,, ,,
Wai ng helps you as an investor and a lot of people just can't stand to wait. If you didn't get the deferred-gra fica on gene, you've got to work very hard to overcome that.
- Charlie Munger
Editor’s Note
- Warren Buffe “ “
The most important quality for an investor is temperament, not intellect.
Historyisrepletewithexamplesofhowpatience,
discipline,andemotionalcontrolhaveshaped investmentsuccessstories.Fromlegendary investorslikeWarrenBuffett,knownforhispatient approachtovalueinvesting,toinstitutionalinvestorswho adheretodisciplinedriskmanagementpractices,the importanceofthesequalitiescannotbeoverstated.Market downturns,economiccrises,andgeopoliticaleventshave testedtheresolveofeventhemostseasonedinvestors,yet thosewhohavestayedtruetotheirprincipleshaveoften emergedstrongerontheotherside.
ChiefInvestmentOfficers(CIOs)playacrucialrolein embodyingtheseprincipleswithininstitutionalinvestment firms.Asstewardsoflargepoolsofcapital,CIOsaretasked withoverseeinginvestmentstrategies,allocatingresources, andmanagingriskonbehalfoftheirclientsor organizations.Theirleadershipsetsthetoneforinvestment decision-makingandshapestheoverallcultureofthefirm. Intimesofmarketvolatilityanduncertainty,CIOsmust exhibitunrelentingdisciplineandstrategicforesightto
navigateturbulentwatersandsteerportfoliostowardslongtermsuccess.Drawingfromthelessonsofhistoryandthe wisdomofseasonedinvestors,CIOsserveasguardiansof capital,entrustedwiththeresponsibilityofpreservingand growingwealthinanever-growingworld.
TheCIOWorld'slatestedition 'The Most Influential Chief Investment Officers to Follow in 2024' focuseson suchguardianswhoareconsiderablyinfluencingthe investmentbusinesswiththeirstrategicacumen,monitoring thecompany'snumerousinvestmentstodevelopdistinctive investmentstrategiesthatprovideprofitablereturnsforthe firm.
Haveagoodreadahead!
AlayaBrown
Editor-in-Chief
Deputy Editor
Managing Editor
Assistant Editor
Visualizer
Art & Design Head
Art & Design Assitant
Business Development Manager
Business Development Executives
Technical Head
Assitant Technical Head
Digital Marketing Manager
Research Analyst
Circulation Manager
Chidiebere Moses
Carter
Phoebe Jacob
Aisha, Olivia
David Walker
Mia Rodricks
Helena
Eric
Richard
Damien Nizerolle
Group Chief Investment Officer
Demetris Efstathiou Chief Investment Officer
Fabiana Fedeli Chief Investment Officer, Equi es, Mul -Asset, and Sustainability
Juan Sanchez-Roselly Global Chief Investment Officer
Company Name
AccorInvest www.accorinvest.com
Blue Diagonal Capital Limited www.bluediagonal capital.com
M&G Investments www.mandg.com
Santander Private Banking www.santanderprivate banking.com
Louis Flamand Chief Investment Officer
Michael Niedzielski
Co-founder & Chief Investment Officer
Omar Al-Gharabally Chief Investment Officer
Altaroc www.altaroc.pe ROCE Capital www.rocecapital.com
Greenstone Placement Management FZ-LLC www gsequity.com
Teymour Abou El Kheir Chief Investment Officer
Infinity Capital Investment
h ps://infinitycapital.ro
Damien, a seasoned professional, transi oned from notary to leadership roles at Klépierre and Unibail-Rodamco. His notable achievements in acquisi ons and investments culminated in his current role as Group Chief Investment Officer at AccorInvest.
Demetris, CIO of Blue Diagonal Capital, has 25 years of global financial market exper se, specializing in emerging markets and fixed income.
Fabiana, raised in Rome, Italy, experienced adversity due to her father's un mely death and gender-ascribed roles, leading her to remain agnos c to societal norms.
Juan is an experienced wealth management professional who specializes in financial advising, investment decisions, behavioral finance, asset alloca on, and economic history, as well as knowledge of mul cultural situa ons.
Louis is a seasoned private equity professional with extensive experience in audit, management consul ng, and wealth management, managing global private equity por olios and selec ng private market funds globally.
Michael co-founded ROCE Capital. With a background at T Rowe Price and Fidelity, he holds an MBA from Columbia, speaks mul ple languages, and champions pediatric cancer research.
Omar, a 16-year investment banking veteran with experience in fund placement, asset management, risk management, por olio advisory, private banking, and fundraising, is the Chief Investment Officer, President, and Partner of Greenstone Equity Partners.
As a CIO, Teymour is a passionate advocate for innova ve ideas to tackle climate change and reduce carbon emissions through renewable energy sources like solar and wind.
Vijay Valecha Chief Investment Officer
Werner Braunöck
Founding Partner and Chief Investment Officer
Century Financial www.century.ae/en/ Narmo Capital www.narmocapital.com
Vijay, a Chemical Engineering graduate, transi oned from a water desalina on company to finance due to the financial boom and the poten al of engineers in finance.
Werner, Founding Partner and Chief Investment Officer of Narmo Capital brings 15 years of experience in Investment Banking and Alterna ve Asset Management, embodying resilience and strategic foresight.
CoverStory
Vijay Valecha
Redefining the Career Paradigm in Finance
Navigating a Career Shift from Process Engineering to Finance, One Passionate Leap at a Time!
Life,theysay,isajourney.Ajourneythatcanleadus tosometrulyextraordinaryplaceswhenwechoose tofollowourpassions.It'sremarkablehowthis pursuitcansteerustowardsunchartedterritories,pushing theboundariesofwhatwethoughtpossible.
Passionisadrivingforce,anever-presentcompanionthat ignitesourcuriosity,fuelsourenthusiasm,andempowers ustoexploretheworldinfreshandunexpectedways. Whenwedaretofollowourpassions,lifebecomesan incredibleadventure,fullofvividexperiencesandpriceless lessons.
ThetaleofVijayValecha'scareerisanexemplarofthe extraordinaryplaceslifecantakeyouwhenyoufollow yourpassion.BorninMumbaiandraisedinDubai,his earlyyearswereshapedbythetypicalexpectationsofa middle-classIndianfamily.Medicineorengineeringwas theenvisionedpathtosuccess.Yet,lifehadadifferent coursechartedoutforhim.
HavingearnedadegreeinChemicalEngineeringin2007, Vijayventuredintoacareerinprocessengineeringata waterdesalinationcompany.Backthen,theglobalfinancial marketswerewitnessingaboom,andmanyofhispeers beganshiftingtheirprofessionalfocusfromengineeringto finance.Drivenbythisgrowingtrendandthebeliefthat engineerswereinherentlyequippedforsuccessinfinance, hedecidedtomakeasignificantcareertransition.
However,ashesoondiscovered,financewasanentirely differentarena,farremovedfromtheworldofengineering. Beyondthenumbersandcalculations,itrequireda profoundunderstandingofintricatesystemsandcomplex marketdynamics.Thelearningcurvewassteep,butVijay wasunshaken,forhisheartwasinthegame.Hispassion forfinancemadeeventhemostchallengingaspectsofthe fieldengagingandenjoyable.
Intheend,hisdecisiontopivotfromengineeringtofinance wasoneofthemostrewardingchoiceshehadevermade.It propelledhimintotherealmofinvestment,andhequickly ascendedthroughtherankstobecometheChief InvestmentOfficeratCenturyFinancial.Hisjourneyisa testamenttotheincredibleplacesonecanreachwhenthey combinetheirpassionwithdetermination,andwhenthey daretotaketheroadlesstraveled.
Below are the highlights of the interview:
InspiringInception
CenturyFinancial,apioneerinfinancialmarket investments,hassuccessfullynavigatedtheUAEmarketfor overthreedecades.Initiallystartingwithcommodity futuresandforexdealingin1989,thecompanyhasevolved intoaleadingproviderofcomprehensiveinvestment services,cateringtobothlocalandexpatriateinvestors.In anindustrythathaswitnessednumerousplayersand changingmarketconditions,CenturyFinancialhasstood outbyearningthetrustofitsclientelethroughexceptional customerserviceandaprofessionalapproach.The company'sspecializationliesininvestmentservices, offeringaccesstoavastrangeof40,000instrumentsacross 125globalmarketsand31countries.Withafocusonhighnet-worthindividuals(HNIs)intheregion,Century Financialprioritizestheneedsofitscustomersandstrives toprovidethemwiththebestpossibleexperience.
Thecompany'scommitmenttoempoweringinvestorsand tradersisevidentinitshigh-touchservices,multi-asset tradingplatforms,bespokeresearch,anddiverserangeof investableproducts.Additionally,CenturyFinancialgoes beyondtransactionalservicesbyofferingsupport,training, andregularseminarstoensurethatitsclientsarewellinformedandequippedtomakeinformedinvestment decisions.
Withactivitiesspanninginvestment,wealthmanagement, andtradingtechnology,CenturyFinancialhasestablished itselfasaregionalpowerhouseinthefinancialservices category.
