All about OBSR. Everything we do is underpinned by independent, in-depth research conducted with integrity.

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1 All about OBSR Everything we do is underpinned by independent, in-depth research conducted with integrity.

2 History of OBSR, a Morningstar company OBSR was established in 1999 following a management buy-out of the research business within Buck Consultants. From these beginnings a company was built that helps intermediaries understand investment funds and find products to meet their client needs. In 2002, OBSR launched the UK Fund Ratings service widely acknowledged to be the leading fund ratings service of its type in the industry. The company grew organically over the following years launching new services and products and in 2008 OBSR acquired the global research business from Crosby Forsyth. This move was the foundation for the OBSR Global Fund Ratings service, which was set up in In 2009, OBSR reviewed its business strategy and sought to broaden the range of capabilities it could offer to it s clients. As a result in April 2010, OBSR was acquired by Morningstar, which further expands the information, skills and services available to OBSR consultancy clients. OBSR has continually evolved to become a leading business that is synonymous with high-quality retail investment research and consultancy services and is staffed by respected individuals from all areas of financial services.

3 An introduction to our business OBSR is a research-led consultancy business operating solely in the financial services arena. Our purpose is to help financial services businesses find the funds and services that enable them to deliver the right investment solutions to their clients. In order to achieve that, our company is solely focused on independent, in-depth research and consultancy, conducted with integrity. Our client base includes many of the best-known firms in the industry. We offer services and solutions to fund managers, product providers, wraps and platforms, large distribution firms and financial advisers. OBSR aims to be the most-trusted investment consultancy and research company for advisers and product providers and the most-respected investment research company by fund managers. If you would like to discuss how our expertise can help your business, please visit or call us on

4 What makes us different? We are completely independent We look at all managers, focusing solely on the requirements of our clients, and rate and recommend those that we think are the best. In order to provide unbiased research we do not charge fund managers to research their funds; we only charge a licence fee to managers wishing to publicise OBSR Fund Ratings. Of course this often means we will award ratings to fund management companies with which we have no commercial arrangement. We occupy a unique position in the industry OBSR occupies a unique place between financial advisers, product providers and fund management groups. We feel this privileged position enables us to better understand the industry s dynamics and offer solutions and services that best meet the needs of our clients. 4

5 Our research approach Our philosophy is centred on the belief that qualitative research is the best way to truly understand a fund and therefore deliver insightful, forward-looking opinions on its future prospects. It is this focus on qualitative research supported by quantitative analysis which clearly differentiates our approach from that used by many other fund research companies. Following the aquisition of OBSR by Morningstar, OBSR will lead the qualitative fund research for Morningstar in the UK, and as a result the Morningstar qualitative research team joined the OBSR team in August 2010 Our in-depth, qualitative analysis is achieved primarily through face-to-face interviews where we seek to understand how a fund is managed, what it sets out to achieve and the prospects of those objectives being met in the future. Our ultimate aim is to understand the fund as well as its manager. We take a holistic view of our fund research and interview those who have an influence on the fund. This may include those responsible for the business as a whole, for example the chief executive officer, chief investment officer, head of strategy and/or asset allocation, as well as those involved in the investment process such as heads of desk, performance analysts, risk team, and any other relevant support staff. These meetings enable us find out exactly how the fund is run and what risks are being taken. As we analyse such a wide variety of funds we aim to be flexible in our research approach. During our meetings we work within an organised framework, but we are not constrained by a fixed format or set of questions. We think it is important to consider each fund on an individual basis. There are however a number of key areas that we always cover because they are important for our understanding of a proposition, including group ownership and stability, investment philosophy and objectives, personnel, investment process, research resources and portfolio construction and risk controls. Away from fund manager interviews we use a variety of other inputs and data to inform our views, but we are not driven by the figures. They are simply useful to help inform and validate our decisions. Once we fully understand a fund we apply the OBSR Categories. These are our own unique tight peer groups that enable us to compare funds against those with similar objectives to determine whether the fund, for its type, is meeting and will continue to meet its objectives. We also undertake an ongoing programme of regular review meetings to ensure that our understanding of funds is as up-to-date as possible. We are amongst the first to know should a material change happen to a fund, such as a manager leaving. 5

6 Consultancy services and solutions Consultancy and research Investment consultancy is at the heart of what we do as an organisation, and is a natural extension of the in-depth research we conduct. Each consultancy project is unique to each client s needs, so please contact us for more information on how we may be able to help you. Strategic consultancy Because of our in-depth knowledge and experience of the retail investment market, OBSR is able to help our clients design and develop their investment propositions. We work closely with our clients to understand their clients investment needs, the competitor landscape and the regulatory environment and then we help define a differentiated investment proposition which will be at the core of the client s offering to the market. Asset Allocation Strategy The acquisition of OBSR by Morningstar enables us to offer our clients state of the art asset allocation solutions for different needs, for example, retirement planning. The expertise in asset allocation solutions available through Morningstar and Ibbotson, a subsidiary of Morningstar, are well renowned globally, and market leading. Model portfolios We offer many institutions and product providers model portfolio solutions which enable their supporting intermediaries to manage the investment needs of their clients. Our service can comprise assistance with asset allocation through to portfolio construction and fund and manager selection. Bespoke fund and product panels Our best advice panelling service is a bespoke offering designed to suit each intermediary firm s individual requirements and business model. Our independent research and analysis is the engine that drives the selection process, together with specific client input. 6 Consultancy and research Model portfolios Bespoke panels

