Our Investment Approach

Make your money work harder

Our investment approach

Dive into investments

Maybe you’re new to investments. Maybe you’re a bit of an expert. Or maybe you’re somewhere in the middle.

Whatever stage you’re at, you might find the way we work at SJP a little different. Our approach is all about you trusting us to invest your money wisely. This means we choose the talent from anywhere in the world. We do this through our Investment Committee, who appoint the best talent they identify in the world. We’ll tell you all about it in the following pages. Then all you have to do is relax and look forward to a rewarding future – just how you imagine it.

Let’s get started.

Making a wise choice

We’d all like our money to work harder – but how can it, when the financial landscape is changing all the time?

Looking at the previous performance of an investment manager only gives you part of the picture. Even the best will occasionally underperform the market over a short period. Equally, the worst can sometimes achieve impressive results. Past performance is no guarantee of future success.

Remember, too, that managers can switch funds or leave the business. Also, a management style that has previously worked well, may not be right for current or future markets.

So, when you choose someone to manage your money, how can you be sure you’ve made the right choice – now and for the future?

And how can you monitor the manager you’ve chosen to make sure they’re still doing a good job?

Our solution is radical and effective. You wouldn’t expect to find all the world’s greatest fund managers in one single investment house. So we don’t employ in-house fund managers. Instead, we carefully select a specialist team to manage our funds. Here we explain how you can benefit from this. We also tell you about the St. James’s Place Investment Committee, our team of analysts and our panel of independent consultancies. These are the key elements at the heart of our approach.

What makes us different ?

Recognising that no single investment house has a monopoly on expertise, we choose outstanding external fund managers to look after our funds.

Here’s why:

‹ It gives us the freedom to choose first-class managers to look after your funds.

‹ If we lose confidence in them, we can change managers quickly.

‹ You can diversify your portfolio by spreading your money across funds invested by managers with different styles.

Our Investment Committee manages the fund managers for you. Its aim is to bring you superior investment results, both medium and long-term. It does this by keeping a close eye on the managers and the companies they work for.

The Committee is supported by our in-house team of analysts and a panel of independent consultancies.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.

Who are our InvestmentCommittee

Our Investment Committee focuses on:

‹ Choosing the best fund managers for you. This means carefully examining the people and procedures in a large number of investment companies.

‹ Continuously monitoring those managers. This way we make sure they maintain the standards we chose them for in the first place. We do this by monitoring their portfolios and their processes.

‹ Changing managers. If we’re unhappy with a manager, we’ll appoint another to manage the fund. We make sure it’s a seamless transition, with no charge or tax implication for you.

‹ Making sure you have an appropriate spread of investments. We do this by providing a wide range of funds and portfolios. We select fund managers not only for their quality, but also for their style of investment management.

What makes us distinctive?

Many businesses now offer a multi-manager approach, but we’re different in several ways:

We offer a range of investment styles. Taken all together, these give you real diversification. You can create your own portfolio or invest in one of our hand-chosen portfolios designed to meet different investment objectives.

Transaction costs will occur when managers are removed or added to a fund. These are not charges, but rather your share of the inevitable external costs, such as stamp duty and bid/offer spreads on individual shares, that are incurred whenever assets are traded.

Unlike most of our competitors, we use only external fund managers for our funds.

Other businesses have an interest in directing business to funds managed in-house to maximise their own profits. We have no such conflict of interest or investment bias.

We choose fund managers based on their skills in active management, rather than following a benchmark.

You won’t be liable to capital gains or income tax from any change in fund manager.

The St. James’s Place Investment Committee appoints and replaces managers on behalf of all of our clients. We don’t wait until we’ve lost confidence in a manager.

Many other businesses simply try to provide access to as many funds in the market as possible. This leaves the investor with the challenge of deciding which might give the best results.

The 2001 Treasury report, Institutional Investment in the UK: A Review by Paul Myners, found that institutional fund managers tend to invest the huge amounts of money they handle in line with market indices or industry benchmarks. We insist that our managers are active, not passive.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.

The levels and bases of taxation and reliefs from taxation can change at any time and are dependent on individual circumstances.

our Investment Committee Discover

The cornerstone of our investment management approach is our Investment Committee. Its role is to manage our fund managers, whether we find them locally or globally.

Its aim is to give you the best medium-term investment results by choosing the best people and investment companies to make this happen. It monitors both and makes changes when they’re needed.

Tapping into global talent

Our Committee members are hugely knowledgeable. Yet we recognise that to make the most of managers from around the world, we need a dedicated research team.