GlobalTradingJourney
AsVijayrecounted,"Joiningfinancewasn'tanextensively planneddecision.ItwasmoreofaninterestIhadduetomy majorineconomicsduringengineering.Despitethe industry'sperceivedinstability,Ifoundmyselfdrawntoit." HerememberedhisentryintoEdelweissinMarch2008,a timemanyconsideredtobetheworstforthefinancial sector."Strangelyenough,Iconsiderittobetheperfect timing,"heexplained,emphasizingthatindividuals commencingtheirfinancialcareersin2008acquireda heightenedawarenessofrisk,aqualityhebelievedwas lackingintoday'snewcomers.
Finance was a whole different ball game, and being good at math was a very, very small part of learning the field. The learning curve was steep, but when you love doing something, it automa cally becomes easy. Learning finance and taking that jump s ll happens to be one of the best decisions I have ever made in my life.
Reflectingontheexperienceofwitnessingthemarket turmoilduringtheGreatRecessionattheoutsetofhis career,"Itshapedmanyofusintogoodriskmanagerswith amoreconservativemindset.Thesequalitiesproved invaluable,enablingustonotonlysurvivebutalsothrivein anymarketcycle,"Vijayadded.
WhenhejoinedalargefinancialorganizationinMarch 2008,ithadaworkforceofover10,000employees.His team,focusedonlow-riskarbitrage,consistedof130 individuals.However,bytheendoftheyear,theteamhad shrunktojust4people.ThisexperiencetaughtVijaythe importanceofsurvivalinthemarkets,asitultimatelyleads tothriving.
Overall,hisjourneyinfinancehasbeenshapedbyhis abilitytoadaptandpersevereinchallengingmarket conditions.
UnmatchedExpertise
Vijayhasalwaysbeenafirmbelieverintheimportanceof havingastronggraspofbothtechnicalandfundamental analysis."Thesestudiesareessentialforunderstandingthe market.Fundamentalshelpusgaugevaluationsandfair pricing,whiletechnicalanalysisallowsforprecisemarket timing,"heasserts!
Fueledbyhisinterestsinmathematicsandeconomics, "Learningquantitativeanalysisandfundamentalswasnot
onlyeducationalbutalsoenjoyable,"Vijayshares. Henotesthatmanyindividualsstruggletocombine thesetwosciencesduetodifferingtimeframes. "Fundamentalsplayoutoverthelongterm,while technicalsandquantitativeanalysisprovide winningstrategiesintheshortterm,"hepoints out. "Combining both approaches is crucial for a comprehensive understanding of various investment portfolios tailored to individual goals and life targets."
RiskManagementStrategies
AsquotedbyJohnKeynes, "Markets can stay irrational longer than you can remain solvent." Riskplaysacrucialroleinfinancialmarkets, andbothfundamentalandtechnicalanalysiscan oftenfailduetotheirrationalandsemi-efficient natureofthemarkets.Ignoringriskmanagementcan resultinirreversiblelosses,whichnotonlyhurt financiallybutalsotarnishesthereputationofthe financialindustry Vijayhasalwaysemphasizedthe importanceofunderstandingtherisksassociatedwith higherleverage,higherbeta,small-capornewindustries, andnewassetclasses.Investingalargeportionofyour incomeinthefinancialmarketsbasedonthefearofmissing out(FOMO)orthe"youonlyliveonce"(YOLO)mentality canleadtodisastrousoutcomes.
Aprudentandpatientinvestor,ontheotherhand,tendsto outlastandoutperformshort-termtrendsandachieve sustainablegainsinthelongrun.
TradingBlueprints
Vijay,anexperiencedprofessionalinthefinancialmarkets, hasincreasinglyembracedtheprinciplesofbehavioral finance.Asasubfieldofeconomics,behavioralfinance examineshowpsychologicalfactorsimpactfinancial decision-making.Itchallengestheconventionalbeliefthat investorsarerationalactorswhobasetheirdecisionson logicandobjectiveanalysis.Instead,behavioralfinance suggeststhatinvestorsareoftenswayedbyemotions, biases,andheuristics.Manyindividualsstruggleto differentiatebetweentherisksandrewardstheytrulyseek, leadingtoamisalignmentbetweentheirinvestmentsand expectations.Inthisrole,theobjectiveistoguideclients towardsarealisticunderstandingofriskandexpectations.
KeyLearningsandExperiences
DuringhistenureatEdelweiss,Vijayacquireda comprehensiveunderstandingoffinance,includingIndian markets,ADRs,arbitrage,long-shortstrategies,quant trading,andoptionstrategybuilding.
Heemphasized,"Edelweissisrenownedforits commitmenttofosteringgrowthandprovidingvaluable learningopportunities."Asanovice,Vijaywasnot dismissedbutinsteadencouragedtoexplorenewideasand furtherdevelophisskills.
AtHiraGlobal,heembarkedonadifferentjourney,taking theinitiativetoestablishafundfromscratch.This experienceprovidedhimwithvaluableinsightsintothe businessaspectsofhiringandmanagingpeople,aswellas meetingclientexpectations."Boththeseexperienceswere immenselybeneficialtomypersonalandprofessional growth,allowingmetoacquireawealthofknowledge,"he reflected.
ImpactofaQuantitativeBackground
AsaquantanalystatRasmala,thedevelopmentofthe UAE'sfirstpurequant-basedfundintheregionalmarkets wasauniqueexperience.Vijay'sdeepinterestandexpertise inquantitativeanalysis,fueledbytheireducational backgroundandcoreareaofinterest,playedacrucialrole inthisendeavor Theconvergenceofnumbersand aspirationshasalwaysbeenacaptivatingaspectforthem, astheyfindgreatenjoymentinquantifyingeverything.
EnhancingExpertise
Educationalwayspaysoff,istheoldsaying,anditisvery true.Vijayemphasizedthatcomingfromascientific background,hehadtogethimselfandstilltryeverydayto getmyselfmoreandmoreeducatedinthefinancialfield.
PathtoFinancialFreedom
Financialindependence,alsoknownasFIRE,isbelievedby Vijaytobeachievableforeveryone.Inahighlycapitalistic world,individualsoftendisregardtheiraspirationsand dreams,conformingtosocietalorworldlyexpectations.The desiretoretireearlyiscommon,yetmanystruggleto understandhowtomakeitareality.Itisstrongly recommendedthatindividualsstartlearningaboutthe importanceofinvestingandthepowerofcompoundingata youngage,enablingthemtobecomepartoftheFIRE movement.Ittypicallytakesapproximately20–25yearsof worktoattainmostofthefundamentalgoalsindividuals have.Consideringthatmanypeoplebegintheircareersin theirearly20s,itishighlylikelythatwewillsoonwitness individualsretiringintheirearly40s,allowingthemtofully enjoylifeandtheworldbyembracingthismovement.
ProminentMediaOutlets
Vijayhasbeenfortunatetoreceiverecognitionandhavehis thoughtsandinputsacknowledgedbymembersofthe financialcommunity.Hegreatlyappreciatesthevaluable workcarriedoutbytheseinfluentialmediaorganizationsin spreadingfinancialawarenessonagloballevel.Hefeels privilegedtohavetheopportunitytocollaboratewithsome ofthebrightestmindsintheworld.
UncoveringtheGlobalMarketandInvestingIndustry
Vijayemphasizestheimportanceofrecognizingthe dominantthemeinthemarketduringaparticulardecadeor cycle.Inthe21stcentury,thefirstdecadesawafocuson realestateandbanking,whilethelastdecadewitnesseda surgeintechnologyleadinguptoelectricvehicles.The currentdecadehasbegunwithdigitalassets,themetaverse, andartificialintelligenceemergingasthemainthemes.
Having seen one of the worst turmoil in the markets, which is o en referred to as the Great Recession, at the start of one's career makes for good risk managers and a more conserva ve mindset. These are quali es that help you survive and thrive during any part of a market cycle.
Whileitiscrucialtounderstandthesetrends,headvises thatonlyasmallportionofone'sportfolioshouldbe allocatedtotrend-basedinvestments.Themajorityofthe portfolioshouldalwaysbededicatedtoinvestinginbasic industriesthathaveconsistentgrowthpotential.Core componentssuchasequities,bonds,andrealestateshould remainthefoundationofanyportfolio.Oncethesecore elementsareinplace,individualscanconsidermaking trend-basedinvestmentstopotentiallyoutperformthe marketonasmallerscale.
However,itisworthnotingthatconsistentlyoutperforming thebroadermarketbyasignificantmarginhasproventobe challenging.Therefore,Vijayreiteratestheimportanceof riskmanagementforsmartlong-terminvestorswhoare planningfortheirretirementandfuturegoals.
How toGrow fromInveing Miseps
Reflectionisapowerfultoolforpersonalgrowth,
allowingindividualstolearnfromtheir experiencesandmistakes.Byreflectingonpast actions,onecangainvaluableinsightsthatcontributeto continuousimprovementanddevelopment.
Leveragingreflectionasatechnicaltoolcansignificantly enhancedecision-makingprocessesandimproveoverall portfolioperformance.Thistechnicalperspectivedelves intohowinvestorscanutilizedataanalysis,quantitative methods,andalgorithmicstrategiestodissectpastmissteps, extractactionableinsights,andoptimizefutureinvestment strategies.
DataAnalysisandQuantitativeMethods
Dataanalysisliesatthecoreofreflectingoninvestment misstepsfromatechnicalperspective.Investorscan leveragehistoricalmarketdata,financialstatements,and performancemetricstoconductthoroughpost-mortemson pastinvestmentdecisions.Quantitativemethods,suchas statisticalanalysis,regressionmodeling,andmachine learningalgorithms,canhelpidentifypatterns,correlations, andcausationsbehindinvestmentsuccessesandfailures.
