OMMM enhances approach to asset allocation

Old Mutual Multi-Managers (OMMM) has enhanced its investment processes with a team-based approach to investing following a business reorganisation that brought together the SYmmETRY Multi-Manager business and Acsis late last year.

The business was rebranded in July, with former Acsis CIO Andrew Salmon heading the combined investment team. The company designs multi-manager products for Old Mutual’s corporate and wealth businesses, with the latter grouped under Old Mutual Wealth and the former under Old Mutual Corporate. This includes balanced and inflation-targeting funds as well as smooth bonus and absolute-return products and specialist mandates, which incorporates hedge funds, an Islamic fund and an Africa fund.

“The aim is to help clients plan their lifetime investments,” says Stephen Brierley, who heads hedge fund manager research at OMMM. “We follow a client-led wealth model that considers clients’ various life stages.”

Brierley is part of the experienced 14-strong investment team that meets regularly to debate opportunities. Their method of investing has evolved from a generalist mandate approach to one where strategic and tactical asset allocation models are used to arrive at desired outcomes.

“Hedge funds are increasingly part of investment discussions as we examine markets on both a qualitative and quantitative basis and then allocate accordingly. We use hedge funds in our dedicated fund of hedge fund portfolios and also as building blocks in other mandates,” he says.

For example, Brierley notes that long/short equity funds are currently a key part of the team’s inflation-plus target mandates as they have been finding the local market expensive and they are preferring global equity exposure over domestic. Besides being a standalone product, the Symmetry Long Short Equity Fund of Hedge Fund forms part of OMMM’s absolute-return product and also its aggressive strategic asset allocation fund.

Brierley says that since the merger the team has also benefited from the skills and insights of David Mohr as chief investment strategist, informing discussions with clients around market trends and investment opportunities.

“Our approach is two-fold,” he says. “We listen to what our underlying managers tell us they are seeing in the markets and we also form our own views based on internal research and discussion, which we are able to share with clients. It is an enhanced approach that benefits the end investor.”

The team researches about 100 managers and is currently invested in six long-only managers, both onshore and offshore, and 10 hedge fund managers, preferring a high-conviction stance that does not over-diversify portfolios.

OMMM now has more than R100 billion in assets under management, of which R1.5 billion is in hedge fund assets across four mandates. Copyright. HedgeNews Africa – October 2014.