So our Committee calls on a panel of leading independent consultancies, each contracted for their expertise in particular investment markets. They also rely on our in-house team of investment analysts. In this way, we put international expertise at your fingertips.

Staying close to the action

Our Investment Committee monitors fund management closely. It does this without influencing managers’ investment policies. Your investments’ performance comes via superior managers whom we hold accountable.

In general, exceptional investors rely on skilful stock selection to perform better than their peers. Our Investment Committee uses a range of tools to analyse and assess these skills. The aim is to avoid managers who occasionally do well simply by betting on the direction of the market.

Our managers typically take a ‘bottom-up’ approach. They look at the fundamentals of individual stocks, rather than sectors or regions, to identify quality investments. This makes growth more likely to be repeatable, as returns are less reliant on ‘winning’ a bet on the market or on a particular area outperforming.

Keeping track of portfolios

The SJP Investment Committee meets at least six times a year, depending on market conditions. Meetings include fund manager presentations, which give us the chance to question managers closely and look carefully at each portfolio.

At each meeting the Committee makes crucial decisions about the best way forward. It has four options:

‹ Leave the portfolio of managers unchanged. The Committee is confident your funds are being managed well.

‹ Keep the investment company but change the manager. The departure of a manager might trigger this decision.

‹ Change both the investment company and manager. The Committee is no longer confident they are managing your funds well.

‹ Introduce a new investment fund or strategy to improve opportunities or performance prospects.

Meet our InvestmentCommittee

The Committee’s responsibilities require a broad range of knowledge, skills and experience. We select its members carefully for their individual expertise and to represent your views. After all, it’s you who will ultimately feel the impact of the funds’ performance.

Tom Beal Executive Board Director – Investments

Tom is responsible for investment strategy, asset allocation, manager research and monitoring.

He’s worked in financial markets for 21 years; 12 of those at SJP. Before joining us, Tom worked in investment banking at Credit Suisse and J.P.Morgan. He began his career in the capital markets division at Thomson Reuters.

He’s also a lay advisor to the Royal College of Surgeons for the UK Finance and Investment Committee.

John Betteridge Independent Member

John has nearly 40 years’ experience in financial services, in the UK and abroad. He was Chief Investment Officer for the UK division of Prudential plc, where he oversaw the management of more than £150 billion of assets.

Most recently, he was a Board member and Chief Investment Officer of our discretionary wealth manager, Rowan Dartington, until he retired in 2020. He then joined us as a Nonexecutive Director and Chair of the Asset Allocation Committee.

John is an independent investment adviser to a number of UK pension funds and two international insurance companies. He’s also Chair of the St. James’s Place Asia Investment Committee.

Davina Curling Independent Member

In the course of her career, Davina has spent more than 25 years in investment management, including more than 20 as a fund manager. This has primarily been spent in European equities for retail and institutional investors specialising in retail. She has worked at some of the biggest names in the industry, including SMBC Nikko Securities, Foreign & Colonial Investment Trust and Royal & Sun Alliance. In 2007 she joined Russell Investments as the Managing Director responsible for around $20 billion of panEuropean assets in the multi-manager arena. In 2011 she was appointed to the Board of the Invesco Income Growth Trust as a Non-executive Director and to the Board of the BlackRock Greater Europe Investment Trust.

Davina was appointed to the Investment Committee in July 2014. Her experience of multimanager funds and the fund manager selection and analysis process is hugely important to her work here.

Steven Daniels Independent Member

From 2012 until March 2021, Steven was the CEO and CIO of Tesco Pension Investment, responsible for asset allocation in equities, bonds and property and for selecting their external fund managers.

He was an independent member of the Investment Committee of the Alzheimer’s Society from 2010 to 2019. He has also been a Board member of various investment trusts. With more than 35 years’ experience in fund management and as a CIO, he began his career with Pearl Assurance, then worked for 22 years with Liverpool Victoria from 1988. There, he was appointed Group Director of Investment in 1996. He served as an Executive Director of Liverpool Victoria Friendly Society from 1996 until 2009, where he was Group Director of Asset Management and Acquisitions. He was Managing Director of Liverpool Victoria Asset Management from 1997 to 2008, then served as its Executive Chairman.

Kathryn has nearly thirty years’ experience within investment management as a direct investor of substantial multi-asset portfolios. She is particularly interested in the effective risk management of alternatives and derivatives as part of a wider portfolio and has significant experience of ESG integration and effective governance processes.