Byanalyzingkeyperformanceindicators,risk-adjusted returns,andportfolioallocationstrategies,investorscan gainadeeperunderstandingoftheirinvestmentbehavior andthefactorsdrivingperformance.Thisdata-driven approachenablesinvestorstoobjectivelyevaluatethe efficacyoftheirstrategiesandmakeinformedadjustments movingforward.
AlgorithmicTradingStrategies
Algorithmictradingstrategiesofferasystematicframework forimplementinginvestmentdecisionsbasedonpredefined rulesandalgorithms.Thesestrategiescanincorporate reflectionsonpastmisstepsbyintegratingfeedbackloops andadaptivelearningmechanisms.
Forinstance,reinforcementlearningalgorithmscan continuouslyadjusttradingparametersbasedonreal-time marketfeedback,optimizingperformanceovertime. Similarly,evolutionaryalgorithmscansimulatetheprocess ofnaturalselectiontoevolvetradingstrategiesthatare robustandadaptivetochangingmarketconditions.
Byencodingreflectionsonpastmisstepsintoalgorithmic tradingsystems,investorscanautomatetheprocessof learningfromexperienceanditerativelyimprove investmentstrategiesinasystematicanddisciplined manner
PortfolioOptimizationTechniques
Portfoliooptimizationtechniquesaimtoconstruct diversifiedinvestmentportfoliosthatmaximizereturns whileminimizingrisk.Reflectionplaysacrucialrolein fine-tuningportfolioallocationstrategiesandmitigatingthe impactofpastmissteps.
Modernportfoliotheory,mean-varianceoptimization,and riskparitystrategiesleveragehistoricaldataandstatistical analysistooptimizeassetallocationacrossdifferentasset classes.Byreflectingonpastperformance,investorscan identifyoverexposedsectors,underperformingassets,and systemicriskswithintheirportfolios.
Furthermore,dynamicassetallocationmodelscanadapt portfolioweightsinresponsetochangingmarketconditions andmacroeconomicindicators.Byincorporatingreflections onpastmisstepsintotheoptimizationprocess,investors canenhanceportfolioresilienceandachievemorerobust risk-adjustedreturns.
MachineLearningApplications
Machinelearningalgorithmsofferpowerfultoolsfor extractingactionableinsightsfromvastamountsof financialdataanduncoveringhiddenpatternsinmarket behavior.Byleveragingsupervisedlearning,unsupervised learning,andreinforcementlearningtechniques,investors canenhancetheirunderstandingofcomplexmarket
dynamicsandimproveinvestmentdecision-making processes.
Forexample,sentimentanalysisalgorithmscananalyze newsarticles,socialmediafeeds,andmarketsentiment indicatorstogaugeinvestorsentimentandidentifymarket trends.Naturallanguageprocessingalgorithmscanextract insightsfromfinancialreports,earningscalls,andanalyst transcriptstoassessthefundamentalhealthofcompanies.
Byintegratingmachinelearningalgorithmsintoinvestment strategies,investorscanleveragereflectionsonpast misstepstoidentifyopportunities,mitigaterisks,and optimizeportfolioperformanceinadata-drivenand systematicmanner
Inconclusion,leveragingreflectionininvestmentstrategies fromatechnicalperspectiveoffersasystematicframework forlearningfrompastmissteps,optimizinginvestment decisions,andenhancingportfolioperformance.By harnessingthepowerofdataanalysis,quantitativemethods, algorithmictradingstrategies,portfoliooptimization techniques,andmachinelearningapplications,investors canextractactionableinsightsfrompastexperiencesand continuouslyimprovetheirinvestmentstrategiesina dynamicandevolvingmarketenvironment.
- Alaya Brown
Fabiana Fedeli
A Journey of Determina on and Global Explora on
Navigating Challenges, Building a Legacy, and Redefining Investment Strategies!
Acommonbeliefisthatprivilegeisthepathto success.It'struethatsomepeopleseemtohave greateraccesstocertainopportunities,butit's importanttothinkaboutthevariousstoriesthatinfluence thestateoffinance.FabianaFedeliisalivingexampleof fortitude,inquisitiveness,andasteadfastworkethic.Her risefromthecobblestonestreetsofRometothetopranks ofglobalfinanceisataleofperseveranceandaneverendingquestforknowledge.Shecurrentlyholdsthe positionofChiefInvestmentOfficer,Equities,Multi AssetandSustainabilityatM&GInvestments.
BornandraisedinRome,Italy,Fabianafacedadversity earlyon.Theuntimelydeathofherfatherwhenshewas justayearandahalfoldleftherandhermotherforging aheadasafamilyoftwo.Growingupinasocietystill entrenchedingender-ascribedroles,herupbringingwitha singleparentrenderedheragnostictosocietalnorms—an invaluableassetinherlatercareer.Financialmodesty fueledherdrivetoexcel,propellinghertowardafuturethat defiedexpectations.
Fedeli'sentryintotheworldoffinancewasn'tapredestined path.AchanceencounterwithaTVprogramshowcasing opportunitiesatoneofItaly'spremierbusinessuniversities sparkedherinterest.Determinedandarmedwithgrit,she securedascholarship,ignitingajourneythatledherto studyinJapanandworkacrosstheglobe—fromtheUnited StatestotheUKandtheNetherlands.
ApivotalchapterinFedeli'snarrativeunfoldedinJapan. Drivenbyadesiretoenteracademia,shepursueda scholarshipthatnotonlycoveredtuitionbutalsoprovided forlivingexpenses.Undeterredbythechallengeof
Identifying and understanding the key risks of our investments and employing a rigorous risk-management framework are core parts of portfolio construction and management. It is important to maintain a diversied portfolio, both within and across asset classes, and understand the risk tolerance and liquidity needs of our clients.
studyinginalanguageshebarelyknew,shecompletedher Master'sandtransitionedfromacademiatoasell-side analystroleinTokyo,settingthestageforherillustrious careeringlobalfinance.
Below are the highlights of the interview:
Couldyoupleasetellusaboutyourcompanyandits inceptionstory?
M&GisoneoftheUK'soldestassetmanagers.Itwas foundedin1901andlaunchedEurope'sfirstmutualfund andtheUK'sfirstunittrustin1931.Today,M&Gisa FTSE100companywith5000+employees,£332billionof assetsundermanagement(asofJune30,2023),and500+ investmentprofessionalsprovidingabroadrangeof investmentsolutionsacrossassetclassesspanningequities, fixedincome,multi-asset,privatecredit,infrastructure,real estate,andalternatives.
InEquities,Multi-Asset,andSustainability,whicharethe areasIamresponsiblefor,wehaveover150colleagues workingintheUK,US,ContinentalEurope,andAsia,with ourinvestmentteamsmanagingacombined£58billionof assets(asofJune30,2023)andinvestingacrosstheglobe onbehalfofourclients.
Asactiveinvestors,wehaveastrongin-houseproprietary researchcapability,alongtraditionofstewardship,andan ambitiontoconsistentlyimproveoursustainability credentials.
Howdoyouapproachinvestmentstrategydevelopment andimplementation,andwhatfactorsdoyouconsider whenevaluatingpotentialinvestmentopportunities?
IlovemyjobandfeelprivilegedtodowhatIdo.Icould notdoitwithoutourclientsentrustinguswiththeirsavings andtheirinvestments.Therefore,clientsareatthecenterof everythingwedo.Whenwedevelopnewstrategies,we havetomakesurethattheyserveourclients'needs.Clients' objectives,risktolerances,andinvestmenthorizonsarethe keydriversofourinvestmentoffering.Theseneedsare evolving,andwehavetoevolvewiththem.Timesare changingintheassetmanagementindustry;clientsare becomingincreasinglysophisticatedandputtingalotof thoughtintotheamountofrisktakentoachievecertain returns,aswellastheoperationalsoundnesssupportingan investmentstrategyand,importantly,thelongevityofthe portfoliomanagementteam.Theconceptofa"starportfolio manager"isbeingreplacedbya"starteam,"wherethereis acredibleandclear''bench''oftalentthatcanstepintothe leadportfoliomanager'sshoesandminimizekeyperson risk.Wealsoneedtoensurethatwehavethecombined skillsandcapabilitiestodeliverthesesolutionsforour clients.Weshouldnotpromisewhatwecannotdeliver.
Intermsofidentifyingattractiveinvestmentopportunities, therearethreepillarstoourinvestmentphilosophy:1) activeshare,asclientscometoustoachievereturnsthat theycannotderivefrompassiveexposure;2)in-depthinhouseresearch,whichallowsustoidentifyopportunities thatmaynotbeevidentthroughamoresuperficial approach;and3)sustainabilityintegrationandstewardship. Wehavealongtraditionofworkingcollaborativelywith thecompaniesweinvestin,andtheworldaroundusisalso evolving.Considerationsaroundsustainability,suchas climatechangeanddiversityandinclusion,arenecessaryto ensurethatthecompaniesweinvestinremainresilientina worldofconstantchange.
