. She brings experience of the complex issues faced by individual and family clients, including many with business and charitable interests.
Victoria runs a small offshore open ended master-feeder fund focusing on European equities. The Capital Dynamic European fund uses put options rather than cash equities to gain exposure to European stocks at what Russell considers correct valuations, with added risk controls. It does not use leverage.
Growing Fund Range
Victoria is looking at launching another fund early next year, focusing on a global balanced equity structure that responds to demand from clients.
Currencies are seen as an increasingly important area of risk and return, with each client portfolio subject to well-planned currency hedging with regard to both capital and income. “Clients need to think of FX not just as an overlay but as a currency class as there are always opportunities there,” Russell says.
With the limits of traditional fund vehicles becoming clear, he is considering more creative ways to engage clients. The firm’s separately managed accounts can be used to incubate new strategies, which could be structured as funds.
Russell says Victoria will also make available their Guernsey-domiciled Protected Cell Companies (PCCs) to clients who come with the appropriate legal and tax advice, and are comfortable using tax efficient structures.
A CASE OF THE BLUES – BUT NOT FOR LONG
Confidence in the global economic outlook among the world’s wealthy took a severe knock over the past year, according to a study by consultancy form Scorpio Partnership.
The annual survey taps the opinions of some 9,000 participants worldwide. It shows that wealth confidence among what the authors call the “Futurewealthy”, those with liquid assets of $2m or more, has taken a knock. Many are far less sure than before that the coming year will be quite so rosy,” the report says.
It aims to gauge the attitudes and preferences of what finance firms consider the most prized customer set – the up-and-coming wealthy. It finds that optimism is almost a “tribal” characteristic of the group – most aim to triple or quadruple their wealth in the next ten years.
Interestingly, the report finds that confidence is falling, even though actual performance was better this year than last year, and the gap between expected and actual performance has narrowed to 33 points this year from 42 points last year.
In both Europe and in Asia, about a quarter of the wealthy clients polled said their wealth had decreased in the past year. This was worse than last year for Europe, although not as bad as 2009. Asian respondents had experienced a leap in their wealth since 2009, but were far more cautious than those in other regions about future prospects.
“We know for sure that they will bounce back,” the report says. “But in the meantime, anyone who regards the Futurewealthy as their clients may want to put a little more love into their client care.”
The clients themselves, far from being defeated by the downturn, intend to dig deep to put even more energy into finance, career and personal power.