Core Asset Manager: A Tailored Investment Strategy

Transcription

1 Core Asset Manager: A Tailored Investment Strategy CHRIS HART, Core Investment Manager Brinker Capital Inc., A Registered Investment Advisor For financial advisor use only. For financial professional use only.

2 Agenda Core Investment Philosophy and Process Manager Due Diligence Manager Selection Communications 1

3 Core Asset Manager: A Comprehensive Investment Platform LPs 40 ETFs 35 mutual funds 75 SMA strategies Approximately $3.0 Billion in assets under management A Team of Investment Strategists to help with portfolio design and rebalances Holdings are subject to change 2

4 Investment Philosophy Create diversified custom portfolios that meet client s individual risk tolerance and unique needs Emphasize active management but also incorporate passive exposures Add value through: Manager Selection and Due Diligence Mix of quantitative and qualitative factors Select appropriate managers for allocation Understand its role in the portfolio Asset Allocation and Portfolio Construction Broad diversification Strategic asset allocation combined with shorter term investment considerations Utilize core-satellite approach to portfolio construction 3

5 Benefits of Core Asset Manager Investor Benefits Customized portfolios to meet individual goals and objectives Transparency of holdings Better tax control Ownership of underlying stocks Tax loss harvesting Individualized cost basis Ability to incorporate SRI or ESG screens Use of satellite strategies Asset Class Strategies (ACS) for efficient diversification Real Assets, Alternatives, Fixed Income, International

6 Platform Management & Manager Selection Evaluate Needs Platform needs Sub-style assessment Potential asset class risks Upgrades and enhancements Select, Monitor, Review Consistency of implementation Continuous assessment Correlation to existing strategies PM access and transparency Qualitative & Quantitative Screens Investment team tenure Assets under management Risk-adjusted performance Peer comparisons Onsite Due Diligence PM and investment team Investment philosophy and process Attribution and long term performance Stability of team and organization 5

7 Preferred Active Manager Characteristics Preference for boutique investment firms with institutional presence Seek concentrated, high conviction, and high active share portfolios Lower turnover business owner approach to investing Consistency of investment process Strong risk-adjusted performance across multiple time periods Open to selecting newer strategies or smaller investment managers as appropriate 6

8 Due Diligence Process Core Due Diligence Questionnaire Visit Notes Scorecard Summary Memo Search Memo Discussion 7

9 Manager A - Small Cap Value Key Points Boutique institutional investment firm based in San Mateo, CA $3.1 billion in AUM and advised by academic thought leaders in behavioral finance Unique investment process based on behavioral finance principles Contrarian process that uses non-quantitative strategies to exploit over-reaction Fundamental analysis to confirm behavioral thesis Strong long-term track record since inception in 1993 Differentiated pattern of alpha relative to many bottom up fundamental peers 8

10 Manager B - Large Cap Growth Key Points Sole focus on large cap growth investing since inception in 1992 Based in St. Louis with approximately $10 billion in AUM Concentrated, high conviction portfolio of 20 stocks Patient approach to growth investing Low turnover, business owner mindset Strict valuation control Stability of key investment personnel and investment discipline Long term track record of strong risk-adjusted returns 9

11 Manager C - Ladder Plus Key Points Boutique fixed income manager specializing in municipals Unique business structure that provides a competitive advantage on municipal bond pricing Focus on superior execution allows them to take less credit and duration risk Opportunistic approach to municipal fixed income investing Strong risk adjusted returns since inception in

12 Ongoing Manager Monitoring and Review Daily Review absolute and relative performance Monthly Review absolute and relative performance Manager attribution and commentary Identify performance outliers Quarterly Annually Written updates on individual managers Identify asset class trends impacting managers Conference call with PM Analyze relative and absolute performance versus peers Onsite due diligence meetings with PM and investment team Review detailed manager due diligence questionnaire and ADV Universe review relative to benchmark and peers Complete manager scorecard 11 11

13 Core Insights Manager Strategy Updates Published quarterly to spotlight individual managers Three sections: Key investment process and takeaways Quarterly attribution commentary Short & long term performance opinion One page document digging deeper into an individual manager Asset Class Review Published quarterly for Large Cap and Small/SMID cap asset classes Qualitative and quantitative content on individual strategies and benchmark trends Portfolio level detail, performance, and key portfolio risk statistics Benchmark factor analysis (market cap, P/E, Yield, Beta, EPS Growth) Portfolio positioning for managers relative to benchmark Longer document digging deeper into asset class trends and comparing managers Core Quarterly Webinar Discuss market observations and trends across asset classes Review active manager performance and notable outliers Provide update on Core platform developments New manager searches Q&A 12

14 Core Asset Manager Ideas Opportunistically enhance manager roster across asset classes Identify unique and complimentary investment strategies Remain open to emerging managers and strategies Discipline Manager due diligence & selection process Six asset class methodology Well diversified & strategic asset allocation Better Outcomes Tailored solutions to achieve individual investment goals Dedicated Brinker Capital investment professionals providing support for portfolio construction, reviews and rebalances Partnership that results in enhanced client experience 13