Wedon'tfollowtheherd,evenifthatcanfeel uncomfortableattimes,particularlyduringboutsofmarket volatility Activedecision-makingisaboutseeking opportunitiesthathavethepotentialtodeliverlong-term valueforourclientsanddrillingdowntofullyunderstand thecompaniesweareinvestingin.There'snosubstitutefor in-depthanalysis.Nexttoit,knowingwheretobestdirect ourresearcheffortscomeswithindustryknow-howand investmentexperience.
Whatwasyourmostimportantdecisionyoumadeasa ChiefInvestmentOfficer?
AsaCIO,Igettomanagethemostpowerfulasset:our people.Therefore,mymostimportantinvestmentdecisions areaboutmyteam.Overthelasttwoandahalfyearswe haveworkedhardatbreakingsilosbetweendifferent investmentdesks.Wehaveabolishedtheword "collaboration"andreplaceditwith"accountability."We areallaccountabletoeachotherforsharingbestpractices andresearchideas.Ratherthanduplicating,wepool resourcessothatwecaninvestinthebesttools,thebest dataandthebesttechnology Ayearago,Ihireda California-basedtechnology-focusedinvestmentteam.It tookmealongtimetofindthem.Iwaslookingforclear knowledgeleadershipaswellasvaluesthatwouldmake thempartofthat"accountability"culture. Theirarrivalhas beenacatalystforupgradingthetechnologyknow-howof thebroaderteam,andhasledtothelaunchofourfirst GlobalAI(ArtificialIntelligence)strategy.
Howdoyoucollaboratewithotherdepartmentsor teamswithintheorganizationtoaligninvestment strategieswithoverallbusinessgoals?
OneofthereasonswhyIenjoyworkingatM&Gisthesize ofourorganization:wearelargeenoughtohavedeep expertiseandmeaningfulresourcesinallmajorasset classes(Equities,FixedIncome,PrivateMarkets)andyet wearesmallandnimbleenoughthattherearenobarriers forustoworktogetherandinnovatehorizontallyacross thoseassetclasses.Icansitwithmyfixedincomeand privateassetcolleaguesandbrainstormonproduct innovation.Idobelievethatinthefuture,ourclientswillbe increasinglyinterestedincross-assetopportunitieswhere weareabletoharvestalphaandmanageriskinwaysthat arelesscorrelatedwithtraditionalassetverticals.
Anexampleofcross-teamproductinnovationthisyearhas beenbetweenourpublicandprivateequityteams.Wefelt thatthemarketwasnottakingadvantageofopportunitiesin early-stageunlistedbusinesses,wheresignificantvalue couldbecreatedbyengagingwiththeirmanagementteams, guidingthecompaniesthroughtoIPO,andthencontinuing tosupportthosebusinessespost-listing.Therefore,we launchedacross-overstrategythatleveragesM&G's broaderinvestmenteco-system,combiningtheearly-stage researchandoriginationexpertiseofourprivateasset colleagueswithourlongtraditionofmarketresearchand companyengagementinpublicassets.
WhatadvicedoyouhaveforaspiringChiefInvestment Officersorthoselookingtoentertheinvestmentfield?
Forthoselookingatacareerasinvestors,humilityand resiliencearerare,precious,andessentialcurrenciesinour lineofwork.Youshouldneverforgetthatyouare safekeepingandgrowingassetsforyourclients.Without thoseclients,youwouldnotbeinyourseat.Andforan aspiringCIO,makesureyoucreateateamofinvestment professionalswithdiverseandcomplementaryskillsets,not acollectionofclones.
Pleasegiveusafewtestimonialsfromyourclientsand awardsorrecognitionthataccuratelyhighlightyour achievementsinthecorporateniche.
Industryrecognition:
• NamedbyFinancialNewsasoneofthe100Most InfluentialWomeninFinancein2022
Boarddirectorships:
• Non-executiveDirectorontheBoardofM&G InvestmentsSouthAfrica.
• Non-executiveDirectorandChairoftheAudit CommitteeofRelmadaTherapeutics(Nasdaq:RLMD), alate-stagebiotechnologycompany.
Investmentcommitteememberships:
• MemberoftheInvestmentCommitteeofThe InvestmentAssociation,atradebodyrepresenting InvestmentManagersintheUKwhocollectively manageover£8.8trillioninassets.
• MemberoftheInvestmentCommitteeofUK-based TheOpenUniversity
RegularlypublishedinprintandinterviewedonTVand radio:
• Regularbroadcastmediaappearances(Bloomberg, CNBC,Sky)andongoingdialogueswithsenior journalistsandeditorsintheUK,Europe,Asia,Africa, andtheUS,providinginsightsandanalysisabouthow wearenavigatingmarketsonbehalfofourclients.
LOUIS Flamand
Bridging Ins tu onal
A Journey Through Global Markets, Wealth Management, and a Retail PE Revolution!
Passionisthedrivingforcethattransformsajobinto afulfillingcareer,andnowhereisthismoreevident thaninthedynamicworldofprivateequity Louis Flamand,ChiefInvestmentOfficeratAltaroc,standsas anexampleofthetransformativepoweroffollowingone's passionintherealmoflong-terminvestments.
Beginninghisprofessionaljourneyinauditand managementconsulting,heswiftlypivotedtowardshis passionfortheprivateequityassetclass.Histrajectorytook himfromErnst&Young'stransactionservicesteamin ParistoQuartiliumFundsofFunds,wherehecoveredPE strategiesacrossEurope,theU.S.,andAsia.
Louis'sglobalodysseycontinuedashemovedtoLondonin 2013,co-headingtheprivatemarketswealthmanagement teamatUBS.Managingasubstantialglobalprivateequity portfolio,heplayedapivotalroleinselectingprivate marketfundsworldwidefortheleadingwealthmanager's globalprivateclientbase.
Forovereightyears,heheadedtheLondon-basedPEteam atMetLifeInvestmentManagement,overseeingprimary commitmentsandequityco-investmentsinEuropeand Asia.Withaportfolioexposureof$5billionoutofthe firm's$20billiontotalexposuretoprivateequity,he becameakeymemberofMetLife'sglobalPrivateEquity investmentcommittee.
Now,LouisembarksonanewchapteratAltaroc,aretail fundoffunds.Believingthattheprivateequityassetclassis matureenoughtoentertheretailmarket,heiscaptivatedby Altaroc'svision—aretailrevolutionthatprovidesprivate
WE BELIEVE THAT THE KEY RISK IN PRIVATE EQUITY FUND INVESTING IS TEAM RISK. THE SMALLER THE TEAM, THE HIGHER THE RISK. IF YOU BACK A TEAM OF 12 PROFESSIONALS AND THE TOP 2 KEY SENIOR PROFESSIONALS LEAVE THE FIRM, TRIGGERING A KEY MAN CLAUSE, YOUR INVESTMENT CAN REALLY BE IN TROUBLE. WE HENCE AVOID TAKING A MATERIAL TEAM RISK: (I) WE ONLY INVEST IN FUNDS OF MORE THAN $1 BILLION IN SIZE; (II) WE BACK ROCK-SOLID ORGANIZATIONS, AS I EXPLAINED BEFORE, WITH A LOW KEY PERSON RISK.
clientsaccesstotop-tierprivateequityfundsunderthe sameconditionsasinstitutionalinvestors.Withco-founders MauriceTchenioandFredericStolar,bothindustry pioneers,heissettoleveragehiswealthofexperienceto spearheadAltaroc'smissionandrevolutionizetheprivate equitylandscapeforprivateclients.
Below are the highlights of the interview:
CouldyoupleasebriefusonAltarocanditsinception story?
Altarocwasbornfromasharedvision.Webelieveditwas timetodemocratizeaccesstoinstitutional-qualityPrivate Equity,enablingindividualstotapintothepotentialofthis assetclass.MauriceTcheniofirstembarkedonthismission whenhecreatedAltamirin1995.Altamirprovides individualswithaccess,throughapubliclylistedfund,to theperformanceoftheApaxandSeven2(formerlyApax France)funds,alongwithco-investmentopportunities. FredericStolar,ontheotherhand,hadbeenmanaging capitalfromwealthyfamiliesatSagardandsharedthe convictionthatthebenefitsofPrivateEquityshouldextend beyondthewealthiestfamilies.
AltarocprovidesaccesstoinstitutionalPrivateEquity throughannualfunds-of-funds,with80%committedto5-7 buyoutsand/orgrowthequityfundsand20%allocatedto equityco-investments.Ourentrypointstartsat€100,000 forourAltarocannualfund-of-fundsandamere€1,000for ourAltalifefund-of-funds,accessiblethroughliquidity-
guaranteedlifeinsurancecontractsinFrance.Operating underaB2B2Cmodel,wereachretailclientsthrough independentfinancialadvisorsandprivatebanks.This approachhasresultedinAltarocraisingover€820million injustover22monthsinFrancealone.Oursightsarenow setonexpandinggeographically,targetingtheSwiss,UK, Italian,BeneluxandGermanmarkets.
Howdoyouapproachinvestmentstrategydevelopment andimplementation,andwhatfactorsdoyouconsider whenevaluatingpotentialinvestmentopportunities?
