Unigestion plans wealth management push following asset gathering
Geneva-based asset manager Unigestion is preparing for a push into the wealth manager space as it broadens its reach in the UK.
The Swiss firm, which has $24bn in assets under management globally but has until recently confined itself to serving the UK's institutional market, saw its first fund enter the Investment Association (IA) universe in May.
Its Uni-Global Cross Asset Navigator fund is now the second best-performing fund in the IA Targeted Absolute Return (TAR) sector over a three-year period, returning 30.9% according to data from FE, although funds within the sector are notoriously difficult to compare.
The 45-year-old company's London office is well established, but its primary focus has been working with pension funds and local authorities.
Lloyd Reynolds, head of UK and Ireland at Unigestion, told Investment Week that side of the company is "quite a sizeable business in the UK".
Now the firm's focus is moving into the wealth management market, where its footprint is currently "much smaller".
Reynolds added: "That is one of the reasons why we put the Navigator fund into the Investment Association TAR sector. Just to tell people we have this strategy and get a bit more visibility.
"There are a lot of multi-asset products in the UK market and we felt it was important we had a long track record before we really started to come out and talk to people in the UK space."
Performance
According to the fund's factsheet, it aims to deliver returns of cash +5% across all market conditions over a rolling three-year period. Since the strategy's inception four years ago, its annualised return as at 30 April was 3.5%.
Its annualised three-year return to 30 April was 4.8%.
Some of the largest funds in the absolute return sector, like Standard Life's Global Absolute Return strategies, have been dogged by underperformance and persistent outflows in recent years.
However, Reynolds highlighted Unigestion is bucking that trend with the fund more than doubling since December 2017, to $344m as at 30 April, from $169m.
He said: "If you look at the growth of our fund, we have managed to keep raising assets at a time when the sector has seen outflows.\
"We see inflows because of the way in which we run the strategy and its more defensive nature. When you think about absolute return, you have to look at the label. What is the manager trying to achieve?
"We are trying to achieve positive returns over three years. That means you might not get a positive return over 12 months."
Portfolio manager Salman Baig said the fund's defensive profile is an outcome of its process, which is threefold.
First, it diversifies across what it sees as the four regimes of an economic cycle - steady growth, recession, inflation and market stress.
This is played out through investing in alternative risk premia, which can include strategies focusing on equity factors such as momentum, size and quality.
Second, it has a systematic dynamic allocation strategy using 'nowcasters' - proprietary indicators that help predict and take into account current, near future and recent past economic and market conditions - to adjust the portfolio's asset allocation.
Finally, they overlay a book of tactical opportunities that reflect the portfolio managers' shorter- and medium-term macro views.
This often sees the fund take positions on currencies, for instance.
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