Flexibility & Competence – key to being a game changer

We were recently approached by a prospective client who wanted to ‘trial’ our offering. Starting off with a small advisory account, with the intention that, if we prove our value add, it may become a larger discretionary account.

Not only did he want to start with a relatively small dollar allocation, but the prospective client also wanted to only pay a performance fee, with no base minimum.

Was I open to the idea? Of course, yes.

The name of the game is flexibility. While the prospect may not add much in the way of revenue, our mandate is to be a game changer in the wealth management industry – providing Insight and institutional level asset management services, at an equitable fee, to high net worth individuals, their families and institutions

Furthermore, I enjoy the investment discussions we have. So both parties should benefit from the relationship.

So how will he benefit? We see five key advantages of working with us:

Firstly, we have some unique access to alternatives, active managers and hedge funds. By having a very wide network and fund research partners in Europe and USA, we are able to secure preferential access and, in some cases, lower fees. Minimum allocations can fall as low as 100k as opposed to the usual USD1m. This allows us to create a nicely diversified portfolio, with a relatively small allocation.

Secondly, we can offer far lower transaction fees to the client. Most Private banks will charge a 1-1.5% allocation fee and then a trailing fee of 40-70bps. We bring the trailer fees down to zero. The bank’s upfront fee for fund subscription is also massively reduced, potentially down to a few hundred dollars. 

A potential saving to the client of at least 1%, if not significantly more. And this is via our preferred bank relationship with a Common Equity Tier One ratio of over 25% and a AA- Fitch rating, one of the highest globally.

We offer our service to clients on a discretionary or non discretionary basis. Where it makes sense we can also offer them direct access to the PB, via our platform, so they can do the underlying trading. Want to open the account in HK or elsewhere? – No problem. Can be done.

Thirdly, we don’t get paid for trading, or for generating high manager fees, so there is no conflict of interest. Our focus is to reduce cost for the client and ensure our interests are fully aligned.

Fourthly, we are developing some unique partnerships with a number of ‘FinTech’ companies, that can help lower costs further, for those clients that wish more passive allocations, and also provide excellent portfolio diagnostics.

Our plan is to offer a free portfolio health check service to accredited clients, so that they can identify what factors are driving performance and where the risks are in their current portfolios.

Our experience is that individuals & SMEs place far too much faith and trust in their current banking or wealth management relationships. They may not have sufficient knowledge to question the institution. Our aim is to provide them with the necessary insight to ask the right questions, to ensure their portfolios are structured around their needs.

So, it is a ‘win-win’ scenario.

We are happy to be trialled. Starting off with a small allocation or on an advisory basis, makes sense for both parties – the client needs to feel comfortable with our capabilities and we love nothing more than the challenge of demonstrating our value add.

Should you wish to talk further, please reach out to me on [email protected]