Ourstrategyconsistsofinvestinggloballysolelyinbuyout andgrowthequityfunds,which,webelieve,offerthebest risk/returnprofileforprivateclients.Weseektobuild annualportfoliosof5-7fundsmeetingthefollowing criteria:(i)sectorexposure:50%technologyand technology-relatedservices,20%healthcare,20%services, and10%consumer;(ii)geographicalexposure:45% Europe,45%U.S.,10%Asiaandtherestoftheworld;(iii) marketsegmentexposure:primarilyexposedtothemiddle marketthatoffershigh-valuecreationpotentialandmultiple exitroutes.Factorsweconsiderwhenevaluatingpotential investmentopportunitiesinclude(i)thesizeandqualityof theorganization:wewanttobackrock-solidorganizations withatleast50professionalsand3bnofAuM,withstrong internalsectorandoperatingexpertise;(ii)trackrecords: themanagershouldhaveadeeptrackrecordthatprovesits capacitytogenerateanetperformanceinexcessof2xwith alowlossrate.Ourduediligencewillthenfocuson validatingthatthispastperformanceisrepeatableinthe future.
Wespecificallyliketobackmanagerswhohavedeveloped value-creationplaybooksthatencompassallthebest practicestheyhavedevelopedduringtheirlongmanager experience.
Howdoyoumanageriskinyourinvestmentportfolio, andcanyoushareanexampleofasuccessfulinvestment decisionyoumadeasaChiefInvestmentOfficer?
WebelievethatthekeyriskinPrivateEquityfund investingisteamrisk.Thesmallertheteam,thehigherthe risk.Ifyoubackateamof12professionalsandthetop2 keyseniorprofessionalsleavethefirm,triggeringakey manclause,yourinvestmentcanreallybeintrouble.We henceavoidtakingamaterialteamrisk:(i)weonlyinvest infundsofmorethan$1billioninsize;(ii)webackrocksolidorganizations,asIexplainedbefore,withalowkey personrisk.
Toinvestinthelowermiddlemarket,whichistypically coveredbysmallfundsandhencesmallteams,Idecidedto investinlowermid-marketfundsthatarepartofbigger platforms.Morethanadecadeago,asPEmanagersinthe USstartedtoraiselargerflagshipfunds,becomingtoolarge toinvestinthelowerendofthemid-marketwheretheyhad beensuccessfulinthepast,someofthemdecidedtolaunch asmallerfundwithadedicatedteamfocusedonthelower mid-market.Thistypeoffundthatbelongstoalarger platformhasalowerteamriskbecause,shouldsomething happentoitssmalldedicatedteam,themanagercan transferresourcesfromtheflagshipfundtothissmaller fund.Comparedtoasmallindependentlowermid-market fund,thisfund'steamriskandhenceriskprofileismuch lower,anditsreturnprofileisactuallyhigherasitbenefits fromthedeeptrackrecord,"largecapquality"processes, sectorexpertise,andoperationalexpertiseofthelarge flagshipfund.Ihavemadeseveralsuccessfulinvestments insuchfundsinEuropeasthisthemethatstartedinthe morematureUSmarketarrivedinEurope.
Wealsoobviouslymanageriskthroughthediversification ofourfunds.With5-7fundsinanannualfundoffunds,our portfolioisprobablymoreconcentratedthantheportfolios ofinstitutionalfundsoffunds,butthisallowsustobevery selective,andwetendtoinvestinfundsthatarequite diversifiedintermsofnumberofinvestments.Onthecoinvestmentside,wealsotargetsolidbusinessesinthebest sectorsofexpertiseofthemanagersweinvestwith.
Howdoyoustayinformedaboutmarkettrendsand changesintheinvestmentlandscape?
WemeetwithPrivateEquitymanagersveryregularly We haveregularupdatecallswithourexistingrelationshipsand dealflowmeetings,andweoftentravelacrossEuropeand theU.S.focusingexclusivelyonmeetingmanagers.Thisis thebestwaytostayclosetothemarketandidentifymarket trends.Wealsohavefrequentinteractionswithplacement agentsinordertoidentifyfutureinvestmentopportunities andbeawareofchangesintheinvestmentlandscape.
Whatmetricsdoyouusetoassesstheperformanceof yourinvestmentportfolio?
KeyperformancemetricsareTVPI,DPI,andNetIRR,as thesearenetoffeesandcarriedinterestpaidtothe managers.Wepayalotofattentiontotheinvestmentrateof thefundsweinvestin,aswewantourclientcommitments tobefullyinvestedinportfoliocompaniestoreducetheir gross-to-netperformancespread.Wehenceinvestwith managers,whotypicallyinvestmorethan100%oftheir fundsbyrecyclingmanagementfeesandexpenses.Assuch, wealsomonitorthe"TotalValue/FundSize"performance metric,whichshouldultimatelyexceedthe"Total Value/PaidIn(TVPI)"metricthankstorecycling.
Howdoyoucollaboratewithotherdepartmentsor teamswithintheorganizationtoaligninvestment strategieswithoverallbusinessgoals?
AtAltaroc,weallworkcloselytogetherinasingleofficein Paris.Atthisstageofourdevelopment,weonlyfocuson buyoutandgrowthequitystrategies,butweexpectto launchnewproductsinthefuture.Workingcloselywithour fundraisingteamisessentialforustodesigntheright products.
Howdoyouadaptyourinvestmentstrategiesto changingmarketconditions?
OnecannottimethemarketwithaPEfundoffund program,asaPEfundwilltypicallybeinvestedover5 years,i.e.with5entrypointsindifferentmarketconditions, anddivestedoverthenext5years,i.e.with5exitpointsin differentmarketconditions,sothatonecannotsecondguess whichvintagewillbebestandwhichstrategywill outperformforaspecificvintage.Ultimately,itisthePE fundmanagerwhocontrolstheinvestmentandexittiming, notthefundoffundmanager Wefocusonwhatwebelieve arethetwomostattractivePEstrategiesfromarisk/return
profilestandpoint:buyoutandgrowthequity,andwewill notchangeourfocusbecauseofdifferentmarket conditions.However,sincetherecentsurgeininterestrates, wehavebeenpayingevenmoreattentiontoPEmanagers' valuecreationleverswhenselectingfunds,focusingon managerswhosepaststrongreturnshavebeengenerated withlowlevelsoffinancialleverage.
WhatchallengesdoyoufaceasaChiefInvestment Officer,andhowdoyouovercomethem?
InvestingannualPEfundsatthesametimeastheyare beingraisedcanbechallenging.Wehavethecapacityto warehousehalfoftheportfolio,sowetypicallyselect2–3 fundsjustbeforelaunchingthefundraisingforournew vintagetoprovidesomeportfoliovisibilitytoourclients. Wethencommittotheremainingfundswehaveselected forthatspecificvintagetowardstheendofthefundraising. Thisimpliesknowingpreciselythefundraisingtimingofall targetfundsinthemarketandconstantlyspeakingwith managers,asthesetimingscanevolverapidly.Investingin only5-7fundsperyearisalsoactuallychallenging,aswe needtoanalyzealargenumberofopportunitiesand benchmarkthempreciselytoultimatelyselecttheverybest ones.Ialsoneedtosourceequityco-investments,which canbeachallengewithamoreconcentratedportfolio.I makesurethatamaterialshareofthefundsweinvestoffers enoughco-investmentopportunitiesforustoallocate20% ofourannualfundoffundstoequityco-investments.
Canyouprovideinsightsintothefuturetrendsand innovationsintheinvestmentindustrythatyou anticipate?
AltarocstandsattheforefrontoftheRetailRevolutionin PrivateEquity,offeringretailinvestorsunprecedented access,returns,andtechnology-drivenconvenience.The RetailPrivateEquityendeavorfacedmultifaceted challenges:theneedforcapital,technologicalinnovation, andabreadthofcompetenciesencompassingdigital, investment,marketing,educationskillsets,andregulatory understanding.TechnologyplaysapivotalroleinthisRetail Revolution.Onlythehighest-qualitydigitalsolutions empowerretailfunds-of-fundsto:
Seamlesslymanagecapitalcalls,distributions,and reportingviamobileplatforms,foramuchhighernumber ofclientsthanforinstitutionalfundsoffunds.
Educatefinancialadvisorsandretailclientsthrough immersivevideosandasophisticatedfintechecosystem, fosteringadeepunderstandingofourassetclass.
Createadynamicmarketplaceforclientstobuyorsellin thesecondarymarket.
Altaroc'sfullydigitalizedofferingenablesprivate individualstocommittoourfunds-of-fundsin7minutes. We'vestreamlinedcapitalcallmanagement,with20%of thecommitmentinitiatedatclosingandsubsequent10% callsonMarch31standSeptember30theachyearuntilthe fullcommitmentisreached.
Werecognizethatweareinthenascentstagesofthis revolution.The"RetailRevolutioninPrivateEquity" challengestheestablishedinstitutionalorder.Some institutionalLPsfearthatretailcapitalinflowsmaydampen returns.However,Ibelieveitwillfuelthefuturegrowthof theassetclass,enhancingitssophisticationandinstitutional qualityacrossmanagers.Thisrevolutionispositiveforall, asPrivateEquityremainsadrivingforcefortheeconomy andsociety,fosteringjobcreationandeconomicgrowth.
WhatadvicedoyouhaveforaspiringChiefInvestment Officersorthoselookingtoentertheinvestmentfield?
IampassionateaboutPrivateEquityandlong-term investments.IamnotsureIwouldhaveenjoyedaCIOrole ifithadnotbeenfocusedonprivatemarkets.Isimply believethatinordertosucceed,oneneedstoenjoyone's job.MyadvicetoanyaspiringCIOwouldbetotrytojoina companythatfocusesontheassetclassesheorsheis passionateabout.