7 Consultancy services and solutions Guided architecture solutions OBSR offers a range of solutions for distributors wishing to develop or select a range of external manager fund links. We have been instrumental in developing the investment proposition and external fund range for many institutions. This is often referred to as guided architecture. Our position as an independent, qualitative research business means we re ideally placed to deliver value-added, best-of-breed, differentiated solutions to meet the diverse needs of intermediaries and their clients. The solutions we develop are designed to support institutions and intermediaries in conforming to the regulatory regime. Fund Ratings OBSR Fund Ratings are the crystallisation of our rigorous research process and our reputation stands or falls on the strength of them. OBSR Fund Ratings are acknowledged to be a badge of quality for consistent fund returns and thousands of advisers rely on them to select suitable funds for their clients. Our Fund Ratings are split into two areas, UK and Global. UK Fund Ratings These focus on UK authorised unit trusts, UK OEICs, multi-manager funds and UK friendly offshore funds. Typically around 10% of this universe will have been awarded an OBSR A, AA or AAA rating, although there is no set quota. For more information and to register for the service please visit Guided architecture solutions Fund Ratings UK Fund Ratings 7

8 Guided architecture solutions Fund Ratings UK Fund Ratings Consultancy services and solutions Global Fund Ratings Our Global Fund Ratings service was launched in 2009 and is designed to support businesses whose clients are seeking the best investment funds available globally. For more information and to register for the service please visit OBSR Advisory Services OBSR Advisory Services was set up to help firms develop and manage investment solutions, designed to meet the specific needs of their clients and supporting intermediaries. OBSR has significant experience in this area and we are able to assist at every stage of the process, from asset allocation and portfolio construction through to fund and manager selection. OBSR Selector and Morningstar Adviser Workstation OBSR and Morningstar offer two proprietary web based tools, to support intermediaries in delivery of financial and investment advice to clients. The appropriateness of these tools to particular intermediary businesses will depend on the requirements of each business. Morningstar Adviser Workstation Morningstar Adviser Workstation Office Edition is a multiple award-winning, powerful software solution for financial advisers with a suite of tools and data sets that easily integrate into any practice. Adviser Workstation allows you to consolidate client data from multiple platforms and build a robust, repeatable and independent investment process. Built to support and optimise critical tasks such as client risk assessment, fund research, portfolio management, and client reporting Adviser Workstation is a tool that can revolutionise your practice. Selector Selector is a web-based tool that enables advisers to access our in-depth investment and product research for client recommendations on protection, insured products, funds, wrap platforms and SIPPs. This easy to use system helps advisers match funds and products to each client s needs and risk profile. It does so by focusing on how funds are managed rather than relying on past performance. It also takes into account the product features that are appropriate for each client. It is a useful tool to help advisers comply with the Treating Customers Fairly regulation. 8

9 Our team OBSR has grown considerably since its beginnings and has been able to attract and retain quality professionals from the financial services industry, including those that have worked for fund management firms, life assurance companies and intermediary organisations. This variety of experience means that OBSR has an intimate understanding of the different parts of the marketplace. Key members of our senior management team are listed below. Richard Romer-Lee Joint Managing Director Richard is a founder of OBSR, has over 20 years of industry experience and has been involved in investment manager appraisal and selection since Richard is a well-known and respected commentator on the investment industry. Nigel Whittingham Joint Managing Director Nigel joined OBSR in 2007, as executive board director. He has had senior roles with a number of large life companies and fund management groups. He brings with him a wealth of knowledge gained from setting up and running the multi-manager businesses at both Insight and Edinburgh Fund Managers, where he was Sales and Marketing Director. Phil Lindsay Business Development Director Phil joined OBSR in 2005 to further promote the company and expand the client base. He has a wealth of experience and prior to joining OBSR he was head of Bank Distribution for a major provider and was also responsible for liaison with industry commentators including OBSR. 9

10 Our team Ruli Viljoen Head of Investment Research Ruli joined OBSR in February 2009 and heads up the Investment Research team. As well as conducting research for Global and UK funds, Ruli looks after a number of consultancy clients. Prior to this Ruli managed the long only fund of funds portfolios for a London based asset management group and has also worked as a Private Client Relationship Manager in a South African based private banking organisation. She has worked in the UK in fund research since 1996 and in the investment industry since Gill Hutchison Head of Investment Consultancy Gill joined OBSR in 2003 and heads up the Investment Consultancy team, with ultimate responsibility for the investment research consultancy services provided to OBSR s clients. Gill has managed a number of key consultancy relationships for many years and has been instrumental in developing the services provided to them. Gill has over 18 years of experience having previously worked for two private banking organisations as a Portfolio Manager for discretionary portfolios. was previously Chief Investment Officer at Forsyth Partners. He was instrumental in creating the UK and Global ratings services. Andy Brunner Chief Strategist Andy joined OBSR in November 2008 as Investment Strategist. He held a similar role at Crosby from April- August 2008 after having run his own consultancy business from September 2002 acting as an adviser to charity and pension funds. Andy started in the industry in September 1976 and held a number of analyst positions prior to becoming Director of Investment at Imperial Trident/Laurentian in July Benjamin Bird International Development Director Ben joined OBSR in He has over 15 years of experience in the investment fund research industry and has worked in a variety of client facing business development and product roles across Europe and the Middle East. He brings a wealth of experience having worked at Standard & Poor s Fund Services for 10 years and prior to this at Fund Research Limited. Peter Toogood Director of Investment Services Peter joined OBSR in 2008 and has responsibility for Investment Advisory Services. He has over 20 years of experience researching mutual funds and 10

11 Getting in touch If you would like further information on our solutions or services or simply want to talk through how our research can help better meet your client needs, please contact us using the information below. Old Broad Street Research Ltd Scandinavian House, 2 Cannon Street London EC4M 6QQ Telephone: Fax: info@obsr.co.uk Website: 11

12 In-depth. Informed. Independent.