She was formerly Head of Strategy Coordination at USS (Universities Superannuation Scheme) which operates the largest pension scheme in the UK. Her team oversaw asset allocation, portfolio construction and manager selection. She was also a Director of BT Pension Scheme Management, responsible for manager selection and liabilities. Prior to that she worked at Progressive Alternative Investments, SG Warburg and UBS.

Kathryn currently holds a range of nonexecutive and advisory roles within investment management, as well as being an Ambassador for the Diversity Project. She was a founding Trustee of the Standards Board for Alternative Investments and Chair of the London Board of 100 Women in Finance.

In addition,seniormembers of SJP sit on the Committee.Theybring a wealth of investment experience from long careers in financial services and fund management.

Kathryn Graham

Independent Member

Why use independent consultancies?

The companies in our panel of investment consultancies are totally independent of SJP. Like our external fund managers, they’re under contract to provide us with a range of services.

Consultants assess managers via close day-to-day involvement in the investment industry. They don’t rely on investment performance tables, whose value is limited. They work with the Investment Committee to help achieve better investment results.

Our investment consultancies are highly specialised. Their skills aren’t normally available to private clients but are essential if you’re aiming to achieve superior performance. This point was highlighted in a report commissioned by the government to investigate the UK savings and investment market (Sandler Review: Medium and Long-Term Retail Savings in the UK, 2002).

Our independent consultancies work with complete objectivity. This isn’t easy elsewhere, where monitored portfolios include funds managed by a company’s own investment department. Sometimes that department is responsible for its own monitoring.

We believe that superior investment decisions are made by individuals rather than their businesses. Our consultants always look to the individual rather than the company when recommending a manager.

Even when we use a large fund-management company, we insist its portfolio is handled by the individual we trust.

invest with SJP? Why

We undertake thorough research to select the best investments for you. That way we can give you access to as many options as possible.

Everyone who invests with us can call on the specialist skills of our investment consultancies and the Investment Committee. These aren’t available to private individuals or advisers.

This is how we know when a manager in an investment company stops managing, when they start new funds, or when they leave a company altogether. We have our finger on the pulse. We also know when a key analyst known for coming up with good ideas leaves a company.

When our committee asks a consultant to recommend a manager, a risk control process kicks in. They think about how one manager’s style and process will complement our other fund managers’ styles. Using people with different approaches means you benefit from diverse management styles.

Our investment approach means you get constant expert analysis, as well as targeted support from independent consultancies. It’s of huge strategic benefit and we hope it brings you peace of mind.

And should we decide that a change of manager, or the addition of another manager is needed, we’ll quietly get on and do it. Without charges, without tax and without any hassle.

Be informed

The value of an investment with SJP will be directly linked to the performance of the funds you select. The value can therefore go down as well as up. You may get back less than you invested.

These specialist skills aren’tusuallyavailableto private clients but,forus, they’reessential.

How we make changes

That can sound complicated, so we want to show you how it works. Here are just a few recent examples of decisions made by the Investment Committee to introduce new funds or change managers.

Date / Change Notes

November 2022

Polaris range launched

We launched 4 new fund of funds solutions: Polaris 1, Polaris 2, Polaris 3 and Polaris 4. They are distinguished by their potential ranges of allocations to equities, fixed income and alternatives

October 2022

UK Equity Income Fund

We merged the Allshare Income, Equity Income and UK Income funds into the UK & International Income Fund and then renamed the merged fund the ‘UK Equity Income Fund’.

July 2022

Emerging Markets Equity Fund

To allow the fund to continue to meet its objective of long-term capital growth, we removed the requirement to hold a focused portfolio of only 40-50 stocks. Removal of this restriction allowed the fund to increase the number of stocks held and reduce the concentration risk.

July 2022

Global Growth Fund

We simplified the fund’s structure to improve the long-term growth potential of the fund, by changing some of the fund managers to ones with a sharper focus on growth stocks. The Fund’s investment policy was updated to remove the requirement to invest via other funds.

January 2022

Global Absolute Return Fund

We merged the UK Absolute Return and the Alternative Assets funds into the Multi Asset fund and renamed it the Global Absolute Return fund.

The asset allocation and fund selection of the Polaris range will be determined by our Investment Committee. Activities such as monitoring and rebalancing will be managed by State Street Global Advisors. Actively managed and backed by meticulous research, the Polaris range is aligned with clients’ risk tolerance, investment objectives, and capacity for loss. The solutions are automatically rebalanced to ensure they continue to match clients’ attitude to risk.