,, ,,
Far more money has been lost by investors trying to an cipate correc ons, than lost in the correc ons themselves.
- Peter Lynch
From Graham to Buffe !
Evolu on of Value Inves ng Strategies in the Hands ofChief Invement Officers
Valueinvesting,atime-testedinvestmentstrategy,has
evolvedsignificantlyovertheyears.Originatingfrom theprincipleslaiddownbyBenjaminGraham,often referredtoasthe"FatherofValueInvesting,"thestrategyhas undergonetransformationalshiftsunderthestewardshipof renownedinvestorslikeWarrenBuffett.Today,inthehandsof ChiefInvestmentOfficers(CIOs),theevolutionofvalue investingstrategiescontinuestoshapeinvestmentdecisionsand portfolios.
Let's delve into this journey from Graham to Buffett and explore how CIOs are navigating the ever-changing landscape of value investing.
TheFoundation:BenjaminGraham'sPrinciples
BenjaminGraham,throughhisseminalworkslike"Security Analysis"and"TheIntelligentInvestor,"laidthefoundationof valueinvesting.Hisapproachwasgroundedintheideaof buyingstockstradingatadiscounttotheirintrinsicvalue, therebyprovidingamarginofsafetyforinvestors.Graham emphasizedtheimportanceofthoroughfundamentalanalysis, focusingonfinancialmetricssuchasearnings,dividends,and bookvalue.
DuringGraham'sera,themarketwaslessefficient, presentingampleopportunitiesforundervaluedstockstobe discoveredandexploited.CIOsofthattimeadheredclosely toGraham'sprinciples,seekingoutbargainsinamarket characterizedbyinefficienciesandmispricing.
TheBuffettEra:AShifttowardsQualityandLongTermThinking
WarrenBuffett,aprotégéofBenjaminGraham,further refinedandevolvedtheprinciplesofvalueinvesting.While BuffettinitiallyfollowedGraham'sapproachofdeepvalue investing,hegraduallyshiftedtowardsastrategythat focusedmoreonthequalityofbusinessesandtheirlongtermprospects.
Buffett'semphasisonbuyingexceptionalcompaniesatfair pricesratherthanmediocrecompaniesatdeepdiscounts markedasignificantdeparturefromGraham'sapproach.He famouslycoinedtheterm"intrinsicvalue"todescribehis estimationofacompany'strueworth,consideringfactors beyondjustthebalancesheet.
UnderBuffett'sguidance,CIOsbegantoprioritize qualitativefactorssuchascompetitiveadvantage, managementquality,andbrandstrengthalongside traditionalquantitativemetrics.Thisshifttowardsamore qualitativeapproachreflectedanacknowledgmentofthe changingdynamicsofthemarketandtheincreasing efficiencyofinformationdissemination.
ModernChallengesandAdaptationsbyCIOs
Intoday'sfast-pacedandinformation-drivenmarkets,CIOs faceahostofchallengesthatrequireadaptationand innovationintheirvalueinvestingstrategies.Theriseof algorithmictrading,increasedcompetition,andthe proliferationofdatahavemadeitmoredifficulttouncover undervaluedopportunitiesusingtraditionalmethods.
Tonavigatethesechallenges,CIOsareleveraging technologyandadvancedanalyticstoaugmenttheir investmentprocesses.Machinelearningalgorithmsare employedtoanalyzevastdatasetsandidentifypatternsthat mayeludehumaninvestors.Thisintegrationoftechnology allowsCIOstosiftthroughlargevolumesofinformation moreefficientlyanduncoverhiddenopportunities.
Furthermore,CIOsareincreasinglyembracingamore flexibleandopportunisticapproachtovalueinvesting.
Whilethecoreprinciplesofbuyingundervaluedassets remainintact,thereisarecognitionthatvaluecanmanifest indifferentformsbeyondtraditionalfinancialmetrics.This includesfactorssuchasintellectualproperty,brandequity, andnetworkeffects,whichmaynotbefullycapturedby conventionalvaluationmethods.
Inaddition,theconceptofenvironmental,social,and governance(ESG)factorshasgainedprominenceinthe investmentlandscape.CIOsareintegratingESG considerationsintotheirvalueinvestingstrategies, recognizingtheimportanceofsustainabilityandresponsible corporatebehaviorinlong-termvaluecreation.
TheRoleofBehavioralFinance
AnotherareaoffocusformodernCIOsisbehavioralfinance, whichstudiesthepsychologicalfactorsinfluencinginvestor behavior.Byunderstandingcognitivebiasesandmarket inefficiencies,CIOscanbetterexploitopportunitiesand avoidcommonpitfalls.
Behavioralfinancehasledtoagreateremphasison qualitativefactorssuchassentimentanalysisandmarket psychologyintheinvestmentprocess.CIOsrecognizethat investorsentimentandmarketdynamicsplayasignificant roleinshapingstockprices,sometimesdivergingfrom underlyingfundamentals.
Conclusion
TheevolutionofvalueinvestingfromGrahamtoBuffettand beyondreflectsthedynamicnatureoftheinvestment landscape.Whilethecoreprinciplesofbuyingundervalued assetsremainfundamental,CIOshaveadaptedtheir strategiestomeetthechallengesofmodernmarkets.
Byintegratingtechnology,embracingamoreflexible approach,andincorporatinginsightsfromfieldslike behavioralfinanceandESGinvesting,CIOsarepositioning themselvestosucceedinanever-changingenvironment.As theycontinuetorefinetheirvalueinvestingstrategies,one thingremainsclear:theprinciplesofprudence,patience,and along-termperspective,championedbyGrahamandBuffett, continuetoguidethepathforward.
- Alaya Brown
TeymourAbou El Kheir Fueling Passion for Impact
A Journey of Investments, Real Estate, FMCGs, Pharmaceuticals, and Sustainability!
Myprofessionaljourneyhasalwaysbeendriven byaprofoundpassionforgeneratinginnovative ideasthatcancreateapositiveimpactonthe world." - Teymour Abou El Kheir Withinthefluidarenaof investmentandcorporateleadership,TeymourAbouEl Kheirisanexemplarofcreativityandprogress.AsInfinity CapitalInvestment'sChiefInvestmentOfficer,henot onlycontributesaplethoraofknowledgebutalsoagenuine dedicationtotacklingoneoftheworld'smostimperative problems:climatechange.
Establishedin2011,InfinityCapitalInvestmentisbeyonda typicalinvestmentfirm.Asamultifacetedentity,it comprisesofenterprisesspanningvariousindustries, includinginvestment,realestate,FMCGs,pharmaceuticals, andastaunchfocusonsustainability.Teymour’svision goesaboveconventionalsuccessmetrics;it'saboutcreating alastinglegacythatcontributesmeaningfullytotheworld.
InfinityCapitalInvestment,underhisleadership,has strategicallyexpandeditsportfolio,becomingacommercial powerhousethatfostersmodernization,growth,and sustainability Thecompany'scommitmenttoexcellence, adaptability,andaforward-thinkingapproachhavesetit apartinthebusinesslandscape.WhileInfinityCapital Investmentoperatesacrossdiversesectors,itsdiligence towardsustainabilityisaflickeringhallmark.Thoughmany companiesfocussolelyonprofits,theytakeaholistic approach,acknowledgingtheinterconnectednessof business,society,andtheenvironment.Thecompany's involvementinrenewableenergyreflectsitsobligationto reducecarbonemissionsandaddressthepressingchallenge ofclimatechange.
Yet,InfinityCapitalInvestmentsdoesn'tlimititsimpactto justsustainability Thecompanywieldsconsiderable influenceinpropellingvariousindustriesforward, strategicallypositioningitselfininvestment,realestate,
FMCGs,andpharmaceuticals.Itshistoryismarkedby valueadditionandsocietaladvancement,inadditiontothe financialelement.AsTeymourpersistsingoverningInfinity CapitalInvestmenttowardsunprecedentedheights,the journeydevelopsnotonlyasanaccountofcommercial achievementbutalsoasaninterpretationofconscientious, influential,andenduringleadership.Heislayingtheway forafuturewheresuccessisdeterminednotjustby financialgainsbutalsobytheenduringimpactan organizationhasontheworld.
Below are the interview highlights:
Howdoyouapproachinvestmentstrategydevelopment andimplementation,andwhatfactorsdoyouconsider whenevaluatingpotentialinvestmentopportunities?
Whenitcomestodevelopingandimplementingan investmentstrategy,Ibelieveintakingacomprehensive approach.Iconsideramultitudeoffactors,encompassing marketdynamics,businessnews,financialperformance, andsustainabilitymetrics,thatcaninfluenceboththenation andthecommunity
However,theprimaryfocalpointsinmyinvestment strategyformulationrevolvearoundthealignmentof potentialinvestmentopportunitieswithsocialand environmentalgoals.Iplaceastrongemphasisonensuring thatourinvestmentscontributetoasustainable,green economy.Evaluatingopportunitiesbasedontheirpotential forlong-termgrowthisofparamountimportance.
Howdoyoumanageriskinyourinvestmentportfolio, andcanyoushareanexampleofasuccessfulinvestment decisionyoumadeasaChiefInvestmentOfficer?
AsChiefInvestmentOfficer,riskmanagementinthe investmentportfolioisthecornerstoneofmyrole.To effectivelymanagerisk,weemployamultifaceted approach.Diversificationplaysakeyrole,withinvestments spreadacrossdifferentcountriesandtechnologies.
