Institutions

London & Capital started out in business more than 21 years ago, as a portfolio management provider for High Net Worth private clients.  Today, and with more than $3.4 billion under management, the innovative and fast-growing wealth manager is targeting the mass affluent too, announcing today the launch of a new portfolio management service.

The London & Capital Portfolio Management Service is the first vehicle to emerge from the Company’s newly formed UK Retail division, with Jamie Farquhar appointed to head the new operation.  Farquhar joined London & Capital from Lifetime, where he was responsible for the investment proposition of Norwich Union’s open architecture wrap platform.  With some 20 years experience in the investment industry, Jamie was previously Head of UK Retail for F&C.

Commenting on its market entry, Farquhar said, “The majority of intermediaries are accomplished portfolio planners, with high levels of expertise in asset allocation and fund selection.  However, many would openly admit that even with the required level of experience, they struggle to devote the time required to manage client portfolios.  Faced with ever-tightening regulations and increasing administrative workloads, intermediaries need to find more client-facing time and growing numbers are outsourcing their investment responsibilities, the popularity of multi-manager funds evidencing this trend.

“Faced with this dynamic shift, we undertook a comprehensive review of the services available and identified an opportunity for a new kind of service, one which sits between multi-manager at one end of the scale and full blown stockbroker services for HNW clients at the other.  Genuinely geared to serving the needs of the mass affluent market and closely aligned to a modern platform strategy, our new Service will allow intermediaries to outsource investment management whilst retaining full control of the relationship and their clients’ affairs.”

The London & Capital Portfolio Management Service
London & Capital’s reputation has been built on the bedrock of an enviable track record for running highly successful diversified absolute return portfolios for its global private and institutional client base, maintaining a focus on capital preservation.  The new Service is the latest to emerge from an expanding stable of investment funds and services, combining absolute return investment strategies with a best of the best multi-manager approach.

 The new Service will offer a tailored alternative to the many off-the-shelf multi-manager solutions available by investing in a shortlist of funds selected by the widely respected and independent research consultancy Old Broad Street Research (“OBSR”) and within the context of a top-down asset allocation framework set by London & Capital’s Chief Investment Officer, Ashok Shah.  Investors will be able to invest across five risk-graded portfolios, focusing on London & Capital’s proven absolute return investment strategies.

OBSR is a highly respected research consultancy, supplying qualitative investment analysis supported by quantitative information, producing fund ratings and product panels across the retail life, pension, investment and savings markets.  Ratings are based on OBSR’s proven and robust research methodology, coverage including UK authorised Unit Trusts, OEICs and UK Friendly offshore funds.

The composition of each portfolio will vary according to risk budget.  Each strategy is designed to meet pre-defined risk/return criteria with a view to wealth preservation over the medium to longer term, and diversification is achieved through allocation to multiple asset classes.

Strategy                Benchmark*
Conservative        Bank base rate +1.0%
Moderately cautious    Bank base rate +1.5%
Balanced        Bank base rate +2.0%
Moderately aggressive    Bank base rate +2.5%
Aggressive        Bank base rate +3.0%
(* After charges)

The new Service has been designed to keep the intermediary at the core of the advice process i.e. to retain the primary advice relationship.  Portfolios will be invested based on the intermediary’s assessment of the client’s risk profile and investment objectives, and across a platform agreed between the intermediary and his client, not dictated by London & Capital.  The Service is completely agnostic of platform, Transact, Nucleus, Ascentric, and Lifetime having the architecture to support the new proposition at launch with others expected to come on-stream during the second and third quarters.

Key facts about the new Service
•    Low minimum investment level, dependent on the investor’s choice of platform
•    Transparent fees and commission:
o    annual fee 0.75% for delivery of tailored portfolio to platform
o    platform charge and annual management fees on underlying funds dependent on the investor’s choice of platform
o    remuneration to be agreed between client and intermediary (CAR)
•    Clients able to maintain tax-efficient wrappers such as ISAs, PEPs and SIPPs as well as standalone holdings
•    Daily market monitoring with impact assessment on portfolios
•    Intermediary reporting on a quarterly basis and client reporting direct from the platform itself with 24/7 client and adviser access
•    No investment in London & Capital’s own funds.  All short-listed funds identified according to OBSR’s stringent independent research requirements