All clients should understand that running a model portfolio is cheaper and more efficient than running a bespoke portfolio. However not every client wants a model and or has a set of requirements that means that moving directly to a model today or investing in one may not fit their requirements. We have therefore developed a bespoke service to tailor a portfolio for clients whose needs generally fit into one of the following categories: –
- A client may start a relationship with us and have a collection of assets that have been acquired by many years of self-investing or by utilisation of a long hold strategy with their existing manager. With these types of clients, the aim is to do an analysis of every line of stock and decide whether we believe there is value in retaining to a specific sell point and accepting the additional risks or selling it down now. This enables a progressive move to a more model portfolio approach where so desired;
- A client may have a potential capital gains problem and need to manage the rebalance over a period of time to manage the taxation;
- A client who has strong opinions and wants to be involved in the asset allocation decision;
- A client who desires a target return in excess of 10% per annum and can accept psychologically higher levels of volatility and the potential for high unrealised capital losses (above 20% in any one year);
- A requirement to have a Socially Responsible or Ethical Portfolio which requires screening to exclude certain assets:
Whether it is one of these or for some other reason, the aim is for our investment managers to be flexible and to work with you to provide your client with what they want.
We manage each bespoke portfolio using the same focus as Outcome Based Investing (OBI) but with a greater emphasis on the asset allocation being cyclically adjusted in line with the cycle, through different assets at different points in the economic cycle. Please note, as with all our portfolios if we believe that market risk is unquantifiable and the risk to significant, then we will look to protect capital values as with all investment strategies we adopt for clients at OCM.
To discuss this proposition in more detail with one of our Investment Managers please contact us directly.