TeymourAbouElKheir ChiefInvestmentOfficer
InfinityCapitalInvestment
Remaining well-informed about market trends and changes in the investment landscape is paramount, especially in the dynamic green economy. I regularly peruse financial news to keep up with real-time market updates. I also delve into industry reports, which provide valuable insights into sectorspecific trends and emerging opportunities.
Inaddition,weplacegreatemphasisonconducting comprehensiveresearchandanalysistoidentifyinvestment opportunitieswithstronggrowthpotentialandasolidriskreturnprofile.
Howdoyoustayinformedaboutmarkettrendsand changesintheinvestmentlandscape?
Remainingwell-informedaboutmarkettrendsandchanges intheinvestmentlandscapeisparamount,especiallyinthe dynamicgreeneconomy.Iregularlyperusefinancialnews tokeepupwithreal-timemarketupdates.Ialsodelveinto industryreports,whichprovidevaluableinsightsinto sector-specifictrendsandemergingopportunities.
Inadditiontotheseresources,Iutilizemarketanalysistools thatoffercomprehensivedataandin-depthanalysis,helping memakeinformeddecisions.Ialsobelieveinthepowerof learningfromexpertsandpeersinthefield,andIactively participateinconferencesandnetworkingeventstogain valuableinsightsandexperiences.
Whatmetricsdoyouusetoassesstheperformanceof yourinvestmentportfolio?
Assessingtheperformanceofaninvestmentportfolioisa multi-dimensionalprocess,andwerelyonarangeof metrics,suchastheInternalRateofReturn,RiskAdjusted Return,ESGMetrics,andbenchmarkingcomparisonsto gainacomprehensiveunderstandingofitseffectiveness.
Howdoyoucollaboratewithotherdepartmentsor teamswithintheorganizationtoaligninvestment strategieswithoverallbusinessgoals?
Collaborationwithotherdepartmentsorteamswithinthe organizationisinstrumentalinharmonizinginvestment strategieswithoverarchingbusinessgoals.Toensure seamlessalignmentbetweendepartments,weconvene regularlyviacoordinatedmeetingsthatbringtogether diversestakeholdersfromvariousdepartments.These gatheringsprovideaforumtodiscussrespectiveobjectives, identifycommonground,andpinpointareasofsynergy
Inadditiontoregularmeetings,weestablishcrossfunctionalteams,ortaskforces,whennecessary These teamsaredesignedtofosteramoreintegratedapproach, enablingtheexchangeofideasandexpertiseacross departments.
Howdoyouadaptyourinvestmentstrategiesto changingmarketconditions?
Adaptinginvestmentstrategiestochangingmarket conditionsisafundamentalaspectofachievingsuccessin theinvestmentlandscape.Theprocessinvolveskeepinga constantvigiloneconomicindicators,marketmovements, andfinancialnews;regularlyassessingtheperformanceof differentassetclasses;analyzingmarkettrendswhile consideringbothshort-termfluctuationsandlong-term trajectories;andalteringportfolioallocationsbasedon changingandevolvingmarketconditions.
WhatchallengesdoyoufaceasaChiefInvestment Officer,andhowdoyouovercomethem?
ThereareseveralsignificantchallengesthatIencounterin myrole,withtheconstantlyshiftingmarketconditionsand economicuncertaintiesrankingamongthemostformidable. Toaddressthesechallenges,Iconsistentlyremainvigilant, continuouslymonitoringmarkettrendsandassessinghow theymightaffectourinvestments.Tochallengeeconomic uncertainties,weengageinthoroughresearchandalways keepafingeronthepulseoftheindustry.Thishelpsensure ourstrategiesremainrelevantandadaptabletochanging economicdynamics.
However,oneofthemostsignificantelementsin overcomingthesechallengesisthepeopleIchoosetowork with.Ihaveapenchantforselectingindividualswhoare notonlyhighlyqualifiedbutalsopossessuniquetalents. Together,asacohesiveteam,theybringadiverserangeof backgrounds,experiences,andeducationalpursuitstothe table.
What'syourperspectiveonthefuturetrends, particularlyregardingtheexpansionofwindandsolar projects,energystoragetechnologies,andthegrowing emphasisonsustainableinvesting?
Aswelookaheadintheinvestmentindustry,several significanttrendsandinnovationsareonthehorizon.We
canexpectacontinuedandevenacceleratedexpansionof windandsolarenergyprojects.Thisgrowthisdrivenby significantcostreductionsandtechnologicalbreakthroughs.
Furthermore,giventheintermittentnatureofrenewable energysources,energystoragetechnologies,particularly batteries,willtakethespotlight.Investmentsinthissector willgrowasweseektocreateamorestableand dependablegrid.Ialsofeelthattheemphasisonsustainable andsociallyresponsibleinvestingwillpersistandevolve. Investorswillincreasinglyconsiderenvironmental,social, andgovernance(ESG)factorswhenmakinginvestment decisions.
Lastly,innovationsinfintech,artificialintelligence,and dataanalyticswilltransformhowinvestmentsaremanaged, providingnewtoolsforriskassessmentandportfolio optimization.
WhatadvicedoyouhaveforaspiringChiefInvestment Officersorthoselookingtoentertheinvestmentfield?
ForthoseaspiringtobecomesuccessfulChiefInvestment Officersorentertheinvestmentfield,myadviceisrootedin theimportanceofcontinuouslearningandadaptability The investmentlandscapeisdynamicandever-evolving,and stayingaheadofthecurveisparamount.Todothesame, individualsmustalwaysmaintainastrongsenseofcuriosity andadesiretolearn.Theyshouldalwayskeepaneyeon industrytrendsandbreakthroughsbyconstantlyreading, attendingseminars,andupskillingthemselves.
Itisalsoimportantforonetonetworkeffectively,as connectingwithestablishedexpertsandprofessionalsinthe investmentfieldwillprovideaccesstotheirinsights, experiences,andinvaluableguidance,aswellasopendoors forcareeradvancement.
Finally,itisimperativeforprofessionalstobepreparedto adapttochangingcircumstancesandmarketconditions.As theinvestmentlandscapetransforms,flexibilityand adaptabilityarealwayskeytosuccess.
Welcome to the Vanguard of Transformative Investing
Navigating Resilience, Innovation, and Success in Investment Leadership based on “People, Purpose, Profit”!
Successisnotfinal,andfailureisnotfatal.Itisthe couragetocontinuethatcount,saysWinston Churchill.Intheever-evolvinglandscapeoffinance andinvestment,thesewordsechowithprofoundwisdom. Theyencapsulatetheessenceofresilienceandtherelentless pursuitofsuccess,aphilosophyembodiedbyourfeatured personality,WernerBraunöck.
AstheFoundingPartnerandChiefInvestmentOfficerof NarmoCapital,hestandsatthehelmofafinancialempire builton25yearsofrichexperienceinInvestmentBanking andAlternativeAssetManagement.Hisjourneyismarked byatenacitytonavigatecomplexterrain,andhisstory resonateswiththeveryspiritofChurchill'squote.Werner inspiresandempowersenterprisingforward-thinkers.Either theinvestorsitselfinhisFundsorthroughtheinvestments directly!
BeforeestablishingtheMulti-FamilyOffice“Narmo Capital”in2013,WernerwastheCIOandfoundingpartner ofVERTOInvest,aventurethatleftantransformative positiveimpacttotheworldthroughhishighimpactESG investmentinwww.arcticgreen.comwhichbecamethe largestGeothermalCompanyintheworld!
Hisexpertiseextendsbeyondconventionalboundaries.As theCIOandfoundingpartneroftheAlternativeAsset ManagementFund“M&ARisk-ArbandEventDriven HedgeFund”J-C-M,heservedastopquartileHedgeFund managertointernationalinstitutionsandalsooffering insightsonintricatefinancialmatters,notablydi-stressed Icelandicdebtexposureforlargeinstituions.Hisjourneyin
AlternativeAssetManagementFundsincludessignificant rolesasaPortfolioManageratGriffinCapitalManagement andSeniorAnalystatTisburyCapitalManagement, showcasinghisversatilityanddepthofknowledge.
TherootsofWerner'ssuccesstracebacktohisearlycareer atCitigroup,wherehehonedhisskillsintheCorporate FinanceandM&AdepartmentsinbothLondonandNew York.Thisfoundationalexperiencesetthestageforacareer markedbycontinuousgrowth,adaptability,andan unrelentingcommitmenttoexcellence.
AswedelveintoWerner'sstory,weunravelnotjustatale ofprofessionaltriumphsbutatestamenttothecourage requiredtoweatherstorms,learnfromfailures,andpersist onthepathtosuccess.Inanexclusiveconversation,he sharesinsights,lessons,andthevisionthatpropelsNarmo Capitalintothefuture,makinghimaluminaryintheworld offinance.
Below are the interview highlights:
Couldyoupleasetellaboutyourselfandwhatmotivated youtoembarkonthissector?
Themotivationformetoenterthemulti-familyoffice th sectoris6 fold:
WealthManagementOpportunity:There'sasubstantial marketamonghigh-net-worthindividualsandfamilies seekingsophisticatedfinancialmanagement.Thepotential formanagingsignificantwealthandofferingpersonalized servicesassolutionproviderisastrongmotivator.