This change enhanced the diversification within the merged & renamed fund by increasing the number of fund managers to three. As well as the existing fund manager Artemis Investment Management LLP, Redwheel and J.P.Morgan were also appointed to manage the fund. The blend of complementary investment styles aims for stronger performance over the longer term through varying market conditions.

This change improved the fund’s liquidity and diversification, as well as allowing access to a broader range of investment opportunities. It also reduced risk and increased the potential for the fund to continue to perform positively in the medium to long term. As well as the current fund manager Wasatch Advisors Inc, Arga Investment Management LP, Lazard Asset Management and Somerset Capital Management LLP were also appointed as fund managers.

The Global Growth Fund structure changed from a ‘fundof-funds’ to a more straightforward structure of holding direct assets. Changes to the Fund Managers were also made and now include: Artisan Partners, Axiom Investors, Edgepoint Investment Group, Sands Capital Management and WCM Investment Management.

Date / Change Notes

December 2021

Global Growth, Global Quality and International Equity Funds

We appointed State Street Global Advisors (SSGA) as replacement manager for Magellan.

November 2021

Global Equity Fund

We redesigned this fund for stronger Environmental, Social and Corporate governance (ESG), greater performance and lower charges.

SSGA are an existing St. James’s Place fund manager and we have worked extensively with them for several years as we’ve evolved our fund range. They are the fourth largest asset management firm in the world, and have a strong pedigree in the management of active quantitative strategies.

We replaced the existing structure of BlackRock, Hambro and Sands Capital with a new combination of equal parts: Los Angeles Capital, Man Numeric and State Street Global Advisors. All three are exclusive to SJP. The new structure has much-improved ESG credentials, including a core targeting of a minimum 50% reduction in carbon emissions, a minimum 50% reduction in fossil fuel exposure, and improved green revenue exposure versus the benchmark. The fund will also provide greater diversification and aims for stronger performance. We amended the fund’s objective and reduced charges.

October 2021

Growth and income portfolios

Following continual review of our range of portfolios, we made some changes.

July 2021

UK Fund

We merged the Income Distribution, UK Equity and UK Growth funds into the UK & General Progressive fund and renamed the merged fund ‘UK’.

We revised the fund mixes of the Growth Portfolios, using our evolving fund range and responding to changing markets. Given market conditions, we decided that the outcomes the Defensive Portfolio could deliver were not attractive to our clients in the long run, so it was discontinued.

To simplify and consolidate our UK equity offering, we merged several UK funds. Combining complementary investment styles, we aim to deliver a smoother, more consistent return profile. Keeping most of the managers of the merged funds, the Investment Committee decided to replace Majedie and add some managers new to SJP – Baillie Gifford and Los Angeles Capital –producing a fund split equally between six managers.

July 2021

Diversified Bond Fund

We replaced Brigade in the mandate.

We replaced Brigade with BlueBay and Man GLG, resulting in a line-up of BlueBay, Man GLG, Payden & Rygel and TwentyFour. Man GLG is a manager new to St. James’s Place, with a wealth of experience in high yield. The evolved Diversified Bond Fund is designed to offer improved asset allocation and enable it to respond more opportunistically to short- and medium-term market movements, while managing risk and volatility.

The Global Absolute Return Fund will enhance diversification by increasing the number of fund managers to six, with complementary investment strategies. The combination of these fund managers should provide a smoother investment return over the longer term through varying market conditions. The fund managers now include: Amundi, BlackRock, Invesco, Payden & Rygel, State Street Global Advisors and Wellington Management.

July 2021

Investment Grade Corporate Bond Fund

We added Columbia Threadneedle.

July 2021

UK Income Fund

Replaced Majedie with Artemis.

As a strategy complementary to that of Loomis Sayles, the Investment Committee added Columbia Threadneedle to this fund. This aims to improve diversification and deliver a smoother, more consistent return profile.

In the interest of ongoing performance, the Investment Committee decided to replace Majedie with Artemis in this mandate. We also reduced client charges.

The benefits to you

Put simply, our approach means we can offer you what we consider to be the best investment options available.

We manage risk by choosing and combining managers carefully from different disciplines.

This gives our investments scope to produce added value over time.

The value of an investment with SJP will be directly linked to the performance of the funds you select. The value can therefore go down as well as up. You may get back less than you invested.

Ready to take the steps that could secure your future?

Talk to your Adviser today.