Structured Products

Structured Products

Structured products: build in downside protection Structured products are pre-packaged fixed-term investments that provide private investors with easy access to offshore equity and commodity markets, with a pre-defined risk and return profile over a pre-defined...

7 Ways we help you find your Freedom

The honour of being appointed as your financial confidant is a responsibility we deem paramount. Our client’s loyalty is earned through repeatedly proving that our value proposition is not only lip-service but the pinnacle task we set ourselves each day. When we wake up in the morning we start again focussing at the tasks at hand to provide our clients with financial freedom.

Many firms will talk about their relentless pursuit to beat their chosen benchmarks and generate alpha (outperformance), which understandably is a popular theme. Divergent from this strategy, GraySwan’s focus is foremost on risk management and not merely the outperformance of any given market or benchmark. Safeguarding our clients’ investment portfolios against material risks which may have a material adverse impact on their long term investment plan is fundamental to our investment advisory and wealth management process. It is a goal, an obligation, a promise that we relentlessly work towards daily.

We think differently, but the game-changer is us empowering our clients to think differently, too! If we want something better than the crowd, we need to think differently from the crowd. If we keep doing the same things all over all the time why would we get a different result? The world has changed, we need to think differently about our investments.

These are the seven ways in which we help you find your Freedom:

1. OUR INVESTMENT CONSULTING APPROACH

Our robust and well-defined investment strategy enables our clients to achieve their short, medium, and long-term goals in any market environment. We act as investment architects and long-term strategic investment thinking partners. We empower our clients to optimally combine different asset classes, investment styles, investment strategies, investment managers and mandates or products within a clear and well-defined performance and risk-managed framework.

2. CONSTRUCTING A STRATEGIC AND TACTICAL ASSET ALLOCATION

The first step in constructing a long term Strategic Asset Allocation (SAA) is to establish the performance objective and risk tolerance of our client. Then we test whether such is manageable within a pre-defined framework. Next, we examine such goals using our proprietary asset modeling optimisation techniques. We model asset classes by testing them historically and then making forward-looking adjustments based on our expectations. This process enables us to construct a SAA. Further, we determine Tactical Asset Allocation (TAA) bands or ranges which provides us with guidance how far we may deviate from the long term asset allocation when shorter term opportunities arises. These decisions are based on forward-looking assumptions that would meet all the performance objectives and risk parameters identified.

Understanding the nature of our clients’ liabilities and then defining the optimal performance objective, time horizon, and risk tolerance is key to building any successful investment strategy. We know that strategic long-term SAA counts for approximately eighty percent of long term returns. TAA, dynamic risk management and hedging strategies as well as investment manager and mandate / product selection and the periodic rebalancing account for the balance.

We believe success in the next few years will ultimately depend on our ability to implement tactical asset allocations when short term investment opportunities arise. However, we also know that if we invest with quality investment managers that have proven they can beat the market consistently over the long term, they will assist us in managing our clients’ expectations and increase the likelihood of achieving pre-defined performance targets within a well-managed risk budget.

3. INVESTMENT MANAGER SELECTION

In the world of investing, every investment manager claims to be the best, and they can typically back it up with some or other performance metric. However, it must be stressed that any data can be manipulated to sell a story. Most investment managers actually underperform the market after costs has been incorporated into the results. Our research analysts are well versed in studying performance data and qualitative factors to genuinely detect those few investment managers who can provide superior risk-adjusted returns for our clients.

Although there is enough evidence to support a low cost passive tracker investment management approach, there is also evidence that truly exceptional investment managers can beat the market after costs. We advise our clients to use a combination of low cost passive tracker funds as well as actively managed funds in their portfolios. It’s not one or the other, but rather the optimal combination of both active and passive approaches that leads to a well-diversified and cost-effective investment portfolio.

Our unique and high conviction investment manager research and selection advisory offering, centres around a deep understanding of the investment management industry acquired over the past two decades. We have gained our competitive edge not only from our wealth of investment consulting experience but also from our offshore investment management background.

4. PORTFOLIO CONSTRUCTION

We make use of our proprietary analytical tools to ensure the optimal blend of skilled active, passive and also smart beta investment managers. We do so within each asset class, investment strategy and investment style. We manage diversification in several ways. Examples of these methods are asset class composition, geographical allocation (i.e. local versus offshore and African assets), portfolio construction (i.e. the optimal combination of asset classes and investment managers, investment styles and investment approaches) and currency and equity hedging strategies as and when suitable.

5. INCORPORATION OF OUR VIEWS

After identifying and blending the most optimal investment managers and funds, we incorporate our current and forward-looking views. Our investment team functions as a cohesive unit that interacts daily to review the current investment portfolios, discuss the existing global market environment and, most importantly, to identify where opportunities and threats exist.

6. EXECUTION, MONITORING & IMPLEMENTATION

We implement our investment beliefs timeously with high conviction and low cost. Subsequently, we continuously monitor our clients’ portfolios and provide regular transparent reporting. Our unique reporting tools empower our clients to analyse their long-term investment strategy and compare selected investment managers, mandates, and products to clearly defined benchmarks, performance targets and risk guidelines.

7. OUR INVESTMENT CONSULTING TEAM

Our teams’ collective advisory experience exceeds one hundred years, dealing with some of the most prestigious institutional clients in South Africa. It renders us excessively qualified and capable of handling the financial affairs of any private investor, family office, retirement fund, corporate investor, or umbrella fund.

Our core investment consulting team has worked together for more than fifteen years, and the average experience of our investment consultants is also fifteen years.

Most investment consultants do not have actual investment management experience. Our knowledge of previously managing an offshore alternative investment management company provides us with practical rather than just theoretical insights. Our investment consultant to client ratio is the highest in the industry and gives us a definite competitive advantage. It also affords our clients a world-class service and ultimately gives them the freedom to be part of global change.

SUMMARY

At GraySwan, we are not just our clients’ investment consultants, but also their long term strategic thinking partners. We help our clients to reach financial freedom.

Structured Products

Structured Products

Structured products: build in downside protection Structured products are pre-packaged fixed-term investments that provide private investors with easy access to offshore equity and commodity markets, with a pre-defined risk and return profile over a pre-defined...