Entering the investment field and aspiring to become a CIO requires a blend of educa on, prac cal experience, con nuous learning, strong interpersonal skills, and a commitment to ethical prac ces. Building a successful career in this dynamic field takes me, dedica on, and a proac ve approach to personal and professional development.
Werner Braunöck Founding Partner & Chief Investment Officer Narmo Capital
RelationshipBuilding:MFOsoftenaimtobuildlong-term relationshipswithaffluentinvestors.Thepersonalization anddepthofservicesIofferallowforstrongconnections, potentiallyleadingtoclientloyaltyandreferrals.
CustomizationandSpecialization:Myclientsare motivatedbytheopportunitytospecializeinoffering customizedsolutionsforcomplexfinancialneeds,suchas estateplanning,succession,orphilanthropicadvising, whichoftenrequireahighlevelofexpertise.
EntrepreneurialDrive:StartingaMFOwasdrivenby entrepreneurialgoals—creatingandmanagingabusiness thatprovidesspecializedfinancialservicesandtailor-made adviseandleadership.
FinancialandProfessionalGrowth:Theopportunitiesfor financialsuccessandprofessionalgrowtharevery motivatingfactorstome.TheMFOsectorshowslucrative opportunitiesasitdealswithaffluentclientsandtheir substantialassets.
ImpactandFulfilment:Forsomeprofessionals,theability tomakeasubstantialimpactonclients'lives,theirlegacies, andphilanthropiceffortscanbeamotivatingfactor, providingasenseoffulfilmentbeyondfinancialgain. TakingthebiggestESGimpactinvestmentasprime example:USD30mlninArcticGreenEnergyin2010 which-duringthelast13years-convertedsmogcitiesinto “bluesky”inAsiaandprotectingmillionsofpeople’slife throughgreenenergy.Thisistobecontinuedgloballyon evenlargerscale!
TheMFOsectorattractsindividualslikemeinterestedin offeringsophisticatedfinancialservices,customizing solutions,andestablishinglong-termrelationshipswith high-net-worthclients.Themotivationsoftenrevolve aroundtheopportunitytoprovidetailored,comprehensive wealthmanagementandfinancialsolutionstomeetthe uniqueneedsofaffluentfamilies.
Couldyoupleasetellusaboutyourcompanyandits inceptionstory?
Narmoisanindependentfinancialadvisoryfirmwitha long-termglobalapproachtowealthpreservationand wealthplanning.Weprovideprofessionaladviceon customizedfinancialstrategiestoplan,preserve,andgrow wealthforourclients.Ourprimeaimistohelpourclients achievetheirlong-termfinancialgoalsbyprovidingvalue ateverypointofcontact.
Weareafinancialadvisoryfirmgearedtowardsdelivering comprehensive,unbiasedfinancialadviceforinstitutional clientsandhigh-net-worthindividuals.Narmowasselected toserveasthemainadvisortoseveralprominentfamily offices.Narmoadvisesitsclientsonthebestrisk/reward assetallocationandidentifiessuitablebest-in-class investmentsforselectedmandates.
Our clients are institutions and high-net-worth individuals. To exceed our clients expectations, Narmo primarily focuses on:
Tailor-madePortfolioConstructionandAssetAllocation; ComprehensiveInvestmentAdvisoryandInvestment StrategyReviewProcess;DisciplinedPortfolioMonitoring andRiskAssessmentProcedures;Tailor-madeGenerational FinancialPlanning;DeliveringSuperiorPerformancevia OptimizedRisk/RewardAnalysisofDealFlow.
Our Business:
AtNarmo,webelievethatthemostimportantwaywehelp youstaydisciplined,focused,andontrackisthroughour comprehensivestep-by-stepadvisoryprocess.Thisprocess isdesignedtouncoveryourfullrangeoffinancialneeds, fromwealthplanningtowealthprotectiontopreserving yourlegacy.Thisallowsustobuildcustomizedfinancial strategiestoorganize,preserve,andgrowwealthinline withourclients'plans.
Narmo’sdisciplinedanddiscerningprofessionalteam regularlyperformsduediligencetothehighestindustry standardsandanalysesindustriestoidentifyspecific investmentopportunitiesandtrends.Opportunitiesare selectedbasedonaclearlydefinedsetofcriteria.Portfolio constructionandassetallocationareexecutedtothehighest degreeofalignmentwithourclient’sneeds.
What are our USPs?
Aproventrackrecordofcapitalpreservationcombined withlong-termgrowth;independentadviceonallocation andinvestment;noconflictofinterestbecauseweare investeddirectlyourselves;aone-stopsolutionproviding cost-consciousinstitutionalfinancialadvice;Tailor-made financialsolutionsaligningclientsriskandrewardtargets;a professionalteamwith50+yearsofcombinedfinancial servicesexperience.
Howdoyouapproachinvestmentstrategydevelopment andimplementation,andwhatfactorsdoyouconsider whenevaluatingpotentialinvestmentopportunities?
1.SetClearObjectivesandRiskTolerance:
• DefineGoals:Determineyourfinancialgoals,whether it'swealthaccumulation,retirementplanning,saving foreducation,etc.
• RiskAppetite:Assessyourrisktolerance—howmuch volatilityorriskyoucantolerateinyourinvestments.
2.AssetAllocation:
• Diversification:Spreadinvestmentsacrossdifferent assetclasses(stocks,bonds,realestate,etc.)toreduce risk.
• BalancingRiskandReturn:Allocateassetsbasedon yourrisktoleranceanddesiredreturn.
3.TimeHorizon:
• Short-Termvs.Long-Term:Consideryourinvestment horizon—short-termgoalsmayrequiremore conservativeinvestments,whilelong-termgoalsmight allowformoreaggressivestrategies.
4.ResearchandDueDiligence:
• FundamentalAnalysis:Evaluatepotentialinvestments basedonfinancialstatements,management,market trends,etc.
• TechnicalAnalysis:Usehistoricalpriceandvolume datatoforecastfuturepricemovements.
5.RiskManagement:
• RiskAssessment:Understandandquantifytherisks associatedwithpotentialinvestments.
• Hedging:Considerusingtoolslikederivativesor insurancetomitigaterisks.
6.StayInformed:
• EconomicandMarketAnalysis:Keeptrackof economicindicators,geopoliticalevents,andmarket trendsthatcanimpactyourinvestments.
• ContinuousLearning:Stayupdatedoninvestment strategies,marketchanges,andnewopportunities.
Factors to Consider When Evaluating Investments:
• MarketConditions:Economichealth,interestrates, inflation,etc.,canaffectinvestmentperformance.
• IndustryandSectorAnalysis:Certainsectorsor industriesmayperformbetterthanothersduring specificeconomiccycles.
• CompanyFundamentals:Assessfinancialhealth, growthpotential,managementquality,competitive advantage,etc.
• Valuation:Determineiftheinvestmentis undervaluedorovervaluedbasedonitspricerelative toitsfundamentals.
• Liquidity:Considerhoweasilyaninvestmentcanbe convertedtocashwithoutimpactingitsmarketprice.
• RegulatoryandPoliticalFactors:Changesin regulationsorpoliticallandscapescaninfluence investmentperformance.
• Environmental,Social,andGovernance(ESG) Factors:Increasinglyimportantininvestment decisions,evaluatingacompany'sESGpracticescan beacrucialfactor
Implementation and Review:
• ExecutethePlan:Investaccordingtothestrategy developed.
• RegularReview:Monitorandreviewyourportfolio periodically,makingadjustmentsbasedonchangesin goals,marketconditions,orpersonalcircumstances.
Remember,it'scrucialtotailoryourinvestmentstrategyto yourindividualcircumstancesandregularlyreviewand adaptitasneeded.Narmo’sinputprovidesvaluableinsights andguidancebasedonyourspecificsituationandgoals.
Howdoyoustayinformedaboutmarkettrendsand changesintheinvestmentlandscape?
Stayinginformedaboutmarkettrendsandchangesinthe investmentlandscapeiscrucialforanyinvestment professional,especiallymyselfastheChiefInvestment Officer(CIO).Hereareseveralstrategiestypically employedtostayupdated:
NewsandPublications
ResearchReportsandMarketAnalysis
9.ContinuousEducationandLearning
10.Social-mediaandOnlineCommunities
Byemployingacombinationofthesestrategiesand sources,ingeneralCIOsandinvestmentprofessionalscan gathercomprehensiveinformation,analysetrends,and makeinformeddecisionsinmanaginginvestmentportfolios withintheever-evolvingfinanciallandscape.
Canyouprovideinsightsintothefuturetrendsand innovationsintheinvestmentindustrythatyou anticipate?
WhileIcan'tpredictthefuture,severaltrendsandpotential innovationshavebeengainingtractionintheinvestment industry.Herearesomeinsightsintofuturetrendsthat manyanticipatecouldshapetheinvestmentlandscape:
1.IncreasedEmphasisonESGInvesting
2.TechnologicalAdvancements
3.DigitalTransformationandFintechIntegration
4.AlternativeInvestmentsandPrivateMarkets
5.FocusonCustomizationandPersonalization
6.RegulatoryChangesandCompliance
7.BehaviouralFinanceIntegration
8.FocusonDataPrivacyandCybersecurity
9.ContinuedEvolutionofPassiveandActiveManagement
10.GlobalizationandGeopoliticalConsiderations
www thecioworld.com