Appointment of Asset Risk Consultants

Posted on Jul.14, 2015 by in Latest News

Appointment of Asset Risk Consultants

In May 2015 GFS appointed Asset Risk Consultants (ARC) to independently recommend discretionary fund managers (DFM) appropriate to our clients. ARC is an independent, privately owned consulting practise, regulated by both Jersey and Guernsey’s financial authorities in order to provide investment consulting services on funds and private portfolios. Founded in 1995, they are renown among the finance industry for its independent research capability as well as their experience with various funds and investment portfolio managers and so we are ecstatic to have them on board to advise us of the best possible managers for our clients.

-So what is a DFM and why do you need ARC’s advice?

Discretionary fund managers provide an on-going, active investment management service that will ensure you do not take any more risk than you need to, thus providing risk management to cope with future market instability during growth and income stages. There are over 185 Discretionary Fund Managers as recognised by the representative body for the investment community; Wealth Management Association therefore Generation Financial Services has appointed ARC to advise us on which DFMs would be the best fit for our clients. Using their Propriety Manager Selection Methodology they compare investment processes including risk and asset allocation as well as size, service benchmarks, performance relative to risk, and succession planning and charges. These items among others are compiled and form a preferred manager matrix specific to GFS and as part of their ongoing service ARC conduct quarterly reviews with the matrix being reassessed annually. This means your money will always be invested based on what is best for you, our client.

-So how is my money to be managed?

GFS would like to offer each client a choice of three DFMs for each situation. A client’s situation is defined by the size of investable assets, how risk averse they are, their service level requirements and in some cases geographic location (for face to face meetings outside of London). Each DFM will have to evidence their superior track record in terms of investment return and service capability and for portfolios over £150,000 their investment solutions are to be managed on a segregated or bespoke account basis.

-What if my portfolio performs badly?

Should your portfolio have an overall performance score in the 3rd or 4th quartile in any given quarter OR you have two or more quarters where the performance is below average the DFM will be placed on a watch-list. DFMs are also monitored for changes in corporate ownership and key personnel as well as changes in style and this will be communicated immediately with appropriate action considered.  The preferred list of DFMs will be reviewed on an annual basis and any breaches will result in a manager being displaced and in some cases monies being withdrawn from investment and re allocated. Rest assured though as ARC have a very comprehensive screening process for DFMs with annual questionnaires being sent requiring very comprehensive information such as investment philosophy, background, regulation and ownership information, turnover, performance data etc.

To view their extensive selection methodology process and the blank questionnaire that the DFMs have to complete for ARC GFS click on the link below.

Preferred Manager Matrix Methodology

Generation FS

Generation FS