Mediolanum's business plans target the expansion of the team and their in-house skills in direct securities selection with a keener focus on the equity unit.
Mediolanum International Funds Limited (MIFL), the European asset management platform of the Mediolanum Banking Group, has unveiled its business plans for 2020, which start by harnessing new skills and competencies and expanding its internal team resources.
Mediolanum International Funds, headquartered in Dublin since 1997, manages over €42bn assets.
By expanding our internal competencies, we can also achieve better economies of scale and reducing the cost for our clients by switching investments in target funds into portfolios of securities managed internally.”
The manager's business plans kick off with the expansion of its employment base by 20% in 2020. In order to accommodate the growing team, the firm moved its Irish operations last year to new headquarters.
Mediolanum's investment solution over the years has primarily been based on a multi-manager approach, also leveraging on sub-advisory, as outlined by the company's CEO Furio Pietribiasi: "Since the foundation of our group, diversification has always been a pillar of the ‘5D' commercial philosophy of our distributors when they provide advice to their clients, and we want to benefit of it also when we structure our solutions".
"Even from an investment perspective, we strongly believe that diversification among managers can generate massive value. We want to invest with managers that can demonstrate evidence of generating value over the long-term, i.e. alpha.
"But we also know that alpha is cyclical and depends on each individual manager's investment process, style and market conditions. Furthermore, managers don't always necessarily do well at the same time.
"For this reason, by combining them and identifying the right manager allocation, we can achieve at any time sustainable alpha, because while some might suffer, others will do very well, enabling us to deliver better returns to the clients."
Speaking to InvestmentEurope during his trip to London in December, Pietribiasi said the company was seeking to expand the team and competencies in direct securities selection.
He said: "When selecting external managers - we wanted the best ones with the best fund performance persistence but they tend not to be the cost effective . So, we had to figure out how to build better economies of scale for our clients delivering solutions with lower TER while mitigating impacts on our P/L.
"We felt that if we could hire the right resources where we had the necessary scale in terms of AUM, we could deliver better results to clients and the business, without compromising on performances quality."
HUNT FOR EQUITY
Mediolanum is on an open hunt for equity specialists, an area which it recognises to have unexploited potential, in terms of strategies that could be internalised, and AUM.
Pietribiasi explains that although the group has established relationships with equity managers through its multi-management approach over the years, the next logical step would be to hire for the internal team.
He continues: "Following the success of recruiting great talent for the fixed income team, we wanted to build on the strength of the results of the existing equity team, where we recently launched some equity income strategies, whose results are very promising.
"By expanding our internal competencies, we can also achieve better economies of scale and reduce the cost for our clients by switching investments in target funds into portfolios of securities managed internally. That said, we will never compromise a trade-off between performance for lower costs maintaining manager diversification."
Over the last 20 months, Mediolanum went on a hiring spree, which included the appointment of Inma Conde as head of manager research, Christophe Jaubert as CIO, Brian O'Reilly head of Market Strategy, and Charles Diebel to lead the fixed income team.